A policy letter dated April 14, 2003, and written by the Iowa Department of Revenue and Finance clarifies that drain cleaning and unplugging toilets, sinks and sewers are subject to Iowa sales tax and local option tax, if applicable, under the enumerated service of "pipe fitting and plumbing."

The department is publishing this clarification because it is aware that contrary advice may have been provided in the past. Businesses that have not collected sales tax in the past should start collecting tax on these services immediately.

The taxation of pipe fitting and plumbing is addressed in department rule 701 IAC 26.36, which states:

701-26.36(422) Pipe fitting and plumbing. Persons engaged in the business of pipe fitting and plumbing are rendering, furnishing or performing a service, the gross receipts from which are subject to tax. "Pipe fitting and plumbing" shall mean the trade of fitting, threading, installing and repairing of pipes, fixtures or apparatus used for heating, refrigerating, air conditioning or concerned with the introduction, distribution and disposal of a natural or artificial substance.

Iowa Department of Revenue
(6/10/03)