SECTION .1100 ‑ SALES OF TOBACCO items: FARM MACHINES

AND MACHINERY

 

17 NCAC 07B .1101          FARM MACHINES: MACHINERY: TOBACCO ITEMS

(a)  Sales to farmers of farm machinery, attachment and

repair parts for farm machinery, and lubricants applied to farm machinery for

use by them in planting, cultivating, harvesting or curing of farm crops

including nursery or greenhouse stock and products of the forest, or to dairy

operators, poultry farmers, egg producers, and commercial producers of animals

are exempt from sales and use tax.  Sales of farm machinery, attachment and

repair parts for farm machinery, and lubricants applied to farm machinery to

farmers for any purpose or use not defined in this Rule, or to any person other

than a farmer as herein defined, even though for a use or purpose herein

defined, are subject to the applicable statutory state and local sales or use

tax without limitation.  In other words, to qualify for the exemption from

sales and use tax, the transaction must be a sale of farm machinery, attachment

and repair parts for farm machinery, and lubricants applied to farm machinery

to a farmer for one of the uses or purposes herein defined and unless all three

conditions are met, the sale is subject to the applicable statutory state and

local sales or use tax without limit.

(b)  Form E-595E, Streamlined Sales Tax Agreement

Certificate of Exemption, may be completed by a farmer or producer and accepted

by a vendor as the authority for exempting from the sales and use tax the

following:

(1)           farm machinery, attachment and repair parts

for farm machinery, and lubricants applied to farm machinery for use in

planting, cultivating, harvesting or curing farm crops, including nursery or

greenhouse stock and products of the forest, or for use in the production of

dairy products, poultry, eggs, livestock, fish or aquatic plants.

(2)           The lease or rental of tobacco sheets used

in handling tobacco in the warehouse and transporting tobacco to and from the

warehouse.

(3)           A metal flue sold for use in curing tobacco,

whether the flue is attached to a handfired furnace or used in connection with

a mechanical burner.

(4)           A bulk tobacco barn or rack, parts and

accessories attached to the tobacco barn or rack, and any similar apparatus,

part, or accessory used to cure or dry tobacco or another crop.

(5)           A grain, feed, or soybean facility, and

parts and accessories attached to the facility.

(6)           Containers for use in the planting,

producing, harvesting, curing, marketing, packaging, sale, or transporting or

delivery of products when such containers do not go with and become a part of

the sale of products.

(7)           Wrapping paper, labels, wrapping twine,

paper, cloth, plastic bags, cartons, packages and containers, wooden boxes,

baskets, coops, barrels, and like articles sold to farmers and producers when

such materials are used for packaging, shipment or delivery of tangible

personal property which is sold either at wholesale or retail and when such

articles constitute a part of the sale of such tangible personal property and are

delivered with it to the customer.

(c)  When a customer makes a purchase and executes a Form

E-595E, Streamlined Sales Tax Agreement Certificate of Exemption which is then

furnished to the vendor, the vendor is relieved of the liability for any

additional tax that is subsequently determined to be due and the purchaser has

assumed liability for the tax if the vendor has a fully completed Form E-595E

on file.  In the absence of the certificate or other documentation to support

an exemption from tax, the vendor is liable for any additional tax determined

to be due on a transaction.

(d)  The following are examples of sales of farm machinery,

attachment and repair parts for farm machinery, and lubricants applied to farm

machinery which are exempt when sold to farmers for use by them in planting,

cultivating, harvesting or curing farm crops:

(1)           tractors,

(2)           plows,

(3)           harrows,

(4)           cultivators,

(5)           mowers,

(6)           planters,

(7)           corn pickers and snappers,

(8)           manure spreaders,

(9)           manure loaders,

(10)         harvester threshers,

(11)         rotary tillers,

(12)         fertilizer distributors,

(13)         wind‑rowers,

(14)         forage blowers,

(15)         stalk cutters,

(16)         seeders,

(17)         grain loaders,

(18)         harvesters,

(19)         cotton pickers,

(20)         rotary hoes,

(21)         corn and hay elevators,

(22)         tobacco curers,

(23)         tobacco flues,

(24)         tobacco trucks or slides,

(25)         wagons,

(26)         non‑highway trailers,

(27)         mechanical rakes,

(28)         balers,

(29)         rod weeders,

(30)         combines,

(31)         tobacco transplanters,

(32)         shredders for corn stalks,

(33)         power loader lifts,

(34)         platform carriers,

(35)         portable insecticide sprayers,

(36)         chain saws,

(37)         motor oils, greases, lubricants and anti‑freeze;

(38)         hydraulic fluids.

(e)  Examples of items which are subject to the applicable

statutory state and local sales or use tax when sold to farmers for general

purposes:

(1)           lawn mowers;

(2)           snow plows;

(3)           oil storage tanks and fittings;

(4)           drainage tile;

(5)           paint, cleaning compounds and brushes;

(6)           baler twine;

(7)           tobacco sticks and tobacco twine;

(8)           tools for maintaining machinery and

equipment.

(f)  The lists in Paragraphs (d) and (e) of this Rule are

not intended to be exclusive, but are for illustrative purposes only. If there

is any question as to the tax status of any item which does not appear therein,

such question shall be submitted to the secretary, together with a detailed

statement of the business of the purchaser, the design and structure of the

article, and its use, to the end that the applicable rate of tax may be

correctly determined.

(g)  The word farmer as used in this Rule includes crop

farmers, dairy operators, poultry farmers, egg producers, livestock farmers,

nurserymen, greenhouse operators, farmers who raise fish or water plants,

orchardmen and other persons coming within the generally accepted definition of

the word.  It does not include a person who merely cultivates a garden for

personal use.

 

History Note:        Authority G.S. 105‑164.4; 105‑164.6;

105-164.13; 105‑262; Article 39; Article 40; Article 42; Article 43;

Article 44;

Eff. February 1, 1976;

Amended Eff. June 1, 2006; August 1, 1996; April 1, 1995;

July 1, 1994; October 1, 1993; June 1, 1992.