The South Carolina Department of Revenue has issued a pair of reports offering guidance on how small businesses and other retailers should handle fuel surcharges and so-called “inflation fees,” or fees to help offset cost increases caused by inflation or supply chain issues.
In the first report, Revenue says that a separately stated “inflation fee,” “convenience fee,” or similar type of fee charged by a retailer as part of the retail sale of tangible personal property generally is subject to state and local sales and use taxes. Click here to learn more.
In a draft report issued on Thursday, Nov. 3, the department said fuel surcharges charged by retailers when delivering merchandise should be considered “gross proceeds of sales” or “sales price” and generally are subject to the sales tax as well. Read the draft report here.
NFIB State Director Ben Homeyer said, “Higher fuel costs and supply chain issues have forced a lot of small businesses to pass the increase along to their customers in the form of extra fees. It’s important for small business owners to understand the rules to avoid problems down the road.”