FAR Section 52.229-2

52.229-2

FEDERAL ACQUISITION REGULATION
STATE AND LOCAL TAXES (APR 1984)

Notwithstanding the terms of the Federal, State, and Local
Taxes clause, the contract price excludes all State and local
taxes levied on or measured by the contract or sales price of
the services or completed supplies furnished under this contract. The Contractor shall state separately on its invoices
taxes excluded from the contract price, and the Government
agrees either to pay the amount of the taxes to the Contractor
or provide evidence necessary to sustain an exemption.
(End of clause)
52.229-2 North Carolina State and Local Sales and Use
Tax.
As prescribed in 29.401-2, insert the following clause in
solicitations and contracts for construction to be performed in
North Carolina:
NORTH CAROLINA STATE AND LOCAL SALES AND USE
TAX (APR 1984)
(a) “Materials,” as used in this clause, means building
materials, supplies, fixtures, and equipment that become a
part of or are annexed to any building or structure erected,
altered, or repaired under this contract.
(b) If this is a fixed-price contract, the contract price
includes North Carolina State and local sales and use taxes to
be paid on materials, notwithstanding any other provision of
this contract. If this is a cost-reimbursement contract, any
North Carolina State and local sales and use taxes paid by the
Contractor on materials shall constitute an allowable cost
under this contract.
(c) At the time specified in paragraph (d) of this section,
the Contractor shall furnish the Contracting Officer certified
statements setting forth the cost of the materials purchased
from each vendor and the amount of North Carolina State and
local sales and use taxes paid. In the event the Contractor
makes several purchases from the same vendor, the certified
statement shall indicate the invoice numbers, the inclusive
dates of the invoices, the total amount of the invoices, and the
North Carolina State and local sales and use taxes paid. The
statement shall also include the cost of any tangible personal
property withdrawn from the Contractor’s warehouse stock
and the amount of North Carolina State and local sales or use
tax paid on this property by the Contractor. Any local sales or
use taxes included in the Contractor’s statements must be
shown separately from the State sales or use taxes. The Contractor shall furnish any additional information the Commissioner of Revenue of the State of North Carolina may require
to substantiate a refund claim for sales or use taxes. The Contractor shall also obtain and furnish to the Contracting Officer
similar certified statements by its subcontractors.
(d) If this contract is completed before the next October 1,
the certified statements to be furnished pursuant to
paragraph (c) of this clause shall be submitted within 60 days
after completion. If this contract is not completed before the
52.2-186

(FAC 2005–14)

next October 1, the certified statements shall be submitted on
or before November 30 of each year and shall cover taxes paid
during the 12-month period that ended the preceding
September 30.
(e) The certified statements to be furnished pursuant to
paragraph (c) of this clause shall be in the following form:
I hereby certify that during the period ______ to _____
[insert dates], ____ [insert name of Contractor or subcontractor] paid North Carolina State and local sales and use taxes
aggregating $______ (State) and $______ (local), with respect
to building materials, supplies, fixtures, and equipment that
have become a part of or annexed to a building or structure
erected, altered, or repaired by _________ [insert name of Contractor or subcontractor] for the United States of America, and
that the vendors from whom the property was purchased, the
dates and numbers of the invoices covering the purchases, the
total amount of the invoices of each vendor, the North Carolina
State and local sales and use taxes paid on the property (shown
separately), and the cost of property withdrawn from warehouse
stock and North Carolina State and local sales or use taxes paid
on this property are as set forth in the attachments.

(End of clause)
Alternate I (Apr 1984). If the requirement is for vessel
repair to be performed in North Carolina, substitute the following paragraph (a) for paragraph (a) of the basic clause:
(a) “Materials,” as used in this clause, means materials,
supplies, fixtures, and equipment that become a part of or are
annexed to any vessel altered or repaired under this contract.

52.229-3 Federal, State, and Local Taxes.
As prescribed in 29.401-3, insert the following clause:
FEDERAL, STATE, AND LOCAL TAXES (APR 2003)
(a) As used in this clause—
“After-imposed Federal tax” means any new or increased
Federal excise tax or duty, or tax that was exempted or
excluded on the contract date but whose exemption was later
revoked or reduced during the contract period, on the transactions or property covered by this contract that the Contractor
is required to pay or bear as the result of legislative, judicial,
or administrative action taking effect after the contract date.
It does not include social security tax or other employment
taxes.
“After-relieved Federal tax” means any amount of Federal
excise tax or duty, except social security or other employment
taxes, that would otherwise have been payable on the transactions or property covered by this contract, but which the Contractor is not required to pay or bear, or for which the
Contractor obtains a refund or drawback, as the result of legislative, judicial, or administrative action taking effect after
the contract date.
“All applicable Federal, State, and local taxes and duties”
means all taxes and duties, in effect on the contract date, that