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WI SB654
WI SB654Exempting persons engaged in certain contract research services from the sales and use tax. (FE)
summary
Introduced
11/14/2025
11/14/2025
In Committee
02/03/2026
02/03/2026
Crossed Over
Passed
Dead
Introduced Session
Potential new amendment
2025-2026 Regular Session
Bill Summary
This bill exempts persons engaged in contract research services from the sales and use tax for the purchase of machinery and equipment that is consumed or destroyed in use exclusively for qualified research. Under the bill, “contract research services” is research conducted by a person for a customer that, if conducted by employees of the customer, would constitute qualified research. Current law provides a sales and use tax exemption for the purchase of machinery and equipment that is consumed or destroyed in use exclusively for qualified research by persons engaged in manufacturing on manufacturing property and by persons engaged primarily in biotechnology. Because this bill relates to an exemption from state or local taxes, it may be referred to the Joint Survey Committee on Tax Exemptions for a report to be printed as an appendix to the bill. For further information see the state and local fiscal estimate, which will be printed as an appendix to this bill. LRB-4911/1 KP:skw 2025 - 2026 Legislature SENATE BILL 654
AI Summary
This bill expands sales and use tax exemptions for contract research services by creating new definitions and extending tax benefits. Specifically, the bill defines "contract research services" as research conducted by a person for a customer that would qualify as research if performed by the customer's employees. It broadens the definition of "qualified research" to include research funded within a combined business group and research funded by contract research expenses, as defined in the Internal Revenue Code. The bill adds a new category of entities eligible for the sales and use tax exemption: persons engaged in contract research services in the state. This means that companies performing research services for other businesses can now purchase machinery and equipment used exclusively for qualified research without paying sales and use tax, similar to existing exemptions for manufacturers and biotechnology companies. The legislation aims to support research and development activities by reducing tax burdens on contract research organizations. The bill will take effect on the first day of the third month after its publication.
Committee Categories
Budget and Finance
Sponsors (4)
Last Action
Report of Joint Survey Committee on Tax Exemptions received, Ayes 9, Noes 0 (on 02/10/2026)
Official Document
bill text
bill summary
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bill summary
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bill summary
| Document Type | Source Location |
|---|---|
| State Bill Page | https://docs.legis.wisconsin.gov/2025/proposals/reg/sen/bill/sb654 |
| Fiscal Note - SB654: Report of the Joint Survey Committee on Tax Exemptions | https://docs.legis.wisconsin.gov/2025/related/fe/sb654/sb654_jscte.pdf |
| SB654 ROCP for Joint Committee on Finance | https://docs.legis.wisconsin.gov/2025/related/records/joint/finance/1970264.pdf |
| Analysis - LC Amendment Memo | https://docs.legis.wisconsin.gov/document/lcamendmentmemos/2025/REG/SB654.pdf |
| SB654 ROCP for Committee on Agriculture and Revenue On 1/14/2026 | https://docs.legis.wisconsin.gov/2025/related/records/senate/agriculture_and_revenue/1964036.pdf |
| Senate Amendment 1 | https://docs.legis.wisconsin.gov/document/amends/2025/REG/SB654-SA1.pdf |
| Fiscal Note - SB654: Fiscal Estimate From DOR | https://docs.legis.wisconsin.gov/2025/related/fe/sb654/sb654_dor.pdf |
| BillText | https://docs.legis.wisconsin.gov/document/proposaltext/2025/REG/SB654.pdf |
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