|Organization:||Massachusetts Department of Revenue|
|Referenced Sources:||Massachusetts General Laws|
Sales and Use Tax
March 28, 1979
You request a ruling with respect to the sales and use tax status of the purchase of machinery by *********** a Massachusetts limited partnership (hereafter "Purchaser") from ********** a Delaware Corporation (hereafter "Seller"). The purchase of that machinery is described in a contract between the Purchaser and Seller executed on December 27, 1978.
The Purchaser has contracted with the Seller for the construction of a hydroelectric project on the Merrimack River in Lawrence, Massachusetts. Included in the contract are certain items of machinery. Upon completion of the project its entire electrical output will be sold by the Purchaser to [a power company] which will resell the electricity to retail utilities, which in turn will deliver it to ultimate consumers.
Section 6(s) of Chapter 64H of the General Laws provides:
"The following sales and the gross receipts there from shall be exempt from the tax imposed by this chapter:
(s) Sales of machinery, ... used ... in the furnishing of ... electricity when delivered to consumers through mains, lines or pipes ..."
Section 7(b) of Chapter 64I of the General Laws provides:
"The tax imposed by this chapter shall not apply to:
(b) Sales exempt from the taxes imposed under Chapter 64H …"
It is ruled that the sale of machinery used in the furnishing of electricity included in the contract between [Purchaser] and [Seller] dated December 27, 1978, is exempt from sales and use taxes imposed by Section 6(s) of Chapter 64H and Section 7(b) of Chapter 64I of the General Laws.
Very truly yours,
/s/L. Joyce Hampers
L. Joyce Hampers
Commissioner of Revenue