Manufacturing

 

DEPARTMENT OF REVENUE
Sales and Use Tax

RULE NO: RULE TITLE
12A-1.043: Manufacturing

NOTICE OF CHANGE

Notice is hereby given that the following changes have been made to the proposed rule in accordance with subparagraph 120.54(3)(d)1., F.S., published in Vol. 34 No. 12, March 21, 2008 issue of the Florida Administrative Weekly.

In response to written comments received from the Joint Administrative Procedures Committee, dated April 10, 2008, the Department has changed the proposed amendments to paragraphs (d), (e), (f), and (g) of subsection (6) of Rule 12A-1.043, F.A.C., Manufacturing. When adopted, those paragraphs will read as follows:

(d)1. Materials and labor may be purchased tax-exempt when the purchaser extends an exemption certificate to the vendor or supplier certifying that the materials and labor will be used directly and solely for research or development purposes, as provided in Section 212.052, F.S. Any person, including affiliated groups, as defined in s. 1504 of the Internal Revenue Code, as amended, who manufactures, produces, compounds, processes, or fabricates in any manner tangible personal property for such taxpayer’s own use directly and solely in research or development shall not be subject to the tax upon the cost of the product so manufactured, produced, compounded, processed, or fabricated for the purpose of research and development. However, the tax shall be due on the purchase, rental, or repair of real property or tangible personal property employed in research or development.

2. The following is a suggested format for an exemption certificate for purchases of materials and labor:

EXEMPTION CERTIFICATE

ITEMS OF TANGIBLE PERSONAL PROPERTY
AND LABOR

USED IN RESEARCH OR DEVELOPMENT

This is to certify that purchases of tangible personal property or labor on or after                                                   (date) from                         (Selling Dealer’s Business Name) will be directly and solely used in research or development activities, as provided in Section 212.052, Florida Statutes.  These research or development activities are located at:

___________________________________

(Street)

___________________________________

(City and State)

I understand that if I fraudulently issue this certificate to evade the payment of tax, I will be liable for payment of the tax plus a penalty of 200% of the tax and be liable for fine and punishment provided by law for conviction of a felony of the third degree, as provided in Sections 775.082, 775.083, or 775.084, Florida Statutes.

Under penalties of perjury, I declare that I have read the foregoing document and that the facts stated in it are true.

_________________________________________________

Purchaser’s Name (Print or Type)Purchaser’s Address

________________________________________________

Signature and TitleFlorida Sales and Use Tax Number
(if applicable)

________________________________________________

DateFederal Employer’s Identification
Number (if applicable)

(e)1. Machinery and equipment, including materials and labor used in the self-fabrication of machinery and equipment, may be purchased or leased tax-exempt when the purchaser extends an affidavit to the vendor or supplier stating that the item(s) will be used predominantly for research or development purposes, as provided in Section 212.08(18), F.S.

2. The following is a suggested format of an affidavit to be provided to the selling dealer or lessor:

AFFIDAVIT

MACHINERY AND EQUIPMENT USED
IN RESEARCH OR DEVELOPMENT

I, the undersigned individual, hereby swear and affirm that the purchase(s) or lease(s) of machinery and equipment, including materials and labor used in the self-fabrication of machinery and equipment, on or after____________(date) from___________________(Selling Dealer’s Business Name), will be used predominantly in research or development activities, as provided in Section 212.08(18), Florida Statutes.

These research or development activities are located at:

______________________________________

(Street)

______________________________________

(City and State)

I understand that if I fraudulently issue this affidavit to evade the payment of Florida sales tax, I will be liable for payment of the tax plus a penalty of 200% of the tax and be subject to conviction of a third degree felony.

Under the penalties of perjury, I swear or affirm that I have read the foregoing affidavit and that the facts stated herein are true to the best of my knowledge and belief.

_______________________________

Purchaser’s Name (Print or Type)

________________________________

Signature and Title

________________________________

Date

Sworn to and subscribed before me this_________day of _________20________BY                (name of person making statement).

Personally Known:________________________

Or Produced Identification:____Signature of Notary

Type of Identification Produced:____(Print, Type, or Stamp

Commissioned Name of
Notary)

(f) Instead of furnishing an exemption certificate, as provided in paragraph (d), or an affidavit, as provided in paragraph (e), any purchaser who holds a valid Sales and Use Tax Direct Pay Permit, as provided in Rule 12A-1.0911, F.A.C., may extend a copy of the permit to the selling dealer to make purchases tax-exempt under this subsection.

(g)(e) The tax imposed by Section 212.052, Florida Statutes shall apply to any product of research or development that is tangible personal property which is offered for sale. When a prototype or product of research or development is used by the developer for any purpose other than research or development, including being offered for sale, it is subject to tax shall be taxable.