Exempts sales and use tax on construction materials for certain public entities financing capital projects.

The bill provides a sales and use tax exemption for construction materials used in projects financed by the state of Minnesota or local governments. The exemption applies to materials purchased by contractors, subcontractors, or builders for construction, reconstruction, repair, maintenance, or improvement of eligible capital projects. The tax must be imposed and collected as if the rates applied and then refunded. Refunds for eligible purchases must not be issued until after June 30, 2026.

Exempts sales and use tax on construction materials for certain public entities financing capital projects.

The bill provides a sales and use tax exemption for construction materials used in projects financed by the state of Minnesota or local governments. The exemption applies to materials purchased by contractors, subcontractors, or builders for construction, reconstruction, repair, maintenance, or improvement of eligible capital projects. The tax must be imposed and collected as if the rates applied and then refunded. Refunds for eligible purchases must not be issued until after June 30, 2026.