California Partial Sales Tax Exemption Certificate – Manufacturing Equipment

Partial Sales Tax Exemption Certificate – Manufacturing Equipment
Partial Exemption Certificate for Manufacturing and Research and Development Equipment
California Department of Tax and Fee Administration

INFORMATION UPDATE
Assembly Bill (AB) 398 (Chapter 135, Stats. 2017) and AB 131 (Chapter 252, Stats. 2017) amended Revenue and Taxation
Code (R&TC) section 6377.1, which provides for a partial sales and use tax exemption for certain manufacturing and research &
development equipment. Among other changes, the amendments change, beginning January 1, 2018:
• The definition of a “qualified person” to include persons primarily engaged in electric power generation or distribution of electric
power as described in NAICS codes 221111 to 221118, or 221122.
• The definition of “qualified tangible personal property” to include special purpose buildings and foundations used as an integral part
of the generation or production, or storage and distribution, of electric power.
The exemption certificate forms, CDTFA-230-M, Partial Exemption Certificate for Manufacturing and Research & Development
Equipment, and CDTFA-230-MC, Construction Contracts-Partial Exemption Certificate for Manufacturing, and Research &
Development Equipment, are included in Regulation 1525.4, Manufacturing and Research & Development Equipment. We have
revised the date on the posted exemption certificate forms to conform with the statutory changes. These forms will be further revised
once the process of updating Regulation 1525.4 is completed.
We suggest that, if applicable, the person issuing the exemption certificate add a statement on the certificate that they are “primarily
engaged in the generation or production, or storage and distribution, of electric power as described in NAICS codes 221111 to 221118,
or 221122.”
For more information about the amendments to R&TC section 6377.1, please see our online guide, Tax Guide for Manufacturing and
Research & Development Equipment Exemption.

CDTFA-230-M REV. 4 (9-21)

STATE OF CALIFORNIA

PARTIAL EXEMPTION CERTIFICATE FOR MANUFACTURING
AND RESEARCH & DEVELOPMENT EQUIPMENT

CALIFORNIA DEPARTMENT OF
TAX AND FEE ADMINISTRATION

Section 6377.11
This is a partial exemption from sales and use taxes at the rate of 4.1875 percent from July 1, 2014, to December 31, 2016, and at the rate
of 3.9375 percent from January 1, 2017, to June 30, 2030. You are not relieved from your obligations for the remaining state tax and
local and district taxes on this transaction. This partial exemption also applies to lease periods occurring on or after July 1, 2014, and
before July 1, 2030, for leases of qualified tangible personal property, even if the lease agreement was entered into prior to July 1, 2014.
I hereby certify that the tangible personal property described below and purchased or leased from:
SELLER’S/LESSOR’S NAME

SELLER’S/LESSOR’S ADDRESS (street, city, state, ZIP Code)

is qualified tangible personal property and will be used by me primarily (please check one):
1.

For manufacturing, processing, refining, fabricating, or recycling;

2.

For research and development;

3.

To maintain, repair, measure, or test any property being used for (1) or (2) above; or

4.

As a special-purpose building and/or foundation.

Description of qualified tangible personal property purchased or leased 2:

If this is a specific partial exemption certificate, provide the purchase order or sales invoice number and a precise description of the
property being purchased. If you want this certificate to be used as a blanket certificate for future purchases, describe generally the type
of property you will be purchasing, and ask your vendor to keep this certificate on file.
I, as the undersigned purchaser, hereby certify I am primarily engaged in manufacturing, processing, refining, fabricating, or recycling
as described in codes 3111 to 3399 in the North American Industry Classification System (NAICS) 3, or I am primarily engaged in
biotechnology, or physical, engineering, and life sciences research and development as described in codes 541711 and 541712 of the
NAICS.
I understand that by law, I am required to report and pay the state tax (calculated on the sales price/rentals payable of the property) at the
time the property is purchased, removed, converted, or used if:
•
•
•
•

The purchase exceeds the $200 million limitation;
The property is removed from California within one year of the date of purchase or lease;
The property is converted for use in a manner not qualifying for the exemption; or
The property is used in a manner not qualifying for the partial exemption.

NAME OF PURCHASER

SIGNATURE OF PURCHASER, PURCHASER’S EMPLOYEE, OR AUTHORIZED REPRESENTATIVE

PRINTED NAME OF PERSON SIGNING

TITLE

ADDRESS OF PURCHASER

PERMIT NUMBER (if you are not required to hold a permit, explain why)

TELEPHONE NUMBER

EMAIL ADDRESS OF PERSON SIGNING

DATE

1

CDTFA is updating this exemption certificate as part of changes to Regulation 1525.4, which is currently going through the rulemaking process.
Please use this updated form until the regulation is adopted and approved. This form is subject to change.

2

See Regulation 1525.4 (b)(9) for a description of what is included and excluded from “qualified tangible personal property.”

3

Official 2012 US NAICS Manual, U.S. Office of Management and Budget, 2012 edition.

CLEAR

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