Okla. Admin. Code § 710:65-13-130

Current through Vol. 42, No. 4, November 1, 2024

Section 710:65-13-130 - Sales to and by the government; taxable and exempt transactions

(a)Sales "to" governmental entities. Sales of tangible personal property or services to this State, its institutions or political subdivisions, and to the United States, including its agencies and instrumentalities are exempt from sales tax. Sales to other states' governments, political subdivisions, institutions, or agencies are not exempt, unless the state is one which borders Oklahoma and grants a like exemption from taxes on similar sales of items to Oklahoma or its political subdivisions.

(1)Records required. The books and records of the vendor must show that the purchase was billed to and paid by the government agency.

(2)Sales to government employees. Sales to individuals who are employees of this State, its institutions and subdivisions, or of the United States government, are not exempt from tax unless the sale is billed directly to the appropriate government agency or the purchase is by means of properly completed government purchase order or credit card. Sales made on credit cards bearing an employee's name and the name of the government agency for which the employee works will qualify for exemption only if the card is issued to the Federal Government, rather than to the individual, and is paid directly by the Federal Government. The credit cards that currently meet these criteria are those issued through the GSA SmartPay card program:

(A)Fleet cards. All Federal Government fleet cards are centrally-billed. This means that all charges are billed directly to the Federal Government and paid directly by the Federal Government. Charges made using an authorized fleet card are therefore, exempt from the levy of Oklahoma sales tax. Authorized fleet cards must meet all the requirements set out in this paragraph:

(i) The fleet card prefix (first 4 digits) must be 4486, 4614, 4716, 5565, 5568 or 8699;

(ii) The fleet card platform must be Voyager, MasterCard, Wright Express, or Visa; and

(iii) The Voyager fleet card must be issued by Citibank, or U.S. Bank; the MasterCard fleet card must be issued by Citibank, JP Morgan Chase or U.S. Bank; the Wright Express fleet card must be issued by Citibank.

(B)Purchase cards. All Federal Government purchase cards are centrally-billed. This means that all charges are billed directly to the Federal Government and paid directly by the Federal Government. Charges made using an authorized purchase card are therefore, exempt from the levy of Oklahoma sales tax. Authorized purchase cards must meet all the requirement set out in this paragraph:

(i) The purchase card prefix (first 4 digits) must be 4486, 4614, 4716, 5565 or 5568;

(ii) The purchase card platform must be Visa or MasterCard; and

(iii) The Visa purchase card must be issued by Citibank, JP Morgan Chase or U.S. Bank; The MasterCard purchase card must be issued by Citibank, JP Morgan Chase, or U.S. Bank;

(C)Travel cards. Federal Government travel cards may be centrally-billed or individually billed. Individually-billed charges are billed to and paid by the federal employee, and then reimbursed by the Federal Government. Individually-billed charges made using a travel card are subject to the levy of Oklahoma sales tax. Only centrally-billed charges made using an authorized travel card, because they are billed directly to and paid directly by the Federal Government, are exempt from the levy of Oklahoma sales tax. Authorized travel cards must meet all the requirements set out in this paragraph:

(i) The travel card prefix (1st four (4) digits) must by 4486, 4614, 5565 or 5568;

(ii) The sixth (6th) digit of the account numbering structure will denote whether the travel card is centrally-billed or individually-billed:

(I) A sixth digit of 0, 6, 7, 8, or 9 denotes that the travel card is centrally-billed;

(II) A sixth digit of 1, 2, 3, or 4 indicates that the travel card is individually-billed;

(iii) The travel card platform must be Visa or MasterCard; and

(iv) The travel card, whether Visa or MasterCard, must be issued by Citibank, U.S.Bank, or JP Morgan Chase.

