Laws, Regulations & Annotations

Business Taxes Law Guide – Revision 2013
 

Sales and Use Tax Annotations


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P

440.0000 PROPERTY USED IN MANUFACTURING—Regulation 1525

Annotation 440.1963

(b) PROPERTY BECOMING COMPONENT PART OF FINISHED PRODUCT

(2) Food, Beverages

440.1963 Chemicals Used in Manufacture of Bakers Yeast. A manufacturer of bakers yeast purchases the following chemicals: di-ammonium phosphate, ammonium sulfate, argue ammonia, phosphoric acid, magnesium sulfate and zinc sulfate.

Bakers yeast contains carbon, nitrogen, phosphates, sulfates, and traces of magnesium and zinc. The carbon and some amounts of other required substances are usually supplied by molasses, which have previously been considered to be nontaxable when used in yeast production. Hydrogen is supplied by ammonia or by ammonium salts such as sulfate or phosphates. Phosphates are supplied by phosphoric acid or ammonium phosphate. Sulfate is supplied in ammonium sulfates. Traces of magnesium and zinc are supplied in the form of salts such as the sulfates. Since all of these chemicals are absorbed into the yeast and are present in and an integral part of the yeast which is sold, sales of the aforementioned chemicals to manufacturers of bakers yeast are not subject to tax. 5/7/75.