Which defense-technology project items were exempt in Florida TAA 24A-008?

Plain-English summary

The Department concluded that all eight reviewed categories qualified for the defense-technology facility exemption in section 212.08(5)(j).

The exempt categories were foundations; a fire pump house; motor-control-center and control-room structures; an external storm-water collection and retention system; utility feeds; piles; consumable installation materials; and rented barges, cranes, and other installation equipment.

The taxpayer had to give the seller its tax-exemption permit and keep records showing that purchases were used at and by the certified project rather than elsewhere.

What this means for you

Project structures and installation inputs may qualify when they function as industrial machinery and equipment used by a properly certified defense-technology facility. Certification, use, and records remain essential.

Common questions

Were all eight reviewed categories exempt? Yes.

Did rented installation equipment qualify? Yes.

What documentation did the ruling require? The exemption permit and books and records showing project use.

Citations and references

• Fla. Stat. § 212.08(5)(j), as cited in the advisement.

Source

• Landing page: Florida Tax Law Library
• Advisement: TAA 24A-008

Original ruling text

Question:

Whether Taxpayer’s purchases or rentals of items/materials used in the
at its
project are eligible and qualify for the
exemption from Florida sales and use tax provided under s. 212.08(5)(j), F.S.
Answer:

Taxpayer’s puchases or rentals of items/materials used in the
project would be eligible and qualify for the
exemption from Florida sales and use tax provided under s. 212.08(5)(j), F.S.

June 27, 2024

Re:

Dear

Technical Assistance Advisement – 24A-008
Sales and Use Tax – Exemption Manufacturing
(“Taxpayer”)
BP No.
Section 212.08(5)(j), Florida Statutes (F.S.)
:

This letter is a response to your petition dated
, for the Florida Department of Revenue’s
(the “Department’s”) issuance of a Technical Assistance Advisement ("TAA") with regard to whether
voluntary donations received are subject to Florida sales and use tax. Your petition has been carefully
examined and the Department finds it to be in compliance with the requisite criteria set forth in Chapter
12-11, Florida Administrative Code. This response to your request constitutes a TAA and is issued to you
under the authority of section 213.22, F.S.
Requested Advisements
Taxpayer is inquiring whether the exemption provided under s. 212.08(5)(j), F.S., would apply to the entire
, including the material required to construct the
that are necessary for the
to be used as designed. Specifically,
Taxpayer is seeking clarification concerning the following items:

Technical Assistance Advisement
June 27, 2024
Page 2

1.

– These are concrete structures
designed to support the full weight of a
. They
physically support the
, and integrate conduits and other fixtures used to supply
the
with major electrical feeds, a comprehensive fire control system, storm water
and hazardous fluids containment and retention, information technologies infrastructure,
security systems, and the mounting hardware for trestles and scaffolding to support
access to all areas of the

2. Fire Pump House – The Fire Pump House will be constructed solely to enclose the fire
   pump system from the weather and salt corrosion. It is used to feed the fire control
   system. The pump house has no other purpose and would be rendered archaic and be
   removed upon the pump systems being decommissioned.
3. Motor Control Center and Control Room Structures – Integral to the waterside portion of
   the
   elevating platform are the motor control center which houses the numerous
   winches necessary to lift a large
   , and the control room, where the operators
   monitor the weight distribution of the
   while it is being lifted and transferred to
   an
   These structures would become archaic and be removed if
   the
   was decommissioned.
4. Storm water collection and retention system external to the
   – Hazardous
   fluids are contained within the
   and processed in compliance with federal and
   state statutes. Storm water from the
   and
   however, exits from the
   maintenance area and is controlled through various structures on the site external to the
   . These are designed specifically to address the outflows from the tool.
5. Utility Feeds – To operate the
   , utilities will be run from various portions of
   the
   to the
   . These include water, electricity, the fire main, the fire pumps,
   security systems, and information technologies infrastructure.
6. Piles – Concrete and steel piles are installed throughout the
   to stabilize the
   winches and lifting platform to prevent the
   from becoming unstable on the
   platform during lift.
7. Consumable Materials – The installation of the
   requires the use of numerous
   consumable materials such as nails, screws, forms lumber, form oil, cure compounds
   etcetera, necessary to complete the installation.
8. Rented Equipment – The installation of the
   cranes, and other installation equipment.

requires the rental of barges,

Technical Assistance Advisement
June 27, 2024
Page 3

Facts as Provided
Taxpayer has presented the following information regarding its

, project.

