A BILL TO BE ENTITLED
AN ACT to clarify the scope of tax imposed on mill machinery.
The General Assembly of North Carolina enacts:
SECTION 1.  G.S. 105‑187.51B reads as rewritten:
"§ 105‑187.51B.  Tax imposed on certain recyclers, research and development companies, industrial machinery refurbishing companies, and companies located at ports facilities.
(a)	Tax. – A privilege tax is imposed on the following:
…
(6)	A company (i) that is engaged at the establishment in fabrication of metal work, (ii) that performs work included in industry group 332312, 332313, or 332322, (iii) that has annual gross receipts, including the gross receipts of all related persons as defined in G.S. 105‑163.010, from the fabrication of metal work of at least eight million dollars ($8,000,000), and (iv) that purchases equipment or an attachment or repair part for equipment that meets all of the following requirements:
a.	Is capitalized by the company for tax purposes under the Code.
b.	Is used by the company at the establishment in the fabrication or manufacture of metal products or used by the company at the establishment to create equipment for the fabrication or manufacture of metal products.
c.	Would be considered mill machinery or mill machinery parts or accessories under G.S. 105‑187.51 if it were purchased by a manufacturing industry or plant and used by the industry or plant to manufacture tangible personal property.
(7)	A company that is primarily a secondary metals recycler, as defined in G.S. 66‑420, that purchases equipment or an attachment or repair part for equipment that meets all of the following requirements:
a.	Is capitalized by the company for tax purposes under the Code.
b.	Is used by the company at the establishment in the secondary metals recycling activities in which it is primarily engaged.
c.	Would be considered mill machinery or mill machinery parts or accessories under G.S. 105‑187.51 if it were purchased by a manufacturing industry or plant and used by the industry or plant to manufacture tangible personal property.(b)	Rate. – The tax is one percent (1%) of the sales price of the equipment or other tangible personal property. The maximum tax is eighty dollars ($80.00) per article."
SECTION 2.  This act becomes effective July 1, 2010, and applies to purchases made on or after that date.