Are lessors allowed to accept direct pay permits in NJ?
The Direct Pay authority provided in the Sales & Use Tax Act only allows a direct pay permit to be issued to a purchaser who acquires tangible personal property or services under circumstances which make it impossible at the time of acquisition to determine the manner in which the property or services to be used. The Direct Pay Permit (ST-6A) cannot be used where the taxability is not in question at the time of the purchase. There does not appear to be any basis for issuing a Direct Pay Permit to a leasing company. If the property itself or the lessee of the property is entitled to a sales tax exemption, the appropriate exemption certificate should be provided to the lessor. (e.g. ST-4, ST-5, ST-7) The Division also issues Direct Pay (Audit) Certificates (ST-6X). The holder of an ST-6X is generally authorized to pay the tax directly to the Division rather than to the vendor of taxable goods and services. The holder of a Direct Pay (Audit) Certificate may issue the Certificate to a less
