1. (1) Sales for resale include those whereby a supplier of materials, supplies, equipment and services makes such tangible personal property or services available for further processing as a component part of a product to legitimate dealers engaged in and actually reselling or leasing such property or services to a user or consumer. Sales to a manufacturer or processor for future processing, manufacture or conversion into articles of tangible personal property for resale where such industrial materials become a component part of the finished product are likewise considered sales for resale.
2. (2) Sales of tangible personal property and services to a retailer who may make further distributions from a central warehouse or other distribution point to others for resale shall be deemed to be wholesale sales.
3. (3) Sales for resale made by a wholesaler to another wholesaler shall not be subject to business tax.
4. (4) The price charged by the vendor for tangible personal property or services or the quality of such property or services is immaterial in determining whether or not a sale is one for resale. The controlling factor is what the vendee does with his purchase.
5. (5) Sales to a contractor who in the course of performing his contract installs property or uses services in a structure, as a component part thereof, are retail sales to a user or consumer.

Authority: T.C.A. §§ 67-101, 67-5822, 67-1-102, 67-4-702, and 67-4-703. Administrative History: Original rule certified June 7, 1974. Amendments filed June 28, 2016; effective September 26, 2016.