Today’s Topic: Legislature makes change in farm-income requirements for sales-tax exemption

by | Jul 22, 2014

Southern Farm Network logoAgriculture Commissioner Steve Troxler sits down each week with Southern Farm Network’s Rhonda Garrison to discuss “Today’s Topic.”

Farmers across North Carolina recently received letters from the state Department of Revenue alerting them to changes in the eligibility requirements for the exemption on sales taxes for supplies they purchase, and the steps farmers need to take if they want to continue to qualify. The NCDA&CS has received a number of calls and emails about this issue, because it’s going to affect a good number of small farmers.

The General Assembly’s tax modernization act last year increased the minimum level of farm revenue required for farmers to qualify for the sales-tax exemption. The minimum income needed to qualify was increased from $1,000 to $10,000, and it took effect July 1. Farmers can also qualify if their average gross income in the previous three years was $10,000.

The bottom line here is that many small farmers are now at risk of losing their sales-tax exemption. Commissioner Troxler says he shares their frustration over these changes and is concerned about their effects on small farms.

When legislators first began discussing possible changes to tax laws, the proposals were more far-reaching and potentially even more detrimental to farmers. The department fought to keep the sales-tax exemption for farms, but unfortunately the legislature increased the amount of revenue required to qualify for the exemption.

Farmers with questions about how to reapply for their exemption can call the Department of Revenue’s Taxpayer Assistance and Collection Center at 1-877-252-4487. Information also is available on the Revenue Department’s website.

Click on the audio player below to listen to Commissioner Troxler and Rhonda discuss these changes and their potential impacts.

[Audio:|titles=Today’s Topic for July 22]

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