17 NCAC 07D .0201          MILL MACHINERY

The following items, when purchased by manufacturing industries and plants for use in their manufacturing process, are considered mill machinery, mill machinery parts and accessories within the meaning of the Article F (manufacturing fuel and certain machinery and equipment):

(1)           motors, pulleys, motor bases but not foundations, gears, belts, chains and textile rope drives, line shafting with hangers and pulleys, and other types and makes of drives connecting motors to the driven machinery for direct production processes;

(2)           controls for motors consisting of:

(a)           magnetic starters, push button stations, pressure and float switches, and other types of relays operating motor controllers;

(b)           compensators of auto transformer starters;

(c)           thermal relay types of motor starters;

(d)           drum controllers and resistors;

(e)           disconnecting switches when built as a part of magnetic starters;

(f)            oil switches;

(g)           synchronous motor controllers if a part of production machinery, but not otherwise;

(3)           repair and renewal parts for motors and motor controllers as production machinery;

(4)           steam engines, gasoline engines, diesel engines, motor generators;

(5)           pumps for industrial processes, air compressors, air hoses and nozzles, and pipe for carrying compressed air from compressor to hose for cleaning machinery and equipment; pumps used to remove waste of a manufacturing process;

(6)           moistening or humidifying equipment on or adjacent to machinery when the function of this equipment is the conditioning of materials for processing; This includes piping located on or immediately adjacent to mill machinery and which supports and supplies water to moistening or humidifying equipment, but does not include general piping in the mill supplying water to moistening or humidifying equipment.  General piping in the mill is subject to the applicable statutory state and local sales or use tax;

(7)           that portion of the purchase price of general air conditioning systems allocated to conditioning materials for processing;

(8)           boiler room machinery with flue cleaners, and brushes for boiler tubes, when the boilers are operated for power generation or supplementary thereto in connection with manufacturing processes; stokers, shovels, and other equipment used in boiler rooms for feeding fuels and water to power units, and smoke stacks which are attached to and are a part of the boilers. Equipment as used here does not include storage places for fuels and water, or reserve tanks, bins or other similar items located either inside or outside power rooms or buildings.  Storage tanks, bins or other facilities for water, fuel, raw materials or manufactured products are not considered as mill machinery or accessories to such machinery and are therefore subject to the applicable statutory state and local sales or use tax.  However, tanks, bins and other facilities in which mixing, blending or other processing action takes place are classified as mill machinery or accessories and are therefore subject to the one percent privilege tax with a maximum tax of eighty dollars ($80.00) per article when such items are used in the manufacturing operation;

(9)           conveyors, hoists and hoist cables, (but not track or other fixtures determined to be a part of and which lend support to the building or structure) roving trucks and other materials handling equipment, including lift trucks, used in individual mills for transporting materials or spindles or like articles from inventory to the manufacturing process, transporting materials during temporary interruptions in the manufacturing process in the mill or moving the finished product from the manufacturing or processing line into shipping and storage areas or yards at the individual mill or plant.  Included for the purpose of this Paragraph are work tables, with seats and other accessories thereto at which employees work on materials in process; racks, bins, canvas baskets and similar equipment for handling goods in process; and roving cans;

(10)         hand tools designed for use on a particular machine, such as special wrenches supplied by makers of textile machinery for special machines; hammers, screwdrivers, blow torches, soldering irons, rubber mallets and similar general‑use tools and machines used in repair shops to repair mill machinery or along the production line to perform work necessary as a part of the manufacturing processes and all files for general and specific use in a mill or manufacturing plant;

(11)         metal‑cutting and wood‑cutting lathes and their accessories in all kinds of manufacturing plants, factories and mills; band saws, circular saws, all hack saws and blades; shapers and accessories, jointers, planers; drill presses; welding machines; torches; and all other manufacturing machinery and accessories thereto; spinners' whisks, comber brushes and other brushes, in hosiery mills and cotton mills, designed for use on particular machines; polishing wheels, sanding machines and drums, portable or stationary; sandpaper, emery cloth, rubbing tow, paint brushes and filler brushes, steel wool, rubbing waste or cloths or other hand or machine devices for polishing or other finishing processes on a manufactured product; oils and lubricants for use in lubricating production machinery; and wiping cloths, cleaning compounds and paint for mill machinery, mill machinery parts and accessories; chemicals or other materials used to clean ingredient or component parts of manufactured products but which do not enter into or become an ingredient or component part of property being manufactured;

(12)         dyehouse thermometers, recording charts for mill machinery, hank scales and yarn scales, and tachometers and other testing devices used for checking performance or output of machinery;

(13)         air compressors, steam hose and air hose for cleaning mill machinery;

(14)         cloth pencils and mill crayons for marking cloth, lumber or other ingredients in process;

(15)         dynamite and other explosives used in mining and quarrying whether or not such mining or quarrying is carried on as a regular or continuous business within itself, or as a part of a manufacturing industry.  Sales of explosives used in excavation in connection with building or construction are subject to the applicable statutory state and local sales or use tax;

(16)         machinery and equipment used in packaging manufactured products as a part of the manufacturing process;

(17)         pollution abatement equipment used in the manufacturing process.


History Note:        Authority G.S. 105‑164.4; 105‑164.6; 105‑262;105-187.51; 105-187.52; Articles 39, 40, 42, 43,44;

Eff. July 1, 2006.