State of Massachusetts

Massachusetts Utility Sales Tax Exemption

Massachusetts allows businesses to claim exemption on their utility if it is used in the actual manufacturing of tangible personal property to be sold and/or the heating of an industrial plant. To qualify for the exemption, the exempt utility must consist of at least 75% of total utility usage. Utility used exclusively in the agricultural process is also exempt from sales tax.

Directive 92-3

Massachusetts Sales Tax Exemption Certificate

The ST-12 Exemption Certificate is the document that must be filed in Massachusetts in order for a business to claim the Utility Sales Tax Exemption.

Energy Study Requirement

In Massachusetts, a detailed energy study must be performed to identify the exact percentage of utility that is exempt from sales tax. This includes calculating the annual consumption for each device that is consuming the utility and then distinguishing between production devices and non-production devices.

Our Process
01. Discovery

SmartSave investigates client’s current utility situation, and quickly identifies if the company is eligible to save on its utility sales tax through the exemption.

02. Energy Study

A SmartSave energy specialist performs an in-depth study at the business location to determine the exact proportion of energy use that is exempt from taxation.

03. Request

All necessary information is compiled into a report and submitted to the required utility companies and state agencies. SmartSave works hand-in-hand with these entities to ensure that all reports are accurate and compliant with statute.

04. Certification

Once the exemption request is approved, your company receives a refund on the past 2-4 years of overpaid utility sales tax, and stops paying sales tax on all certified production items, generating significant savings for the business each month moving forward.

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