Sales Tax Articles
Sales Tax State Activity Update - January 2007
Florida - Natural Gas Exempt Use Must Be Exclusive Use
In a recent Technical Assistance Advisement, the Florida Department of Revenue indicates natural gas is taxable when purchased through a single meter and used in both taxable and nontaxable activities.
A Florida cabinet maker purchases natural gas through a single meter for its manufacturing facility. The invoice includes sales tax. The natural gas is used to heat the facility and also powers a boiler that is used directly in the taxpayer's manufacturing process.
Florida sales and use tax statutes provide an exemption for natural gas used as a combustible in an industrial manufacturing, processing, compounding process. In order to claim the industrial exemption, a purchaser must sign an exemption certificate stating the fuel is for the exclusive use as designated in the certificate. Since the certificate must indicate the exclusive use of fuel in manufacturing property for sale, the cabinet maker may not allocate the purchase of natural gas purchased through a single meter for purposes of the exemption.
The full text may be accessed on the State of Florida Department of Revenue website.
(Florida Department of Revenue, Technical Assistance Advisement No. 02A-053, 12/5/06)
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