Archive for Sales And Use Tax Manufacturing Exemption

Determination Of Property’s Taxability For Michigan Sales And Use Tax

In Michigan sales and use tax law determining whether an item of tangible personal property remains tangible personal property or becomes a fixture affixed to real estate can significantly affect the taxability of the item in question. This determination may impact whether the taxpayer is considered a retailer or a contractor.

There are also several exemptions in Michigan sales and use tax law for purchases of tangible personal property that do not apply if the item is instead a fixture. The Michigan sales and use tax exemptions for both the agricultural industry and the industrial processing or manufacturing industry include such language.

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North Carolina Sales And Use Tax Exemptions For Manufacturers Revised Effective July 1, 2018

North Carolina sales and use tax law provides an exemption for sales of mill machinery, machinery parts and manufacturing accessories, however these items are subject to a 1% privilege tax with a maximum tax of $80 per article until June 30, 2018. The 1% privilege tax has been repealed effective June 30, 2018 by Senate Bill 257 from the 2017 Legislative Session.  Beginning July 1, 2018 purchases of qualifying mill machinery, machinery parts and manufacturing accessories will be exempt from both North Carolina sales and use tax as well as the privilege tax. Read More

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Washington Sales And Use Tax Exemptions For Medical Products Purchased By Hospitals

Washington sales and use tax law considers hospitals and health care facilities to be the consumers of the medical supplies and equipment used in providing medical services to patients. The Washington sales and use tax exemptions that apply to certain purchases do so based upon the use of the item in question.

Prescription drugs for human consumption are exempt from Washington sales and use tax.  There is a three-pronged definition a substance must meet in order to be defined as a “drug” under Washington sales and use tax law.

First, it must be a substance that is listed in the official United States pharmacopoeia.  Second, it must be intended for use during the diagnosis, cure, mitigation, treatment or prevention of disease.  Third, the substance must affect the structure or function of the body.  Read More

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California Sales Tax Exemption for Manufacturing and R&D Machinery and Equipment

Beginning July 1, 2014 manufacturers in California are eligible for a partial exemption from state sales and use tax. This California sales tax exemption for manufacturing and research and development machinery and equipment reduces the state sales tax by 4.1875% from July 1, 2014 through December 31, 2016. From January 1, 2017 through June 30, 2022 the state sales tax rate is reduced by 3.9375%. In order to qualify for this exemption the “qualified tangible personal property” must be purchased or leased by a “qualified person” and used in one of four ways:

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