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Taxable Purchases and Use Tax

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This section describes taxable purchases and use tax for financial institutions.

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Purchases made by federally chartered banks and savings and loans and state chartered credit unions, banks, and savings and loans are taxable.

Items you use to operate your business are taxable unless an exemption applies. Several services are also taxable. If you do not pay sales tax on a taxable purchase, then use tax is due. See below for specific examples.

Taxable Purchases	Examples
Business items	Books, directories, guides Canned or packaged computer software purchased, leased, or licensed to use Copy machine supplies Giveaway items - candy, premiums, and incentives (prizes for kids club, etc.) Maintenance agreements for canned computer software Taxable advertising materials Training materials and supplies
General items	Cleaning supplies Furniture and fixtures Name plates Office equipment Office supplies Paper towels Toilet issue
Utilities	Electricity Gas Water
Taxable services	Building cleaning and maintenance, see Building Cleaning and Maintenance Detective and security Lawn and garden care For more information, see a complete list of taxable services.

Use Tax [+]

If you buy equipment, supplies, or other taxable items for your business and the seller does not charge Minnesota sales tax, you owe use tax on the cost of the items. If your business is located in an area with a local tax, you may also owe local use tax.

Some common situations where you may owe use tax include:

You buy taxable items or services online without paying sales tax
You withdraw an item from inventory to use (instead of selling it), donate, or give away
You buy taxable items outside of Minnesota
You buy taxable items in another Minnesota city or county with a lower (or no) local sales tax

For more information, see Use Tax for Businesses and Local Sales and Use Taxes.

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Taxable Purchases and Use Tax