Distinction between construction contracting and certain related activities.
Gilbert Town Code, Reg. 58-415.2
in effectReg. 58-415.2. - Distinction between construction contracting and certain related activities.
(a) Certain rentals, leases, and licenses for use in connection with construction contracting. Rental, leasing, or licensing of earthmoving equipment with an operator shall be deemed construction contracting activity. Rental, leasing, or licensing of any other tangible personal property (with or without an operator) or of earthmoving equipment without an operator shall be deemed rental, leasing, or licensing of tangible personal property. For example:
(1) Rental of a backhoe, bulldozer, or similar earthmoving equipment with operator is construction contracting. Rental of these items without an operator is rental of tangible personal property.
(2) Rental of scaffolding, temporary fences, or barricades is rental of tangible personal property.
(3) Rental of pumps or cranes is rental of tangible personal property, whether or not an operator is provided with the equipment rented.
(b) Distinction between construction contracting, retail, and certain direct customer service activities.
(1) When an item is attached or installed on real property, it is a construction contracting activity and any subsequent repair, removal, or replacement of that item is construction contracting.
(2) Items attached or installed on tangible personal property are retail sales.
(3) Transactions where no tangible personal property is attached or installed are considered direct customer service activities (for example: carpet cleaning, lawn mowing, landscaping maintenance).
(4) Demolition, earth moving, and wrecking activities are considered construction contracting.
(c) Sale of consumable goods incorporated into or applied to real property is considered a retail sale and not construction contracting. Examples of consumable goods are lubricants, faucet washers, and air conditioning coolant, but not paint.
(d) Installation or removal of tangible personal property which has independent functional utility is considered a retail activity.
(1) "Tangible personal property which has independent functional utility" must be able to substantially perform its function(s) without attachment to real property. "Attachment to real property" must include more than connection to water, power, gas, communication, or other service.
(2) Examples of tangible personal property which has independent functional utility include artwork, furnishings, "plug-in" kitchen equipment, or similar items installed by bolts or similar fastenings.
(3) Examples of tangible personal property which does not have independent functional utility include wall-to-wall carpeting, flooring, wallpaper, kitchen cabinets, or "built-in" dishwashers or ranges.
(4) The installation of window coverings (drapes, mini-blinds, etc.) is always a retail activity.
(Tax Code 1995, Reg. 15-415.2)
Source: Town of Gilbert, Arizona, Town Code (Municode Library, library.municode.com)URL: https://library.municode.com/az/gilbert/codes/code_of_ordinances?nodeId=CO_CH58PREXTA_RERIEXTA_REG._58-415.2DIBECOCOCEREACFetched: 11/1/2026