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Arkansas: COVID-19 Sanitizing Services Taxable

Dated July 24, 2020

Citations: Revenue Opinion 20200413

SUMMARY BY TAX ANALYSTS

The Arkansas Department of Finance and Administration issued a legal opinion explaining that charges for cleaning and fogging in order to sanitize spaces to prevent the spread of COVID-19 are subject to sales and use tax, as the service qualifies as a specified taxable cleaning service.

June 23, 2020

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Re: Revenue Opinion 20200413
COVID-19 Cleaning

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You email requesting a legal opinion has been assigned to me for response. Your request states as follows:

We are a restoration company with Covid-19 we are cleaning and fogging to get rid of the possible germ. We are not a janitorial company but for this service should we pay sales tax? We are not cleaning to clean but to kill the virus sanitizing service.

I understand request to ask whether the gross receipts derived from the service of sanitizing surfaces that are contaminated or possibly contaminated by COVID-19 are subject to sales tax.

RESPONSE

Yes. Arkansas gross receipts tax (sales tax) is levied upon the gross proceeds or gross receipts derived from all sales of tangible personal property, specified digital products, and certain enumerated services, unless specifically exempted by law. Ark. Code Ann. § 26-52-301 et seq. (Supp. 2019). The gross receipts derived from the service of cleaning or janitorial work are subject to sales tax. Ark. Code Ann. § 26-52-301(3)(D)(i)(b) (Supp. 2019). Cleaning services are defined as “services to rid the interior or exterior of any building, dwelling, or other structure of dirt, impurities, or extraneous matter.” Arkansas Gross Receipts Tax Rule GR-9.4. Your service of sanitizing surfaces for COVD-19 is taxable, and you should be collecting the tax from your customers and remitting it to the Department.

This opinion is based on my understanding of the facts as set out in your inquiry as those facts are governed by current Arkansas laws, rules and regulations. Any change in the facts or law could result in a different opinion. You may rely on this opinion for three years pursuant to Ark. Gross Receipts Tax Rules GR-75(B).

Sincerely,

Chris McNeal, Attorney
DFA Revenue Legal Counsel

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