Petitioner, a contracting firm, requested a declaratory order to determine whether installation charges for qualified manufacturing equipment, either new or used, are required to be separately stated to be exempt from sales tax and whether one lump sum charge renders the total charge taxable or exempt. The Director found that under Iowa Code section 423.3(48) and Iowa Administrative Code rule 701—215.22, only the installation of new industrial machinery or equipment is exempt from sales tax. Further, if there is one lump-sum charge for both exempt and non-exempt equipment and installation, that amount would be subject to tax because the new equipment is not separately identified and charged.
2024-01-17