17 NCAC 07B .0108          TRADE DISCOUNTS AND CASH DISCOUNTS

(a)  Trade and Bargaining Discounts. -- A trade discount is a reduction in the price a seller charges that is extended to a particular purchaser or group of purchasers without reservation at the time the sale is being negotiated. A bargaining discount is a reduction in the price a seller charges that is extended to a purchaser at the time the sale is being negotiated as a result of bargaining between the purchaser and the seller. The sales price of an item, as the term item is defined in G.S. 105-164.3, does not include a trade discount or bargaining discount that is not reimbursed by a third party.

(b)  Cash and Terms Discounts. -- A cash or terms discount is a reduction in the price a seller charges that is extended to the purchaser for prompt payment of an invoice. The sales price of an item does not include a cash or terms discount that is not reimbursed by a third party.

(c)  Trade-ins and Over-allowance. -- The amount of a trade-in, including an over-allowance, which is the difference between the trade-in amount and the actual cash value of the trade-in, taken by a purchaser as a credit or partial payment on the sale of an item is not a reduction in the sales price of the item. The trade-in is consideration given towards the purchase of the item. Any applicable sales or use tax shall be computed and paid on the sales price of the item without any deduction for a trade-in.

History Note:        Authority G.S. 105‑164.3; 105-164.4; 105-164.6; 105‑262; 105-264;

Eff. February 1, 1976.

Amended Eff. August 1, 2002;

Readopted Eff. January 1, 2024.