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    Is the contractor allowed fee on material use tax?


    We suggest you discuss with your contracting team, program manager and/or legal department as appropriate. 
    It is unclear as to how your contract is structured and what type of contract you are using (FFP, CPFF, etc.).  Taxes are a normal cost of doing business and generally are part of the total cost input to which a G&A rate would be applied.  Cost of Money, although not attracting profit/fee itself would, as a rate, be applied to the taxes as well.  The fee is negotiable, but it is reasonable that these taxes are part of doing business and attract fee as do the other costs of doing business.

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