PURPOSE: This rule clarifies which tax rate to use in computing use tax liability on gross receipts when there has been a change in the state use tax rate.

1. (1) Use tax is calculated at the tax rate in effect on the date of the sale.
2. (2) When a change in the Missouri state use tax rate becomes effective, all gross receipts from cash or charge sales made by a vendor on or after the effective date of the rate change are subject to the new use tax rate.
3. (3) Gross receipts from charge sales made prior to the effective date of the rate change are subject to the tax rate in effect at the time the charge sale was made.
4. (4) A vendor of tangible personal property in Missouri may report and remit a use tax liability based upon either the gross sales method or the gross receipts method. If the vendor elects to report under the gross sales method, the vendor must report the sale in the month in which the sale is made and pay the use tax rate in effect at the time the sale is made. If the vendor elects to report under the gross receipts method, the vendor must report and remit use tax based upon the use tax rate in effect at the time the sale was made (see 12 CSR 10-3.164 Installment Sales and Repossessions for reporting of use tax on installment sales). A vendor may not change his/her reporting method without permission from the director of revenue.

AUTHORITY: section 144.705, RSMo (1994).* Emergency rule filed Sept. 29, 1989, effective Oct. 9, 1989, expired Feb. 5, 1990. Original rule filed Sept. 29, 1989, effective Jan. 26, 1990. *Original authority 1959.