|Organization:||Massachusetts Department of Revenue|
|Referenced Sources:||Massachusetts General Laws|
Sales and Use Tax
June 11, 1980
********** (the "Company") leases moorings in ********** Harbor to boat owners. The moorings consist of surface flotation attached by chains to concrete blocks resting on the ocean floor. The Company has paid a sales tax on its purchases of the blocks, Company has paid a sales tax on its purchases of the blocks, chains and other materials used to make the moorings.
You inquires whether the mooring leases are subject to Massachusetts sales tax.
Massachusetts General Laws Chapter 64H, Section 2 imposes a tax on sales at retail of tangible personal property. Chapter 64H, Section 1(12)(a) provides that leases and rentals constitute "sales" for purposes of the tax.
Sales of materials which become ingredient or component parts of tangible personal property to be sold are exempt from tax under Chapter 64H, Section 6(r).
Based on the foregoing, it is ruled that the rental charges to boat owners are subject to tax, but the Company's purchases of the blocks, chains and other materials used to make the moorings are exempt from tax under Chapter 64H, Section 6(r).
The vendor or vendors of the materials used to make the moorings may refund to you the tax collected on your purchase of the materials and apply for abatement of the tax, or you yourself may apply for an abatement, acting under power of attorney from the vendor or vendors.
Very truly yours,
/s/L. Joyce Hampers
L. Joyce Hampers
Commissioner of Revenue