Technical Information Release

Technical Information Release TIR 81-2: Use Tax Exemption for Sales Upon Which Tax Was Paid Under Laws of Another State

Date: 10/09/1981
Referenced Sources: Massachusetts General Laws

Sales and Use

Massachusetts General Laws Chapter 64I, Section 7(c) sets forth an exemption from the Massachusetts use tax for sales upon which the purchaser has paid a tax or made reimbursement therefor to a vendor or retailer under the laws of any state or territory of the United States. The exemption applies only where the tax was legally due without any right to a refund or credit, and the other state or territory allows a corresponding exemption with respect to the sale or use of tangible personal property upon which a sales or use tax was paid to Massachusetts.

The following jurisdictions allow such a corresponding exemption:

  • Alabama
  • Missouri
  • Alaska
  • Nebraska
  • Arizona
  • New Jersey
  • Arkansas
  • New Mexico
  • California
  • New York
  • Colorado
  • North
  • Carolina
  • Connecticut
  • North Dakota
  • District of Columbia
  • Ohio
  • Florida
  • Oklahoma
  • Georgia
  • Pennsylvania
  • Hawaii
  • Rhode Island
  • Idaho
  • South Dakota
  • Kansas
  • Utah
  • Louisiana
  • Vermont
  • Maine
  • Virginia
  • Michigan
  • Washington
  • Minnesota
  • West Virginia
  • Mississippi
  • Wisconsin

In the following jurisdictions, such a corresponding exemption is allowed only under certain circumstances. Where a purchaser has paid a tax under the laws of such a jurisdiction, the exemption in Section 7(c) will apply only if that jurisdiction would allow a corresponding exemption under the same circumstances for sales upon which a sales or use tax was paid to Massachusetts.

Indiana Exemption is allowed except with respect to motor vehicles and aircraft.

Kentucky Exemption applies for sales but not use tax paid under laws of another state; no exemption in the case of construction equipment brought into Kentucky.

Maryland Exemption applies for sales but not use tax paid under laws of another state.

South Carolina Exemption is limited to construction equipment brought into South Carolina.

Wyoming Exemption applies for sales but not use tax paid under laws of another state.

Where a tax was paid under the laws of another state at a rate (or, in states imposing both state and local sales and use taxes, at combined state and local rates) of less than five per cent, the exemption does not apply, but the Massachusetts use tax will be determined by multiplying the "sales price" as defined under Massachusetts law by a percentage representing the difference between the five per cent Massachusetts rate and the rate or rates imposed in the first taxing Jurisdiction.

Joyce Hampers

Commissioner of Revenue

October 9, 1981

 

TIR 81-2

Referenced Sources:

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