IDAPA 35.01.02.084 — CONTAINERS RETURNABLE/NONRETURNABLE (RULE 084)

Sections 63-3622, 63-3622E, Idaho Code
01.
Container. A container encloses or will enclose tangible personal property which is sold at
wholesale or retail. A container may be comprised of one (1) or more components. Items used as shipping supplies
which do not enclose the product are not considered to be containers. Example: Cartons of canned goods are placed
on a pallet. Shrink wrap is used to bind the cartons to the pallet. A shipping address label is affixed to the shrink wrap.
The container includes the cans in which the goods are enclosed; the cartons in which the canned goods are placed;
and the shrink wrap and pallet which enclose the cartons. The address label is not part of the container.
(3-31-22)
02.
Containers Exempt from Tax. The following containers are exempt from sales or use tax:
(3-31-22)
a.
Nonreturnable containers purchased by a retailer or wholesaler who places the contents in the
container and sells the contents with the container at retail or wholesale, including cans, barrels, boxes, cartons,
grocery sacks, disposable soft drink cups and lids, and other to-go fast food containers.
(3-31-22)
b.
Returnable containers when the container, along with the contents, is sold at retail if the fee for the
container is separately stated, including returnable beer kegs, returnable barrels, and returnable pallets.
(3-31-22)
c.
Returnable containers when sold back to retailers or manufacturers for refilling.
(3-31-22)
d.
Returnable or nonreturnable containers when sold with contents that are exempted from the tax,
regardless of whether or not the container is separately billed, including containers for prescription drugs, and oxygen
or acetylene cylinders, when the use of the gases qualifies for the production exemption.
(3-31-22)
03.
Taxable Containers. Containers subject to sales and use tax include containers used by persons
who are providing a service rather than selling a product, such as plastic clothing bags purchased by dry cleaners.
(3-31-22)
04.
Supplies. Shipping, selling, or distribution supplies are not considered to be containers and are
taxable when purchased by the shipper, seller, or distributor, such as:
(3-31-22)
a.
Shipping pallets and lumber stickers when not banded or shrink wrapped to the product to be sold,
thereby not becoming a part of the container.
(3-31-22)
b.
Banding or binders used to secure goods to transportation equipment.
(3-31-22)
c.
Price stickers and address labels affixed to containers that do not provide any product information
such as weight, quantity, nutritional value, or other necessary product description. See Rule 042 of these rules.
(3-31-22)
d.
Example: Plywood is wrapped with lumber wrap. The bundles are rested on pallets for shipping. In
this example the lumber wrap is the only container. As the bundles are not enclosed onto the pallet, the pallet is not a
container and is instead a taxable shipping supply subject to the tax.
(3-31-22)
IDAHO ADMINISTRATIVE CODE
IDAPA 35.01.02
State Tax Commission
Idaho Sales & Use Tax Administrative Rules
Section 085
Page 79