S02 INSTRUCTIONS TO BIDDERS REGARDING TAX EXEMPTION IN NY 2.1.docx
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- Solicitation number
- 36C24226R0034
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This file contains instructions to bidders regarding tax exemption provisions specific to New York State for a federal construction contract with the Department of Veterans Affairs. The document clarifies that under New York Consolidated Laws Chapter 60, Article 28, the U.S. government and its agencies are exempt from state sales and compensating use taxes when purchasing materials and services. For this solicitation (36C24226R0034), contractors must complete the ST-120.1 "Contractor Exempt Purchase Certificate" when purchasing building and construction materials to be incorporated into VA real property in New York, and retain documentation as required by state law.
All bids submitted in response to this solicitation are presumed to reflect the tax exemption, meaning offerors should not include New York State sales and compensating use taxes on material sales for incorporation into VA real estate in their cost proposals. This exemption applies to the design-build HVAC upgrade project for Buildings 4 and 5 at the facility, which involves upgrading AC Plants with three new chillers, cooling towers, variable frequency drive cabinets, and electrical switchgear to provide adequate cooling capacity for the Main Hospital and address equipment shutdown issues during peak summer loads.
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INSTRUCTIONS, CONDITIONS, AND OTHER STATEMENTS TO BIDDERS/OFFERORS
2.2 Special Notes regarding FAR 52.229-3: Federal, State, and Local Taxes:
Offerors are hereby notified that under New York Consolidated Laws, Chapter 60 - Tax, Article 28 - Sales and Compensating Use Taxes, Part 3 – 1116 (2), the United States of America, any of its agencies and instrumentalities, is immune from taxation when it is the purchaser, user, or consumer, or when it sells services or property of a kind not ordinarily sold by private persons.
Pursuant to Chapter 60, Article 28, Part 3-1115(17), a contractor’s purchase of such building and construction materials within New York to be incorporated into the real property belonging to the U.S. Department of Veterans Affairs (VA) is subject to the exemption from the New York State sales and compensating use taxes. To take advantage of the tax exemption, the successful offeror under this solicitation must complete ST-120.1 “Contractor Exempt Purchase Certificate” when it purchases construction materials for this contract and keep it on file as required by the state of New York tax laws.
Notwithstanding FAR 52.229-3, all bids received in response to this solicitation are presumed to reflect this tax exemption and therefore should not include New York’s state sales and compensating use taxes on sales of materials for incorporation into VA real estate under this contract.
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