Florida Department of Revenue

TIP #98(A)1-28
Date Issued: 12/30/98

Beginning January 1, 1999, Pollution Control Equipment for Manufacturing Facilities Will Be Exempt From Sales and Use Tax

The 1998 Legislature provided an exemption from sales and use tax for pollution control equipment for manufacturing facilities.  This exemption is subject to the following limitations:

• Transactions for the purchase or lease, reconstruction, repair, or replacement of any facility, device, fixture, equipment, machinery, or structure used primarily for the control or abatement of pollution or contaminants in manufacturing, processing, compounding, or producing items of tangible personal property for sale at fixed locations shall not be subject to sales and use tax.  Such transactions must be completed, or lease payments made, on or after January 1, 1999.  Transactions completed, or lease payments made, prior to January 1, 1999, are not eligible for exemption.
• To qualify, such items must be installed or constructed to comply with a law implemented by, or a condition of a permit issued by, the Florida Department of Environmental Protection.
• The purchaser of the pollution control equipment must sign a certificate stating that the equipment, machinery, or materials to be exempted are required to meet such law or permit condition.  A suggested format for the certificate is enclosed.
• The exemption is available to the manufacturer, to the general contractor, and to the general contractor's subcontractors.

To exempt the qualifying purchase(s), the owner or operator of the facility must give a certificate of exemption to the contractor or vendor.  The contractor, in turn, would issue its own certificate to its subcontractors or to the vendor along with a copy of the certificate provided by the owner or operator.  This process continues from subcontractors to subsubcontractors until the actual purchase order is issued to the vendor or supplier for the qualifying equipment, machinery, or materials.

When extending a certificate for this exemption do not include another business entity's Certificate of Registration number (sales tax number) or Direct Pay Certificate number.  A Certificate of Registration number or Direct Pay Certificate number may be used only by the business entity to which it was assigned.

The owner/operator, the contractor, and the subcontractors should retain all documents and records that could be used to support this exemption.  These documents include, but are not limited to: (1) photocopies of certificates; (2) purchase orders; (3) invoices; (4) depreciation schedules; (5) chart of accounts; and, (6) permits.

For More Information

References:s. 212.051, F.S.