[Code of Federal Regulations]

[Title 48, Volume 1]

[Revised as of October 1, 2005]

From the U.S. Government Printing Office via GPO Access

[CITE: 48CFR29.101]



[Page 568-569]

 

            TITLE 48--FEDERAL ACQUISITION REGULATIONS SYSTEM

 

                CHAPTER 1--FEDERAL ACQUISITION REGULATION

 

PART 29_TAXES--Table of Contents

 

                          Subpart 29.1_General

 

Sec. 29.101  Resolving tax problems.





    (a) Contract tax problems are essentially legal in nature and vary 

widely. Specific tax questions must be resolved by reference to the 

applicable contract terms and to the pertinent tax laws and regulations. 

Therefore, when tax questions arise, contracting officers should request 

assistance from the agency-designated legal counsel.

    (b) To keep treatment within an agency consistent, contracting 

officers or other authorized personnel shall consult the agency-

designated counsel before negotiating with any taxing authority for the 

purpose of (1) determining whether or not a tax is valid or applicable 

or (2) obtaining exemption from, or refund of, a tax.

    (c) When the constitutional immunity of the Government from State or



[[Page 569]]



local taxation may reasonably be at issue, contractors should be 

discouraged from negotiating independently with taxing authorities if 

the contract involved is either (1) a cost-reimbursement contract or (2) 

a fixed-price contract containing a tax escalation clause.

    (d) Before purchasing goods or services from a foreign source, the 

contracting officer should consult the agency-designated counsel (1) for 

information on foreign tax treaties and agreements in force and on the 

implementation of any foreign-tax-relief programs and (2) to resolve any 

other tax questions affecting the prospective contract.