S.B. 245 Enrolled

1

FUNDING RELATING TO AIRPORTS, HIGHWAYS,
2 AND PUBLIC TRANSIT
3 2008 GENERAL SESSION
4 STATE OF UTAH
5 Chief Sponsor: Curtis S. Bramble
6 House Sponsor: David Clark
7
8 LONG TITLE
9 General Description:
10 This bill amends the Motor Vehicles Code, the Sales and Use Tax Act, and the
11 Transportation Code relating to the local option highway construction and
12 transportation corridor preservation fee, a local sales and use tax to fund tourism,
13 recreation, cultural, convention, and airport facilities, a local sales and use tax to fund
14 certain airport, highway, or public transit projects or services, a state sales and use tax,
15 and financing of certain fixed guideways with certain airport revenue.
16 Highlighted Provisions:
17 This bill:
18 . addresses an audit relating to the local sales and use tax to fund tourism, recreation,
19 cultural, convention, and airport facilities;
20 . reallocates a portion of the revenue received from the local option highway
21 construction and transportation corridor preservation fee imposed in a county of the
22 first class from the County of the First Class State Highway Projects Fund to the
23 legislative body of a city of the first class located within a county of the first class
24 that has an international airport with a United States customs office within its
25 boundaries;
26 . addresses amounts a seller may retain as a seller discount;
27 . repeals a purpose statement;
28 . provides part titles;
29 . defines terms;

30 . provides that a county legislative body may expend certain local sales and use tax
31 revenues for an airport facility in addition to other purposes allowed by statute;
32 . addresses provisions relating to ordinances and bonding for purposes of the local
33 sales and use tax to fund tourism, recreation, cultural, convention, and airport
34 facilities;
35 . authorizes a county of the second class to impose a local option sales and use tax to
36 fund certain airport, highway, or public transit projects or services;
37 . addresses the procedures and requirements for imposing the local option sales and
38 use tax to fund certain airport, highway, or public transit projects or services,
39 including providing that the sales and use tax is an agreement sales and use tax;
40 . imposes a state sales and use tax under certain circumstances;
41 . addresses the procedures and requirements for imposing the state sales and use tax,
42 including providing that:
43 . the sales and use tax is an agreement sales and use tax; and
44 . the revenues are distributed to certain public transit districts;
45 . modifies the sources of funding for the Local Transportation Corridor Preservation
46 Fund;
47 . creates a special revenue fund known as the County of the Second Class State
48 Highway Projects Fund, including:
49 . addressing funding of the fund; and
50 . addressing the purposes for which fund monies may be expended;
51 . provides that an airport operator may not use airport revenue to contribute to
52 constructing, equipping, maintaining, or operating a fixed guideway; and
53 . makes technical changes.
54 Monies Appropriated in this Bill:
55 None
56 Other Special Clauses:
57 This bill provides effective dates.

58 This bill coordinates with H.B. 206, Tax Amendments, to make substantive and
59 technical amendments, including enacting Sections 59-12-1904, 59-12-1905,
60 59-12-1906, 59-12-2005, 59-12-2006, and 59-12-2007.
61 Utah Code Sections Affected:
62 AMENDS:
63 11-41-102, as last amended by Laws of Utah 2007, Chapter 9
64 17-31-5.5, as last amended by Laws of Utah 2007, Chapter 3
65 41-1a-1222, as last amended by Laws of Utah 2007, Chapters 201 and 274
66 59-12-102, as last amended by Laws of Utah 2007, Chapters 9, 214, 224, and 288
67 59-12-103, as last amended by Laws of Utah 2007, Chapters 9, 101, 126, 206, and 288
68 59-12-104.2, as last amended by Laws of Utah 2003, Chapter 312
69 59-12-108, as last amended by Laws of Utah 2007, Chapter 9
70 59-12-602, as last amended by Laws of Utah 1995, Chapter 248
71 59-12-603, as last amended by Laws of Utah 2007, Chapters 3, 9, and 219
72 72-2-117.5, as last amended by Laws of Utah 2007, Chapters 181 and 201
73 72-2-121, as last amended by Laws of Utah 2007, Chapter 201
74 72-10-102, as last amended by Laws of Utah 2003, Chapter 183
75 ENACTS:
76 59-12-601.1, Utah Code Annotated 1953
77 59-12-1901, Utah Code Annotated 1953
78 59-12-1902, Utah Code Annotated 1953
79 59-12-1903, Utah Code Annotated 1953
80 59-12-2001, Utah Code Annotated 1953
81 59-12-2002, Utah Code Annotated 1953
82 59-12-2003, Utah Code Annotated 1953
83 59-12-2004, Utah Code Annotated 1953
84 72-2-121.2, Utah Code Annotated 1953
85 72-10-215, Utah Code Annotated 1953

