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4. Grading, excavating, ditching, dredging or landscaping;
5. Insulating services or repairs;
6. Plumbing or pipe fitting;
7. Tin and sheet metal work;
8. Welding, etc.
305 Persons performing any services taxed under Miss. Code Ann. Section 27-65-23 for
contracts of $10,000 or less owe the regular retail rate of sales tax on gross income.
Persons performing contracts of $10,000 or less that do not include services taxed under
Miss. Code Ann. Section 27-65-23 owe no tax on gross income but are required to pay
the regular retail rate of sales or use tax on all taxable purchases.
306 Continuous contracts on projects embracing activities taxable under Miss. Code Ann.
Section 27-65-21, which are to be carried on for a definite period of time and a definite
amount, will be qualified and taxed at 3½%. Otherwise, the determination of whether a
contract is subject to tax under Miss. Code Ann. Section 27-65-21 will be made from
purchase orders, work orders or invoices. Purchase orders, work orders or invoices that
are a continuation of prior purchase orders, work orders or invoices will be considered
part of one project. Generally, work on a project takes place in the same, adjacent or
adjoining area. Transmission lines (gas, water, sewage, power, telephone, etc.) are
considered a project. Amounts included in the contract for non-taxable activities (grass
cutting, tree trimming, etc.) may be excluded from the taxable amount of the contract.
307 Individual contracts for the construction of several buildings, streets, etc., or parts
thereof, may together be qualifiable as a prime contract despite the fact that the
compensation for each separate part of the project is less than $10,000. In order to
determine whether such contracts are qualifiable, consideration must be given to the
types of activities involved.
308 Contracts for the performance of work upon personal property, such as shipbuilding or
ship repairing, or activities that consist of demolishing or razing old property or clearing
land, are not subject to the provisions of Miss. Code Ann. Section 27-65-21. However,
where land clearing or building razing activities are incidental to the primary purpose of
the contract, such as highway or building construction, the total contract is taxable. No
separation of incidental activity will be allowed even though it may be subcontracted.
309 Contractor’s tax does not apply to the contract price or compensation received to restore,
repair, or replace a utility distribution or transmission system (electric, gas, water,
sewage, telephone, etc.) damaged by an ice storm, hurricane, flood, tornado, wind,
earthquake or other natural disaster if the entity performing the restoration, repair or
replacement is reimbursed for its cost only.
310 The portion of the contract price or compensation received from the sale and installation
of manufacturing or processing machinery that loses its identity as tangible personal
property to a manufacturer or a customer processor is to be taxed at the special sales tax
rate of 1 ½%.