§ 58.7. Trading stamps.
(a) Companies who distribute and sell trading stamp programs are liable for tax upon the cost to them of trading stamps, booklets, catalogues and promotion items, such as signs, and the like, transferred to the retail merchants in connection with the trading stamp program. The sale of trading stamps to retail merchants, however, is not subject to tax.
(b) The purchase of property by the trading stamp company for the purpose of redeeming stamps is considered to be a purchase for resale and is therefore exempt from tax.
(c) The redemption of trading stamps for the exchange of merchandise is a ‘‘sale at retail’’ under the TRC. Persons redeeming the stamps shall collect sales tax upon the fair retail price of the merchandise being tendered.
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