86 REPEALS:
87 59-12-601, as last amended by Laws of Utah 1991, Chapter 265
88
89 Be it enacted by the Legislature of the state of Utah:
90 Section 1. Section 11-41-102 is amended to read:
91 11-41-102. Definitions.
92 As used in this chapter:
93 (1) "Agreement" means an oral or written agreement between a:
94 (a) (i) county; or
95 (ii) municipality; and
96 (b) person.
97 (2) "Municipality" means a:
98 (a) city; or
99 (b) town.
100 (3) "Payment" includes:
101 (a) a payment;
102 (b) a rebate;
103 (c) a refund; or
104 (d) an amount similar to Subsections (3)(a) through (c).
105 (4) "Regional retail business" means a:
106 (a) retail business that occupies a floor area of more than 80,000 square feet;
107 (b) dealer as defined in Section 41-1a-102 ;
108 (c) retail shopping facility that has at least two anchor tenants if the total number of
109 anchor tenants in the shopping facility occupy a total floor area of more than 150,000 square
110 feet; or
111 (d) grocery store that occupies a floor area of more than 30,000 square feet.
112 (5) (a) "Sales and use tax" means a tax:
113 (i) imposed on transactions within a:

114 (A) county; or
115 (B) municipality; and
116 (ii) except as provided in Subsection (5)(b), authorized under Title 59, Chapter 12,
117 Sales and Use Tax Act.
118 (b) Notwithstanding Subsection (5)(a)(ii), "sales and use tax" does not include a tax
119 authorized under:
120 (i) Subsection 59-12-103 (2)(a)(i);
121 (ii) Subsection 59-12-103 (2)(b)(i);
122 (iii) Subsection 59-12-103 (2)(c)(i);
123 (iv) Subsection 59-12-103 (2)(d)(i)(A);
124 (v) Subsection 59-12-103 (2)(e)(ii)(A);
125 (vi) Subsection 59-12-103 (2)(e)(iii)(A);
126 (vii) Section 59-12-301 ;
127 (viii) Section 59-12-352 ;
128 (ix) Section 59-12-353 ;
129 (x) Section 59-12-603 ; or
130 (xi) Section 59-12-1201 .
131 (6) (a) "Sales and use tax incentive payment" means a payment of revenues:
132 (i) to a person;
133 (ii) by a:
134 (A) county; or
135 (B) municipality;
136 (iii) to induce the person to locate or relocate a regional retail business within the:
137 (A) county; or
138 (B) municipality; and
139 (iv) that are derived from a sales and use tax.
140 (b) "Sales and use tax incentive payment" does not include funding for public
141 infrastructure.

142 Section 2. Section 17-31-5.5 is amended to read:
143 17-31-5.5. Independent audit -- Report to county legislative body -- Content.
144 (1) The legislative body of each county imposing the transient room tax provided for in
145 Section 59-12-301 shall annually engage an independent auditor to perform an audit to verify
146 that transient room tax funds are used only as authorized by this chapter and to report the
147 findings of the audit to the county legislative body.
148 (2) Subsection (1) applies to the tourism, recreation, cultural, [and] convention, and
149 airport facilities tax provided for in Section 59-12-603 , except that the audit verification
150 required under this Subsection (2) shall be for the uses authorized under Section 59-12-603 .
151 (3) The report required under Subsection (1) shall include a breakdown of expenditures
152 into the following categories:
153 (a) for the transient room tax, identification of expenditures for:
154 (i) establishing and promoting:
155 (A) recreation;
156 (B) tourism;
157 (C) film production; and
158 (D) conventions;
159 (ii) acquiring, leasing, constructing, furnishing, or operating:
160 (A) convention meeting rooms;
161 (B) exhibit halls;
162 (C) visitor information centers;
163 (D) museums; and
164 (E) related facilities;
165 (iii) acquiring or leasing land required for or related to the purposes listed in Subsection
166 (3)(a)(ii);
167 (iv) mitigation costs as identified in Subsection 17-31-2 (1)(d); and
168 (v) making the annual payment of principal, interest, premiums, and necessary reserves
169 for any or the aggregate of bonds issued to pay for costs referred to in Subsections

170 17-31-2 (2)(c) and (3)(a); and
171 (b) for the tourism, recreation, cultural, [and] convention, and airport facilities tax,
172 identification of expenditures for:
173 (i) financing tourism promotion, which means an activity to develop, encourage, solicit,
174 or market tourism that attracts transient guests to the county, including planning, product
175 development, and advertising;
176 (ii) the development, operation, and maintenance of the following facilities as defined in
177 Section 59-12-602 :
178 (A) [tourist facilities] an airport facility;
179 (B) [recreation facilities] a convention facility;
180 (C) a cultural [facilities; and] facility;
181 (D) [convention facilities] a recreation facility; and
182 (E) a tourist facility; and
183 (iii) a pledge as security for evidences of indebtedness under Subsection 59-12-603 (3).
184 (4) A county legislative body shall provide a copy of a report it receives under this
185 section to:
186 (a) the Governor's Office of Economic Development;
187 (b) its tourism tax advisory board; and
188 (c) the Office of the Legislative Fiscal Analyst.
189 Section 3. Section 41-1a-1222 is amended to read:
190 41-1a-1222. Local option highway construction and transportation corridor
191 preservation fee -- Exemptions -- Deposit -- Transfer -- County ordinance -- Notice.
192 (1) (a) (i) A county legislative body may impose a local option highway construction
193 and transportation corridor preservation fee of up to $10 on each motor vehicle registration
194 within the county.
195 (ii) A fee imposed under Subsection (1)(a)(i) shall be set in whole dollar increments.
196 (b) If imposed under Subsection (1)(a), at the time application is made for registration
197 or renewal of registration of a motor vehicle under this chapter, the applicant shall pay the local

