If an out-of-state customer purchases product from a business and hires a delivery company to take possession of the product at the business’ location and deliver the product to the customer, is the transaction subject to sales tax?

When a customer hires a shipping company to pick up product the customer has purchased and the customer pays the shipping company directly, the shipping company becomes the customer’s agent. As such, the actions of the shipping company are considered actions of the customer. The transaction is subject to sales tax because the product transfers to the customer/customer’s agent at the Tennessee seller’s location.

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