What machinery & equipment doesn't qualify for exemption?
Hand powered tools
- Example: screw drivers, hammers, clamps, tape measures
Items (including repair and replacement parts) with a useful life of less than one year
- Example: disposable liners or filters
Buildings and parts of buildings that merely provide workspace for people, or provide shelter or store tangible personal property or machinery and equipment.
- Examples: Office space, closets, washrooms, tasting rooms
Building fixtures that aren't integral to the manufacturing operation and are permanently affixed to and become a physical part of a building.
- Examples: fire sprinklers, building electrical systems, washroom fixtures, shelving in tasting room
- Items that aren't “used directly” in the manufacturing process. (See below.)
- Items that don't meet the “majority use” criteria. (See below.)
What does “used directly” mean?
Only M&E that meets the “used directly” criteria qualifies for the sales/use tax exemption. Qualifying M&E may meet any of the following criteria:
Acts upon or interacts with the grapes or wine being manufactured.
- Examples: destemmer, top fermenter, crusher wine barrels
Conveys, transports, handles, or temporarily stores the grapes or wine being manufactured.
- Examples: wheelbarrows, handcarts, storage racks, forklifts, tanks, vats, piping, wine barrels, and concrete storage pads
- Not qualifying under this criterion: Floor space in buildings; items used to package, ship, or support or brace the wine during transport
Controls, guides, measures, verifies, aligns, regulates, or tests wine at or away from the manufacturing site.
- Examples: graduated cylinders, chemical testing equipment
Provides physical support for or access to the wine.
- Examples: catwalks in between vats; scaffolding around tanks; braces under vats; ladders near controls
- Not qualifying under these criteria: M&E used to access the building, provide work space for people or space for items, such as doors or stairways
Produces power for or lubricates the machinery and equipment.
- Examples: a generator that provides power to destemmer; lubricating devices such as hoses, oil guns, and pumps, whether or not attached to the machinery and equipment
Produces another item of tangible personal property for use in the manufacturing operation.
- Examples: printer that makes bottle labels, embossing press for labels, caps
Places the wine in the bottle, container, or package, in which it is normally sold or transported.
- Example: bottling equipment
- Is integral to research and development as defined in RCW 82.63.010.