198 option highway construction and transportation corridor preservation fee established by the
199 county legislative body.
200 (c) The following are exempt from the fee required under Subsection (1)(a):
201 (i) a motor vehicle that is exempt from the registration fee under Section 41-1a-1209 or
202 Subsection 41-1a-419 (3);
203 (ii) a commercial vehicle with an apportioned registration under Section 41-1a-301 ; and
204 (iii) a motor vehicle with a Purple Heart special group license plate issued in accordance
205 with Section 41-1a-421 .
206 (2) (a) Except as provided in Subsection (2)(b), the revenue generated under this
207 section shall be:
208 (i) deposited in the Local Transportation Corridor Preservation Fund created in Section
209 72-2-117.5 ;
210 (ii) credited to the county from which it is generated; and
211 (iii) used and distributed in accordance with Section 72-2-117.5 .
212 (b) [Seventy percent of the] The revenue generated by a fee imposed under this section
213 in a county of the first class shall be[:] deposited or transferred as follows:
214 (i) 50% of the revenue shall be:
215 [(i)] (A) deposited in the County of the First Class State Highway Projects Fund
216 created in Section 72-2-121 ; and
217 [(ii)] (B) used in accordance with Section 72-2-121 [.];
218 (ii) 20% of the revenue shall be:
219 (A) transferred to the legislative body of a city of the first class:
220 (I) located in a county of the first class; and
221 (II) that has:
222 (Aa) an international airport within its boundaries; and
223 (Bb) a United States customs office on the premises of the international airport
224 described in Subsection (2)(b)(ii)(A)(II)(Aa); and
225 (B) used by the city described in Subsection (2)(b)(ii)(A) for highway construction,

226 reconstruction, or maintenance projects; and
227 (iii) 30% of the revenue shall be deposited, credited, and used as provided in Subsection
228 (2)(a).
229 (3) To impose or change the amount of a fee under this section, the county legislative
230 body shall pass an ordinance:
231 (a) approving the fee;
232 (b) setting the amount of the fee; and
233 (c) providing an effective date for the fee as provided in Subsection (4).
234 (4) (a) If a county legislative body enacts, changes, or repeals a fee under this section,
235 the enactment, change, or repeal shall take effect on July 1 if the commission receives notice
236 meeting the requirements of Subsection (4)(b) from the county prior to April 1.
237 (b) The notice described in Subsection (4)(a) shall:
238 (i) state that the county will enact, change, or repeal a fee under this part;
239 (ii) include a copy of the ordinance imposing the fee; and
240 (iii) if the county enacts or changes the fee under this section, state the amount of the
241 fee.
242 Section 4. Section 59-12-102 is amended to read:
243 59-12-102. Definitions.
244 As used in this chapter:
245 (1) (a) "Admission or user fees" includes season passes.
246 (b) "Admission or user fees" does not include annual membership dues to private
247 organizations.
248 (2) "Agreement" means the Streamlined Sales and Use Tax Agreement described in
249 Section 59-12-102.1 .
250 (3) "Agreement combined tax rate" means the sum of the tax rates:
251 (a) listed under Subsection (4); and
252 (b) that are imposed within a local taxing jurisdiction.
253 (4) "Agreement sales and use tax" means a tax imposed under:

254 (a) Subsection 59-12-103 (2)(a)(i)(A);
255 (b) Subsection 59-12-103 (2)(b)(i);
256 (c) Subsection 59-12-103 (2)(c)(i);
257 (d) Subsection 59-12-103 (2)(d)(i)(A)(I);
258 (e) Subsection 59-12-103 (2)(e)(ii)(A)(I);
259 (f) Subsection 59-12-103 (2)(e)(iii)(A)(I);
260 (g) Section 59-12-204 ;
261 (h) Section 59-12-401 ;
262 (i) Section 59-12-402 ;
263 (j) Section 59-12-501 ;
264 (k) Section 59-12-502 ;
265 (l) Section 59-12-703 ;
266 (m) Section 59-12-802 ;
267 (n) Section 59-12-804 ;
268 (o) Section 59-12-1001 ;
269 (p) Section 59-12-1102 ;
270 (q) Section 59-12-1302 ;
271 (r) Section 59-12-1402 ;
272 (s) Section 59-12-1503 ; [or]
273 (t) Section 59-12-1703 [.];
274 (u) Section 59-12-1903 ; or
275 (v) Section 59-12-2003 .
276 (5) "Aircraft" is as defined in Section 72-10-102 .
277 (6) "Alcoholic beverage" means a beverage that:
278 (a) is suitable for human consumption; and
279 (b) contains .5% or more alcohol by volume.
280 (7) "Area agency on aging" is as defined in Section 62A-3-101 .
281 (8) "Assisted amusement device" means an amusement device, skill device, or ride

