Bill > SF1724

This bill modifies sales and use tax exemption provisions for construction materials purchased by contractors for specific types of entities, expanding existing tax refund mechanisms. The legislation creates a new tax exemption for building, construction, and reconstruction materials used in facilities for various entities including school districts, local governments, publicly-owned hospitals and nursing homes, libraries, nonprofit groups, hospitals, dental providers, and nursing homes. The bill also extends the exemption to materials used in public infrastructure projects for school districts and local governments. Importantly, while these materials will be exempt, contractors must initially pay the sales tax at the standard rate and then apply for a full refund through the Minnesota Department of Revenue. Contractors will be limited to filing no more than two refund applications per calendar year for these tax-exempt purchases. The new provisions will take effect for sales and purchases made after June 30, 2025, providing clarity and predictability for contractors and the entities they serve. By broadening the existing tax exemption and refund process, the bill aims to reduce the financial burden on public service organizations and infrastructure development.

Budget and Finance

https://www.revisor.mn.gov/bills/bill.php?b=Senate&f=SF1724&ssn=0&y=2025