Wind energy sales tax exemption bill held

A bill, S2005, which would provide a sales and use tax exemption on the receipts from sales of any wind energy device or system, was held in the Senate Budget committee today due to concerns about the retroactive nature of the wording.

Current law, since July 1, 1977, has provided for a sales and use tax exemption on solar energy devices and systems.

The bill further allows a person to file an application for a sales and use tax rebate reflecting the amount of the tax paid on a wind energy device or system with the Director of the Division of Taxation in the Department of the Treasury that was purchased and installed after June 30, 1977 and prior to the operative date of the bill.

Further, in order for the purchaser to qualify for the rebate, the device or system must still be in use on the operative date of the bill and otherwise meet the requirements of section 1 of the bill. The bill requires the director to promulgate regulations and forms for that purpose, including a provision that an applicant shall provide proof of such purchase and installation and the amount of such tax paid.

Estimated fiscal-year 2011 revenue loss is about $340 million, dropping to $85.2 million for the next two fiscal years, according to Treasury.

Sen. Jeff Van Drew, who said he would have abstained from voting because he has a windmill, said small businesses had not been charging sales tax for installing such systems. “Now they are going to have to eat that,’’ he explained.

Wind energy sales tax exemption bill held