NC S581

Replaces the annual sales and use tax refund system for counties and cities with a direct sales and use tax exemption effective October 1, 2023

Creates new exemption (52a) in G.S. 105-164.13 allowing counties and cities to purchase items tax-free when purchased for their own use or by contractors performing work for them, provided they submit exemption certificates and purchase orders containing exemption numbers

Exempts purchases of building materials, supplies, fixtures, and equipment that become part of buildings or structures owned or leased by counties or cities, but excludes electricity, telecommunications service, ancillary service, piped natural gas, video programming, and prepaid meal plans

Requires counties and cities to obtain sales tax exemption numbers from the Department and authorizes them to use exemption certificates and properly documented purchase orders to claim exemptions at the point of sale

Allows counties and cities to still request refunds under the prior system for purchases made before July 1, 2023