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2020 Tennessee Code
Title 67 - Taxes and Licenses
Chapter 6 - Sales and Use Taxes
Part 2 - Taxes Imposed
§ 67-6-206. Industrial Machinery and Raw Materials — Exemptions. [Effective on July 1, 2021. See the Version Effective Until July 1, 2021.]

Universal Citation: TN Code § 67-6-206 (2020)
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  1. After June 30, 1983, no tax is due with respect to industrial machinery.
    1. No tax is imposed with respect to water when sold to or used by manufacturers. No tax is imposed with respect to gas, electricity, fuel oil, coal and other energy fuels when sold to or used by manufacturers.
      1. For the purpose of this subsection (b), “manufacturer” means one whose principal business is fabricating or processing tangible personal property for resale and also includes a person engaged at a location in packaging automotive aftermarket products manufactured at other locations by the same person or by a corporation affiliated with the manufacturing corporation such that:
        1. Either corporation directly owns or controls one hundred percent (100%) of the capital stock of the other corporation; or
        2. One hundred percent (100%) of the capital stock of both corporations is directly owned or controlled by a common parent.
      2. “Packaging”, as used in this subdivision (b)(2), refers only to the fabrication or installation, or both, of that packaging that will accompany the automotive aftermarket product when sold at retail. The exemption shall apply only to the substances used in the packaging process. That use must be established to the satisfaction of the commissioner by separate metering or otherwise.
    3. To qualify for the exemption under this section, a person shall apply for and receive a certificate of qualification for the exemption from the commissioner for each location that the person qualifies as a manufacturer or qualified data center. The person shall furnish to vendors and suppliers of the purchases either a copy of the certificate issued by the commissioner or a Streamlined Sales Tax certificate of exemption, which shall include the manufacturer's exemption authorization number included on the certificate issued by the commissioner, to evidence qualification for the exemption.
    4. Notwithstanding subdivision (b)(2), “manufacturer” shall not include any person whose principal business is the preparation of food for immediate retail sale.
    5. [Deleted by 2007 amendment, effective July 1, 2021.]
    6. [Deleted by 2007 amendment, effective July 1, 2021.]
    7. [Deleted by 2007 amendment, effective July 1, 2021.]
    8. [Deleted by 2007 amendment, effective July 1, 2021.]
    1. Tax at the rate of one and one-half percent (1.5%) shall be imposed with respect to electricity when sold to or used by a qualified data center.
    2. No tax is imposed with respect to cooling equipment or backup power infrastructure when sold to or used by a qualified data center.
    3. As used in subdivision (c)(2):
      1. “Backup power infrastructure” means backup power generation, battery systems, and related infrastructure used primarily for and necessary to the operations of a qualified data center; and
      2. “Cooling equipment” means cooling systems, cooling towers, and other temperature control infrastructure used primarily for and necessary to the operations of a qualified data center.
  4. Any qualified data center that applies for job tax credits under § 67-4-2109 must certify on its business plan that it has not, within the previous twelve (12) months, been found to be in violation of the Worker Adjustment and Retraining Notification (WARN) Act (29 U.S.C. §§ 2101-2109), the Fair Labor Standards Act of 1938 (29 U.S.C. § 201 et seq.), or federal immigration laws. Any qualified data center that fails to provide the required certification shall not qualify for job tax credits under § 67-4-2109.
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