Section Tax 11.11 - Utility, industrial and governmental waste treatment facilities(1) GENERAL. Section 77.54(26), Stats., provides a sales and use tax exemption for tangible personal property and items and property under s. 77.52(1) (b) and (c), Stats., which becomes a component part of certain waste treatment facilities.(2) UTILITY WASTE TREATMENT EXEMPTION. If a utility waste treatment facility that is taxed under ch. 76, Stats., qualifies for property tax exemption under s. 76.025(1), Stats., as approved by the department, it qualifies for the sales and use tax exemption under s. 77.54(26), Stats. Note: Refer to s. Tax 6.40 for information on how to request approvals for property tax exemption for utility waste treatment facilities. For more information regarding exemptions for waste treatment facilities owned by a utility, including railroads, airlines, and pipelines, approved by the department, write to Wisconsin Department of Revenue, Manufacturing and Utility Bureau, PO Box 8971, Madison WI 53708-8971; telephone (608) 266-3845; send an e-mail to mfgtelco@wisconsin.gov; or access the department's web site at www.revenue.wi.gov and search "waste treatment facilities".
(2m) INDUSTRIAL WASTE TREATMENT EXEMPTION. (a) An industrial waste treatment facility is any property purchased or constructed as a waste treatment facility used exclusively and directly to remove, store, or cause a physical or chemical change in industrial waste or air contaminants for the purpose of abating or eliminating pollution of surface waters, the air, or waters of the state if that property is not used to grow agricultural products for sale. In this paragraph, "used exclusively" means to the exclusion of all other uses except:1. For other use not exceeding 5% of total use.2. To produce heat or steam for a manufacturing process, if the fuel consists of either 95% or more industrial waste that would otherwise be considered superfluous, discarded, or fugitive material or 50 percent or more of wood chips, sawdust, or other wood residue from the paper and wood products manufacturing process, if the wood chips, sawdust, or other wood residue would otherwise be considered superfluous, discarded, or fugitive material.(b) Tangible personal property and items and property under s. 77.52(1) (b) and (c), Stats., becoming a component part of an industrial waste treatment facility is exempt from the sales and use tax under s. 77.54(26), Stats., if the facility qualifies for property tax exemption under s. 70.11(21), Stats. Note: For information regarding the property tax exemption for industrial waste treatment facilities of manufacturers write or call the district office of the Wisconsin Department of Revenue, Bureau of Manufacturing and Telco Assessments. To locate the district office, write or call Wisconsin Department of Revenue, Bureau of Manufacturing and Telco Assessment, PO Box 8971, Madison WI 53708-8971; telephone (608) 266-1147. The web site is http://www.revenue.wi.gov/contact/slfbmta.html. To ascertain whether a non-manufacturing property would be exempt under s. 70.11(21), Stats., owners may refer to the Wisconsin Property Assessment Manual or contact the local property tax assessor.
