Commonwealth of Massachusetts
The Governor's Budget Recommendation

Tax Expenditure Budget

Part VI: Appendix B

**Fiscal Year Estimates (in millions)**
Tax Expenditure	Item Number	FY95(1)	FY96(1)	FY97
PERSONAL INCOME TAX
Exclusions from Gross Income
Exemption of Premiums on Accident and Accidental Death Insurance	1.001	1.5	1.5	1.5
Exemption of Premiums on Group-Term Life Insurance	1.002	15.2	15.2	15.2
Exemption of Interest on Life Insurance Policy and Annuity Cash Value	1.003	94.9	100.7	151.6
Exemption of Employer Contributions for Medical Insurance Premiums and Medical Care	1.004	343.19	368.7	396.1
Exemption of Annuity or Pension Payments to Firemen and Policemen	1.005
Exemption of Distributions from Certain Contributory Pension and Annuity Plans	1.006
Exemption of Railroad Retirement Benefits	1.007	3.3	3.3	3.4
Exemption of Public Assistance Benefits	1.008	25.4	26.4	27.3
Exemption of Social Security Benefits	1.009	293.6	296.7	298
Exemption of Workers' Compensation Benefits	1.010	3.2	3.3	3.5
Exemption of Dependent Care Expenses	1.011	6.1	7.1	8.1
Exemption of Certain Foster Care Payments	1.012	4.2	4.2	4.3
Exemption of Payments Made to Coal Miners	1.013
Exemption of Rental Value of Parsonages	1.014
Exemption of Scholarships and Fellowships	1.015	8.31	9.3	10.4
Exclusion of Certain Prizes and Awards	1.016
Exemption of Cost-Sharing Payments	1.017
Exemption of Meals and Lodging Provided at Work	1.018	4.6	4.6	4.6
Treatment of Business-Related Entertainment Expenses	1.019	3	3.1	3.2
Exemption of Income from the Sale, Lease or Transfer of Certain Patents	1.020
Exemption of Capital Gains on Home Sale for Persons 55 and Over	1.021	38.35	39.8	41.3
Nontaxation of Capital Gains at Death	1.022	49.28	54.2	59.6
Exemption of Interest from Massachusetts Obligations	1.023	88.2	77.5	77.4
Exemption of Benefits and Allowances to Armed Forces Personnel	1.024	4.6	4.7	4.7
Exemption of Veterans' Pensions, Disability Compensation and G.I. Benefits	1.025	15.13	15.9	16.7
Exemption of Military Disability Pensions	1.026	.4	.4	.4
Exemption of Compensation to Massachusetts-Based Nonresident Military Personnel	1.027	13.2	12.8	12.4
Exemption of Income Received by Persons Killed in Military Action or Terrorist Activity	1.028
Deferrals of Gross Income
Net Exemption of Employer Contributions and Earnings of Private Pension Plans	1.101	523.38	530.2	537.1
Treatment of Incentive Stock Options	1.102
Exemption of Earnings on Stock Bonus Plans or Profit Sharing Trusts	1.103
Exemption of Earnings on IRA and Keogh Plans	1.104	161.1	180.37	198.93
Deferral of Capital Gains on Home Sales	1.105	62.5	60.2	53.7
Nontaxation of Capital Gains at Time of Gift	1.106
Deductions from Gross Income
Deduction of Capital Losses against Interest and Dividend Income	1.202
Excess Natural Resource Depletion Allowance	1.203	.7	.7	.7
Abandoned Building Renovation Deduction	1.204
Accelerated Deductions from Gross Income
Accelerated Depreciation on Rental Housing	1.301	5.6	5.6	5.6
Accelerated Depreciation on Rehabilitation of Low Income Housing	1.302
Accelerated Depreciation on Buildings (other than Rental Housing)	1.303	10.5	9.8	7.7
Accelerated Cost Recovery System (ACRS) for Equipment	1.304	37.94	39.3	40.7
Deduction for Excess First-Year Depreciation	1.305	2.9	2.9	1.7
Five-Year Amortization of Start-Up Cost	1.306	.8	.8	.8
Five-Year Amortization of Certain Operating Rights	1.307
Expensing of Exploration and Development Costs	1.308	3.2	3.2	3.2
Expensing of Research and Development Expenditures in One Year	1.309	1.1	1.2	1.4
Five-Year Amortization of Pollution Control Facilities	1.310
Seven Year Amortization for Reforestation	1.311
Expensing of Certain Capital Outlays of Farmers	1.312	.2	.2	.2
Deductions from Adjusted Gross Income
Deduction for Employee Social Security and Railroad Retirement Payments	1.401	259	264	273
Deduction for Employee Contributions to Public Pension Plans	1.402
Additional Exemption for the Elderly	1.403	10	11	12
Additional Exemption for the Blind	1.404	.5	.5	.5
Dependents Exemption where the Child Earns Income	1.405
Deduction for Dependent Under 12	1.406	15	14	14
Personal Exemption for Students Aged 19 or Over	1.407	6	6	6
Deduction for Adoption Fees	1.408	1	1	1
Deduction for Business-Related Childcare Expenses	1.409	14	15	16
Exemption of Medical Expenses	1.410	26.7	27.37	28.03
Rent Deduction	1.411	92	92	96
Nontaxation of Charitable Purpose Income of Trustees, Executors or Administrators	1.412
Exemption of Interest on Savings in Massachusetts Banks	1.413	12	13	13
Preferential Rate of Taxation
Preferential Treatment of Interest on Savings Massachusetts Banks	1.501	156	169.6	184.9
Credits Against Tax
Renewable Energy Source Credit	1.601
Credit for Removal of Lead Paint	1.602	6.6	7.7	8.6
Economic Opportunity Area Credit	1.603
SUBTOTAL(2)		2424.43	2505.04	2644.47

