Which equipment used to manufacture soil qualified for Florida's manufacturing exemption, and did the farm-equipment exemption apply?

Plain-English summary

Florida split the taxpayer's equipment into two groups under the manufacturing exemption: machinery integral to producing soil for sale qualified, while items used mainly for repair, equipment maintenance, or general grounds maintenance did not.

The taxpayer's primary activity at its Florida locations fell under NAICS 325314, and it used depreciable equipment at fixed locations to manufacture, process, compound, and produce soil. Fla. Stat. Sec. 212.08(7)(jjj) required each qualifying item to perform a significant production function without which the production process could not be completed.

The TAA refers to an attached item-by-item determination, but the published ruling text preserved here does not include that enclosure. The public page therefore supports the Department's classification rule, but not a verified list of which named machines fell on each side.

Florida separately denied the agricultural exemption. Producing soil was not “agricultural production” under Sec. 212.02(32), and the equipment was not used on a farm or in a forest to produce crops or agricultural products. The taxpayer's trailers weighed more than 12,000 pounds and were not used for an exempt agricultural purpose, so the agricultural trailer provision also did not apply.

What this means for you

Soil and growing-media manufacturers

The manufacturing exemption can apply even though the farm-equipment exemption does not. Analyze each item's direct role in the production process.

Equipment purchasers

Repair-shop tools, equipment-maintenance items, and grounds-maintenance equipment generally did not satisfy the integral-production test described in this TAA.

Common questions

Did some soil-manufacturing equipment qualify? Yes, under Sec. 212.08(7)(jjj), but the published text does not include the referenced item-by-item enclosure.

Did the farm-equipment exemption apply? No. Florida did not treat soil production as agricultural production.

Did the trailers qualify for the agricultural trailer exemption? No. They exceeded 12,000 pounds and were not used for an exempt agricultural purpose.

Citations and references

• Fla. Stat. Sec. 212.08(7)(jjj)
• Fla. Stat. Sec. 212.08(3)
• Fla. Stat. Sec. 212.02(32)
• Fla. Admin. Code R. 12A-1.087(1)(b)

Source

• Landing page: Florida Tax Law Library
• Advisement: TAA 22A-003

Original ruling text

QUESTION: Whether Taxpayer’s equipment is eligible for the exemption from Florida sales and use tax
provided under s. 212.08(7)(jjj), F.S., Certain machinery and equipment and/or s. 212.08(3), F.S.,
Exemptions; certain farm equipment.

ANSWER: Purchases of machinery and equipment that meet the eligibility requirements of s.
212.08(7)(jjj), F.S., are exempt from Florida sales and use tax. Attached is a comprehensive list with the
Department’s determination of the taxability of each of the items of machinery and equipment.

Taxpayer’s purchases of machinery and equipment do not qualify for the exemption provided to
purchases of machinery and equipment used in agricultural production or transport pursuant to the
provisions of s. 212.08(3), F.S.

February 10, 2022

XXXX
XXXX
XXXX
XXXX
XXXX
Re:

Technical Assistance Advisement 22A-003
Florida Sales and Use Tax
XXXX (“Taxpayer”)
BP#: XXXX
Sections 212.02(32), 212.05, 212.055, 212.8(3), 212.08(7)(jjj), Florida Statutes (F.S.)
Rule 12A-1.087(1)(b), Florida Administrative Code (F.A.C.)

