DOR RESPONDS TO SALES TAX EXEMPTION QUESTION

Richard Parsons, Tax Law Specialist with the Florida Department of Revenue (DOR), issued a Letter of Technical Advice Tuesday (September 12) in response to a letter from the

Agricultural Coalition as to whether electricity used in farm equipment buildings that are for storage, maintenance, and repairing of equipment qualifies for the exemption from sales tax.

Parsons agreed that “successful agricultural production is greatly aided by support facilities and that these facilities are important components of farm production,” but determined that “they serve an indirect function and are not used directly in the production or processing of farm products. Therefore, the electricity used in these facilities does not qualify for the sales tax exemption.”

Parsons went on to say that his letter “does not constitute the official position of the Department.”

FFVA still believes that the sponsors of the legislation intended to exempt electricity used in these buildings from sales tax. If DOR does not change its position, FFVA plans to urge the Legislature to readdress this issue next session.

For further information, Producer Members may contact the FFVA Government Affairs Office at (850) 521-0455.