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Solid Waste Management Tax Information
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The Solid Waste Management (SWM) Tax applies to services for both mixed municipal solid waste and non-mixed municipal solid waste.
The tax rate depends on the type of waste and who generated it, as detailed below.
Note: Solid Waste Management Tax is reported in the Sales and Use Tax return in e-Services.
Service Provider Requirements
A waste management service provider is responsible for collecting and remitting the SWM Tax to the Minnesota Department of Revenue. A provider is anyone who directly bills a waste generator (customer) for waste management services. Examples include:
- Waste haulers
- Waste management facilities, such as incinerators (waste-to-energy facilities), transfer stations, and landfills
- Local and county governments, or other political subdivisions
You must report SWM Tax on your Sales and Use Tax return and pay the tax to the Minnesota Department of Revenue. For details, see:
You must pay the SWM Tax on all taxable services you provide, even if you did not charge the correct amount or you failed to list the tax on customer bills or invoices as required.
Minnesota Tax ID Requirements and number are available on our website or by calling 651-282-5225 or 1-800- 657-3605.
Customer Bills
On customer bills or invoices, you must:
- Identify the tax as “solid waste management tax”
- List the amount of SWM Tax separately from other charges
- Itemize charges for non-taxable services (and don’t collect SWM Tax on these charges)
Due Dates
The SWM Tax due date is based on the filing schedule determined by the department when you register for the tax.
| IF YOU FILE: | YOU MUST FILE AND PAY BY: |
|---|
| Monthly | 20th day of the month |
| Quarterly | April 20, July 20, Oct. 20, and Jan. 20 |
| Annually | Feb. 5 |
Refund on Bad Debt
If you pay the SWM Tax before a customer pays you (accrual basis) and you cannot collect the tax from that customer, you can request a refund of the tax. To be eligible for a refund, the amount owed you must qualify as a bad debt according to section 166(a) of the Internal Revenue Code.
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MMSW is garbage, refuse, and other solid waste from residential, commercial, and community activities. For MMSW, the tax is based on the sales price charged by the provider and the type of waste generator (customer). For details, see MMSW Descriptions.
| Generator of MMSW | SWM Tax Rate |
|---|
| Residential | 9.75% of sales price |
| Commercial | 17% of sale price |
| Self-hauler | 17% of sale price |
“Sales price” is the total of all charges and fees for the service, whether billed separately or together. Examples include: collection, transportation, processing, disposal, and administrative fees; fuel surcharges; and any fee for garbage bags or stickers provided to the customer.
Non-MMSW waste is construction, demolition, industrial, infectious, and pathological waste material that’s collected, processed, and disposed of separately from mixed waste. For details, see Non-MMSW Descriptions.
The tax is based on the actual volume, container capacity, or weight of the waste. The provider must calculate the tax in the same way as they bill the customer. For example, if the provider bills by the cubic yard, they must calculate the tax using the cubic yard rate.
| Type of Non-MMSW | SWM Tax Rate |
|---|
| Construction and demolition debris | debris 60 cents per cubic yard or $2 per ton* |
| Industrial waste (“per ton” rate is subject to change) | 60 cents per cubic yard or 46.2 cents per ton |
| Infectious and pathological waste | 60 cents per cubic yard or .004 cents per pound |
*The commissioner of Revenue, after consultation with the commissioner of Pollution Control Agency, shall determine and may publish by notice a conversion schedule for construction debris.
The following types of waste or fees are exempt from SWM Tax:
Waste management charges for recyclable materials are exempt from SWM Tax if all of the following conditions are met:
- The customer (generator) separates recyclables from other garbage.
- The recyclables are collected separately from other garbage and delivered to a facility where they are recycled.
- The charge for managing the recyclables is itemized on the customer’s bill.
“Recyclable materials” include paper, glass, plastics, metals, source-separated organics, automobile oil, batteries, and other materials that are separated from solid waste for the purpose of recycling.
Note: Incinerating waste to create energy is not considered recycling.
Sales Tax Exemptions
The following items are exempt from sales tax when a local government or waste hauler purchases and uses them to provide waste management services that are subject to SWM Tax:
- Bags or stickers that are sold to customers to bundle or mark waste for pickup
- Waste management containers and compactors used for garbage. To buy these items without paying sales tax, you must give your supplier a completed Form ST3, Certificate of Exemption
The exemption doesn’t include:
- Containers or compactors used for recycling and organics
- Repair or replacement parts for the containers and packers
- Trucks purchased complete with chassis and packer/compactors
For more information, go to Form SWMT-10, Solid Waste Management Tax Exemption Certificate.
