Oklahoma Administrative Code › Title 710 - Oklahoma Tax Commission › Chapter 65 - Sales and Use Tax › Subchapter 13 - Sales and Use Tax Exemptions › Part 29 - MANUFACTURING › Section 710:65-13-153 - Exemption for "qualified manufacturers"

Current through Vol. 41, No. 20, July 1, 2024
(a)
Qualification.
Sales of
				  construction materials to a qualified manufacturer to be consumed or
				  incorporated in a new manufacturing facility or to expand an existing
				  manufacturing facility are exempt from sales and use tax. For purposes of this
				  exemption, sales made to a contractor or sub-contractor who has previously
				  entered into a contractual relationship with a qualified manufacturer for
				  construction or expansion of a manufacturing facility shall be considered sales
				  made to the qualified manufacturer.
(1)
"Manufacturing facility"
for purposes of this exemption, means
				  buildings and land improvements used in manufacturing as defined in Section
				  1352 of
				  Title 68 of the Oklahoma Statutes, except that up to ten percent (10%) of the
				  square feet of such building may be devoted to office to provide clerical
				  support for the manufacturing operation and shall also mean building and land
				  improvements used for the purpose of packing, packaging, repackaging, labeling
				  or assembling for distribution to market, if at least seventy percent (70%) of
				  the product is made in Oklahoma by the same company but at an off-site in-state
				  manufacturing facility or facilities. Retail outlets will be included only if
				  the retail outlet is operated in conjunction with and on the same site or
				  premises as the manufacturing facility.
(2)
"Qualified manufacturer"
for
				  purposes of this exemption, means:
(A) Any
				  enterprise whose total cost of construction of a new or expanded facility
				  exceeds the sum of Five Million Dollars ($5,000,000.00) and the new or expanded
				  facility adds at least One Hundred (100) new full-time-equivalent employees, as
				  certified by the Employment Security Commission, and such employees are
				  maintained for a period of at least thirty-six (36) months, upon completion of
				  the facility.
(B) If the cost of
				  construction exceeds Ten Million Dollars ($10,000,000.00) and the combined cost
				  of construction material, machinery, equipment, and other tangible personal
				  property exceeds Fifty Million Dollars ($50,000,000.00), the required number of
				  new full-time-equivalent employees to be added and maintained to be a
"Qualified manufacturer"
is Seventy-five (75).
(C) If the total cost of construction exceeds
				  the sum of Three Hundred Million Dollars ($300,000,000.00) the
"Qualified
				  manufacturer"
must maintain an employment level of a least 1,750 full
				  time equivalent employees.
(3)
"Total costs of construction"
				  defined.
For purposes of this Section,
"total cost of
				  construction"
means and includes building and construction materials,
				  and engineering and architectural fees or charges directly associated with the
				  construction of a new or expanded facility, but shall not include attorney
				  fees. For purposes of (a)(2)(C) of this Section the
"total cost of
				  construction"
shall also include the cost of qualified depreciable
				  property, as defined by Section
				  2357.4
				  of Title 68 of the Oklahoma Statutes, and labor services performed in the
				  construction of a new or expanded facility.
(4)
The employment requirement.
The employment requirement described in this Section can be satisfied by a
				  portion of the required new full-time-equivalent employees being employed at a
				  manufacturing facility related to or supported by the new or expanded business,
				  so long as both or all facilities are owned by the same person.