CORPORATE EXCISE
Exclusions from Gross Income
Small Business Corporations	2.001	13.8	14.9	15.5
Exemption of Income from the Sale,Lease or Transfer of Certain Patents	2.002
Deferrals of Gross Income
Deferral of Tax on Certain Shipping Companies	2.101	.2	.2	.2
Deductions from Gross Income
Charitable Deduction	2.201	9.8	9.8	9.8
Additional Deduction for Certain Businesses in a Poverty Area (UJIP)	2.202	.2	.2	.2
Net Operating Loss (NOL) Carryover	2.203	88.7	91.9	93.6
Excess Natural Resource Depletion Allowance	2.204	.1	.1	.1
Deduction for Certain Dividends of Cooperatives	2.205
Abandoned Building Renovation Deduction	2.206
Accelerated Deductions from Gross Income
Accelerated Depreciation on Rental Housing	2.301	8	8	8
Accelerated Depreciation for Rehabilitation of Low-Income Housing	2.302
Expensing for Removal of Barriers to the Handicapped	2.303	.6	.6	.6
Five-Year Amortization of Start-Up Cost	2.304	2.9	2.9	2.9
Accelerated Cost Recovery System (ACRS) for Equipment	2.305	166.029	163.8	161.6
Deduction for Excess First-Year Depreciation	2.306	.8	6.1	3.8
Accelerated Depreciation on Buildings (other than Rental Housing)	2.307	30.66	26.5	22.9
Expensing of Research and Development Expenditures in One Year	2.308	36.95	40	43.3
Expensing of Exploration and Development.Costs	2.309	.1	.1	.1
Five-Year Amortizaton of Certain Operating Rights	2.310
Five-Year Amortization of Pollution Control Facilities	2.311
Expensing of Certain Expenditures for Alternative Energy Sources	2.312	.5	.6	.7
Seven-Year Amortization for Reforestation	2.313
Adjustments to Apportionment Formula
Unequal Weighting of Sales, Payroll, and Property in Apportionment Formula	2.401	77.3	126.8	150.7
Exclusions from Property Component
Nontaxation of Certain Energy Property	2.501
Exemption for Property Subject to Local Taxation	2.502	81.6	86.3	89.8
Credits Against Tax
Tax Credit for Building in a Poverty Area (UJIP)	2.601	.4	.4	.4
Investment Tax Credit(3)	2.602	21.6	22.4	24.5
Vanpool Credit	2.603	.7	.8	.8
Research Credit	2.604	41	50	50.7
Economic Opportunity Area Credit	2.605
Entity Exempt from Taxation
Exemption of Credit Union Income	2.701	7.5	7.5	7.5
Tax-Exempt Organizations	2.702
Exemption for Regulated Investment Companies	2.703
SUBTOTAL(2)		589.44	659.9	687.7

