Pollution Abatement Equipment
Sales and Use Tax Exemption
Pollution abatement equipment for manufacturing is exempt from sales and use tax, but is subject to a 1% privilege tax, capped at a maximum of $80 per article. In addition, chemicals purchased by manufacturers to be used in air or stream pollution abatement equipment or processes are exempt from sales and use tax, but are subject to a 1% privilege tax, capped at a maximum of $80 per article. The privilege tax is repealed beginning on July 1, 2018.
Pollution abatement equipment means any equipment, including parts and accessories, used to eliminate, prevent or reduce air and water pollutants emitted resulting from the manufacturing process. This category also includes equipment used for the purpose of treating, pretreating or modifying any potential solid, liquid or gaseous pollutants that might be harmful, detrimental or offensive to human, animal or plant life or to property. Neither buildings housing such control and abatement equipment, nor equipment used within a building’s interior primarily for health, comfort or safety purposes is eligible for this exemption.
Property Tax Exemption
North Carolina does not levy property tax on real and personal property that is used exclusively for air cleaning, waste disposal or to abate, reduce or prevent air and/or water pollution. To claim an exclusion on property tax liability, a taxpayer must apply to the county for exclusion during the annual listing period and apply to the North Carolina Department of Environmental Quality for exclusion certification.
The North Carolina Recycling Property Tax Exemption excludes equipment and facilities used exclusively for recycling and resource recovery from property tax liability. For more details and application information, please visit the Solid Waste Section of the N.C. Department of Environmental Quality website.
Recycling Business Assistance Center, Recycling Business Development Grants
The Recycling Business Assistance Center (RBAC) is a partnership between the state Departments of Environmental Quality and Commerce. RBAC offers a variety of financial tools and incentives for recycling businesses, including tax credits, grants, loans and incentive programs.
In an effort to divert materials from the waste stream while supporting company growth, expansion and job creation in North Carolina, RBAC offers Recycling Business Development grants to eligible organizations. Funds are typically used for sustainable investments in equipment and buildings necessary to increase the capacity of a recycling company. Funding is made available through an annual request for proposal process that begins in the fall. Applicants may request a maximum of $40,000 and must provide at least a 50% cash match. For more information, visit the Grants section of the RBAC website.
The Economic Development Partnership of North Carolina does not award or administer this incentive. All economic development incentives are awarded and administered by the North Carolina Department of Commerce.