New York Codes, Rules and Regulations › Title 20 - DEPARTMENT OF TAXATION AND FINANCE › Chapter IV - Sales And Use And Other Miscellaneous Taxes › Subchapter A - Sales And Use Taxes › Part 531 - Compensating Use Tax › Section 531.2 - Definitions

Current through Register Vol. 46, No. 28, July 10, 2024
The definitions in this section shall apply with respect to
					 the compensating use tax.
(a)
				  Consideration. Consideration is the amount paid for any property or service,
				  valued in money. Consideration includes monetary consideration, exchange,
				  barter, the rendering of any service, or any agreement therefor. Monetary
				  consideration includes assumption of liabilities, fees, rentals, royalties or
				  any other charge that a purchaser, lessee or licensee is required to
				  pay.
(b) Manufacturing.
				  Manufacturing is the production of tangible personal property that has a
				  different identity from its ingredients. Manufacturing includes the production
				  of standardized items as well as the production of items to a customer's
				  specifications.
Example 1:Company A is a producer of steel beams and
					 girders which are incorporated into buildings. The beam is manufactured by
					 combining iron ore and other ingredients.
Example 2:Company B furnishes concrete that is poured into
					 foundations. Cement, water and aggregates are mixed in a truck enroute to the
					 job, to form concrete. The concrete is a manufactured product.
Example 3:Company C at its plant combines asphalt, stone,
					 and other ingredients to produce a compound which, when laid, is a road
					 surface. The finished compound is a manufactured product.
Example 4:Company D takes concrete and other ingredients
					 which it casts into slabs and blocks. The finished casting is a manufactured
					 product.
Example 5:Company E combines metal, wood, glass, and other
					 component parts into structural panel sections which are joined to form the
					 bearing walls of a building. These panels are manufactured products.
Example 6:Company F laminates wood panels which are joined
					 to form arches. These laminated arches are manufactured products.
(c) Assembling. Assembling is the
				  coupling or the uniting of parts or materials as a manufacturing process or as
				  a step in the manufacturing process which results in a new product.
Example 1:Company A purchases drilled angle iron from
					 Company B and steel shelving from Company C. Company A then bolts the shelving
					 to the angle iron, to produce bookcases by assembly.
Example 2:Company C combines pre-cut glass, plastic,
					 aluminum extrusions and rubber gaskets to make storm windows. Such combining of
					 materials is assembling.
(d) Fabrication. Fabrication is the
				  alteration or modification of a manufactured product without a change in the
				  identity of the product. Fabrication includes cutting, perforating, and similar
				  operations. Where a manufacturer, processor or assembler fabricates tangible
				  personal property which he installs to the specifications of a capital
				  improvement, the value added by such fabrication is not subject to the use tax.
				  (See section
				  531.3[b]
				  [1][iii]  of this Part.)
Example 1:Company K bends flat sheet metal to form heating
					 and air conditioning duct work. This operation constitutes fabrication as the
					 identity of the sheet metal is not lost.
Example 2:Company L manufactures steel beams. It also
					 modifies them by attaching flanges according to specifications for its use in
					 erecting a certain building. The steel beams have not lost their identity after
					 the flanges have been attached and Company L has manufactured and fabricated
					 and installed the beams.
Example 3:Company M bends, and shapes wrought iron railings
					 according to the rise in the stairs of a certain building. M's work on railings
					 is fabrication.
(e)
				  Processing. Processing is the performance of any service on tangible personal
				  property which effects a change in the nature, shape or form of the
				  property.
(f) Installation.
				  Installation is the physical affixation of tangible personal property to other
				  tangible personal property or to real property.
Cross-reference:Other applicable definitions, see Part 526
					 of this Title.