Ruling 89-100, Agricultural Services

This information is not current and is being provided for reference purposes only

This Ruling has been obsoleted by AN 94(3)

You have inquired as to the taxability of architectural services that are rendered to municipalities or other tax-exempt entities through intermediary parties.

In situations where both the architect and the subcontractors on the job contract directly with a municipality or tax-exempt entity, the sales tax would not apply to architectural services or to the purchase of materials physically incorporated in the building. The architect should obtain a "Governmental Agency Exemption Certificate" or a "Charitable and Religious Organizations Exemption Certificate."

However, in situations where an intermediary party is involved, such as in a "turn-key" project, the tax exemption is lost both for the provider of services and on the purchase of materials because a private contractor is the purchaser of the services and materials, not the municipality.

Any exemption from tax must be granted by the General Assembly. If the you decide to pursue a legislative remedy, I suggest that you contact our Legal Division which stands ready to assist you in drafting suggested language.


September 20, 1989