282 device that is started and stopped by an individual:
283 (a) who is not the purchaser or renter of the right to use or operate the amusement
284 device, skill device, or ride device; and
285 (b) at the direction of the seller of the right to use the amusement device, skill device, or
286 ride device.
287 (9) "Assisted cleaning or washing of tangible personal property" means cleaning or
288 washing of tangible personal property if the cleaning or washing labor is primarily performed by
289 an individual:
290 (a) who is not the purchaser of the cleaning or washing of the tangible personal
291 property; and
292 (b) at the direction of the seller of the cleaning or washing of the tangible personal
293 property.
294 (10) "Authorized carrier" means:
295 (a) in the case of vehicles operated over public highways, the holder of credentials
296 indicating that the vehicle is or will be operated pursuant to both the International Registration
297 Plan and the International Fuel Tax Agreement;
298 (b) in the case of aircraft, the holder of a Federal Aviation Administration operating
299 certificate or air carrier's operating certificate; or
300 (c) in the case of locomotives, freight cars, railroad work equipment, or other rolling
301 stock, the holder of a certificate issued by the United States Surface Transportation Board.
302 (11) (a) Except as provided in Subsection (11)(b), "biomass energy" means any of the
303 following that is used as the primary source of energy to produce fuel or electricity:
304 (i) material from a plant or tree; or
305 (ii) other organic matter that is available on a renewable basis, including:
306 (A) slash and brush from forests and woodlands;
307 (B) animal waste;
308 (C) methane produced:
309 (I) at landfills; or

310 (II) as a byproduct of the treatment of wastewater residuals;
311 (D) aquatic plants; and
312 (E) agricultural products.
313 (b) "Biomass energy" does not include:
314 (i) black liquor;
315 (ii) treated woods; or
316 (iii) biomass from municipal solid waste other than methane produced:
317 (A) at landfills; or
318 (B) as a byproduct of the treatment of wastewater residuals.
319 (12) (a) "Bundled transaction" means the sale of two or more items of tangible personal
320 property if:
321 (i) one or more of the items of tangible personal property is food and food ingredients;
322 and
323 (ii) the items of tangible personal property are:
324 (A) distinct and identifiable; and
325 (B) sold for one price that is not itemized.
326 (b) "Bundled transaction" does not include the sale of tangible personal property if the
327 sales price varies, or is negotiable, on the basis of the selection by the purchaser of the items of
328 tangible personal property included in the transaction.
329 (c) For purposes of Subsection (12)(a)(ii)(A), tangible personal property that is distinct
330 and identifiable does not include:
331 (i) packaging that:
332 (A) accompanies the sale of the tangible personal property; and
333 (B) is incidental or immaterial to the sale of the tangible personal property;
334 (ii) tangible personal property provided free of charge with the purchase of another item
335 of tangible personal property; or
336 (iii) an item of tangible personal property included in the definition of "purchase price."
337 (d) For purposes of Subsection (12)(c)(ii), an item of tangible personal property is

338 provided free of charge with the purchase of another item of tangible personal property if the
339 sales price of the purchased item of tangible personal property does not vary depending on the
340 inclusion of the tangible personal property provided free of charge.
341 (13) "Certified automated system" means software certified by the governing board of
342 the agreement in accordance with Section 59-12-102.1 that:
343 (a) calculates the agreement sales and use tax imposed within a local taxing jurisdiction:
344 (i) on a transaction; and
345 (ii) in the states that are members of the agreement;
346 (b) determines the amount of agreement sales and use tax to remit to a state that is a
347 member of the agreement; and
348 (c) maintains a record of the transaction described in Subsection (13)(a)(i).
349 (14) "Certified service provider" means an agent certified:
350 (a) by the governing board of the agreement in accordance with Section 59-12-102.1 ;
351 and
352 (b) to perform all of a seller's sales and use tax functions for an agreement sales and use
353 tax other than the seller's obligation under Section 59-12-107.4 to remit a tax on the seller's
354 own purchases.
355 (15) (a) Subject to Subsection (15)(b), "clothing" means all human wearing apparel
356 suitable for general use.
357 (b) In accordance with Title 63, Chapter 46a, Utah Administrative Rulemaking Act, the
358 commission shall make rules:
359 (i) listing the items that constitute "clothing"; and
360 (ii) that are consistent with the list of items that constitute "clothing" under the
361 agreement.
362 (16) "Coal-to-liquid" means the process of converting coal into a liquid synthetic fuel.
363 (17) "Commercial use" means the use of gas, electricity, heat, coal, fuel oil, or other
364 fuels that does not constitute industrial use under Subsection (42) or residential use under
365 Subsection (80).

366 (18) (a) "Common carrier" means a person engaged in or transacting the business of
367 transporting passengers, freight, merchandise, or other property for hire within this state.
368 (b) (i) "Common carrier" does not include a person who, at the time the person is
369 traveling to or from that person's place of employment, transports a passenger to or from the
370 passenger's place of employment.
371 (ii) For purposes of Subsection (18)(b)(i), in accordance with Title 63, Chapter 46a,
372 Utah Administrative Rulemaking Act, the commission may make rules defining what constitutes
373 a person's place of employment.
374 (19) "Component part" includes:
375 (a) poultry, dairy, and other livestock feed, and their components;
376 (b) baling ties and twine used in the baling of hay and straw;
377 (c) fuel used for providing temperature control of orchards and commercial
378 greenhouses doing a majority of their business in wholesale sales, and for providing power for
379 off-highway type farm machinery; and
380 (d) feed, seeds, and seedlings.
381 (20) "Computer" means an electronic device that accepts information:
382 (a) (i) in digital form; or
383 (ii) in a form similar to digital form; and
384 (b) manipulates that information for a result based on a sequence of instructions.
385 (21) "Computer software" means a set of coded instructions designed to cause:
386 (a) a computer to perform a task; or
387 (b) automatic data processing equipment to perform a task.
388 (22) "Construction materials" means any tangible personal property that will be
389 converted into real property.
390 (23) "Delivered electronically" means delivered to a purchaser by means other than
391 tangible storage media.
392 (24) (a) "Delivery charge" means a charge:
393 (i) by a seller of:

