(1) For the purposes of the exemption provided in this section:

(a) The term “research or development” means research which has one of the following as its ultimate goal:

1. Basic research in a scientific field of endeavor.
2. Advancing knowledge or technology in a scientific or technical field of endeavor.
3. The development of a new product, whether or not the new product is offered for sale.
4. The improvement of an existing product, whether or not the improved product is offered for sale.
5. The development of new uses of an existing product, whether or not a new use is offered as a rationale to purchase the product.
6. The design and development of prototypes, whether or not a resulting product is offered for sale.

The term “research or development” does not include ordinary testing or inspection of materials or products used for quality control, market research, efficiency surveys, consumer surveys, advertising and promotions, management studies, or research in connection with literary, historical, social science, psychological, or other similar nontechnical activities.

Terms Used In Florida Statutes 212.052

  • Business: means any activity engaged in by any person, or caused to be engaged in by him or her, with the object of private or public gain, benefit, or advantage, either direct or indirect. See Florida Statutes 212.02
  • Cost price: means the actual cost of articles of tangible personal property without any deductions therefrom on account of the cost of materials used, labor or service costs, transportation charges, or any expenses whatsoever. See Florida Statutes 212.02
  • department: means the Department of Revenue. See Florida Statutes 212.02
  • Person: includes any individual, firm, copartnership, joint adventure, association, corporation, estate, trust, business trust, receiver, syndicate, or other group or combination acting as a unit and also includes any political subdivision, municipality, state agency, bureau, or department and includes the plural as well as the singular number. See Florida Statutes 212.02
  • Personal property: All property that is not real property.
  • Sale: means and includes:
    (a) Any transfer of title or possession, or both, exchange, barter, license, lease, or rental, conditional or otherwise, in any manner or by any means whatsoever, of tangible personal property for a consideration. See Florida Statutes 212.02
  • Tangible personal property: means and includes personal property which may be seen, weighed, measured, or touched or is in any manner perceptible to the senses, including electric power or energy, boats, motor vehicles and mobile homes as defined in…. See Florida Statutes 212.02
  • Use: means and includes the exercise of any right or power over tangible personal property incident to the ownership thereof, or interest therein, except that it does not include the sale at retail of that property in the regular course of business. See Florida Statutes 212.02
(b) The term “costs” means cost price as defined in s. 212.02(4).
(c) The term “product” means any item, device, technique, prototype, invention, or process which is, was, or may be commercially exploitable.
(2) Notwithstanding any provision of this chapter to the contrary, any person, including an affiliated group as defined in s. 1504 of the Internal Revenue Code of 1954, as amended, who manufactures, produces, compounds, processes, or fabricates in any manner tangible personal property for such taxpayer’s own use directly and solely in research or development shall not be subject to the tax imposed by this chapter upon the cost of the product so manufactured, produced, compounded, processed, or fabricated.
(3) This section does not apply to any product of research or development which is used by a person, including an affiliated group as defined in s. 1504 of the Internal Revenue Code of 1954, as amended, in the ordinary course of business, other than for research or development, except and to the extent that the knowledge, technology, science, design, plan, patent, or understanding which is derived from the product of research or development is applied in the ordinary course of business. In addition, this section does not apply to any product of research or development that is tangible personal property which is offered for sale.
(4) Any person, including an affiliated group as defined in s. 1504 of the Internal Revenue Code of 1954, as amended, who makes a fraudulent claim under this section shall be liable for the payment of the tax due, together with the penalties set forth in s. 212.085, and as otherwise provided by law.
(5) The department shall promulgate rules governing the implementation and operation of this section.
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