District of Columbia Utility Sales Tax Exemption

Manufacturers and industrial processors with facilities located in District of Columbia may be eligible for a utility tax exemption. District of Columbia offers an exemption from sales tax on the purchase of electricity, natural gas, and water used in qualifying production activities. This tax exemption is authorized by D.C. Code § 47-2005(11).

Exemption Language of D.C. Code § 47-2005(11)

Sales of natural or artificial gas, oil, electricity, solid fuel, or steam, directly used in manufacturing, assembling, processing, or refining of tangible personal property for sale or resale" are exempt from tax.

Utility Study Requirement for Exemption Qualification

A District of Columbia utility tax study must list every piece of equipment and appliance (production and non-production) that uses the utility and the annual consumption of each. Failure to properly calculate or classify utility usage is cause for denial of the exemption.

District of Columbia Statute of Limitations on Tax Refund

3 years

State Sales Tax Rate: 6.35%

Average Local Sales Tax Rate: 0%

Helpful Resources

District of Columbia Utility Exemption Certificate: Form OTR-308

District of Columbia Utility Exemption Statute/Rule: D.C. Code § 47-2005(11)

District of Columbia Claim Form for Tax Refund: Claim for Refund - FP-331