(3) MUNICIPAL WASTE TREATMENT EXEMPTION. Tangible personal property and items and property under s. 77.52(1) (b) and (c), Stats., which become a component or ingredient part of municipal facilities that treat waste qualifies for exemption from Wisconsin sales and use tax under s. 77.54(26), Stats. Municipal facilities that treat waste include: (a)Wastewater treatment facility.1. Only the central waste treatment plant which actually treats the sewage qualifies for the exemption.2. Storm sewers, water supply systems and private domestic waste water facilities do not qualify for the sales and use tax exemption.3. The collection system throughout the area served by the treatment facility, the effluent pipeline carrying the treated sewage away from the central treatment plant, earthen dikes, and chain link fences on the boundary of a treatment plant, and dredge material disposal sites are not exempt. The collection systems includes the lift stations, force mains, and associated pumping equipment used to bring the raw sewage to the central treatment plant.(b)Material recovery facility.1. A facility constructed by a municipality to meet mandates of ch. 287, Stats., regarding the reuse, recycling, and recovery of waste material to reduce the need for waste disposal is exempt if the activities include all of the following: a. Sorting recyclable materials delivered from municipalities.b. Processing recyclable materials which may include removing contaminants, baling paper, shredding paper, pelletizing plastics, and crushing glass.c. Storing processed recyclable materials for sale to others.2. The exemption does not apply if the only activities performed are sorting and storing and no processing of the materials takes place.(c)Sanitary landfill. A sanitary landfill, including the treatment equipment, such as the collection and burner system, laboratory equipment, maintenance buildings, garages, office buildings, fences, and gates, qualifies for exemption.(d)Groundwater facilities.1. A municipal facility constructed to treat hazardous or contaminated groundwater, including oil and water separators, air strippers, aerators, blowers, filters, carbon units, controls, pumps, and thermal oxidizers, qualifies for exemption.2. The collection system used to bring the hazardous or contaminated water to the facility and the distribution system used to carry the treated water away from the facility are not exempt. Note: For more information regarding the exemption for municipal treatment facilities, write, email or call Wisconsin Department of Revenue, Customer Service Bureau, Mail Stop 5-77, PO Box 8949, Madison WI 53708-8949, email dorsalesanduse@wisconsin.gov, telephone (608) 266-2776. The web site is www.revenue.wi.gov.
(4) REPAIR, SERVICE AND OPERATION. (a) The repair, service, alteration, cleaning, painting, and maintenance of a utility waste treatment facility described in sub. (2), an industrial waste treatment facility described in sub. (2m), and a municipal waste treatment facility described in sub. (3) as well as the repair parts and replacement for those types of facilities are exempt from the sales and use tax.(b) Chemicals and supplies, including fuel and electricity, used or consumed in operating a utility waste treatment facility described in sub. (2), an industrial waste treatment facility described in sub. (2m) and a municipal waste treatment facility described in sub. (3) are exempt from the sales and use tax.(5) CONTRACTORS AND SUBCONTRACTORS. (a)Exempt purchases. The sales and use tax exemption extends to and includes the purchases of tangible personal property and items and property under s. 77.52(1) (b) and (c), Stats., by a contractor-installer who incorporates the property into an approved utility waste treatment facility or who incorporates the property into an industrial waste treatment facility or a municipal waste treatment facility. The contractor-installer shall certify the intended exempt use of the item to each supplier in order to relieve the supplier of the duty of collecting and reporting the tax on the sales. Certification of exempt use shall be made on a Wisconsin sales and use tax exemption certificate, form S-211. Note: Form S-211 may be obtained by writing or calling Wisconsin Department of Revenue, P.O. Box 8902, Madison, WI 53708-8902, telephone (608) 266-2776.
(b)Taxable purchases. A contractor's purchases of items used or consumed in the performance of the construction contract, and which do not become a component part of the waste treatment facility, are subject to the tax. This includes industrial gases, form lumber, tunnel shields, and supplies used by a contractor during construction. Payments by a contractor for equipment purchased or leased to perform a construction job are also taxable.(c)Determining exemptions.1. `Utility property taxed under ch. 76, Stats.' A contractor or subcontractor may be liable for sales and use tax on a purchase of tangible personal property or items or property under s. 77.52(1) (b) or (c), Stats., that becomes a component part of a utility waste treatment facility that has not been approved by the department for a property tax exemption under s. 76.025(1), Stats. Note: Contractors may direct questions concerning the property to the department as provided in sub. (2).
2. `Industrial property taxed under ch. 70, Stats.' Approvals are not required for industrial waste treatment facilities. A contractor or subcontractor may be liable for sales and use tax on a purchase of tangible personal property or items or property under s. 77.52(1) (b) or (c), Stats., that becomes a component part of a facility that is determined to not qualify for a waste treatment facility property tax exemption under s. 70.11(21), Stats. Note: Contractors may direct questions concerning the taxability of the waste treatment facility to the department as provided in sub. (2m).
