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Last Updated: 9/13/2018

Nontaxable Purchases

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If you create or sell tangible (physical) products, you may purchase certain items for your business without paying tax by giving your vendor Form ST3, Certificate of Exemption

The following purchases are not taxable (see below for details):

  • Items you buy for resale to your customers
  • Materials or supplies you use to create a tangible product (industrial production)
  • Equipment used primarily in Minnesota to create a tangible product (capital equipment)

Note: These exemptions do not apply when images are delivered electronically and there is no transfer of a tangible product.


Items that you will resell to your customers are not taxable.

Industrial Production

Materials and supplies are not taxable if they are used or consumed in the production process of creating a tangible product.

For more information about this exemption, see Fact Sheet 145, Industrial Production.

Capital Equipment

Purchases of capital equipment are not taxable if the equipment is used at least half of its operating time:

  • in Minnesota; and
  • to create a tangible product for retail sale

Examples of equipment that may qualify for this exemption include:

  • cameras
  • props
  • backdrops
  • batteries
  • bulbs
  • lighting equipment
  • printing equipment
  • production equipment
  • accessories and attachments for production equipment
  • production computers and software
  • tripods

Note: Equipment is taxable if used more than half of its operating time:

  • to produce photography that is electronically delivered to a customer; or
  • to provide nontaxable advertising services.

For more information about this exemption, see Fact Sheet 103, Capital Equipment.

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