Colorado cleanroom sales tax exemption suspended, July 2016
- Sales Tax News
- Jun 23, 2016 | Gail Cole
The fate of one of Colorado’s sales tax exemptions depends each year on the health of the state’s General Fund. When there is sufficient revenue to allow General Fund appropriations to increase by at least 6 percent, the exemption stands. Where the 6 percent threshold is not met, the exemption is suspended.
The June 2016 Economic and Revenue Forecast states the appropriations will not increase by at least 6 percent in Fiscal Year 2015-16 or FY 2016-17. “As a result, the sales tax refund for cleanrooms will no longer be available beginning in July 2016.”
The cleanroom machinery sales and use tax exemption applies when the cleanroom is used to produce tangible personal property such as computer components, microprocessors, blank and written software media, biotechnological products, nanotechnological product, photonic products, and pharmaceuticals. “Cleanroom” is defined as “an environment with a level of environmental pollutants such as dust, airborne microbes, aerosol particles, and chemical vapors equal to or less than the maximum number of particles per cubic meter.” Additional qualifications apply (Colorado Department of Revenue FYI Sales 73).
Also suspended is the historic property preservation tax credit for tax year 2016. It will likely not be available for tax year 2017, either, but that has yet to be determined.
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