June 6, 1984

__________ ("Company") is a distributor of computer equipment based in the state of __________ It purchases equipment from __________ ("Manufacturer"), a vendor engaged in business in Massachusetts. The Company resells the equipment to vendors who resell it in turn to customers in Massachusetts. You inquire about the Massachusetts sales tax responsibilities of the Company and the Manufacturer in these circumstances.

It is assumed from your statement of facts that the Manufacturer ships the equipment directly to the Massachusetts customers, and that the Company is not engaged in business in Massachusetts within the meaning of General Laws Chapter 64H, Section 1(5).

The sales tax is imposed upon retail sales of tangible personal property in Massachusetts by any vendor (G.L. c. 64H, § 2). "Retail sale" is defined as a sale of tangible personal property for any purpose other than resale in the regular course of business (G.L. c. 64H, § 1(13)). All gross receipts of a vendor from Massachusetts sales of tangible personal property are presumed to be from retail sales subject to tax unless the vendor takes a resale certificate in good faith from a purchaser who is a registered Massachusetts vendor (G.L. c. 64H, § 8).

Based on the foregoing, it is ruled that the Manufacturer's sales of the equipment to the Company will be presumed to be subject to tax unless the Company registers as a Massachusetts vendor and gives a Massachusetts resale certificate with respect to each sale. The Manufacturer may overcome this presumption by accepting in good faith from the Company a notarized statement on the Company's letterhead that it is not engaged in business in Massachusetts within the meaning of General Laws Chapter 64H, Section 1(5), and that it is purchasing the equipment solely for resale to a registered Massachusetts vendor who will resell it in the regular course of business. The statement must include the name and vendor registration number of the Massachusetts vendor to whom the Company will resell the equipment.

Very truly yours,

/s/Ira A. Jackson

Commissioner of Revenue

IAJ:JXD:mf

LR 84-38