News and Insights

Florida Proposes Rule Change Removing “At the Time of Sale” Requirement for Trade-ins

Tax Development Jun 02, 2011

The Florida Department of Revenue (“Department”) has proposed rules that would amend and clarify Florida sales and use tax rules regarding discounts and trade-ins. The Department’s decision to amend the rules follows a decision from the Florida Court of Appeals (“Court”) in Department of Revenue v. GameStop, Inc., where the Court held that language contained within Fla. Admin. Code Ann. §§ 12A-1.074 and 12A-1.018 contradicts and modifies the law governing trade-ins. Specifically, the Court found that requiring that property be taken in trade “at the time of sale” effectively negated Fla. Stat. Ann. § 212.09.

The proposed amendment to § 12A-1.074, relating to trade-ins, removes the phrase “at the time of sale,” allowing a seller to use a trade-in to reduce sales tax on merchandise purchased at a later date. Further, the proposed amendment to § 12A-1.018 relating to discounts, removes an unnecessary reference to “trade-ins,” ensuring that the regulation is consistent with the holding in Department of Revenue v. GameStop, Inc.


Ginny Buckner Kissling