Ruling in Portable Toilet Company Case Sows Confusion on Tax of Gross Proceeds

Overview


Matthew Boch and Lauren Ferrante analyzed a Louisiana Supreme Court decision which held that waste management services cannot be taxed but might be bundled with tangible personal property. Mr. Boch said the decision “raises the question of what else a tax administrator may try to bundle,” while Ms. Ferrante added that treating a bundled transaction as a nontaxable service suggests the service provider could not properly claim a resale exemption on the acquisition of the property. Both lawyers said the ruling could “raise mischief” in the years ahead.