CS/HB 1163 2022
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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
A bill to be entitled 1
An act relating to sales tax exemptions for hydrogen 2
products; amending s. 212.08, F.S.; exempting from 3
sales taxes the purchase of certain machinery and 4
equipment that produce electric or steam energy from 5
burning hydrogen; requiring a proration of the 6
exemption under specified conditions; exempting from 7
sales taxes the purchase of hydrogen used in specified 8
industrial settings; defining the terms "green 9
hydrogen" and "primarily used"; exempting from sales 10
taxes the purchase of certain machinery and equipment 11
involving green hydrogen, certain types of ammonia, 12
and certain electrochemical reactions of green 13
hydrogen and oxygen; providing guidelines for 14
purchasers to use in obtaining an exemption; providing 15
penalties; authorizing the Department of Revenue to 16
adopt rules to implement the exemptions; providing an 17
effective date. 18
19
Be It Enacted by the Legislature of the State of Florida: 20
21
Section 1. Paragraph (c) of subsection (5) and paragraph 22
(b) of subsection (7) of section 212.08, Florida Statutes, are 23
amended, and paragraph (ppp) is added to subsection (7) of that 24
section, to read: 25
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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
212.08 Sales, rental, use, consumption, distribution, and 26
storage tax; specified exemptions. —The sale at retail, the 27
rental, the use, the consumption, the distribution, and the 28
storage to be used or consumed in this state of the following 29
are hereby specifically exempt from the tax imposed by this 30
chapter. 31
(5) EXEMPTIONS; ACCOUNT OF USE.— 32
(c) Machinery and equipment used in production of 33
electrical or steam energy. — 34
1. The purchase of machinery and equipment for use at a 35
fixed location which machinery and equipment are necessary in 36
the production of electrical or stea m energy resulting from the 37
burning of hydrogen or boiler fuels other than residual oil , is 38
exempt from the tax imposed by this chapter. Such electrical or 39
steam energy must be primarily for use in manufacturing, 40
processing, compounding, or producing for s ale items of tangible 41
personal property in this state. Use of a de minimis amount of 42
residual fuel to facilitate the burning of nonresidual fuel 43
shall not reduce the exemption otherwise available under this 44
paragraph. 45
2. In facilities where machinery and equipment are 46
necessary to burn hydrogen, or both residual and nonresidual 47
fuels, the exemption shall be prorated. Such proration shall be 48
based upon the production of electrical or steam energy from 49
nonresidual fuels and hydrogen as a percentage of elect rical or 50
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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
steam energy from all fuels. If it is determined that 15 percent 51
or less of all electrical or steam energy generated was produced 52
by burning residual fuel, the full exemption shall apply. 53
Purchasers claiming a partial exemption shall obtain such 54
exemption by refund of taxes paid, or as otherwise provided in 55
the department's rules. 56
3. The department may adopt rules that provide for 57
implementation of this exemption. Purchasers of machinery and 58
equipment qualifying for the exemption provided in this 59
paragraph shall furnish the vendor with an affidavit stating 60
that the item or items to be exempted are for the use designated 61
herein. Any person furnishing a false affidavit to the vendor 62
for the purpose of evading payment of any tax imposed under this 63
chapter shall be subject to the penalty set forth in s. 212.085 64
and as otherwise provided by law. Purchasers with self -accrual 65
authority shall maintain all documentation necessary to prove 66
the exempt status of purchases. 67
(7) MISCELLANEOUS EXEMPTIONS. —Exemptions provided to any 68
entity by this chapter do not inure to any transaction that is 69
otherwise taxable under this chapter when payment is made by a 70
representative or employee of the entity by any means, 71
including, but not limited to, cash, check, or credit card, even 72
when that representative or employee is subsequently reimbursed 73
by the entity. In addition, exemptions provided to any entity by 74
this subsection do not inure to any transaction that is 75
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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
otherwise taxable under this chapter unless the entity has 76
obtained a sales tax exemption certificate from the department 77
or the entity obtains or provides other documentation as 78
required by the department. Eligible purchases or leases made 79
with such a certificate must be in strict compliance with this 80
subsection and departmental rules, and any person who makes an 81
exempt purchase with a certificate that is not in strict 82
compliance with this subsection and the rules is liable for and 83
shall pay the tax. The department may adopt rules to administer 84
this subsection. 85
(b) Boiler fuels.—When purchased for use as a combustible 86
fuel, purchases of natural gas, residual oil, recycled oil, 87
waste oil, solid waste material, coal, sulfur, hydrogen, wood, 88
wood residues or wood bark used in an industrial manufacturing, 89
processing, compounding, or production process at a fixed 90
location in this state are exempt from the taxes imposed by this 91
chapter; however, such exemption shall not be allowed unless the 92
purchaser signs a certificate stating that the fuel to be 93
exempted is for the e xclusive use designated herein. This 94
exemption does not apply to the use of boiler fuels that are not 95
used in manufacturing, processing, compounding, or producing 96
items of tangible personal property for sale, or to the use of 97
boiler fuels used by any firm subject to regulation by the 98
Division of Hotels and Restaurants of the Department of Business 99
and Professional Regulation. 100
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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
(ppp) Green hydrogen. — 101
1. As used this paragraph, the term: 102
a. "Green hydrogen" means hydrogen created using an 103
electrolytic process powered from renewable energy sources, 104
including solar energy, wind energy, and geothermal energy. The 105
term also includes hydrogen created using the pyrolytic 106
decomposition of methane gas. 107
b. "Primarily used" means a use of at least 50 percent. 108
2. The following are exempt from the tax imposed by this 109
chapter: 110
a. The purchase of machinery and equipment primarily used 111
in the production, storage, transportation, compression, or 112
blending of green hydrogen. The machinery and equipment must be 113
used at a fixed location. 114
b. The purchase of machinery and equipment primarily used 115
in the production, storage, transportation, compression, or 116
blending of ammonia derived from green hydrogen, if the ammonia 117
will be converted back to green hydrogen before its use or sale. 118
The machinery and equipment must be used at a fixed location. 119
c. The purchase of machinery and equipment that are 120
necessary to produce electrical energy resulting from the 121
electrochemical reaction of green hydrogen and oxygen in a fuel 122
cell. The electrical energy must be primarily used in 123
manufacturing, processing, compounding, or producing for sale 124
items of tangible personal property in this state. The machinery 125
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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
and equipment must be used at a fixed location. 126
3. Purchasers of machinery an d equipment qualifying for 127
the exemption provided in this paragraph shall furnish the 128
vendor with an affidavit stating that the item or items to be 129
exempted are for the use designated herein. Purchasers with 130
self-accrual authority pursuant to s. 212.183 ar e not required 131
to provide this affidavit but shall maintain all documentation 132
necessary to prove the exempt status of purchases. 133
4. A person furnishing a false affidavit to the vendor for 134
the purpose of evading payment of any tax imposed under this 135
chapter shall be subject to the penalty set forth in s. 212.085 136
and as otherwise provided by law. Purchasers with self -accrual 137
authority pursuant to s. 212.183 are not required to provide an 138
affidavit but shall maintain all documentation necessary to 139
prove the exempt status of purchases. 140
5. The department may adopt rules to implement the 141
exemptions in this paragraph. 142
Section 2. This act shall take effect July 1, 2022. 143