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Last Updated: 11/29/2016

Ship and Vessel Purchases

The taxability of ships, vessels, and related items depends on how they are used –for interstate or foreign commerce, or for intrastate commerce. 

Examples include:

  • purchases of ships or vessels

  • leases of ships or vessels

  • accessories or equipment attached to the ship or vessel

  • diesel fuel

  • oil and lubricants

  • rebuilding parts and materials

  • repair and replacement parts

Interstate or foreign commerce

Purchases that are used primarily for interstate or foreign commerce – doing business across state or national borders – qualify for an exemption and are not taxable.

To claim this exemption, give your vendor a completed Form ST3, Certificate of Exemption. Specify the ship repair or replacement parts and lubricants exemption.

Intrastate commerce

Purchases that are used primarily for intrastate commerce – doing business within Minnesota – are taxable.

Exception: Purchases of ships or vessels with a gross registered tonnage of 3,000 or more are exempt from tax.

< Railroad Purchases

Filing Returns and Record-keeping >

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