SALES AND USE TAX
Exempt Entities
Exemption for Sales to the Federal Government	3.001
Exemption for Sales to the Commonwealth	3.002
Exemption for Sales to Tax-Exempt Organizations	3.003	266.2	279	291.2
Exempt Products/Services
Exemption for Food	3.101	331	336	341
Exemption for Certain Food and Beverages Sold in Restaurants	3.102
Exemption for Clothing	3.103	201	204	207
Exemption for Medical and Dental Supplies and Devices	3.104	66	68	71
Exemption for Water	3.105	21	22	23
Exemption for Newspapers and Magazines	3.106	42	43	43
Exemption for the American Flag	3.107
Exemption for Certain Precious Metals	3.108
Exemption for Cement Mixers	3.109
Exemption for Fertilizers, Insecticides and Fungicides	3.110	.84	.81	.78
Exemption for Meals Served by Continuing Care Facilities	3.111
Exempt, Taxed Under Another Excise
Exemption for Alcoholic Beverages	3.201	86	82	83
Exemption for Motor Fuels	3.202	156	159	165
Exempt Component of a Product or Consumed in Production
Exemption for Items Used in Making Clothing	3.301	1.9	2	2.05
Exemption for Materials, Tools, Fuels and Machinery Used in Manufacturing	3.302	142.8	152.8	166.1
Exemption for Materials, Tools, Fuels and Machinery Used in Research and Development	3.303	19.5	21	22.6
Exemption for Materials, Tools, Fuels and Machinery Used in Furnishing Power to Consumers	3.304	70.8	75.5	80.26
Exemption for Materials, Tools, Fuels and Machinery Used in Furnishing Power to an Industrial Manufacturing Plant	3.305	13.9	14.6	15.4
Exemption for Materials, Tools, Fuels and Machinery Used in Newspaper Printing	3.306	20	21	22.1
Exemption for Materials, Tools, Fuels and Machinery Used in Manufacturing of Cast Metal Products	3.307
Exemption for Materials, Tools, Fuels and Machinery Used in Agricultural Production	3.308	3	3	3.1
Exemption for Materials, Tools, Fuels and Machinery Used in Commercial Fishing	3.309	1.6	1.6	1.7
Exemption for TV and Radio	3.310			1.4
Exemptions for Specified Uses of Products/Services
Exemption for Electricity	3.401	106	110	113
Exemption for Fuel Used for Heating Purposes	3.402	51	52	54
Exemption for Piped and Bottled Gas	3.403	54	55	57
Exemption for Steam	3.404	3	4	4
Exemption for Certain Energy Conservation Equipment	3.405
Exemption for Funeral Items	3.406	5	5	5
Exemption for a Motor Vehicle for a Paraplegic	3.407	.6	.6	.6
Exemption for Textbooks	3.408	9	9	10
Exemption for Books used for Religious Worship	3.409
Exemption for Containers	3.410	86	88	91
Exemption for Certain Sales by Typographers, Compositors and Color Separators	3.411
Exemption for Sales of Building Materials and Supplies to be Used in Connection with Certain Construction Contracts	3.412	105.8	111.1	116.7
Exemption for Plant and Seed	3.413	.41	.42	.43
Exemption of Feed	3.414	1.74	1.79	1.83
Exemption for Livestock and Poultry	3.415
Exemption for Commercial Fishing Vessels	3.416	1	1	1
Exemption for Commuter Boats	3.417
Exemption for Fuels, Supplies and Repairs for Vessels Engaged in Interstate or Foreign Commerce	3.418	1.4	1.5	1.5
Exemption for Fuel Used in Operating Aircraft and Railroads	3.419	12.4	13	13.7
Exemption for Sales of Certain New and Used Buses	3.420
Exemption for Films	3.421
Exemption for Telephone and Telegraph Services	3.422	35	37	38
Exempt, Not Taxable as Tangible Personal Property
Nontaxation of Transfers of Real Property	3.501	881.6	943	877.2
Nontaxation of Rentals of Real Property	3.502	506.1	511.2	518.9
Nontaxation of Certain Services	3.503	1111	1155	1204
Miscellaneous Exemptions
Exemption for Casual or Isolated Sales	3.601
Exemption for Vending Machine Sales	3.602
Exemption for Certain Meals	3.603	5.1	5.2	5.4
Exemption for Certain Bed and Breakfast Establishments from Sales Tax on Meals and Room Occupancy Excise	3.604
Exemption for Certain Summer Camps from Sales Tax on Meals and Room Occupancy Excise	3.605	.4	.4	.4
Exemption for Trade-in Allowances for Motor Vehicles and Trailers	3.606	39.9	42.9	46.1
Exemptions for Publications of Tax-Exempt Organizations	3.607	3.4	3.6	3.8
Exemption for Gifts of Scientific Equipment	3.608	11	11	11
Exemption for Vessels or Barges 50 Tons or Over	3.609
Exemption for Rental Charges for Refuse Containers	3.610
Exemption for Honor Trays	3.611
SUBTOTAL(2)		4474.4	4647	4714.27

