Certain Pasteurization Devices Exempt from Sales Tax as Research and Development Equipment in Missouri

Thursday, May 10th, 2012

 
 
Share
Link
Missouri
General

The Missouri Department of Revenue recently issued a letter ruling discussing the taxability of research and development (R&D) equipment in the state. Mo. Ltr. Rul. No. LR 7079 (Dept. of Revenue Apr. 13, 2012). The Applicant works in the dairy industry and wanted to purchase a large pasteurization device to test the effects of very high heat pasteurization on its own products in terms of flavor and color. The Applicant wanted to know whether this type of equipment would be exempt from state and local sales tax as R&D equipment.

R&D equipment is generally exempt from state sales tax. However, only R&D equipment purchased for use or consumption directly or exclusively in the R&D of agricultural, biotechnology, plant genomics products, and prescription pharmaceuticals consumed by humans and animals are also exempt from local sales tax. R&D equipment purchased and used in R&D related to manufacturing, processing, compounding, mining or producing any product will be exempt from states sales tax, but not local sales tax.

The Applicant plans on using the large pasteurization device to test the effect of very high heat pasteurization on its own products in terms of flavor and color. This use amounts to a research or experimentation activity related to manufacturing. Therefore, this type of R&D equipment will be exempt from state sales tax, but not local sales tax.


About TTR

Transaction (buying or selling things), Tax (the tax on this activity), Resources (our people, our website, our support services) - TTR, Inc.

TTR has a website that companies subscribe to and use daily. This website provides a list of everything that can be bought or sold in the U.S. It provides simple answers to whether buying or selling these items is taxable (subject to a sales tax or other tax), and it provides all the legal authority to support these tax answers.

TTR likes to keep things simple and fun, which is why it has great people who provide help to clients on any support questions they have about transaction tax issues.

Please visit TTR on the web at www.ttrus.com or call 866.578.8193.

New York Adopts New Economic Nexus Rule

Wednesday, January 23rd, 2019 -Effective January 2019, a retailer located outside of New York is required to collect use tax if, during the p...

New Commercial Farmer Certification Process in Louisiana

Monday, January 21st, 2019 -Effective January, 15, 2019, the Louisiana Department of Revenue has a new certification process for commercia...

Service Repairs to Petroleum Storage Tanks Exempt in...

Friday, January 18th, 2019 -Louisiana's Board of Tax Appeals recently ruled that repairs on petroleum storage tanks were not taxable. ...

Nevada Exempts Feminine Hygiene Products in 2019

Wednesday, January 16th, 2019 -Last year, Nevada voters approved via ballot measure changes to the Sales and Use Tax Act of 1955. Voters amen...

Cleaning of Beer-Tap Lines Not Taxable in Ohio

Monday, January 14th, 2019 -The Supreme Court of Ohio recently ruled that cleaning beer-tap lines is not taxable. The taxpayer was...

Louisiana Court of Appeals Finds Marketplace Facilitators...

Friday, January 11th, 2019 -The Louisiana Court of Appeals has recently addressed the sales tax liability of marketplace facilitators. A c...