Leased irrigation equipment

From the 2024 DOR Tax Exemption Study

82.08.0288; 82.12.0283 - Leased irrigation equipment Description Leases of irrigation equipment are exempt from sales and use taxes, if: - The lessor purchased the equipment to irrigate land they control. - The lessor paid sales or use tax on the equipment. - The equipment is attached to the land. - The equipment is an incidental part of the land lease. - The equipment is not used in the production of cannabis. Purpose Normally, persons who lease tangible personal property pay sales tax to the lessor. However, in this instance, the owner of the land previously paid the sales tax on the equipment. For sales tax to apply at the lessee level, the original acquisition of the equipment by the lessor would be an exempt sale for resale. Taxpayer ($ in millions): savings FY 2024 FY 2025 FY 2026 FY 2027 State Taxes $2.927 $3.040 $3.158 $3.280 Local Taxes $0.846 $0.879 $0.913 $0.948 Repeal of Repealing this exemption would increase revenues. exemption Potential ($ in millions): revenue gains FY 2024 FY 2025 FY 2026 FY 2027 from full repeal State Taxes $0.000 $2.787 $3.158 $3.280 Local Taxes $0.000 $0.806 $0.913 $0.948 Assumptions - This repeal takes effect July 1, 2024, and impacts 11 months