Is a Bambu franchisee required to reimburse Bambu for state sales taxes on goods furnished to the franchisee?
Bambu Franchise · 2025 FDDAnswer from 2025 FDD Document
- 24.12 Payment of Taxes.
Franchisee shall reimburse Bambu, or its affiliates and designees, promptly and when due, the amount of any state sales taxes, use taxes, personal property taxes and similar taxes imposed upon, required to be collected or paid by Bambu, or its affiliates or designees, on account of services or goods furnished by Bambu, its affiliates or designees, to Franchisee through sale, lease or otherwise (except for any taxes Bambu or its affiliates are required by law to collect from Franchisee with respect to products purchased from Bambu and its affiliates), or on account of collection by Bambu of the franchise fee, or any other payments made by Franchisee to Bambu required under the terms of this Agreement.
Source: Item 23 — Receipts (FDD pages 52–209)
What This Means (2025 FDD)
According to Bambu's 2025 Franchise Disclosure Document, a franchisee is required to reimburse Bambu for state sales taxes. Specifically, the franchisee must promptly pay Bambu, its affiliates, or designees the amount of any state sales taxes, use taxes, personal property taxes, and similar taxes. This reimbursement covers taxes imposed on, required to be collected, or paid by Bambu, its affiliates, or designees.
The reimbursement applies to taxes on account of services or goods furnished by Bambu, its affiliates, or designees to the franchisee through sale, lease, or otherwise. However, this excludes any taxes Bambu or its affiliates are legally required to collect from the franchisee concerning products purchased from Bambu and its affiliates. The reimbursement also covers taxes on the collection of the franchise fee or any other payments made by the franchisee to Bambu as required by the franchise agreement.
This means that if Bambu is required to pay sales, use, or personal property taxes on goods or services it provides to the franchisee (excluding the products the franchisee purchases for resale where Bambu is already collecting sales tax), the franchisee must reimburse Bambu for those tax amounts. This is a fairly standard practice in franchising, ensuring that the franchisor does not bear the tax burden on items furnished to the franchisee.