Laws, Regulations & Annotations

Business Taxes Law Guide – Revision 2013
 

Sales and Use Tax Annotations


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P

435.0000 PRODUCING, FABRICATING AND PROCESSING PROPERTY FURNISHED BY CONSUMERS—GENERAL RULES—Regulation 1526

Annotation 435.1655

(c) MISCELLANEOUS OPERATIONS

435.1655 Tank Production. A taxpayer in the business of manufacturing petroleum products "revamps" tanks by taking a customer's three 27,000-gallon tanks and remaking them into six 13,500-gallon tanks. The labor to produce six tanks out of three constitutes the creation of a new product and is not merely repair or reconditioning of the old tanks. The taxpayer's cutting the original tanks in half, adding new bottom heads and cone tops, new fittings, new lift lugs, new labels, new coatings and linings, and some or all new seismic clips, with appropriate welding is fabrication labor under section 6006(b). Charges for the labor to produce the six tanks are subject to tax. 5/6/99. (2000–1).