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Declaratory Order - Fischer Northwest, Inc.

Recently, the Director of the Department of Revenue issued a Declaratory Order in the matter of Fisher Northwest, Inc. The issue to be determined in the Petitioner was whether the Petitioner, who only performs the sales of sewer, drain and pipe cleaning services, is performing the taxable services of pipe fitting and plumbing pursuant to Iowa Code section 422.43(11) and Department rule 701 IAC 26.36(422)? The Director held that the rule 701 IAC 26.36(422) involves plumbing services and not the services of a plumber. Consequently, it is not a requirement that a retailer be a licensed plumber in order to be subject to Iowa sales or use tax under this taxing provision. Instead, the Director stated that plumbing is generally defined as including the repair and maintenance of pipes, sewers and drains. The cleaning of pipes, drains, a sewers is maintaining or in the case of an obstruction, the repair of pipes, drains and sewers. Consequently, the Director held that the Petitioner was performing a taxable service under Iowa law and should be imposing sales or use tax on charges to its customers.

Posted November 4, 2004