Minnesota Implements New Retail Delivery Fee on Transactions Over $100, Effective July 1st

(KNSI) — Don’t call it a tax. It’s a fee. And if you have something delivered to your home and the transaction costs $100 or more, you’ll have to pay it starting July 1st.

Lawmakers passed the 50 cent Retail Delivery Fee last session. The fee applies to “tangible personal property subject to sales tax” and clothing, which is mostly exempt from state sales and use tax.

When calculating whether a transaction meets or exceeds the $100 threshold, a transaction includes all charges that are part of the sale. The fee is not subject to sales tax if it’s noted separately on a receipt or invoice, and it’s only charged once per transaction, regardless of the number of shipments made. The fee will be shown in a separate line item titled “Road Improvement and Food Delivery Fee.”

Some exclusions apply. Retailers who had sales less than $1 million in the previous calendar year or a marketplace provider facilitating a sale for a retailer with less than $100,000 in marketplace sales.

Drugs, medical devices, accessories and supplies or food, food ingredients or prepared food. Certain baby products are exempt but are still subject to sales tax.

It’s expected to bring in $60 million a year for transportation funding and is aimed at making up for less gas tax revenue due to electric car use.

See more here.

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