Dear XXXX:
This letter is in response to your request dated July 23, 2021, and received in this office on July
23, 2021, for issuance of a Technical Assistance Advisement (“TAA”) pursuant to Section 213.22,
F.S., and Rule Chapter 12-11, F.A.C., concerning manufacturing exemptions. An examination of

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February 10, 2022
Florida Department of Revenue
Page 2

your request has established you complied with the statutory and regulatory requirements for
issuance of a TAA. Therefore, the Department is hereby granting your request for a TAA.
REQUESTED ADVISEMENTS
Whether Taxpayer’s equipment is eligible for the exemption from Florida sales and use tax
provided under s. 212.08(7)(jjj), F.S., Certain machinery and equipment and/or s. 212.08(3), F.S.,
Exemptions; certain farm equipment.
STATED FACTS
Your letter states:
Taxpayer is a Florida for-profit corporation. Taxpayer is engaged in the business of
manufacturing, processing, compounding, and producing soil to be resold. Soil is tangible
personal property subject to sales tax when sold. Taxpayer owns various pieces of
industrial machinery and equipment with a depreciable life of at least three years. The
industrial machinery and equipment are an integral part of the manufacturing,
processing, compounding, and production of the soil from a fixed location in Florida. More
than fifty percent (50%) of the activities where the industrial machinery and equipment
are located have a NAICS code of 325314.
Taxpayer has the following non-exhaustive list of industrial machinery and equipment,
sometimes in multiple quantities, all of which support the activities of manufacturing,
processing, compounding, and producing soil: (1) John Deere 544E Loader ; (2) Toyota
Forklift; (3) Scarab Wind Row Turner; (4) John Deere 624H Loader; (5) John Deere 624H
Loader; (6) Storage Trailer; (7) CAT Generator; (8) John Deere Gator; (9) 2000 Gallon Fuel
Tank; (10) Miller Welder (Shop); (11) Simplicity Screen on Shredder; (12) 275 Gallon Fuel
Tank; (13) John Deere Power Unit; (14) Air Compressor; (15) Grease Pump; (16) Oil Pump;
(17) Doppstadt Trommel Screen; (18) Drill Press; (19) Fuel & Oil Tanks; (20) Miller Welder
(Service Truck); (21) Wire Feeder; (22) Portacool Units; (23) Powermax Plasma Mach; (24)
Transmission Jack; (25) Wheel Dolly; (26) Gorman Rupp Pump 10"; (27) Gorman Rupp
Pump 10"; (28) John Deere 2640 Tractor; (29) CAT D3C Super Dozer; (30) Shipping
Container; (31) Thompson Pump 6"; (32) John Deere 544D Loader; (33) Komatsu D61PX15 Dozer; (34) John Deere 350 DLC Excavator; (35) CAT 240B Excavator; (36) Mack Water
Truck; (37) Extec Screen SR-5; (38) Kawasaki Loader 70-Z7B; (39) Soil Mixing & Blending
Line; (40) Link Belt Excavator Model 250X4LF; (41) Sakai Roller Model 54; (42) Hitachi
Loader ZW180; (43) John Deere 624H Loader; (44) Duratech 3010 Tub Grinder; (45) Link
Belt Excavator Model 250X4LF; (46) Gravely 2T HD60 Mower; (47) Rural King
Tractor/Mower; (48) Bagging Line; (49) Hitachi Loader ZW220; (50) Hitachi Wheel Loader
ZW-180; (51) Kawasaki Wheel Loader KSS95Z7; (52) Compressor; (53) Kawasaki Wheel
Loader 70Z5-2; (54) Kawasaki Wheel Loader 70Z5-2; (55) Kawasaki Wheel Loader 80Z7;