ESTATE AND GENERATION SKIPPING TAX
Exclusions from Transfer Taxation
Nontaxation of Lifetime Transfers	4.001	12.5	10.18	7.14
Nontaxation of Certain Generation-Skipping Transfers	4.002
Exclusions from Gross Estate
Exemption of Annuities under Qualified Retirement Plans	4.101
Exemption of Life Insurance Proceeds on which the Decedent Paid the Premiums	4.102
Preferential Valuations of Property
Special Valuation of Farm Land	4.201
Deductions from Adjusted Gross Estate
Deduction of Charitable Bequests	4.301	16.7	14.55	13.48
Deduction for Bequest to Surviving Spouse	4.302	90	96	96
SUBTOTAL(2)		119.2	120.73	116.62

TOTAL		7607.48	7932.7	8163.07

The following table shows tax expenditure estimates for the four major taxes from Fiscal Year 1995 to Fiscal Year 1997. In general, the revenue estimate for a tax expenditure tends to follow the anticipated growth of tax collections. However, year-to-year changes in estimates may vary for four other principal reasons: we have new data sources, we have refined our methodology, we have relied on federal tax expenditure estimates which have changed, and we have revised estimates to account for changes in tax laws.

Where possible, we have recalculated past estimates based on revised data, improved methodologies, and changes in statute.

Fiscal Year Estimates (in millions)
Tax Expenditure Item Number FY95(1) FY96(1) FY97
PERSONAL INCOME TAX

Exclusions from Gross Income

Exemption of Premiums on Accident and Accidental Death Insurance 1.001 1.5 1.5 1.5

Exemption of Premiums on Group-Term Life Insurance 1.002 15.2 15.2 15.2

Exemption of Interest on Life Insurance Policy and Annuity Cash Value 1.003 94.9 100.7 151.6

Exemption of Employer Contributions for Medical Insurance Premiums and Medical Care 1.004 343.19 368.7 396.1

Exemption of Annuity or Pension Payments to Firemen and Policemen 1.005

Exemption of Distributions from Certain Contributory Pension and Annuity Plans 1.006

Exemption of Railroad Retirement Benefits 1.007 3.3 3.3 3.4

Exemption of Public Assistance Benefits 1.008 25.4 26.4 27.3

Exemption of Social Security Benefits 1.009 293.6 296.7 298

Exemption of Workers' Compensation Benefits 1.010 3.2 3.3 3.5

Exemption of Dependent Care Expenses 1.011 6.1 7.1 8.1

Exemption of Certain Foster Care Payments 1.012 4.2 4.2 4.3

Exemption of Payments Made to Coal Miners 1.013

Exemption of Rental Value of Parsonages 1.014

Exemption of Scholarships and Fellowships 1.015 8.31 9.3 10.4

Exclusion of Certain Prizes and Awards 1.016

Exemption of Cost-Sharing Payments 1.017

Exemption of Meals and Lodging Provided at Work 1.018 4.6 4.6 4.6

Treatment of Business-Related Entertainment Expenses 1.019 3 3.1 3.2

Exemption of Income from the Sale, Lease or Transfer of Certain Patents 1.020

Exemption of Capital Gains on Home Sale for Persons 55 and Over 1.021 38.35 39.8 41.3

