Tax 11.38 Note Example: Company JKL is in the business of custom making cabinets. A customer orders a cabinet from Company JKL. Due to time constraints, Company JKL is unable to make the cabinet. Therefore, Company JKL contracts with Company MNO to make the cabinet from materials provided by Company JKL. Company MNO is not subject to Wisconsin sales or use tax on the charge to Company JKL for making the cabinet if Company JKL provides Company MNO with a properly completed exemption certificate claiming resale.
Tax 11.38(2)(c) (c) Bending glass tubing into neon signs.
Tax 11.38(2)(d) (d) Bookbinding.
Tax 11.38(2)(h) (h) Cutting or crushing stones, gravel or other construction materials.
Tax 11.38(2)(n) (n) Laminating identification cards.
Tax 11.38(2)(o) (o) Making a fur coat from pelts, gloves or a jacket from a hide.
Tax 11.38(2)(p) (p) Making curtains, drapes, slip covers or other household furnishings.
Tax 11.38(2)(r) (r) Retreading tires.
Tax 11.38(2)(t) (t) Threading pipe or welding pipe.
Tax 11.38(3)(a) (a) Machinery and equipment used exclusively and directly in manufacturing.
Tax 11.38 Note Example: Company VWX is an electroplater. Company STU is a manufacturer of car bumpers. Company STU hires Company VWX to electroplate the bumpers. Company VWX may purchase the caustic soda, boric acid, etc., that is consumed or destroyed in the electroplating without Wisconsin sales or use tax when acting as a submanufacturer. These items are consumed or destroyed in the manufacture of tangible personal property, bumpers, destined for sale.
Tax 11.38 Note Note: Section Tax 11.38 interprets ss. 77.51 (14) (f) and (h), 77.52 (2) (a) 10. and 11., 77.54 and 77.55, Stats.
Tax 11.38 Note Note: For information regarding what is manufacturing and exemptions for machinery and equipment and other items used in manufacturing, refer to ss. Tax 11.39, 11.40 and 11.41.
Tax 11.38 History History: Cr. Register, October, 1976, No. 250, eff. 11-1-76; r. and recr. Register, June, 1993, No. 450, eff. 7-1-93; EmR0924: emerg. am. (title), (1) (title), (intro.), (a), (2) (e) and (3) (b), eff. 10-1-09; CR 09-090: am. (title), (1) (title), (intro.), (a), (2) (e) and (3) (b) Register May 2010 No. 653, eff. 6-1-10; correction in (3) (intro.) made under s. 13.92 (4) (b) 7., Stats., Register May 2010 No. 653.
Tax 11.39(1)(1) Definitions.
Tax 11.39(1)(a)1.1. Manufacturing means the production by machinery of a new article of tangible personal property or item or property under s. 77.52 (1) (b) or (c), Stats., with a different form, use, and name from existing materials, by a process popularly regarded as manufacturing.
Tax 11.39(1)(a)2. 2. Manufacturing does not include storing raw materials or finished units of tangible personal property or items or property under s. 77.52 (1) (b) or (c), Stats., research or development, delivery to or from the plant, or repairing or maintaining plant facilities.
Tax 11.39(1)(b) (b) "Plant" as defined in s. 77.51 (10b), Stats., means a parcel of property or adjoining parcels of property, including parcels that are separated only by a public road, and the buildings, machinery, and equipment that are located on the parcel, that are owned by or leased to the manufacturer. Plant inventory does not include unsevered mineral deposits as provided in s. 77.51 (10c), Stats.
Tax 11.39(2) (2)Scope of manufacturing.
Tax 11.39(2)(a)2. 2. Includes conveying work in progress directly from one manufacturing operation to another in the same plant.
Tax 11.39(2)(a)4. 4. Includes storing work in progress in the same plant where the manufacturing occurs.
Tax 11.39(2)(a)6. 6. Includes packaging a new article of tangible personal property or item or property under s. 77.52 (1) (b) or (c), Stats., if the manufacturer or another person on the manufacturer's behalf performs the packaging and if the packaging becomes part of the new article as it is customarily offered for sale by the manufacturer.
