Are Manufacturing and Machinery subject to sales tax?
While Colorado's sales tax generally applies to most transactions, certain items have special treatment in many states when it comes to sales taxes. This page describes the taxability of manufacturing and machinery in Colorado, including machinery, raw materials and utilities & fuel. To learn more, see a full list of taxable and tax-exempt items in Colorado.
In the state of Colorado, for the exemption to be applicable, the purchase must be greater than 500 dollars. However, the exemption is limited to 150,000 dollars for any qualifying purchases of used machinery.
In the state of Colorado, any sales of materials which are intended to become ingredients or components of any sort of manufactured property are considered to be wholesale sales. In addition, any sorts of materials which are used as an aid in manufacturing are considered to be taxable.
Utilities & Fuel
Sales of utilities & fuel are exempt from the sales tax in Colorado.
Back to Colorado Sales Tax Handbook