Illinois Manufacturer’s Purchase Credit Regulation Set To Expire This Summer

Beginning July 30, 2009, the Manufacturer’s Purchase Credit (MPC) will no longer be available. Reenacted on July 30, 2004, with no ending date, the state’s five-year statutory sunset provision automatically applied to the credit. Until its expiration, a manufacturer or graphic arts producer can earn credit for purchasing exempt manufacturing or graphic arts equipment and machinery. The credit is earned based on 6.25% of the sales tax that would have been paid on the items purchased. The credit can then be used for Use and Service Use Tax liabilities for purchasing production-related tangible personal property. Additional rules apply. (86 Ill. Adm. Code Sec. 130.331, Illinois Department of Revenue, amended effective January 23, 2009)

Posted on February 13, 2009