The new facility replaces the old dry dock and a number of antiquated structures with the
.
The primary customer for the

.

. The new facility will

will be performed at the facility.
The

will be built and owned by the
, and
. To ensure technical integrity,
. The
will be based on the cost of fabrication and installation
of the
and associated necessary support infrastructure.
costs will
be a component of
. Therefore, the ultimate beneficiary of any
sales tax exemptions/abatement is the
in the form of lower contracting costs for
work at the facility.
contracts are also generally competed between shipyards, so
“
” is a primary factor in the number of
.

The waterside portion of the
is composed of a movable platform that is translated up and
down from the seafloor to land-level to lift a ship out of the water for
work. A series of
large winches on each side of the platform lift the platform up and down. Operators control the
movement of the platform from an integrated motor control center and control room structure
at land level. The movable platform
.
Trestles with keel/bilge blocks that match the hull shape of the
to be serviced are first
placed on the platform at land level, and then lowered to the seabed. The
is then
maneuvered into the dock above the movable platform. The platform is then raised slowly to
cradle the
as it rises out of the water. Once at land-level,
drive
under the
and trestles and lift both off the ground to transport the
to one of
located on the landside portion of the tool. Once the
is in place in the
landside
, the
lower the
to the ground, and the
.
The
function as a tooling fixture for the
, and are a critical integral component
of the
that have been designed specifically to allow
to perform out-ofwater
required by the
. The lifting platform is neither designed nor intended
to be used to support the
while
. The

Technical Assistance Advisement
June 27, 2024
Page 4

foundations of the
are formed by heavy concrete to support the weight of the
. Integral to the
and their foundations are: a) major electrical conduits to
feed
; b) a fire control system; c) storm water and hazardous fluids containment and
retention; d) information technologies infrastructure; e) security systems; and f) the mounting
hardware for trestles and scaffolding to support access to all areas of the
.
Taxpayer received certification from the Florida Department of Economic Opportunity (DEO) 1 that
its business operations in
, were eligible for the exemption from Florida sales
and use tax under the provisions of s. 212.08(5)(j), F.S.

Applicable Law and Discussion
Section 212.08(5)(j), F.S., Machinery and equipment used in semiconductor, defense, or space technology
production, provide in part, as follows:

1.b. Industrial machinery and equipment used in defense or space technology facilities
certified under subparagraph 5. to design, manufacture, assemble, process, compound, or
produce defense technology products or space technology products for sale or for use by these
facilities are exempt from the tax imposed by this chapter.

7. As used in this paragraph, the term:

c. “Defense technology products” means products that have a military application, including,
but not limited to, weapons, weapons systems, guidance systems, surveillance systems,
communications or information systems, munitions, aircraft, vessels, or boats, or components
thereof, which are intended for military use and manufactured in performance of a contract with
the United States Department of Defense or the military branch of a recognized foreign
government or a subcontract thereunder which relates to matters of national defense.

1
2

Currently the Florida Department of Commerce.
.

Technical Assistance Advisement
June 27, 2024
Page 5

The exemption from Florida sales and use tax provided under s. 212.08(5)(j), F.S., applies to industrial
machinery and equipment used at certified defense technology facilities to design, manufacture,
assemble, process, compound, or produce defense technology products for sale or for use by these
facilities.
It has been determined that Taxpayer is eligible and qualifies for the Florida sales and use tax exemption
provided under s. 212.08(5)(j), F.S., for purchases of industrial machinery and equipment used in defense
technology production. Industrial machinery and equipment that Taxpayer uses in its certified defense
facility that is integral to design, manufacture, assemble, process, compound, or produce defense
technology products or for use by these facilities are exempt from Florida sales and use tax. To obtain the
exemption from tax, Taxpayer would provide its Tax Exemption Permit for Machinery and Equipment Used
by Certified Semiconductor, Defense or Space Technology Facility to the selling dealer.
It should be noted that any dealer that takes an exemption document or an exemption permit in good
faith would be relieved of the liability to collect tax and the Department would look solely to the purchaser
for any tax that may be subsequently determined to be due. A selling dealer accepting the permit in good
faith, will not be held liable for any potential tax due; liability will rest with the purchaser/holder of the
permit. Taxpayer should document in its books and records that purchases were used at and by the
project rather than elsewhere.
Requested Advisements & Determinations
1.

support the full weight of a
the

– These are concrete structures designed to
. They physically support

Based on the description provided,
would be exempt from Florida
sales and use tax under the provisions of s. 212.08(5)(j), F.S., as industrial machinery and
equipment used in a defense technology facility to design, manufacture, assemble, process,
compound, or produce defense technology products or for use by the facility.

