Idaho Admin. Code r. 35.01.02.065 - TIRES BALANCING, STUDDING, AND SIPING

Sections 63-36112, 63-3613, 63-3619, Idaho Code

01. Services Subject to Sales Tax. Sales tax applies to the amount charged for services agreed to be performed in conjunction with the sale of a tire. Examples of such taxable services are balancing, studding, siping, or similar charges. Sales tax will apply to the total amount charged for the tire, the services, and the materials used to perform the services. (3-31-22)

02. Services Not Subject to Sales Tax. (3-31-22)

a. Sales tax does not apply to the amount charged for balancing, studding, or siping a tire owned by the customer. (3-31-22)

b. Sales tax does not apply to a separately stated fee to mount or install a tire whether sold new or owned by the customer. (3-31-22)

c. The person performing the nontaxable service pays use tax on the value of the materials used in performing the service. (3-31-22)

03. Materials Used in Performing a Service. Studs, wheel weights, valve stems, cores, patches, and similar items are materials that may be used to perform both a taxable and nontaxable service. The seller may elect to use any consistent method in determining the value and the amount of materials used in performing taxable and nontaxable services. (3-31-22)

a. The allocation of materials may be determined using a percentage basis. Example: The seller determined through some reasonable basis that sixty percent (60%) of the studs purchased for resale are used in tires that are purchased from him. The remaining forty percent (40%) are used in tires owned by customers and brought in for studding. Use tax will apply to the forty percent (40%) used in studding customer owned tires. As sales tax applies to the entire fee charged for studding a tire sold to a customer, the remaining sixty percent (60%) of the studs will not be subject to use tax, but are included in the amount subject to sales tax imposed on the buyer. (3-31-22)

b. The allocation may be determined based on the value of the material used in performing both taxable and nontaxable services. (3-31-22)

c. The allocation may be determined using any other method that will allow a reasonable allocation of materials used in both a taxable and nontaxable service. (3-31-22)

04. Cross-Reference. Repairs. See Rule 062 of these rules. (3-31-22)

Notes

Idaho Admin. Code r. 35.01.02.065