Is that car wash taxable?

Amazing as it may seem, car washes are often taxable. In some states, self-service, coin-operated car washes are not taxable. But the kind that pulls your car through (you know where the guy who dries your car leaves streaks on the windshield) may be taxable.

If a state taxes car washes, self service vs. pull through seem to be the major variations.

Except in Florida.

I just did a Taxing Policies webinar for Florida, and as usual, I spend a few hours reviewing the laws and refreshing my memory. No matter how many sales tax seminars, I've done in a state, I often find new nuggets of weirdness. So it went for Florida.

In Florida, car washes may be taxable. But unlike other states, which sometimes make the coin-op facilities not taxable, Florida bases the test on whether or not wax or other coatings are applied and remain on the car.

And I quote:

• The entire charge for a wash job, in which wax, silicones, or any other substance is added that forms a protective film or coating, is taxable. The purchase of materials such as wax, silicones, and the like, which form a protective film or coating, is exempt to the dealer. The dealer shall extend a resale certificate to his supplier in lieu of paying tax.

You see, in Florida, the theory is that the service of repairing and maintaining TPP is not taxable. But if there is any transfer of TPP during the service, then the whole service becomes taxable. A watch repairer who just cleans your watch doesn't have to charge you sales tax on the service. But if he adds a drop of oil, the entire amount becomes taxable.

So by adding that wax to a simple wash with soap and water, you make the whole thing taxable. If Florida is having budget problems, and they're looking for loopholes to fill, this might be one to work on. I'm just sayin'.

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The Sales Tax Guy
http://salestaxguy.blogspot.com

See the disclaimer - this is for education only. Research these issues thoroughly before making decisions.

Here's information on our upcoming seminars and webinars.
http://www.salestax-usetax.com/

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