3. `Municipal waste treatment facilities.' Approvals are not required for municipal waste treatment facilities. A contractor or subcontractor may be liable for sales and use tax on a purchase of tangible personal property or items or property under s. 77.52(1) (b) or (c), Stats., that becomes a component part of a facility that is determined not to be a municipal waste treatment facility as provided in sub. (3). Note: Contractors may direct questions concerning the taxability of the waste treatment facility to the department as provided in sub. (2m).
Note: Section Tax 11.11 interprets s. 77.54(26), Stats.
Wis. Admin. Code Department of Revenue Tax 11.11
Cr. Register, March, 1979, No. 279, eff. 4-1-79; am. (2), (4) (b) and (5) (d), r. and recr. (3), Register, September, 1982, No. 321, eff. 10-1-82; am. (2) (b), (3) (a) and (b) and (5) (b), Register, September, 1984, No. 345, eff. 10-1-84; cr. (2) (c), r. (1) (b) and (3), renum. (1) (a) to be (1) and am., renum. (2) (a), (b) and (c) to be (4) (a), (c) and (b) and am., renum. (4) to be (2) and am. (2) (a) and (b), renum. (5) (a), (b), (c) and (d) to be (3) (b), (a), (c) and (d), Register, June, 1991, No. 426, eff. 7-1-91; correction in (2) (a) made under 13.93(2m) (b) 7., Stats., Register, August, 1999, No. 524; am. (2) (b), r. (2) (c), cr. (3) (intro.), (b), (c) and (d), renum. (3) (a) to (d) and (4) to be (3) (a) 1., 2. and 3, (4) and (5) and am. (4) and (5) (c), Register, October, 1999, No. 526, eff. 11-1-99; CR 02-053: renum. (2) (a) and (4) to be (2) and (4) (a) and am., r. (2) (b), cr. (2m) and (4) (b), am. (5) (a), r. and recr. (5) (c) Register November 2002 No. 563, eff. 12-1-02; EmR0924: emerg. am. (1), (2m) (b), (3) (intro.), (5) (a), (c) 1. to 3., renum. (2m) (a) to be (2m) (a) (intro.) and am., cr. (2m) (a) 1. and 2., eff. 10-1-09; CR 09-090: am. (1), (2m) (b), (3) (intro.), (5) (a), (c) 1. to 3., renum. (2m) (a) to be (2m) (a) (intro.) and am., cr. (2m) (a) 1. and 2. Register May 2010 No. 653, eff. 6-1-10; CR 10-094: am. (3) (a) 3., (b) 1. (intro.), b., (c), (d) 1., (4) (a), (5) (b) Register November 2010 No. 659, eff. 12-1-10.Amended by, CR 16-053: am. (3) (intro.) Register June 2018 No. 750, eff. 7/1/2018Amended by, correction in (2) (Note), (3) (d) 2. (Note) made under s. 35.17, Stats., Register July 2021 No. 787, eff. 8/1/2021The interpretations in s. Tax 11.11 are effective July 31, 1975 when ss. 70.11(21) and 77.54(26), Stats., were revised, except: (a) The exemptions for chemicals and supplies used or consumed in operating a waste treatment facility became effective September 1, 1979, pursuant to Chapter 39, Laws of 1979; (b) The approval process for property and sales tax exemptions for industrial waste treatment facilities, except utilities, were eliminated effective January 1, 2002, pursuant to 2001 Wis. Act 16; (c) The definition of an industrial waste treatment facility was amended pursuant to 2007 Wis. Act 19 and applies on and after October 1, 2007; and (d) The separate impositions of tax on coins and stamps sold above face value under s. 77.52(1) (b), Stats., certain leased property affixed to real property under s. 77.52(1) (c), Stats., and digital goods under s. 77.52(1) (d), Stats., became effective October 1, 2009, pursuant to 2009 Wis. Act 2.