DALLAS, May 6, 2016 /PRNewswire/ -- The Florida Legislature has passed House Bill 7099 (signed April 13 and effective July 1, 2016). House Bill 7099 makes permanent the existing sales and use tax exemption of certain manufacturing machinery and equipment. This exemption was previously scheduled to expire on April 30, 2017. House Bill 7099 also expands the exemption to include machinery and equipment used for certain agricultural postharvest activities (and associated repair parts, materials, and labor) and metals recycling.
The now-permanent exemption applies to industrial machinery and equipment purchased by eligible manufacturing businesses, used at a fixed location in Florida for the manufacture, processing, compounding, or production of tangible personal property for sale. In order to qualify for the exemption, the purchaser's primary business activity must be classified under codes 31, 32, 33, and 423930 (recyclable material merchant wholesalers) of the North American Industry Classification System (NAIC).
Qualifying machinery and equipment must:
- be used more than 50% of the time in the qualified business activity;
- have a depreciable life of at least three years; and
- be used as an integral part in the manufacturing, processing, compounding, or production of tangible personal property for sale, or an integral part in the recycling of metals for sale.
The prior temporary manufacturing exemption included mixer drums affixed to mixer trucks and the parts and labor required to affix drums to trucks. However, the provisions for mixer drums were specifically excluded from the permanent extension and currently remain scheduled to expire on April 30, 2017.
Other areas impacted by H.B. 7099 include:
- changes to the administration of tourist development taxes;
- modifications to the aviation fuel tax rate;
- clarifications to the tax on tobacco products;
- providing for an adjustment to the tax calculation on liquor and tobacco sold on cruise ships;
- providing that local governing bodies may decide whether to permit the Economic Development property tax exemption to new and expanding businesses located in enterprise zones; and
- establishment of an exemption from property tax, subject to approval by local governing bodies, for up to 20 years for data center equipment located in an enterprise zone; and
- creating a back-to-school sales tax holiday to run from August 5 through August 7, 2016.
Ryan is an award-winning global tax services firm, with the largest indirect and property tax practices in North America and the seventh largest corporate tax practice in the United States. With global headquarters in Dallas, Texas, the Firm provides a comprehensive range of state, local, federal, and international tax advisory and consulting services on a multi-jurisdictional basis, including audit defense, tax recovery, credits and incentives, tax process improvement and automation, tax appeals, tax compliance, and strategic planning. Ryan is a three-time recipient of the International Service Excellence Award from the Customer Service Institute of America (CSIA) for its commitment to world-class client service. Empowered by the dynamic myRyan work environment, which is widely recognized as the most innovative in the tax services industry, Ryan's multi-disciplinary team of more than 2,100 professionals and associates serves over 12,000 clients in more than 40 countries, including many of the world's most prominent Global 5000 companies. More information about Ryan can be found at ryan.com.
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