S.C. Code Regs. 117-306 — Repairs

Materials used in repairing, for taxing purposes, fall into the following classes:
(a) Materials which pass to the repairman's customers and which do not lose their identity when
used by the repairman and which are a substantial part of their repair job (such as auto repair parts,
radio tubes, and condensers) are sold at retail by the repairman. He must report sales tax on such
sales, including tax on the service incidental thereto. He may, however, if making separate agree-
ments to sell the repair parts and to perform the labor and service required, remit tax only upon the
price of the parts if his records and his invoices clearly show a separation of the amounts received from
sales of parts and from the rendering of services.
(b) Materials which pass to the repairman's customer but which lose their identity when used by the
repairman or which are inconsequential in amount; such as paint, solder, and tack; are considered to
have been used or consumed by the repairman and are taxable at the time of sale to him.
(c) Materials which are used or consumed by the repairman and which do not pass on to his
customer are supplies and taxable when sold to the repairman.
(d) Materials which fall in class (b) or (c) are purchased at wholesale for use by a repairman who, in
addition to using such materials as a repairman, sells the same kinds of materials for use by others.
These materials become subject to the sales tax upon their withdrawal for use by the repairman. Note,
however, that a repairman is not to be considered a vendor unless he carries a stock of goods and sells
outright therefrom a substantial amount. If the repairman makes only isolated sales or ''accommoda-
tion'' sales, he is not to be licensed as a seller under the sales tax law, in which case his supplier is liable
for the tax.
In all instances materials are taxable when sold to repairmen for use in making repairs where such
materials lose their identity as a result of such use. For instance, solder used in welding, paint used in
automobile refinishing, thread used in mending clothing, cloth used in reupholstering. In all
instances where the shape or composition of the repair material is materially changed, such altered or
changed material is considered to have been used or consumed by the repairman, and, for that reason,
subject to tax when sold to him. No tax on this material is to be collected by the repairman from his
customer.
In instances where repair materials and repair parts are passed to the repairman's customers without
change, except necessary and customary minor adjustments, such parts or materials may be purchased
at wholesale by the repairman licensed under the law. The repairman is then liable for sales tax on
such sales of materials and parts to his customers.