Vermont Utility Sales Tax Exemption

Manufacturers and industrial processors with facilities located in Vermont, may be eligible for a utility tax exemption. Vermont offers an exemption from state and local sales tax on the purchase of electricity, natural gas, and water used in qualifying production activities. This tax exemption is authorized by 32 V.S.A. § 9741(34).

Exemption Language of 32 V.S.A. § 9741(34)

"Sales of electricity, oil, gas, and other fuels used directly or indirectly in manufacturing tangible personal property for sale" are exempt from tax."

Utility Study Requirement for Exemption Qualification

A Vermont utility tax study should list every piece of equipment and appliance (production and non-production) that uses the utility and the annual consumption of each. A square footage analysis may be appropriate in Vermont, unless floor space does not accurately reflect usage. Failure to properly calculate or classify utility usage is cause for denial of the exemption.

Vermont Statute of Limitations on Tax Refund

3 years

State Sales Tax Rate: 6%

Average Local Sales Tax Rate: 0.22%

Helpful Resources

Vermont Utility Exemption Certificate: Form S-3F Exemption Certificate

Vermont Utility Exemption Statute/Rule: 32 V.S.A. § 9741(34)

Vermont Claim Form for Tax Refund: Application for Refund REF-620