Taxation of service warranties.

(1) It is the intent of the Legislature that every person is exercising a taxable privilege who engages in this state in the business of soliciting, offering, providing, entering into, issuing, or delivering any service warranty.

(2) For exercising such privilege, a tax is levied on each taxable transaction or incident, which tax is due and payable at the rate of 6 percent on the total consideration received or to be received by any person for issuing and delivering any service warranty.

(3) For purposes of this section, “service warranty” means any contract or agreement which indemnifies the holder of the contract or agreement for the cost of maintaining, repairing, or replacing tangible personal property. The term “service warranty” does not include contracts or agreements to repair, maintain, or replace tangible personal property if such property when sold at retail in this state would not be subject to the tax imposed by this chapter or if the parts and labor to repair tangible personal property qualify for an exemption under this chapter, nor does it include such contracts or agreements covering tangible personal property which becomes a part of real property.

(4) Such tax shall be in addition to the total amount of the consideration for the service warranty, shall be charged by the person receiving such consideration from the service warranty agreement holder, and shall be due and payable by such person at the time he or she receives such consideration. Such person shall remit the tax to the department at the times and in the manner provided for dealers to remit taxes on tangible personal property under this chapter.

(5) This tax is in addition to all other taxes, whether levied in the form of excise, license, or privilege taxes, and is in addition to all other fees and taxes levied.

(6) This tax shall be due and payable according to the algorithm provided in s. 212.12.

(7) This tax shall not apply to any portion of the consideration received by any person in connection with the issuance of any service warranty contract upon which such person is required to pay any premium tax imposed under the Florida Insurance Code or under s. 634.313(1).

(8) If a transaction involves both the issuance of a service warranty that is subject to such tax and the issuance of a warranty, guaranty, extended warranty or extended guaranty, contract, agreement, or other written promise that is not subject to such tax, the consideration shall be separately identified and stated with respect to the taxable and nontaxable portions of the transaction. If the consideration is separately apportioned and identified in good faith, such tax shall apply to the transaction to the extent that the consideration received or to be received in connection with the transaction is payment for a service warranty subject to such tax. If the consideration is not apportioned in good faith, the department may reform the contract; such reformation by the department is to be considered prima facie correct, and the burden to show the contrary rests upon the dealer. If the consideration for such a transaction is not separately identified and stated, the entire transaction is taxable.

(9) Any claim which arises under a service warranty taxable under this section, which claim is paid directly by the person issuing such warranty, is not subject to any tax imposed under this chapter.

(10) Materials and supplies used in the performance of a factory or manufacturer’s warranty are exempt if the contract is furnished at no extra charge with the equipment guaranteed thereunder and such materials and supplies are paid for by the factory or manufacturer.

(11) Any duties imposed by this chapter upon dealers of tangible personal property with respect to collecting and remitting taxes; making returns; keeping books, records, and accounts; and complying with the rules and regulations of the department apply to all dealers as defined in s. 212.06(2)(l).