Service Providers Tax Incentives Twenty-five states around the country use some type of tax incentive or credit to promote recycling market development. The large majority of states offer tax incentives for purchasing recycling equipment either income, sales, or property tax credits. These tax credits range from 10 to 50 percent of equipment costs.
Restrictions often apply to the incentives.
Arizona, for example, requires that the equipment process postconsumer solid waste or produce material that is made from at least 25 percent recycled materials. Other states limit the credits to targeted commodities such as paper or plastic. Tax incentives can take several other forms, as well. Some states offer sales, real, or property tax exemptions on construction and renovation of recycling facilities. Another state offers an income tax credit to individuals who purchase a product made from recovered materials.