(1) In this regulation, the following terms have the meaning indicated:
(2) Defined Terms.
(a) "Equipment" means an implement, such as a tool, apparatus, appliance, utensil, or instrument, used to perform a mechanical or manual operation.
(b) “Geothermal equipment” means equipment that uses ground loop technology to heat and cool a structure.
(c) “Residential wind energy equipment” means equipment installed on residential property that uses wind energy to generate electricity to be used in a residential structure on the property.
(d) Solar Energy Equipment.
(i) “Solar energy equipment” means equipment that uses solar energy to heat or cool a structure, generate electricity to be used in a structure or supplied to the electric grid, or provide hot water for use in a structure.
(ii) "Solar energy equipment" does not include equipment that is part of a nonsolar energy system, such as a window, floor or other passive solar material that does not involve the use of a mechanical or electronic device but is designed to enhance or improve the functionality of a traditional heating or cooling system, or that uses any type of recreational facility or equipment as a storage medium, such as a pool or hot tub.
B. Exempt Sales.
(1) The sales and use tax does not apply to a sale of geothermal equipment, residential wind energy equipment, or solar energy equipment.
(2) The exemption includes the sale of equipment and other material that is attached, applied, fabricated, or assembled in such a manner that it comprises a complete geothermal, residential wind energy, or solar energy system.
(3) Material such as sand, gravel, or grout, although necessary for the system to be built or to function properly, is not equipment or a component of equipment and, therefore, is not exempt from the tax.
(4) Vendors, in lieu of collecting the tax, may accept a signed statement from the buyer certifying that the tangible personal property purchased is qualifying geothermal, residential wind energy, or solar energy equipment. The vendor shall retain the statement with the record of sale.
(5) If sales and use tax is paid on the sale of an item that qualifies for an exemption the person paying the tax may apply to the Comptroller for a refund pursuant to COMAR 03.03.03.05.