2. Fire Pump House – The Fire Pump House will be constructed solely to enclose the fire pump
   system from the weather and salt corrosion. It is used to feed the fire control system. The pump
   house has no other purpose and would be rendered archaic and be removed upon the pump
   systems being decommissioned.
   Based on the description provided, Fire Pump House would be exempt from Florida sales and
   use tax under the provisions of s. 212.08(5)(j), F.S., as industrial machinery and equipment used
   in a defense technology facility to design, manufacture, assemble, process, compound, or
   produce defense technology products or for use by the facility.

Technical Assistance Advisement
June 27, 2024
Page 6

3. Motor Control Center and Control Room Structures – Integral to the waterside portion of the
   are the motor control center which houses the numerous winches
   necessary to lift a
   , and the control room, where the operators monitor the weight
   distribution of the
   while it is being lifted and transferred to an
   .
   These structures would become archaic and be removed if the
   was decommissioned.
   Based on the description provided, Motor Control Center and Control Room Structures would
   be exempt from Florida sales and use tax under the provisions of s. 212.08(5)(j), F.S., as
   industrial machinery and equipment used in a defense technology facility to design,
   manufacture, assemble, process, compound, or produce defense technology products or for use
   by the facility.
4. Storm water collection and retention system external to the
   – Hazardous fluids are
   contained within the
   and processed in compliance with federal and state statutes.
   Storm water from the
   however, exits from the maintenance area and is
   controlled through various structures on the site external to the
   . These are
   designed specifically to address the outflows from the tool.
   Based on the description provided, Storm water collection and retention system external to the
   would be exempt from Florida sales and use tax under the provisions of s.
   212.08(5)(j), F.S., as industrial machinery and equipment used in a defense technology facility
   to design, manufacture, assemble, process, compound, or produce defense technology
   products or for use by the facility.
5. Utility Feeds – To operate the
   , utilities will be run from various portions of the
   . These include water, electricity, the fire main, the fire pumps, security
   systems, and information technologies infrastructure.
   Based on the description provided, Utility Feeds would be exempt from Florida sales and use
   tax under the provisions of s. 212.08(5)(j), F.S., as industrial machinery and equipment used in
   a defense technology facility to design, manufacture, assemble, process, compound, or produce
   defense technology products or for use by the facility.
6. Piles – Concrete and steel piles are installed throughout the
   to stabilize the winches
   and lifting platform to prevent the
   from becoming unstable on the platform during lift.
   Based on the description provided, Piles would be exempt from Florida sales and use tax under
   the provisions of s. 212.08(5)(j), F.S., as industrial machinery and equipment used in a defense
   technology facility to design, manufacture, assemble, process, compound, or produce defense
   technology products or for use by the facility.
7. Consumable Materials – The installation of the
   requires the use of numerous
   consumable materials such as nails, screws, forms lumber, form oil, cure compounds etcetera,
   necessary to complete the instillation.

Technical Assistance Advisement
June 27, 2024
Page 7

Based on the description provided, Consumable Materials would be exempt from Florida sales
and use tax under the provisions of s. 212.08(5)(j), F.S., as industrial machinery and equipment
used in a defense technology facility to design, manufacture, assemble, process, compound, or
produce defense technology products or for use by the facility.

8. Rented Equipment – The installation of the
   other installation equipment.

requires the rental of barges, cranes, and

Based on the description provided, Rented Equipment would be exempt from Florida sales and
use tax under the provisions of s. 212.08(5)(j), F.S., as industrial machinery and equipment used
in a defense technology facility to design, manufacture, assemble, process, compound, or
produce defense technology products or for use by the facility.
This response constitutes a TAA 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 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, 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 TAA, 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 ten (10) days of the date of
this letter.
If you have any further questions with regard to this matter and wish to discuss them, you may contact
me directly at 850-717-6735.
Kind Regards,

Alan R. Fulton

Alan R. Fulton
Revenue Program Administrator I
Technical Assistance & Dispute Resolution

Record ID: 1063296

Technical Assistance Advisement
June 27, 2024
Page 8

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