Minnesota Tax Division Changes Position, Decides Against Letting Glass Service Handlers Collect Shops' Sales Tax

In late December, Harmon Solutions Group (HSG) announced that it was instituting a plan to assume the responsibility collecting state sales tax from insurance companies for network participant shops.

In January 2006, the Minnesota Department of Revenue, Sale and Use Tax division approved HSG's request to be allowed to be the responsible party for administering the retail sales tax charge to the respective insurance companies. CLICK HERE to read the text of the original notice HSG received approving the company to handle the sales tax for network shops.

Last week, the company received a letter from the Department of Revenue rescinding the approval that was granted four months prior. The second letter, dated May 24, gave no specific reason for the change, stating only that, "the Minnesota Department of Revenue, Sale and Use Tax division has reconsidered its position on the handling of Minnesota sales tax by auto glass replacement companies and by glass service handlers such as Harmon Solutions Group."

The letter further stated that HSG "should no longer purchase the glass replacement service from the auto glass replacement companies exempt from Minnesota sales tax."

Representatives from HSG say they quickly made the changes necessary to abide by the state's decision.

"Basically, HSG wanted to work to be a good corporate citizen-as it always has-and follow whatever guidelines the state bodies set forth. We've been completely compliant with what the state has requested, each time," said HSG president Paul Gross.

The Minnesota Independent Auto Glass Association (MIAGA) has issued a statement on the Department of Revenue ruling. CLICK HERE to read the MIAGA statement.