024.01 Discounts allowed by the retailer to customers are deductible in arriving at the net sales price which is taxable. Such discounts must appear on the invoices, records and accounts of the retailer and be substantiated to the satisfaction of the Department of Revenue. A discount is not a proper deduction from gross receipts when given on the sale of property or services which are exempt from the tax.
024.02 A cash discount is usually offered by the seller as an inducement for payment within a specified time. A volume discount is usually offered as an inducement for larger purchases. These discounts may not be deducted by the seller until it has been given to the purchaser. Such discounts will be allowed as a deduction on the seller's tax return when there is sufficient evidence in the records of the seller to indicate that such discounts have been given to the purchaser and the sales reported on the tax return are the amount of sales before discounts.
024.03 A cash rebate is not deductible in arriving at the net sales price which is taxable. A cash rebate is usually allowed by a manufacturer subsequent to the actual sales transaction and is contingent upon the claimant submitting proof that the sales transaction has been finalized. As the sales tax is imposed upon the sales transaction (Reg-1-001, Nature of the Sales Tax), a subsequent rebate of a portion of that sales price, does not reduce the original sales price upon which the tax is imposed.
024.04 See Reg-1-020, Motor Vehicles, for rebates on motor vehicles.
(Sections 77-2702.07 and 77-2702.17, R.S.Supp., 1992. January 24, 1993.)