On July 5, 2017, Missouri Gov. Eric Greitens signed into law an amendment to the sales and use tax law that removes usual and customary delivery charges that are separately stated from the amounts subject to Missouri sales and use tax. The current law is that if delivery charges were part of what the customer was purchasing, even if separately stated, then the delivery charges would be part of the sales and use tax determination. There was a Missouri Supreme Court case that illustrates the concept: concrete purchases were delivered by the seller and were included in the price subject to sales tax since the customer needed to have the concrete delivered in a rotating cement truck in order to receive the concrete in the form needed to do the job (i.e., in order to be effectively poured into the customer's concrete forms). Effective August 28, 2017, the law in Missouri will be that delivery charges that are usual and customary are not part of the sales or use tax calculation so long as separately stated on an invoice, even if the delivery charges are necessary to carry out what the customer purchased.

Keep in mind that it has already been established in Missouri that delivery charges that are requested at the option of the customer, and not necessary to carry out the customer's purchase, are not subject to sales tax. An example would be furniture that is capable of being carried out by the customer and taken by the customer, for which the customer elects to have the seller deliver to the customer's home. In this instance, the law in Missouri has been that such a delivery charge is a non-taxable service.

Thus, effective August 28, 2017 an informed seller or vendor should be able to allow customers to avoid paying Missouri sales or use tax on delivery charges by separately stating them on the customer invoice. See SB 16, amending RS Mo §§144.010(4) and 144.605(8).