Tax 11.39(2)(b) (b) Manufacturing does not include storing raw materials or finished units of tangible personal property or items or property under s. 77.52 (1) (b) or (c), Stats., delivery to or from the plant, repairing or maintaining facilities, or research and development.
Tax 11.39(3)(a) (a) Asphalt plants.
Tax 11.39(3)(b) (b) Bakeries.
Tax 11.39(3)(e) (e) Candy factories.
Tax 11.39(3)(f) (f) Cement and concrete plants.
Tax 11.39(3)(g) (g) Chemical processing plants.
Tax 11.39(3)(i) (i) Creameries and instant milk producers.
Tax 11.39(3)(j) (j) Dairies and cheese plants.
Tax 11.39(3)(k) (k) Electric generating companies.
Tax 11.39(3)(o) (o) Glass making plants.
Tax 11.39(3)(om) (om) Heat treaters and metal platers performing these services on semi-finished products furnished by manufacturers.
Tax 11.39(3)(os) (os) Hide curers.
Tax 11.39(3)(q) (q) Machine and equipment producers.
Tax 11.39(3)(r) (r) Malting plants.
Tax 11.39(3)(t) (t) Motor vehicle and aircraft factories.
Tax 11.39(3)(v) (v) Paint factories.
Tax 11.39(3)(w) (w) Paper making plants.
Tax 11.39(3)(wd) (wd) Persons engaged in snowmaking for a ski hill.
Tax 11.39(3)(x) (x) Printers.
Tax 11.39(3)(y) (y) Sawmills.
Tax 11.39(3)(za) (za) Shoe and clothing factories.
Tax 11.39(3)(zb) (zb) Smelting and steel mills.
Tax 11.39(3)(zc) (zc) Tanneries.
Tax 11.39(3)(zg) (zg) Tire retreaders.
Tax 11.39(4)(d) (d) Fish hatcheries.
Tax 11.39(4)(f) (f) Highway truckers.
Tax 11.39(4)(h) (h) Laundries and dry cleaners.
Tax 11.39(4)(i) (i) Repairpersons.
Tax 11.39(4)(j) (j) Restaurants.
Tax 11.39(4)(k) (k) Television and radio stations.
Tax 11.39(4)(L) (L) Persons engaged in:
Tax 11.39(4)(L)1. 1. Corn shelling.
Tax 11.39(4)(L)2. 2. Experimental and development activities.
Tax 11.39(4)(L)3. 3. Logging and forestry operations.
Tax 11.39(4)(L)4. 4. Mining.
Tax 11.39(4)(L)5. 5. Paper recycling.
Tax 11.39(4)(L)6. 6. Photography.
Tax 11.39(4)(L)7. 7. Popping corn.
Tax 11.39(4)(L)10. 10. Custom slaughtering of animals.
Tax 11.39(4)(L)11. 11. Vending machine operations.
Tax 11.40(1)(d) (d) Section 77.54 (5) (d), Stats., provides an exemption for mobile mixing and processing units and the motor vehicle or trailer on which they are mounted, including accessories, attachments, parts, supplies and materials for those vehicles, trailers and units.
Tax 11.40(1)(e) (e) Section 77.54 (5) (c) and (26m), Stats., provide exemptions for certain motor vehicles, machinery and equipment used in waste reduction and recycling processes.
Tax 11.40 Note Note: See s. Tax 11.11 for more information on waste reduction and recycling exemptions.
Tax 11.40(2) (2)Conditions for exemption and examples. The exemption under sub. (1) (a) shall apply if all the following conditions are met:
Tax 11.40 Note Example: Machines and equipment of a dry cleaner are not used by a manufacturer in manufacturing, because a dry cleaner provides a service and is neither a manufacturer nor producer of tangible personal property or items or property under s. 77.52 (1) (b) or (c), Stats.
Tax 11.40(2)(b) (b) Machines and processing equipment shall be used exclusively in manufacturing.
Tax 11.40 Note Example: A forklift truck used on a production line to move products from machine to machine and used regularly or frequently in a warehouse to move and stock finished products is not used exclusively in manufacturing.
