Form Pub. Ks-1550 - Kansas Business Taxes For The Agrcultural Industry Page 10
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32Labor Services
Artificial Insemination Equipment. The following
items are exempt farm machinery and equipment:
As a general rule, the labor services fee charged by
implanting guns, sheaths, thermometers and thaw units
contractors, subcontractors and repairmen is subject
(used to thaw frozen semen straws).
to sales tax. Labor services are taxed in Kansas when
they involve the installation or application of tangible
Animal Care Products. These animal care products
personal property, or when the labor is to repair,
are exempt as consumed in production: antibiotics,
service, alter or maintain tangible personal property,
wormers, hormones, insecticide (that is applied directly
even when the tangible personal property is attached
on animals), teat dip, detail tail paint and liquid nitrogen.
to real property.
These animal care items are exempt farm machinery
and equipment: Kamar heat detectors, calf jackets and
Farmers and ranchers must generally pay sales tax
biostat tanks.
on all taxable labor services purchased for use in their
farming and ranching operations. Only the labor to
Animal Feed: Feed and feed supplements are
repair or maintain those items considered to be farm
exempt as an ingredient or component part if the animal
machinery and equipment may be purchased without
is an agricultural animal as defined on page 4.
sales tax. (Original construction labor services are not
taxable labor services.)
The cattle feed and any vitamin and
mineral supplements mixed into the feed
Labor to repair an auger, a dairy’s milking
for feeder cattle may be purchased
equipment, or a harrow is exempt. Labor
exempt from sales tax. Food, vitamins and
to repair a fence, grain truck, or storage
minerals for a pet or pleasure animal are taxable.
building is taxable.
CONSTRUCTION PROJECTS
Original Construction Labor Services
An exception to the above general rule is that sales
G
R
:
ENERAL
ULE
MATERIALS USED TO CONSTRUCT AND
tax is not charged when the labor services of installing
REPAIR BUILDINGS AND OTHER STRUCTURES FOR FARMERS
or applying tangible personal property are performed
AND RANCHERS ARE TAXABLE SALES OF TANGIBLE
in connection with the original construction of a building
.
PERSONAL PROPERTY
or facility. The definition of a facility includes feedlots
(page 11) and oil, gas or water wells (page 18).
Also taxable is the sale or rental of construction
equipment. The labor services to construct a new
Original construction is the first or initial construction
building or facility (feedlot or well) are not taxed. The
of a building or the addition of a new wing or floor to an
labor services to repair or maintain an existing farm
existing building, and includes the land improvements
building, well or feedlot are taxable, unless the labor is
immediately surrounding the new structure.
to repair damage from a fire, flood, tornado, lightening,
explosion, windstorm, ice loading and attendant winds,
You are building a new barn. Since this is
terrorism, or earthquake. A windstorm means straight
the first or initial construction of a building,
line winds of at least 80 miles per hour as determined
no sales tax is due the contractors on the
by a recognized meteorological reporting agency or
labor fee they charge to build the new
organization.
barn. Also not taxable is the labor to construct the land
improvements immediately surrounding the barn, such
Materials
as a driveway, ramp and exterior lighting.
The sale of construction materials to a farmer,
Included in the definition of original construction is
rancher or contractor for use in improving real property
any reconstruction work to repair damage to an existing
are taxable retail sales of tangible personal property.
building, facility, or utility structure* damaged or
This includes materials used to build barns, confinement
destroyed by fire, flood, tornado, lightning, explosion,
buildings, corn cribs, drainage-tile systems, fences, grain
windstorm* (80 mph or more), ice loading and attendant
storage bins, greenhouses, roads, silos, storage
winds*, terrorism*, or earthquake. Utility structure
buildings and other buildings and structures.
means transmission and distribution lines owned by an
independent transmission company or cooperative, the
Construction Equipment
Kansas electric transmission authority or natural gas
or electric public utility. The labor charge for
The sale, rental or lease of construction equipment
reconstruction work done for any other reason is taxable.
is taxable. This includes backhoes, graders, hand tools,
*
post-hole diggers, and power tools.
Effective July 1, 2007
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