NOTE: There is no $5,000 cap on the local discretionary sales surtax on service agreements. Therefore, if the service agreement is $10,000 and you sell one to a person who resides in a county with a 1% discretionary sales surtax, you will collect a total of $700.00 in sales tax (7% of the service agreement amount of $10,000). The cost of the service contract is added to the cost of the laptop, and the entire amount is subject to sales tax at the rate in effect where Store A is located. Note: When a motor vehicle dealer sells a warranty, extended warranty, or service contract, the sale is generally taxable at the tax rate in effect where the customer is a resident. While Wisconsin's sales tax generally applies to most transactions, certain items have special treatment in many states when it comes to sales taxes. This page describes the taxability of optional maintenance contracts in Wisconsin, including parts purchased for use in performing service