394 (A) tangible personal property; or
395 (B) services; and
396 (ii) for preparation and delivery of the tangible personal property or services described
397 in Subsection (24)(a)(i) to a location designated by the purchaser.
398 (b) "Delivery charge" includes a charge for the following:
399 (i) transportation;
400 (ii) shipping;
401 (iii) postage;
402 (iv) handling;
403 (v) crating; or
404 (vi) packing.
405 (25) (a) "Dental prosthesis" means the following if fabricated in a laboratory:
406 (i) a bridge;
407 (ii) a crown if that crown covers at least 75% of a tooth structure;
408 (iii) a denture;
409 (iv) an implant;
410 (v) an orthodontic device designed to:
411 (A) retain the position or spacing of teeth; and
412 (B) replace a missing tooth;
413 (vi) a partial denture; or
414 (vii) a device similar to Subsections (25)(a)(i) through (vi).
415 (b) "Dental prosthesis" does not include an appliance or device, other than a device
416 described in Subsection (25)(a), if that appliance or device is used in orthodontic therapy to
417 apply force to the teeth and their supporting structures to:
418 (i) produce changes in their relationship to each other; and
419 (ii) control their growth and development.
420 (26) "Dietary supplement" means a product, other than tobacco, that:
421 (a) is intended to supplement the diet;

422 (b) contains one or more of the following dietary ingredients:
423 (i) a vitamin;
424 (ii) a mineral;
425 (iii) an herb or other botanical;
426 (iv) an amino acid;
427 (v) a dietary substance for use by humans to supplement the diet by increasing the total
428 dietary intake; or
429 (vi) a concentrate, metabolite, constituent, extract, or combination of any ingredient
430 described in Subsections (26)(b)(i) through (v);
431 (c) (i) except as provided in Subsection (26)(c)(ii), is intended for ingestion in:
432 (A) tablet form;
433 (B) capsule form;
434 (C) powder form;
435 (D) softgel form;
436 (E) gelcap form; or
437 (F) liquid form; or
438 (ii) notwithstanding Subsection (26)(c)(i), if the product is not intended for ingestion in
439 a form described in Subsections (26)(c)(i)(A) through (F), is not represented:
440 (A) as conventional food; and
441 (B) for use as a sole item of:
442 (I) a meal; or
443 (II) the diet; and
444 (d) is required to be labeled as a dietary supplement:
445 (i) identifiable by the "Supplemental Facts" box found on the label; and
446 (ii) as required by 21 C.F.R. Sec. 101.36.
447 (27) (a) "Direct mail" means printed material delivered or distributed by United States
448 mail or other delivery service:
449 (i) to:

450 (A) a mass audience; or
451 (B) addressees on a mailing list provided by a purchaser of the mailing list; and
452 (ii) if the cost of the printed material is not billed directly to the recipients.
453 (b) "Direct mail" includes tangible personal property supplied directly or indirectly by a
454 purchaser to a seller of direct mail for inclusion in a package containing the printed material.
455 (c) "Direct mail" does not include multiple items of printed material delivered to a single
456 address.
457 (28) (a) "Disposable home medical equipment or supplies" means medical equipment or
458 supplies that:
459 (i) cannot withstand repeated use; and
460 (ii) are purchased by, for, or on behalf of a person other than:
461 (A) a health care facility as defined in Section 26-21-2 ;
462 (B) a health care provider as defined in Section 78-14-3 ;
463 (C) an office of a health care provider described in Subsection (28)(a)(ii)(B); or
464 (D) a person similar to a person described in Subsections (28)(a)(ii)(A) through (C).
465 (b) "Disposable home medical equipment or supplies" does not include:
466 (i) a drug;
467 (ii) durable medical equipment;
468 (iii) a hearing aid;
469 (iv) a hearing aid accessory;
470 (v) mobility enhancing equipment; or
471 (vi) tangible personal property used to correct impaired vision, including:
472 (A) eyeglasses; or
473 (B) contact lenses.
474 (c) In accordance with Title 63, Chapter 46a, Utah Administrative Rulemaking Act, the
475 commission may by rule define what constitutes medical equipment or supplies.
476 (29) (a) "Drug" means a compound, substance, or preparation, or a component of a
477 compound, substance, or preparation that is:

478 (i) recognized in:
479 (A) the official United States Pharmacopoeia;
480 (B) the official Homeopathic Pharmacopoeia of the United States;
481 (C) the official National Formulary; or
482 (D) a supplement to a publication listed in Subsections (29)(a)(i)(A) through (C);
483 (ii) intended for use in the:
484 (A) diagnosis of disease;
485 (B) cure of disease;
486 (C) mitigation of disease;
487 (D) treatment of disease; or
488 (E) prevention of disease; or
489 (iii) intended to affect:
490 (A) the structure of the body; or
491 (B) any function of the body.
492 (b) "Drug" does not include:
493 (i) food and food ingredients;
494 (ii) a dietary supplement;
495 (iii) an alcoholic beverage; or
496 (iv) a prosthetic device.
497 (30) (a) Except as provided in Subsection (30)(c), "durable medical equipment" means
498 equipment that:
499 (i) can withstand repeated use;
500 (ii) is primarily and customarily used to serve a medical purpose;
501 (iii) generally is not useful to a person in the absence of illness or injury; and
502 (iv) is not worn in or on the body.
503 (b) "Durable medical equipment" includes parts used in the repair or replacement of the
504 equipment described in Subsection (30)(a).
505 (c) Notwithstanding Subsection (30)(a), "durable medical equipment" does not include

