LR 8353
Taxability of Food Pick-Up or Delivery Sold by Marketplace Facilitator
April 30, 2025
Dear Applicant:
This is a letter ruling issued by the Director of Revenue under Section 536.021.10, RSMo, and Missouri Code of State Regulations 12 CSR 10-1.020, in response to your letter dated March 14, 2025.
The facts as presented in your letter ruling request are summarized as follows:
Applicant, located outside of Missouri, operates an online website and mobile application that allows customers to order food and beverages for pick-up or delivery from restaurants in their area. When ordering, the customer chooses if they wish to pick up the food themselves or have the food delivered to their location. If the customer chooses delivery, the Applicant then contracts with another food delivery company operating in the state to utilize the other company’s drivers for delivery purposes. Applicant does not have any employees making deliveries in Missouri. All deliveries are performed by either employees or independent contractors of another food delivery company.
The orders completed through Applicant’s platforms work as follows:
1. A customer will access the Applicant’s platform online or through a mobile application and make a selection of which restaurant they would like to order from.
2. The customer selects the items they wish to order, then remits the payment on the Applicant’s mobile application or website. The customer is charged for the food/drink cost, a delivery fee if the customer chooses a delivery option, a convenience fee for placing the order through the Applicant’s platform, and tax. The customer may also choose to leave a tip for the delivery driver.
3. Once the payment is processed, Applicant receives the payment from the third-party payment processor, retains the convenience fee, then sends the restaurant its part of the payment.
ISSUE 1:
Does Applicant meet Missouri’s definition of a marketplace facilitator?
RESPONSE 1:
Yes. Applicant meets Missouri’s definition of a marketplace facilitator.
Section 144.752.1, RSMo, provides:
For the purposes of this Section, the following terms shall mean:
(1) “Marketplace facilitator”, a person that:
(a) Facilitates a retail sale by a marketplace seller by listing or advertising for sale by the marketplace seller, in any forum, tangible personal property or services that are subject to tax under this chapter; and
(b) Either directly or indirectly, through agreements or arrangements with third parties, collects payment from the purchaser and transmits all or part of the payment to the marketplace seller.
Applicant facilitates retail sales for marketplace sellers and collects payment from the purchaser through arrangements with third parties. Therefore, Applicant is a marketplace facilitator.
ISSUE 2:
Does Applicant have an obligation to collect and remit use tax from the marketplace sellers located in Missouri?
RESPONSE 2:
No. Applicant does not have an obligation to collect and remit use tax from the marketplace sellers described above. Applicant may transfer sales taxes collected on behalf of Missouri restaurants to those restaurants, but those Missouri restaurants are the sellers with primary reporting and remittance obligations under Missouri sales tax law.
Section 144.020.1, RSMo, provides:
[…]The rate of tax shall be as follows:
(1) Upon every retail sale in this state of tangible personal property […][.]
According to Section 144.021.1, “[t]he primary tax burden is placed upon the seller making the taxable sales of property[.]”
Pursuant to Section 144.752.2(1), RSMo,:
Beginning January 1, 2023, marketplace facilitators that engage in business activities within this state shall register with the department to collect and remit use tax, as applicable, on sales made through the marketplace facilitator’s marketplace by or on behalf of a marketplace seller that are delivered into the state[.]
(emphasis added).
As stated above, the primary responsibility to collect and remit sales tax is on the seller. Applicant is not responsible as a Marketplace Facilitator under Section 144.752, RSMo, because that is specific to the collection of use tax for goods delivered into this state. An order from a Missouri restaurant to a Missouri customer does not involve the delivery of goods ‘into this state,’ and is subject to sales tax.
ISSUE 3:
Is Applicant required to collect and remit tax as a Marketplace Facilitator on sales to Missouri diners, from out of state restaurants?
RESPONSE 3:
Yes. Applicant is required to collect and remit tax as a Marketplace Facilitator for out of state restaurant orders that are being delivered into Missouri.
Section 144.752 RSMo, provides:
(1) Beginning January 1, 2023, marketplace facilitators that engage in business activities within this state shall register with the department to collect and remit use tax, as applicable, on sales made through the marketplace facilitator's marketplace by or on behalf of a marketplace seller that are delivered into the state…
According to the Applicant, they are a Marketplace Facilitator. As a Marketplace Facilitator for orders from out of state being delivered into the state, they would be responsible for collecting and remitting use tax.
ISSUE 4:
Does Applicant have a registration requirement in Missouri?
RESPONSE 4:
Possibly. Section 144.752.2 RSMo, provides:
Beginning January 1, 2023, marketplace facilitators that engage in business activities within this state shall register with the department to collect and remit use tax, as applicable…
Section 144.605.2e(e) defines engaging business in this state as “selling tangible personal property for delivery into this state, provided the seller’s gross receipts from taxable sales from deliver of tangible personal property into this state in the previous calendar year or current calendar year exceeds one hundred thousand dollars.” As noted above, Applicant qualifies as a marketplace facilitator, and if responsible for facilitating $100,000 worth of sales, then they would be required to register and remit use tax with the department.
This letter ruling is binding upon the Department of Revenue with respect to the Applicant for three (3) years from the date of this letter and is subject only to statutory changes by the General Assembly and to changes in the interpretation of law by the courts or administrative tribunals. If a change occurs, the taxpayer who relies upon an outdated interpretation may be subject to additional taxes, interest and penalties, which may be imposed prospectively from the date of the change. For this reason, the interpretation set forth above should be reviewed on a regular basis. Please note that any change in or deviation from the facts as presented will render this ruling inapplicable.
Should additional information be needed, please contact Associate Counsel J. Ross Shelton, General Counsel’s Office, Post Office Box 475, Jefferson City, Missouri 65105-0475 (phone 573-751-0961), or me.
Sincerely,
Trish Vincent