Resale Certificate for Nurseries and Garden Centers: Buy Plants and Supplies Tax-Free
Garden centers and nurseries sell a mix of living goods (plants, trees, shrubs) and hard goods (pots, soil, tools, chemicals, decor). Monthly wholesale purchases range from $10,000 for a small seasonal operation to $100,000+ for a large garden center with landscaping services. At 7% tax, that is $8,400 to $84,000 per year in savings.
There is a significant tax wrinkle in this industry: many states exempt certain agricultural products (plants, seeds, soil amendments) from sales tax entirely. Your resale certificate operates independently from those exemptions, but understanding both determines what you pay at wholesale and what you charge at retail.
Plant and Agricultural Exemptions by State
Before discussing the resale certificate, understand this: in many states, sales of plants, seeds, and growing supplies to end consumers are either exempt from sales tax or taxed at a reduced rate.
States that exempt plants and seeds. Several states exempt live plants, nursery stock, seeds, and bulbs from sales tax when sold for planting (not decorative cut flowers). This consumer-level exemption means your retail customers pay no tax on these items.
States that exempt "agricultural" inputs. Fertilizer, soil amendments, pesticides, and growing media may be exempt in states with agricultural exemptions, even when sold to home gardeners.
How this interacts with your resale certificate. Your resale certificate covers your wholesale purchase of plants and supplies intended for resale regardless of whether the retail sale is ultimately taxable or exempt. The certificate lets you buy without paying tax at the wholesale level. The state's consumer-level exemptions determine what you charge retail customers.
In short: use your resale certificate to buy everything tax-free at wholesale. Then charge your retail customers based on your state's rules for each product category.
What You Can Buy Tax-Free (Retail Inventory)
- Live plants (annuals, perennials, shrubs, trees, houseplants, succulents)
- Seeds and bulbs
- Sod and turf (sold to customers)
- Potting soil and growing media (bags sold at retail)
- Fertilizer and plant food (bags and bottles sold at retail)
- Mulch and decorative stone (bags and bulk sold to customers)
- Pots, planters, and containers (ceramic, plastic, terracotta, decorative)
- Garden tools (shovels, rakes, pruners, hoses, gloves)
- Pesticides and herbicides (sold at retail)
- Outdoor furniture (benches, tables, chairs)
- Outdoor decor (garden statues, bird baths, wind chimes, flags)
- Hardscape materials sold at retail (pavers, stepping stones, edging)
- Irrigation supplies (drip systems, sprinklers, hoses, timers)
- Cut flowers and floral arrangements (if you sell retail bouquets)
- Seasonal items (Christmas trees, pumpkins, corn stalks)
- Gift items (candles, soaps, books about gardening)
What You CANNOT Buy Tax-Free
| Item | Why It Is Taxable |
|---|---|
| Greenhouse structures and covering | Business property |
| Growing benches and display tables | Business equipment |
| Irrigation system for your growing operation | Business infrastructure |
| Forklift or tractor | Business equipment |
| Potting machine | Business equipment |
| Soil and media for your own growing | Consumed in production |
| Fertilizer used on your own stock | Consumed in production |
| Pesticides applied to your own plants | Consumed in production |
Growing inputs vs. resale inputs. If you grow plants on-site (most nurseries do), the soil, fertilizer, and chemicals you use in your growing operation are production inputs, not resale items. The same bag of potting soil sitting on the retail shelf for customers IS a resale item. The distinction is between what you consume in your growing operation and what you sell to customers.
Some states have agricultural production exemptions that cover growing inputs separately from the resale exemption. If your state exempts agricultural production supplies, you may not pay tax on growing inputs for a different reason (agricultural exemption rather than resale exemption). Talk to your accountant about which exemption applies to your growing operation.
Nursery vs. Garden Center vs. Landscaper
Retail nursery/garden center. Customers come to your location and buy plants, supplies, and decor. Standard retail operation. Resale certificate covers all inventory purchases.
Wholesale nursery (grower). You grow plants and sell to other nurseries, garden centers, and landscapers. Your buyers present their resale certificates to you. You also need a resale certificate to buy growing stock (liner plants, plugs) from other growers without paying tax.
Landscaping company. This is where it gets complicated. If you install plants as part of a landscaping contract, many states treat you as the end consumer of the plants (the same issue that affects contractors in construction). The plants become part of the real property when installed. In those states, landscapers pay tax on plant purchases and do NOT use a resale certificate.
However, some states allow landscapers to use a resale certificate if the contract itemizes the plant cost separately from labor. Others treat all landscaping as a service where the contractor is the consumer. This is state-specific and mirrors the lump-sum vs. separated contract distinction in construction.
Garden center with landscaping services. If you operate both a retail garden center and a landscaping crew, your retail inventory purchases are covered by the resale certificate. Materials used by your landscaping crew may or may not be, depending on your state.
Seasonal Considerations
Most garden centers have a strong spring season (March through June) and a secondary fall season. Monthly wholesale purchases can swing from $5,000 in winter to $50,000 in April.
Pre-season buying. Ordering bulbs in fall for spring sale, purchasing Christmas trees in October for December sale. The timing of your purchase does not affect the resale exemption. What matters is the intent to resell.
Inventory shrinkage. Plants die. In the nursery business, shrinkage rates of 5-15% are normal. Plants that die in your care are a business loss, not a resale issue. You bought them with the intent to resell. The fact that they did not survive does not retroactively invalidate the resale exemption. (For comparison: a grocery store that throws away expired food also bought that food for resale.)
Bulk Material Sales
Garden centers that sell bulk materials (mulch, topsoil, gravel, stone by the cubic yard) have specific considerations:
Delivery charges. When you deliver a truckload of mulch, the delivery fee may or may not be taxable depending on your state. Some states tax delivery as part of the sale. Others exempt it if separately stated.
Your bulk purchases from quarries and suppliers. Buying bulk mulch, stone, or soil from a supplier for resale is covered by your certificate. The supplier delivers to your yard; you resell to customers in bags or bulk.
Dollar Savings
| Business Type | Monthly Wholesale Purchases | Annual Tax Savings (7%) |
|---|---|---|
| Small seasonal nursery | $8,000 | $6,720 |
| Standard garden center | $25,000 | $21,000 |
| Large garden center with hard goods | $60,000 | $50,400 |
| Multi-location garden center | $150,000+ | $126,000+ |
Common Mistakes
Using the resale certificate for growing supplies. Soil, fertilizer, and chemicals used in your own growing operation are production inputs, not resale items. The resale certificate covers what you sell, not what you consume in growing.
Not understanding your state's plant tax exemption. If your state exempts live plants from sales tax at retail, you still need to charge tax on non-exempt items (pots, tools, decor). Your POS must distinguish between exempt and taxable product categories.
Landscapers assuming they can use a resale certificate. In many states, landscapers are the end consumer of plants they install. Check your state's rules before claiming the resale exemption on materials for installation contracts.
Ignoring seasonal tax filing obligations. Even if your nursery is closed in January, you likely still need to file a sales tax return (showing zero or minimal sales). Missing a filing period triggers penalties.
How to Get Started
- Apply for your resale certificate through your state or our service.
- Provide it to plant suppliers and wholesale growers. Monrovia, Bailey Nurseries, Spring Meadow, and your regional wholesale growers all need it on file.
- Set up accounts with hard goods distributors. Pottery manufacturers, tool suppliers, and chemical distributors.
- Configure your POS for your state's product categories. Plants (possibly exempt), hard goods (taxable), food items (if you sell local honey or produce).