Laws, Regulations & Annotations
Business Taxes Law Guide – Revision 2017
Sales and Use Tax Annotations
440.0000 PROPERTY USED IN MANUFACTURING—Regulation 1525
(a) MANUFACTURING AIDS
(4) Paper Products; Explosives—Chemicals Used In Manufacture Of
440.0400 Paper Products. The following chemicals and compounds are taxable manufacturing aids:
(1) Busan 90—a bromohydroxy acetophenone product which is injected into wood pulp slurries, processing water and paper coatings to prevent the growth of bacteria and formation of slime in pulp and on finished paper.
(2) Sodium Hydroxide (Caustic Soda), Calcium Carbonate (Limestone) and Sodium Sulphate—used to charge an alkaline cooking liquor which digests wood chips, leaving cellulose pulp. (3) Chlorine and Sodium Hydroxide—combined to make Sodium Hypochlorite which is used to bleach kraft pulp.
(4) Chlorine—used in multi-stage bleaching of kraft pulp; combines with lignin, rendering it reactive for subsequent bleaching operations.
(5) Sodium Silicate, Magnesium Sulphate, Trisodium Phosphate and Versenek 80 (Diethylenetriamine—Penta-Acetic Acid)—combined to make a bleaching solution for ground wood pulp. These chemicals act as stabilizers, preventing premature disassociation by pulp impurities.
(6) Sodium Hydroxide—used in caustic-extraction stage of kraft bleaching operations; serves in removal of water-soluble chlorinated lignin material.
(7) Sulphuric Acid, Sodium Chlorate and Sulphur Dioxide—combined to make a chlorine dioxide compound used for bleaching kraft pulp.
(8) Vanzak 112—liquid used as dispersant for pitch in kraft and ground wood pulps. Most of it is eventually washed out of the pulp.
(9) Defoamers (NOPCO DF-120, DF-160 and DF-303)—detergent compounds which are used to inhibit foaming in the process of manufacturing paper. They also serve as aids in the retention of fine pulp particles. The major portion of such defoamers is flushed away with other process effluents.
The following chemicals and compounds, or their constituents, become components of pulp and finished paper products, and thus may be purchased ex-tax for resale by a paper manufacturer.
(1) Mistron Talc—a Magnesium Silicate compound, which is added to wood pulp to control deposition of pitch and remains as a desirable component of finished paper.
(2) Ammonium Hydroxide—used as a mineral dispersant; becomes a component of the waterproof surface coating of finished paper.
(3) Sodium Hydroxide and Sulphur Dioxide—used to control reaction rates in peroxide bleaching of ground wood pulp. No washing of the pulp is done after introduction of these compounds and Sodium and Sulphur therefrom remain in the pulp and finished paper products. 3/10/65.