Laws, Regulations & Annotations

Business Taxes Law Guide – Revision 2017

Sales and Use Tax Annotations

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Annotation 440.1234


(7) Miscellaneous Specific Aids

440.1234 Gypsum for Wallboards. The following chemicals used in the production of gypsum for wallboards are manufacturing aids:

(1) Lignosite (lignosis). Since gypsum is a dehydrate of calcium sulfate and water, it is important that two and only two molecules of water bond to each molecule of calcium sulfate. Lignosite is a diffusing agent which is added to the slurry of calcium sulfate and water to ensure that the water will spread evenly throughout the mixture. When added to the slurry, the lignosite bonds with water molecules to form ionized water-lignin molecules. The ionized molecules apparently surround the calcium sulfate particles and thereby impart a negative charge to each of the particles. The result is that each particle repels every other particle ensuring adequate diffusion of the water and proper bonding to the calcium sulfate.

Lignosite is used as a diffusing agent, and the fact that it remains in the finished product is merely an added benefit. Accordingly, the purchases of lignosite is for the primary purpose of use during the manufacturing process and not for the primary purpose of resale as part of the finished product. Also, the use of the lignosite as a diffusing agent in the manufacturing process is prior to resale.

(2) Retarders and Potassium Sulfate. In the wallboard's drying process, it is important that all parts of the gypsum dry at the same rate. If some parts dry prematurely, the result is stress lines in the gypsum which weaken the wallboard. In order to control the rate of drying, "retarders" and potassium sulfate are added to the gypsum. The retarders are added first and their function is to prevent the gypsum from drying so that no part dries prematurely. At the proper time, potassium sulfate is added. This chemical causes the gypsum to dry almost immediately, thereby producing a uniform "snap set."

Both the retarders and potassium sulfate are used to produce chemical or physical reactions during the manufacturing process. The retarders are used to delay drying and the potassium sulfate is used to produce a snap set. Although the retarders and potassium sulfate remain in the finished gypsum, their physical presence does not appear to have any beneficial effect whatsoever. Accordingly, these chemicals are purchased primarily for use in the manufacturing process and not for resale. Also, the use of these chemicals in the manufacturing process is prior to resale. 6/28/83.