Information about the recent activities of the Office of Tax Policy is provided below. This information includes new and revised publications, rulemaking activities, and recently published letter rulings and information letters.
Recently Published Private Letter Rulings (PLR) and General Information Letters (GIL)
- PLR-26-004 – Sales Tax Exemptions for Purchases of Medical Materials by Hospitals – Sales of medicated dressings, nonmedicated dressings, bandages, gauze, and skin closure products to Company are exempt from sales tax provided they are intended to be furnished by a practitioner as part of professional services to patients.
- GIL 26-003 - Taxability of Inventory for Promotional Giveaways and Nexus for Marketplace Sellers – Tangible personal property that is purchased tax-exempt as a wholesale purchase that is later withdrawn from inventory, used, or made available for use by the purchaser in Colorado for promotional or giveaway purposes in this state is subject to use tax, as is taxable property purchased outside of Colorado and brought into this state for use in this state. However, a taxpayer may claim a credit against the Colorado use tax due for any legally imposed use tax previously paid to another state. A retailer is doing business in Colorado if the retailer maintains any place of business in Colorado directly, indirectly, or by a subsidiary; solicits business and receives orders from Colorado residents; or if the retailer’s sales from Colorado in the current and previous calendar years exceed $100,000.
New and Revised Publications
- Sales & Use Tax Topics: Utilities – This new publication provides information regarding sales tax imposed on gas and electric service and certain exemptions applicable thereto.
- Marijuana Tax Topics: Excise Tax Transitional Guidance – This new publication provides information regarding the implementation of changes made to average market rate (“AMR”) categories by House Bill 26-1077 and by emergency and permanent rules recently adopted by the Department.
Rulemaking Announcements
- Retail Marijuana Tax – We recently adopted both emergency and permanent rules regarding retail marijuana taxes. They repeal and repromulgate, restructure, and consolidate the rules in 1 CCR 201-18. The rules also implement House Bill 26-1077 by creating new average market rate (“AMR”) categories, while eliminating others. See Department publication Marijuana Tax Topics: Excise Tax Transitional Guidance for additional information regarding transitional rules.