Nontaxation of Capital Gains at Death 1.022 49.28 54.2 59.6

Exemption of Interest from Massachusetts Obligations 1.023 88.2 77.5 77.4

Exemption of Benefits and Allowances to Armed Forces Personnel 1.024 4.6 4.7 4.7

Exemption of Veterans' Pensions, Disability Compensation and G.I. Benefits 1.025 15.13 15.9 16.7

Exemption of Military Disability Pensions 1.026 .4 .4 .4

Exemption of Compensation to Massachusetts-Based Nonresident Military Personnel 1.027 13.2 12.8 12.4

Exemption of Income Received by Persons Killed in Military Action or Terrorist Activity 1.028

Deferrals of Gross Income

Net Exemption of Employer Contributions and Earnings of Private Pension Plans 1.101 523.38 530.2 537.1

Treatment of Incentive Stock Options 1.102

Exemption of Earnings on Stock Bonus Plans or Profit Sharing Trusts 1.103

Exemption of Earnings on IRA and Keogh Plans 1.104 161.1 180.37 198.93

Deferral of Capital Gains on Home Sales 1.105 62.5 60.2 53.7

Nontaxation of Capital Gains at Time of Gift 1.106

Deductions from Gross Income

Deduction of Capital Losses against Interest and Dividend Income 1.202

Excess Natural Resource Depletion Allowance 1.203 .7 .7 .7

Abandoned Building Renovation Deduction 1.204

Accelerated Deductions from Gross Income

Accelerated Depreciation on Rental Housing 1.301 5.6 5.6 5.6

Accelerated Depreciation on Rehabilitation of Low Income Housing 1.302

Accelerated Depreciation on Buildings (other than Rental Housing) 1.303 10.5 9.8 7.7

Accelerated Cost Recovery System (ACRS) for Equipment 1.304 37.94 39.3 40.7

Deduction for Excess First-Year Depreciation 1.305 2.9 2.9 1.7

Five-Year Amortization of Start-Up Cost 1.306 .8 .8 .8

Five-Year Amortization of Certain Operating Rights 1.307

Expensing of Exploration and Development Costs 1.308 3.2 3.2 3.2

Expensing of Research and Development Expenditures in One Year 1.309 1.1 1.2 1.4

Five-Year Amortization of Pollution Control Facilities 1.310

Seven Year Amortization for Reforestation 1.311

Expensing of Certain Capital Outlays of Farmers 1.312 .2 .2 .2

Deductions from Adjusted Gross Income

Deduction for Employee Social Security and Railroad Retirement Payments 1.401 259 264 273

Deduction for Employee Contributions to Public Pension Plans 1.402

Additional Exemption for the Elderly 1.403 10 11 12

Additional Exemption for the Blind 1.404 .5 .5 .5

Dependents Exemption where the Child Earns Income 1.405

Deduction for Dependent Under 12 1.406 15 14 14

Personal Exemption for Students Aged 19 or Over 1.407 6 6 6

Deduction for Adoption Fees 1.408 1 1 1

Deduction for Business-Related Childcare Expenses 1.409 14 15 16

Exemption of Medical Expenses 1.410 26.7 27.37 28.03

Rent Deduction 1.411 92 92 96

Nontaxation of Charitable Purpose Income of Trustees, Executors or Administrators 1.412

Exemption of Interest on Savings in Massachusetts Banks 1.413 12 13 13

Preferential Rate of Taxation

Preferential Treatment of Interest on Savings Massachusetts Banks 1.501 156 169.6 184.9

Credits Against Tax

Renewable Energy Source Credit 1.601

Credit for Removal of Lead Paint 1.602 6.6 7.7 8.6

Economic Opportunity Area Credit 1.603

SUBTOTAL(2)
2424.43 2505.04 2644.47

CORPORATE EXCISE

Exclusions from Gross Income

Small Business Corporations 2.001 13.8 14.9 15.5

Exemption of Income from the Sale,Lease or Transfer of Certain Patents 2.002

Deferrals of Gross Income

Deferral of Tax on Certain Shipping Companies 2.101 .2 .2 .2

Deductions from Gross Income

Charitable Deduction 2.201 9.8 9.8 9.8

Additional Deduction for Certain Businesses in a Poverty Area (UJIP) 2.202 .2 .2 .2

