PURPOSE: Sections 144.010.1(9) and 144.020.1(1), RSMo, taxes the retail sale of tangible personal property. This rule interprets the sales tax laws as they apply to veterinarians. This rule also interprets sales tax exemptions that apply to veterinarians including section 144.030.2(22), RSMo.

1. (1) In general, veterinarians are rendering services not subject to sales tax. However, veterinarians making retail sales of tangible personal property are responsible for collecting and remitting sales tax on the gross receipts derived from these sales.

2. (2) Definition of Terms.

   1. (A) Livestock—cattle, calves, sheep, swine, ratite birds, including but not limited to, ostrich and emu, aquatic products as defined in section 277.024, RSMo, elk documented as obtained from a legal source and not from the wild, goats, horses, other equine or rabbits raised in confinement for human consumption.

   2. (B) Prescription drug—controlled drug available by order of a physician’s or veterinarian’s prescription. A prescription must exhibit one of the following legends:

      1. 1. “Caution: Federal law prohibits dis-

pensing without prescription”; or

1. 2. “Caution: Federal law restricts this

drug to be used by or on order by a licensed veterinarian.”

1. (C) Veterinarian—a person licensed to treat animals medically. 12 CSR 10-103

1. (3) Basic Application of Tax.

   1. (A) Veterinarians pay tax on their purchases of items consumed in their veterinarian service. Such items may include, but are not limited to, instruments, bandages, splints, syringes, furniture and equipment.
   2. (B) Veterinarians that sell items including but not limited to, leashes, shampoos, collars, nonprescription drugs, and food for animals (except livestock or poultry) for nonfood producing animals are responsible for collecting and remitting tax on the gross receipts derived from these sales. Veterinarians should provide an exemption certificate to the vendor when purchasing items for resale.
   3. (C) Purchases for resale subsequently used or consumed by the veterinarian are subject to the applicable tax. The veterinarian should accrue and remit this tax to the Missouri Department of Revenue. Veterinarians have used or consumed items purchased for resale if they dispense these items to clients for no charge at the same time they provide a nontaxable service. Medications and vaccines administered to livestock or poultry in the production of food or fiber are exempt from tax.
   4. (D) Prescription drugs are exempt. Products bearing labels, such as, “Available through veterinarians,” “For sales to licensed veterinarians” or “Available through licensed veterinarians exclusively,” are not prescription drugs and are subject to tax.

2. (4) Examples.

   1. (A) Dr. Kassady purchased an examining table and operating supplies for her veterinarian practice. The purchase is subject to tax.
   2. (B) Dr. Kassady sells dog food at retail. She also operates a kennel. Dr. Kassady feeds the dogs in her kennel the same dog food she purchases exempt for resale. When Dr. Kassady removes the food from inventory to use in her kennel, tax is due.
   3. (C) Dr. Kassady sells a poultry farmer nonprescription vaccines for use on turkeys raised for the production of food. The farmer also purchases vaccines for his pets. The vaccines for the poultry are exempt; however, the vaccines for the pets are subject to sales tax.
   4. (D) Dr. Kassady purchases surgical tools bearing the label “For sale to licensed veterinarians” to use in her practice. This purchase is subject to tax.

AUTHORITY: sections 144.270 and 144.705, RSMo 1994.* Original rule filed Nov. 10, 1999, effective May 30, 2000.

*Original authority: 144.270, RSMo 1939, amended 1941, 1943, 1945, 1947, 1955, 1961; 144.705, RSMo 1959. Exotic Animal Paradise, Inc. v. Director of Revenue, (A.H.C. 1989). Purchases of feed and hay for animals in an amusement park were not tax-exempt under section 144.030.2(1), RSMo, even though some animals qualified as livestock, because the exemption applies only to feed and hay for animals that will be ultimately resold. The park was also denied an exemption under section 144.030.2(18), RSMo, for purchases of prescription drugs because it failed to show that any of the items claimed required a prescription.