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February 10, 2022
Florida Department of Revenue
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(56) Kawasaki Wheel Loader 70Z7B; (57) Hitachi Wheel Loader ZW180-6; (58) Gravely
Mower; (59) Walking Floor Chip Trailer; (60) Compactor; (61) Self-Dumping Hopper; and
(62) Paladin with Overhead Magnet.
As it pertains to the Walking Floor Chip Trailers, these trailers weigh just over 12,000
pounds and were each purchased for $37,500.
Taxpayer has provided two spreadsheets for the list of industrial machinery and equipment it is
seeking a determination. The spreadsheets provide a brief description of what each piece of
equipment does as it relates to Taxpayer’s business operations at its locations in Florida.
LAW & DISCUSSION
Manufacturing Exemption
Unless a specific exemption applies, s. 212.05, F.S., provides it is the legislative intent that the
sale of tangible personal property1 in this state is subject to tax. The tax is due and payable at
the rate of 6 percent, plus any applicable surtaxes imposed under s. 212.055, F.S., on the total
consideration for each item or article of tangible personal property when sold at retail in this
state.
Section 212.08(7)(jjj), F.S., provides that industrial machinery and equipment2 purchased by
eligible manufacturing businesses which is used at a fixed location in this state for the
manufacture, processing, compounding, or production of items of tangible personal property for
sale is exempt from the tax. If, at the time of purchase, the purchaser furnishes the seller with a
signed certificate certifying the purchaser’s entitlement to exemption pursuant to this paragraph,
the seller is not required to collect the tax on the sale of such items, and the department shall
look solely to the purchaser for recovery of the tax if it determines that the purchaser was not
entitled to the exemption. An eligible manufacturing business means any business whose
primary business activity3 at the location where the industrial machinery and equipment is
located is within the industries classified under NAICS codes 31, 32, 33, 112511, and 423930. To
obtain this exemption on the purchase of the qualifying machinery or equipment, a taxpayer
would need to complete and then provide to the selling dealer the suggested sample exemption

1

Tangible personal property means and includes personal property which may be seen, weighed, measured, or touched
or is in any manner perceptible to the senses. See s. 212.02(19), F.S.
2
“Industrial machinery and equipment” means, in part, tangible personal property or other property that has a
depreciable life of 3 years or more and that is used as an integral part in the manufacturing, processing, compounding,
or production of tangible personal property for sale. See s. 212.08(7)(jjj)2.e., F.S.
3
“Primary business activity” means an activity representing more than 50 percent of the activities conducted at the
location where the industrial machinery and equipment or postharvest machinery and equipment is located. See S.
212.08(7)(jjj)2.d., F.S.

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February 10, 2022
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certificate found within Tax Information Publication (TIP) No. 16A01-07 attesting to its eligibility
for the exemption.
Based on the machinery and equipment listed and the description provided with the
spreadsheets, some of the machinery and equipment meet the eligibility requirements of s.
212.08(7)(jjj), F.S., for the exemption from sales tax on the purchase of certain machinery and
equipment used to manufacture soil for sale. The machinery and equipment that is integral to
manufacturing of soil and that is eligible for the exemption is attached for Taxpayer’s reference.
Certain items listed were determined to not meet the eligibility requirements of s. 212.08(7)(jjj),
F.S. These items were deemed not to be an integral part in the manufacturing, processing,
compounding or production of soil. From the descriptions provided, the items denied eligibility
are mostly used for the repair or maintenance of equipment used by Taxpayer or for the general
maintenance of facility’s grounds. To be clear, only machinery and equipment that provide a
significant function within the production process, such that the production process could not be
complete without such machinery and equipment would meet the eligibility requirements. The
denied items are attached for Taxpayer’s reference.
Agricultural Exemption
Section 212.08(3), F.S., provides an exemption for power farm equipment, including replacement
parts and accessories, used exclusively on a farm or in a forest in the agricultural production of
crops or products as produced by those agricultural industries included in s. 570.02(1), F.S., or for
fire prevention and suppression work with respect to such crops or products. However, this
exemption shall not be allowed unless the purchaser, renter, or lessee signs a certificate stating
that the farm equipment is to be used exclusively on a farm or in a forest for agricultural
production or for fire prevention and suppression, as required by this subsection. See Rule 12A1.087(1)(b), F.A.C.
As defined in s. 212.02(32), F.S., the term "agricultural production" means the "production of
plants and animals useful to humans, including the preparation, planting, cultivating, or
harvesting of these products or any other practices necessary to accomplish production through
the harvest phase," including storage of raw products on a farm, and includes forestry.
For the purpose of the exemption from tax provided under s. 212.08(3), F.S., the production of
soil is not considered an agricultural process and as such the purchase of machinery and
equipment used to process soil would not be exempt from tax. The exemption provided in s.
212.08(3), F.S., and the related terms defined in s. 212.02, F.S., do not include the term soil or
any synonymous term. The Department must point out that while taxing statutes are strictly
construed against the taxing authority, statutes that grant an exemption are strictly construed
against the taxpayer. See Asphalt Pavers v. Dept. of Revenue, 584 So.2d 55 (Fla. 1st DCA 1991), at
57 (citing the rule that exemptions from tax are strictly construed against the taxpayer, with any

