AR SB441

Amends the definition of "used directly" in manufacturing to exclude machinery and equipment used for producing or repairing replacement dies, molds, repair parts, or replacement parts consumed in the manufacturer's own manufacturing process.

Adds "maintain" as a qualifying purpose for sales and use tax exemptions on machinery and equipment purchased to modify, replace, repair, or maintain existing machinery used directly in manufacturing or processing operations.

Creates a new sales and use tax exemption for machinery and equipment purchased for use or possible use and placed in inventory for later use in qualifying manufacturing purposes.

Establishes that withdrawal of inventory machinery or equipment for non-qualifying purposes triggers tax liability at the time of withdrawal, with tax calculated on the original purchase price.

Provisions become effective on the first day of the calendar quarter following the act's effective date (approved April 11, 2023).