506 mobility enhancing equipment.
507 (31) "Electronic" means:
508 (a) relating to technology; and
509 (b) having:
510 (i) electrical capabilities;
511 (ii) digital capabilities;
512 (iii) magnetic capabilities;
513 (iv) wireless capabilities;
514 (v) optical capabilities;
515 (vi) electromagnetic capabilities; or
516 (vii) capabilities similar to Subsections (31)(b)(i) through (vi).
517 (32) "Employee" is as defined in Section 59-10-401 .
518 (33) "Fixed guideway" means a public transit facility that uses and occupies:
519 (a) rail for the use of public transit; or
520 (b) a separate right-of-way for the use of public transit.
521 (34) (a) "Food and food ingredients" means substances:
522 (i) regardless of whether the substances are in:
523 (A) liquid form;
524 (B) concentrated form;
525 (C) solid form;
526 (D) frozen form;
527 (E) dried form; or
528 (F) dehydrated form; and
529 (ii) that are:
530 (A) sold for:
531 (I) ingestion by humans; or
532 (II) chewing by humans; and
533 (B) consumed for the substance's:

534 (I) taste; or
535 (II) nutritional value.
536 (b) "Food and food ingredients" includes an item described in Subsection (66)(b)(iii).
537 (c) "Food and food ingredients" does not include:
538 (i) an alcoholic beverage;
539 (ii) tobacco; or
540 (iii) prepared food.
541 (35) (a) "Fundraising sales" means sales:
542 (i) (A) made by a school; or
543 (B) made by a school student;
544 (ii) that are for the purpose of raising funds for the school to purchase equipment,
545 materials, or provide transportation; and
546 (iii) that are part of an officially sanctioned school activity.
547 (b) For purposes of Subsection (35)(a)(iii), "officially sanctioned school activity" means
548 a school activity:
549 (i) that is conducted in accordance with a formal policy adopted by the school or school
550 district governing the authorization and supervision of fundraising activities;
551 (ii) that does not directly or indirectly compensate an individual teacher or other
552 educational personnel by direct payment, commissions, or payment in kind; and
553 (iii) the net or gross revenues from which are deposited in a dedicated account
554 controlled by the school or school district.
555 (36) "Geothermal energy" means energy contained in heat that continuously flows
556 outward from the earth that is used as the sole source of energy to produce electricity.
557 (37) "Governing board of the agreement" means the governing board of the agreement
558 that is:
559 (a) authorized to administer the agreement; and
560 (b) established in accordance with the agreement.
561 (38) (a) For purposes of Subsection 59-12-104 (41), "governmental entity" means:

562 (i) the executive branch of the state, including all departments, institutions, boards,
563 divisions, bureaus, offices, commissions, and committees;
564 (ii) the judicial branch of the state, including the courts, the Judicial Council, the Office
565 of the Court Administrator, and similar administrative units in the judicial branch;
566 (iii) the legislative branch of the state, including the House of Representatives, the
567 Senate, the Legislative Printing Office, the Office of Legislative Research and General Counsel,
568 the Office of the Legislative Auditor General, and the Office of the Legislative Fiscal Analyst;
569 (iv) the National Guard;
570 (v) an independent entity as defined in Section 63E-1-102 ; or
571 (vi) a political subdivision as defined in Section 17B-1-102 .
572 (b) "Governmental entity" does not include the state systems of public and higher
573 education, including:
574 (i) a college campus of the Utah College of Applied Technology;
575 (ii) a school;
576 (iii) the State Board of Education;
577 (iv) the State Board of Regents; or
578 (v) a state institution of higher education as defined in Section 53B-3-102 .
579 (39) (a) "Hearing aid" means:
580 (i) an instrument or device having an electronic component that is designed to:
581 (A) (I) improve impaired human hearing; or
582 (II) correct impaired human hearing; and
583 (B) (I) be worn in the human ear; or
584 (II) affixed behind the human ear;
585 (ii) an instrument or device that is surgically implanted into the cochlea; or
586 (iii) a telephone amplifying device.
587 (b) "Hearing aid" does not include:
588 (i) except as provided in Subsection (39)(a)(i)(B) or (39)(a)(ii), an instrument or device
589 having an electronic component that is designed to be worn on the body;

590 (ii) except as provided in Subsection (39)(a)(iii), an assistive listening device or system
591 designed to be used by one individual, including:
592 (A) a personal amplifying system;
593 (B) a personal FM system;
594 (C) a television listening system; or
595 (D) a device or system similar to a device or system described in Subsections
596 (39)(b)(ii)(A) through (C); or
597 (iii) an assistive listening device or system designed to be used by more than one
598 individual, including:
599 (A) a device or system installed in:
600 (I) an auditorium;
601 (II) a church;
602 (III) a conference room;
603 (IV) a synagogue; or
604 (V) a theater; or
605 (B) a device or system similar to a device or system described in Subsections
606 (39)(b)(iii)(A)(I) through (V).
607 (40) (a) "Hearing aid accessory" means a hearing aid:
608 (i) component;
609 (ii) attachment; or
610 (iii) accessory.
611 (b) "Hearing aid accessory" includes:
612 (i) a hearing aid neck loop;
613 (ii) a hearing aid cord;
614 (iii) a hearing aid ear mold;
615 (iv) hearing aid tubing;
616 (v) a hearing aid ear hook; or
617 (vi) a hearing aid remote control.

