Example: Retailer A sells clothing to Customer B for $100. Retailer A also charges Customer B $10 for delivery of the clothing. Retailer A delivers the clothing to Customer B at a Wisconsin address for which the total applicable sales and use tax rate is 5%. The correct computation of the tax due is as follows:
Selling price of clothing ......... | $100.00 |
Delivery charge ................ | -10.00 |
Subtotal ................... | $110.00 |
Tax at 5% ($110 x 5%)....... | -5.50 |
Total ...................... | $115.50 |
Example: If the "delivered price" of a carload of lumber is $6,000, including delivery charges, and the purchaser pays the delivery charges directly to the common carrier and deducts the payment from the amount due the seller, the delivery charges are borne by the seller and are included in the seller's measure of the tax.
Wis. Admin. Code Department of Revenue Tax 11.94
Section Tax 11.94 interpretss. 77.51(2m), (3pd), (12m) (a) 4. and (b) 4., (14) (intro.), and (15b) (a) 4. and (b) 4., 77.52 (1), and 77.585 (8), Stats.
The interpretations in s. Tax 11.94 are effective under the general sales and use tax law on and after September 1, 1969, except: (a) The definitions of "delivery charges" and "direct mail," and the change of the term "gross receipts" to "sales price" and the separate impositions of tax on coins and stamps sold above face value under s. 77.52(1) (b), Stats., certain leased property affixed to real property under s. 77.52(1) (c), Stats., and digital goods under s. 77.52(1) (d), Stats., became effective October 1, 2009, pursuant to 2009 Wis. Act 2; (b) The definitions of "advertising and promotional direct mail" and "other direct mail" became effective May 27, 2010, pursuant to 2009 Wis. Act 330; and (c) The sales and use tax exemption for advertising and promotional direct mail, which includes the delivery charges for advertising and promotional direct mail, became effective July 1, 2013, pursuant to 2011 Wis. Act 32.