Net Operating Loss (NOL) Carryover 2.203 88.7 91.9 93.6

Excess Natural Resource Depletion Allowance 2.204 .1 .1 .1

Deduction for Certain Dividends of Cooperatives 2.205

Abandoned Building Renovation Deduction 2.206

Accelerated Deductions from Gross Income

Accelerated Depreciation on Rental Housing 2.301 8 8 8

Accelerated Depreciation for Rehabilitation of Low-Income Housing 2.302

Expensing for Removal of Barriers to the Handicapped 2.303 .6 .6 .6

Five-Year Amortization of Start-Up Cost 2.304 2.9 2.9 2.9

Accelerated Cost Recovery System (ACRS) for Equipment 2.305 166.029 163.8 161.6

Deduction for Excess First-Year Depreciation 2.306 .8 6.1 3.8

Accelerated Depreciation on Buildings (other than Rental Housing) 2.307 30.66 26.5 22.9

Expensing of Research and Development Expenditures in One Year 2.308 36.95 40 43.3

Expensing of Exploration and Development.Costs 2.309 .1 .1 .1

Five-Year Amortizaton of Certain Operating Rights 2.310

Five-Year Amortization of Pollution Control Facilities 2.311

Expensing of Certain Expenditures for Alternative Energy Sources 2.312 .5 .6 .7

Seven-Year Amortization for Reforestation 2.313

Adjustments to Apportionment Formula

Unequal Weighting of Sales, Payroll, and Property in Apportionment Formula 2.401 77.3 126.8 150.7

Exclusions from Property Component

Nontaxation of Certain Energy Property 2.501

Exemption for Property Subject to Local Taxation 2.502 81.6 86.3 89.8

Credits Against Tax

Tax Credit for Building in a Poverty Area (UJIP) 2.601 .4 .4 .4

Investment Tax Credit(3) 2.602 21.6 22.4 24.5

Vanpool Credit 2.603 .7 .8 .8

Research Credit 2.604 41 50 50.7

Economic Opportunity Area Credit 2.605

Entity Exempt from Taxation

Exemption of Credit Union Income 2.701 7.5 7.5 7.5

Tax-Exempt Organizations 2.702

Exemption for Regulated Investment Companies 2.703

SUBTOTAL(2)
589.44 659.9 687.7

SALES AND USE TAX

Exempt Entities

Exemption for Sales to the Federal Government 3.001

Exemption for Sales to the Commonwealth 3.002

Exemption for Sales to Tax-Exempt Organizations 3.003 266.2 279 291.2

Exempt Products/Services

Exemption for Food 3.101 331 336 341

Exemption for Certain Food and Beverages Sold in Restaurants 3.102

Exemption for Clothing 3.103 201 204 207

Exemption for Medical and Dental Supplies and Devices 3.104 66 68 71

Exemption for Water 3.105 21 22 23

Exemption for Newspapers and Magazines 3.106 42 43 43

Exemption for the American Flag 3.107

Exemption for Certain Precious Metals 3.108

Exemption for Cement Mixers 3.109

Exemption for Fertilizers, Insecticides and Fungicides 3.110 .84 .81 .78

Exemption for Meals Served by Continuing Care Facilities 3.111

Exempt, Taxed Under Another Excise

Exemption for Alcoholic Beverages 3.201 86 82 83

Exemption for Motor Fuels 3.202 156 159 165

Exempt Component of a Product or Consumed in Production

Exemption for Items Used in Making Clothing 3.301 1.9 2 2.05

Exemption for Materials, Tools, Fuels and Machinery Used in Manufacturing 3.302 142.8 152.8 166.1

Exemption for Materials, Tools, Fuels and Machinery Used in Research and Development 3.303 19.5 21 22.6

Exemption for Materials, Tools, Fuels and Machinery Used in Furnishing Power to Consumers 3.304 70.8 75.5 80.26

Exemption for Materials, Tools, Fuels and Machinery Used in Furnishing Power to an Industrial Manufacturing Plant 3.305 13.9 14.6 15.4

Exemption for Materials, Tools, Fuels and Machinery Used in Newspaper Printing 3.306 20 21 22.1

Exemption for Materials, Tools, Fuels and Machinery Used in Manufacturing of Cast Metal Products 3.307

Exemption for Materials, Tools, Fuels and Machinery Used in Agricultural Production 3.308 3 3 3.1