618 (c) "Hearing aid accessory" does not include:
619 (i) a component, attachment, or accessory designed to be used only with an:
620 (A) instrument or device described in Subsection (39)(b)(i); or
621 (B) assistive listening device or system described in Subsection (39)(b)(ii) or (iii); or
622 (ii) a hearing aid battery.
623 (41) "Hydroelectric energy" means water used as the sole source of energy to produce
624 electricity.
625 (42) "Industrial use" means the use of natural gas, electricity, heat, coal, fuel oil, or
626 other fuels:
627 (a) in mining or extraction of minerals;
628 (b) in agricultural operations to produce an agricultural product up to the time of
629 harvest or placing the agricultural product into a storage facility, including:
630 (i) commercial greenhouses;
631 (ii) irrigation pumps;
632 (iii) farm machinery;
633 (iv) implements of husbandry as defined in Subsection 41-1a-102 (23) that are not
634 registered under Title 41, Chapter 1a, Part 2, Registration; and
635 (v) other farming activities;
636 (c) in manufacturing tangible personal property at an establishment described in SIC
637 Codes 2000 to 3999 of the 1987 Standard Industrial Classification Manual of the federal
638 Executive Office of the President, Office of Management and Budget;
639 (d) by a scrap recycler if:
640 (i) from a fixed location, the scrap recycler utilizes machinery or equipment to process
641 one or more of the following items into prepared grades of processed materials for use in new
642 products:
643 (A) iron;
644 (B) steel;
645 (C) nonferrous metal;

646 (D) paper;
647 (E) glass;
648 (F) plastic;
649 (G) textile; or
650 (H) rubber; and
651 (ii) the new products under Subsection (42)(d)(i) would otherwise be made with
652 nonrecycled materials; or
653 (e) in producing a form of energy or steam described in Subsection 54-2-1 (2)(a) by a
654 cogeneration facility as defined in Section 54-2-1 .
655 (43) (a) Except as provided in Subsection (43)(b), "installation charge" means a charge
656 for installing tangible personal property.
657 (b) Notwithstanding Subsection (43)(a), "installation charge" does not include a charge
658 for repairs or renovations of tangible personal property.
659 (44) (a) "Lease" or "rental" means a transfer of possession or control of tangible
660 personal property for:
661 (i) (A) a fixed term; or
662 (B) an indeterminate term; and
663 (ii) consideration.
664 (b) "Lease" or "rental" includes an agreement covering a motor vehicle and trailer if the
665 amount of consideration may be increased or decreased by reference to the amount realized
666 upon sale or disposition of the property as defined in Section 7701(h)(1), Internal Revenue
667 Code.
668 (c) "Lease" or "rental" does not include:
669 (i) a transfer of possession or control of property under a security agreement or
670 deferred payment plan that requires the transfer of title upon completion of the required
671 payments;
672 (ii) a transfer of possession or control of property under an agreement that requires the
673 transfer of title:

674 (A) upon completion of required payments; and
675 (B) if the payment of an option price does not exceed the greater of:
676 (I) $100; or
677 (II) 1% of the total required payments; or
678 (iii) providing tangible personal property along with an operator for a fixed period of
679 time or an indeterminate period of time if the operator is necessary for equipment to perform as
680 designed.
681 (d) For purposes of Subsection (44)(c)(iii), an operator is necessary for equipment to
682 perform as designed if the operator's duties exceed the:
683 (i) set-up of tangible personal property;
684 (ii) maintenance of tangible personal property; or
685 (iii) inspection of tangible personal property.
686 (45) "Load and leave" means delivery to a purchaser by use of a tangible storage media
687 if the tangible storage media is not physically transferred to the purchaser.
688 (46) "Local taxing jurisdiction" means a:
689 (a) county that is authorized to impose an agreement sales and use tax;
690 (b) city that is authorized to impose an agreement sales and use tax; or
691 (c) town that is authorized to impose an agreement sales and use tax.
692 (47) "Manufactured home" is as defined in Section 58-56-3 .
693 (48) For purposes of Section 59-12-104 , "manufacturing facility" means:
694 (a) an establishment described in SIC Codes 2000 to 3999 of the 1987 Standard
695 Industrial Classification Manual of the federal Executive Office of the President, Office of
696 Management and Budget;
697 (b) a scrap recycler if:
698 (i) from a fixed location, the scrap recycler utilizes machinery or equipment to process
699 one or more of the following items into prepared grades of processed materials for use in new
700 products:
701 (A) iron;

