Retail OperationsNew Storage And Warehouse Tax Applies To Third Party, Business Transactions
This morning the Department of Revenue issued guidance on Minnesota's new tax on storage and warehousing services taking effect April 1. This business tax, coupled with two others, was part of the final omnibus tax package passed in the final few hours of the 2013 legislative session. Groups including the Minnesota Retailers Association have called for the repeal of the business-to-business taxes early in the 2014 session.
Examples of storage and warehousing services taxed under the new law:
- Document storage and warehousing (not digital storage);
- Coal storage;
- Customs (foreign trade) warehousing;
- General warehousing and storage of goods;
- Hazardous waste storage;
- Lumber storage terminals;
- Liquor warehousing;
- Self-storage services the purchaser can deduct as a business expense on its federal income tax return; and
- Storage for construction machinery or supplies.
Examples of storage and warehousing services NOT subject to the new tax:
- Agricultural products;
- Refrigerated storage;
- Electronic data storage;
- Self-storage services and storage of motor vehicles, recreational vehicles, and boats (when those services cannot be deducted as a business expense); and
- Petroleum products (interstate petroleum terminals).
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