LR 8381
Taxability of Propane Cylinders and Firewood Sold at Grocery Stores
January 26, 2026
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 December 4, 2025.
The facts as presented in your letter ruling request are summarized as follows:
Applicant operates supermarkets with multiple locations in Missouri. It sells small cylinders (10 pounds) filled with liquid propane. Customers may purchase either full cylinders ("purchase") or return and exchange previously used empty cylinders ("exchange"). The price varies depending on whether it is a purchase or an exchange. Applicant does not show either by weight or value the amount of propane in the differing cylinders. Because applicant does not separately state the amount of propane in the cylinder either by weight or value, applicant charges and collects sales tax on the full sale amount of either the purchase or exchange transaction.
Applicant offers small bundles of firewood for sale, usually 8 to 10 pieces of 16-inch split firewood. Generally, customers purchase one or two bundles at a time. Applicant has never been informed that the purchases would be for heating customer residences, and such would be unlikely given the small amount of wood purchased. Applicant charges and collects sales tax on the full sale amount of the small wood bundles.
ISSUE 1:
Must sales tax be collected on sales of propane cylinders?
RESPONSE 1:
Yes. Sales tax must be collected on the sale of propane cylinders.
Section 144.020.1(1), RSMo, imposes "[u]pon every retail sale in this state of tangible personal property, ... a tax equivalent to four percent of the purchase price paid or charged..."
Section 144.010.1(13), RSMo, defines retail sale to mean "... any transfer made by any person engaged in business as defined herein of the ownership of, or title to, tangible personal property to the purchaser, for use or consumption and not for resale..."
Section 144.030.2(23), RSMo, exempts "all sales of metered water service, electricity, electrical current, natural, artificial or propane gas, wood, coal or home heating oil for domestic use."
Section 144.030.2(23), RSMo, refers to "domestic use" as "nonbusiness, noncommercial, or nonindustrial purposes" by "an individual occupant of a residential premises."
To qualify for the exemption the sale must be for domestic use. Applicant should create and maintain a system to determine whether or not a purchase is exempt and non-exempt.
ISSUE 2:
Must sales tax be collected on sales of small bundles of firewood?
RESPONSE 2:
Yes. Sales tax must be collected on sales of small firewood bundles.
See Response 1.
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 Senior Counsel Kent L. Brown, General Counsel's Office, Post Office Box 475, Jefferson City, Missouri 65105-0475, phone (573) 751-0961.
Sincerely,
Trish Vincent