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February 10, 2022
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ambiguity resolved in favor of the administrative agency); State ex rel. Szabo Food Services Inc.
v. Dickinson, 286 So.2d 529 (Fla. 1973) (“Exemptions to taxing statutes are special favors granted
by the Legislature and are to be strictly construed against the taxpayer.”). See also, United States
Gypsum Co. v. Green, 110 So.2d 409 (Fla. 1959) (also stating that exemptions from tax are strictly
construed against the taxpayer) and Wanda Marine Corp. v. Dep’t of Revenue, 305 So.2d 65, 69
(Fla. 1st DCA 1975).
Based on the facts presented in your letter, the machinery and equipment does not qualify for
the exemption provided under s. 212.08(3), F.S., since it is not purchased for use on a farm or in
a forest in the agricultural production of crops or products, or for fire suppression work with
respect to such crops or products.
Section 212.08(3)(b), F.S., provides that sales tax may not be imposed on that portion of the sales
price below $20,000 for a trailer weighing 12,000 pounds or less and purchased by a farmer for
exclusive use in agricultural production or to transport farm products from his or her farm to the
place where the farmer transfers ownership of the farm products to another.
Taxpayer’s purchase of trailers weighting in excess of 12,000 pounds are not eligible for the
exemption provided under s. 212.08(3)(b), F.S. The purchase of the trailers referenced above is
subject to sales tax because the trailers are not used for an exempt purpose as provided under s.
212.08(3)(a), F.S.
CONCLUSIONS
Purchases of machinery and equipment that meet the eligibility requirements of s. 212.08(7)(jjj),
F.S., are exempt from Florida sales and use tax. Attached is a comprehensive list with the
Department’s determination of the taxability of each of the items of machinery and equipment.
Taxpayer’s purchases of machinery and equipment do not qualify for the exemption provided to
purchases of machinery and equipment used in agricultural production or transport pursuant to
the provisions of s. 212.08(3), F.S.
For more information concerning all the taxes administered by the Department of Revenue,
please refer to the Department’s Internet site at:
http://floridarevenue.com
This response constitutes a Technical Assistance Advisement under s. 213.22, F.S., which is
binding on the Department only under the facts and circumstances described in the request for
this advice as specified in s. 213.22, F.S. Our response is predicated on those facts and the specific
situation summarized above. You are advised that subsequent statutory or administrative rule

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February 10, 2022
Florida Department of Revenue
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changes, or judicial interpretations of the statutes or rules, upon which this advice is based, may
subject similar future transactions to a different treatment than expressed in this response.
You are further advised that this response and your request and related backup documents are
public records under Chapter 119, F.S., and are subject to disclosure to the public under the
conditions of s. 213.22, F.S. Confidential information must be deleted before public disclosure. In
an effort to protect confidentiality, we request you provide the undersigned with an edited copy
of your request for Technical Assistance Advisement, the backup material and this response,
deleting names, addresses and any other details which might lead to identification of the
taxpayer. Your response should be received by the Department within 15 days of the date of this
letter.
Kind Regards,

Xiaoxi Miao
Xiaoxi Miao
Tax Law Specialist
Technical Assistance & Dispute Resolution
Enclosure: Determinations of the taxability of the equipment
XM\tadrstaff
Record ID: 569537