Exemption for Materials, Tools, Fuels and Machinery Used in Commercial Fishing 3.309 1.6 1.6 1.7

Exemption for TV and Radio 3.310

1.4

Exemptions for Specified Uses of Products/Services

Exemption for Electricity 3.401 106 110 113

Exemption for Fuel Used for Heating Purposes 3.402 51 52 54

Exemption for Piped and Bottled Gas 3.403 54 55 57

Exemption for Steam 3.404 3 4 4

Exemption for Certain Energy Conservation Equipment 3.405

Exemption for Funeral Items 3.406 5 5 5

Exemption for a Motor Vehicle for a Paraplegic 3.407 .6 .6 .6

Exemption for Textbooks 3.408 9 9 10

Exemption for Books used for Religious Worship 3.409

Exemption for Containers 3.410 86 88 91

Exemption for Certain Sales by Typographers, Compositors and Color Separators 3.411

Exemption for Sales of Building Materials and Supplies to be Used in Connection with Certain Construction Contracts 3.412 105.8 111.1 116.7

Exemption for Plant and Seed 3.413 .41 .42 .43

Exemption of Feed 3.414 1.74 1.79 1.83

Exemption for Livestock and Poultry 3.415

Exemption for Commercial Fishing Vessels 3.416 1 1 1

Exemption for Commuter Boats 3.417

Exemption for Fuels, Supplies and Repairs for Vessels Engaged in Interstate or Foreign Commerce 3.418 1.4 1.5 1.5

Exemption for Fuel Used in Operating Aircraft and Railroads 3.419 12.4 13 13.7

Exemption for Sales of Certain New and Used Buses 3.420

Exemption for Films 3.421

Exemption for Telephone and Telegraph Services 3.422 35 37 38

Exempt, Not Taxable as Tangible Personal Property

Nontaxation of Transfers of Real Property 3.501 881.6 943 877.2

Nontaxation of Rentals of Real Property 3.502 506.1 511.2 518.9

Nontaxation of Certain Services 3.503 1111 1155 1204

Miscellaneous Exemptions

Exemption for Casual or Isolated Sales 3.601

Exemption for Vending Machine Sales 3.602

Exemption for Certain Meals 3.603 5.1 5.2 5.4

Exemption for Certain Bed and Breakfast Establishments from Sales Tax on Meals and Room Occupancy Excise 3.604

Exemption for Certain Summer Camps from Sales Tax on Meals and Room Occupancy Excise 3.605 .4 .4 .4

Exemption for Trade-in Allowances for Motor Vehicles and Trailers 3.606 39.9 42.9 46.1

Exemptions for Publications of Tax-Exempt Organizations 3.607 3.4 3.6 3.8

Exemption for Gifts of Scientific Equipment 3.608 11 11 11

Exemption for Vessels or Barges 50 Tons or Over 3.609

Exemption for Rental Charges for Refuse Containers 3.610

Exemption for Honor Trays 3.611

SUBTOTAL(2)
4474.4 4647 4714.27

ESTATE AND GENERATION SKIPPING TAX

Exclusions from Transfer Taxation

Nontaxation of Lifetime Transfers 4.001 12.5 10.18 7.14

Nontaxation of Certain Generation-Skipping Transfers 4.002

Exclusions from Gross Estate

Exemption of Annuities under Qualified Retirement Plans 4.101

Exemption of Life Insurance Proceeds on which the Decedent Paid the Premiums 4.102

Preferential Valuations of Property

Special Valuation of Farm Land 4.201

Deductions from Adjusted Gross Estate

Deduction of Charitable Bequests 4.301 16.7 14.55 13.48

Deduction for Bequest to Surviving Spouse 4.302 90 96 96

SUBTOTAL(2)
119.2 120.73 116.62

TOTAL
7607.48 7932.7 8163.07

Endnotes

<1>Estimates have been revised because of new data or improved methodology, and reflect current tax law.

<2>Subtotals and total have been provided to give an idea of the revenue costs of tax expenditures by tax and in total. However, these sums should be used with extreme caution. The underlying estimates do not take into account such factors as the interaction of tax expenditures and taxpayer behavior. Also it should be noted that many estimates are not available due to a lack of data. These estimates are shown as N.A. and are not included in the subtotals and total.

<3>This estimate takes into account the dynamic economic impacts of this tax expenditure.

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