(D)Integrated cards. Federal Government integrated cards may include fleet, travel, or purchase card functionality and offer the Federal Government a single card for all purchases. All fleet and purchase type transactions made on an integrated card are centrally-billed, and therefore exempt from the levy of Oklahoma sales tax, regardless of the sixth digit on the card. travel card type functionality may be centrally-billed or individually-billed. Authorized integrated cards must meet all the requirements set out in this paragraph:

(i) The prefix (first four (4) digits) of an integrated card must be 4486, 4614, 4716, 5565 or 5568;

(ii) For travel functionality only, the sixth digit of the integrated card will denote whether the card is centrally or individually billed:

(I) A sixth digit of 0, 6, 7, 8, or 9 denotes that the integrated card being used for travel functionality is centrally-billed;

(II) A sixth digit of 1, 2, 3, or 4 indicates that the integrated card being used for travel functionality is individually-billed;

(iii) The integrated card platform must be Visa or MasterCard; and

(iv) The integrated card, whether Visa or MasterCard, must be issued by Citibank, U.S.Bank or JP Morgan Chase.

(3)Sale to contractors. Sales to contractors in connection with the performance of any contract with the United States government are not exempt unless the ownership and possession of the property purchased by the contractor or agent transfers immediately to the United States government. [See: 68 O.S. §§ 1356(1), 1356(2) ]

(4)Sales to foreign diplomats, consular mission and mission employees. Foreign diplomats and consular missions and their personnel and eligible family members who have been issued a Diplomatic Tax Exemption Card by the United States Department of State, Office of Foreign Missions may make eligible purchases exempt from sales tax. Qualifying Diplomatic Tax Exemption Cards may also be issued by the American Institute in Taiwan. Each category of tax exemption card bears an animal image indicating the purchases eligible for sales tax exemption by the cardholder as follows:

(A)Owl image card exempts the cardholder from sales tax on all official mission purchases.

(B)Buffalo image card exempts the cardholder from sales tax on all official mission purchases subject to the restrictions listed on the card. For example, the card may read: "Exempt from tax on purchases over $300; not valid for hotels."

(C)Eagle image card exempts the cardholder from sales tax on all personal purchases.

(D)Deer image card exempts the cardholder from sales tax on personal purchases, subject to the restrictions listed on the card. For example, the card may read: "Exempt from tax on purchases over $150; not exempt for hotels, restaurants, and services."

(5)Transferability. The Eagle and Deer exemption cards used for personal purchases are not transferable. The exempt use of the Owl and Buffalo cards is not restricted to the individual pictured on the card.

(6)Exemption requirements. To qualify for exemption, official mission purchases made with either an Owl or Buffalo Card must be invoiced to the cardholder and payments made with mission check or mission credit card. For personal purchases made pursuant to an Eagle or Deer Card to qualify for the exemption, they must be invoiced to the cardholder and payment may be in any form including cash, check, or credit card.

(b)Sales by a lease or lease-purchase agreement with a municipality or county. The sale of tangible personal property or services pursuant to a lease or lease-purchase agreement executed between a vendor and a school district is exempt from sales tax.

(c)Sales "by" governmental entities. Except as specifically exempt by statute, the State of Oklahoma, its agencies and instrumentalities, all counties, townships, and municipal corporations, their respective agencies and instrumentalities, and all other state governmental entities and subdivisions, including state colleges and universities, shall collect, report and remit sales tax on taxable sales of tangible personal property and services. For example, sales of city maps, sales of gifts and souvenirs, sales of food from city operated concessions at stadiums, ballparks, auditoriums, etc., are subject to tax.

(d)Purchases by contractors. Except where specifically authorized by statute, purchases of taxable personal property or services by a contractor, as defined by 68 O.S. § 1352, are taxable to the contractor. A contractor who performs improvements to real property for a governmental entity may not purchase the tangible personal property or services to perform the contract exempt from sales tax under the exemption provided by statute to a governmental entity.

Okla. Admin. Code § 710:65-13-130

Amended at 11 Ok Reg 3521, eff 6-26-94; Amended at 12 Ok Reg 2635, eff 6-26-95; Amended at 15 Ok Reg 2827, eff 6-25-98; Amended at 16 Ok Reg 2653, eff 6-25-99; Amended at 17 Ok Reg 2677, eff 6-25-00; Amended at 22 Ok Reg 1561, eff 6-11-05; Amended at 27 Ok Reg 2308, eff 7-11-10; Amended at 29 Ok Reg 542, eff 5-11-12

Amended by Oklahome Register, Volume 33, Issue 23, August 15, 2016, eff. 8/25/2016