Tax 11.40(2)(c) (c) Machines and processing equipment shall be used directly in manufacturing. The exemption shall not apply if machines and processing equipment are not used directly in the step-by-step processes by which an end product results, even though the machine and equipment are indirectly related to the step-by-step processes. Machine foundations are real property improvements rather than personal property and do not qualify for exemption.
Tax 11.40 Note Example: Machines and equipment are not used directly in manufacturing if used for sweeping a plant; disposing of scrap or waste; plant heating or air conditioning; communications; lighting, safety, fire protection or prevention; research; storage; or delivery to or from a plant or repair or maintenance of machines, processing equipment or facilities. In addition, electric substations, tool storage facilities, water softening equipment, refrigerated storage facilities and catwalks that provide access to various parts of a building are not used directly in manufacturing.
Tax 11.40(3) (3)Other examples of the exemption. Other examples of application of the exemption are as follows:
Tax 11.40 Note Example: A lathe purchased by a manufacturer and used directly and exclusively to produce machines which are used on the manufacturer's production line is exempt. However, if the lathe is used partly for production of the machines and partly for repair purposes, it is not exempt.
Tax 11.40(3)(c) (c) The exemption applies if machines and processing equipment are used exclusively and directly by a manufacturer to produce component parts of tangible personal property or items or property under s. 77.52 (1) (b) or (c), Stats.
Tax 11.40(3)(d) (d) The exemption does not apply to machines or processing equipment used in whole or in part by a manufacturer before the manufacturing process has begun or after it has been completed.
Tax 11.40 Note Example: Machines or equipment used for storage, delivery to or from a plant, repair or maintenance of facilities or equipment, research, or crating or packaging of tangible personal property or items or property under s. 77.52 (1) (b) or (c), Stats., for shipment are not exempt.
Tax 11.40 Note Example: Sweeping compounds are factory supplies rather than processing equipment.
Tax 11.40 Note Example: Conveyor belts, grinding wheels, grinding balls, machine drills, auger bits, milling cutters, emery wheels, jigs, saw blades, machine tool holders, reamers, dies, molds and patterns used as replacement parts for exempt machines and processing equipment are exempt.
Tax 11.40 Note Note: Section Tax 11.40 interprets ss. 77.51 (7h) and 77.54 (5) (c) and (d), (6) (am) 1. and (cm), and (26m), Stats.
Tax 11.41 Tax 11.41 Exemption of property and items consumed or destroyed in manufacturing.
Tax 11.41(1) (1) General.
Tax 11.41(1)(a)(a) Tangible personal property and items under s. 77.52 (1) (b), Stats., that are used exclusively and directly by a manufacturer in manufacturing an article of tangible personal property or item or property under s. 77.52 (1) (b) or (c), Stats., that is destined for sale and that becomes an ingredient or component part of the article of tangible personal property or item or property under s. 77.52 (1) (b) or (c), Stats., destined for sale or is consumed or destroyed or loses its identity in manufacturing the article of tangible personal property or item or property under s. 77.52 (1) (b) or (c), Stats., destined for sale is exempt from Wisconsin sales or use tax under s. 77.54 (2), Stats., except as provided in s. 77.54 (30) (a) 6., Stats.
Tax 11.41(1)(b) (b) Manufacturing is defined in s. 77.51 (7h), Stats., to mean the production by machinery of a new article of tangible personal property or item or property under s. 77.52 (1) (b) or (c), Stats., with a different form, use, and name from existing materials, by a process popularly regarded as manufacturing, and that begins with conveying raw materials and supplies from plant inventory to the place where work is performed in the same plant and ends with conveying finished units of tangible personal property or item or property under s. 77.52 (1) (b) or (c), Stats., to the point of first storage in the same plant.
Tax 11.41(2)(a)4. 4. Cleaning compounds and solvents for maintaining exempt manufacturing machinery whether used while the machinery is operating or while the machinery is idle.
Tax 11.41(2)(a)7. 7. Fluxing material.
Tax 11.41(2)(a)8. 8. Foundry sand.
Tax 11.41(2)(a)10. 10. Lapping and grinding compounds.
Tax 11.41(2)(a)11. 11. Purification agents.
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Published under authority of s. 35.93, Stats. Updated on the first day of each month. Entire code is alwaycurrent. The date shown on each chapter is the date the chapter was last published.