702 (B) steel;
703 (C) nonferrous metal;
704 (D) paper;
705 (E) glass;
706 (F) plastic;
707 (G) textile; or
708 (H) rubber; and
709 (ii) the new products under Subsection (48)(b)(i) would otherwise be made with
710 nonrecycled materials; or
711 (c) a cogeneration facility as defined in Section 54-2-1 .
712 (49) "Member of the immediate family of the producer" means a person who is related
713 to a producer described in Subsection 59-12-104 (20)(a) as a:
714 (a) child or stepchild, regardless of whether the child or stepchild is:
715 (i) an adopted child or adopted stepchild; or
716 (ii) a foster child or foster stepchild;
717 (b) grandchild or stepgrandchild;
718 (c) grandparent or stepgrandparent;
719 (d) nephew or stepnephew;
720 (e) niece or stepniece;
721 (f) parent or stepparent;
722 (g) sibling or stepsibling;
723 (h) spouse;
724 (i) person who is the spouse of a person described in Subsections (49)(a) through (g);
725 or
726 (j) person similar to a person described in Subsections (49)(a) through (i) as determined
727 by the commission by rule made in accordance with Title 63, Chapter 46a, Utah Administrative
728 Rulemaking Act.
729 (50) "Mobile home" is as defined in Section 58-56-3 .

730 (51) "Mobile telecommunications service" is as defined in the Mobile
731 Telecommunications Sourcing Act, 4 U.S.C. Sec. 124.
732 (52) (a) Except as provided in Subsection (52)(c), "mobility enhancing equipment"
733 means equipment that is:
734 (i) primarily and customarily used to provide or increase the ability to move from one
735 place to another;
736 (ii) appropriate for use in a:
737 (A) home; or
738 (B) motor vehicle; and
739 (iii) not generally used by persons with normal mobility.
740 (b) "Mobility enhancing equipment" includes parts used in the repair or replacement of
741 the equipment described in Subsection (52)(a).
742 (c) Notwithstanding Subsection (52)(a), "mobility enhancing equipment" does not
743 include:
744 (i) a motor vehicle;
745 (ii) equipment on a motor vehicle if that equipment is normally provided by the motor
746 vehicle manufacturer;
747 (iii) durable medical equipment; or
748 (iv) a prosthetic device.
749 (53) "Model 1 seller" means a seller that has selected a certified service provider as the
750 seller's agent to perform all of the seller's sales and use tax functions for agreement sales and
751 use taxes other than the seller's obligation under Section 59-12-107.4 to remit a tax on the
752 seller's own purchases.
753 (54) "Model 2 seller" means a seller that:
754 (a) except as provided in Subsection (54)(b), has selected a certified automated system
755 to perform the seller's sales tax functions for agreement sales and use taxes; and
756 (b) notwithstanding Subsection (54)(a), retains responsibility for remitting all of the
757 sales tax:

758 (i) collected by the seller; and
759 (ii) to the appropriate local taxing jurisdiction.
760 (55) (a) Subject to Subsection (55)(b), "model 3 seller" means a seller that has:
761 (i) sales in at least five states that are members of the agreement;
762 (ii) total annual sales revenues of at least $500,000,000;
763 (iii) a proprietary system that calculates the amount of tax:
764 (A) for an agreement sales and use tax; and
765 (B) due to each local taxing jurisdiction; and
766 (iv) entered into a performance agreement with the governing board of the agreement.
767 (b) For purposes of Subsection (55)(a), "model 3 seller" includes an affiliated group of
768 sellers using the same proprietary system.
769 (56) "Modular home" means a modular unit as defined in Section 58-56-3 .
770 (57) "Motor vehicle" is as defined in Section 41-1a-102 .
771 (58) "Oil shale" means a group of fine black to dark brown shales containing bituminous
772 material that yields petroleum upon distillation.
773 (59) (a) "Other fuels" means products that burn independently to produce heat or
774 energy.
775 (b) "Other fuels" includes oxygen when it is used in the manufacturing of tangible
776 personal property.
777 (60) "Pawnbroker" is as defined in Section 13-32a-102 .
778 (61) "Pawn transaction" is as defined in Section 13-32a-102 .
779 (62) (a) "Permanently attached to real property" means that for tangible personal
780 property attached to real property:
781 (i) the attachment of the tangible personal property to the real property:
782 (A) is essential to the use of the tangible personal property; and
783 (B) suggests that the tangible personal property will remain attached to the real
784 property in the same place over the useful life of the tangible personal property; or
785 (ii) if the tangible personal property is detached from the real property, the detachment

786 would:
787 (A) cause substantial damage to the tangible personal property; or
788 (B) require substantial alteration or repair of the real property to which the tangible
789 personal property is attached.
790 (b) "Permanently attached to real property" includes:
791 (i) the attachment of an accessory to the tangible personal property if the accessory is:
792 (A) essential to the operation of the tangible personal property; and
793 (B) attached only to facilitate the operation of the tangible personal property;
794 (ii) a temporary detachment of tangible personal property from real property for a repair
795 or renovation if the repair or renovation is performed where the tangible personal property and
796 real property are located; or
797 (iii) an attachment of the following tangible personal property to real property,
798 regardless of whether the attachment to real property is only through a line that supplies water,
799 electricity, gas, telephone, cable, or supplies a similar item as determined by the commission by
800 rule made in accordance with Title 63, Chapter 46a, Utah Administrative Rulemaking Act:
801 (A) property attached to oil, gas, or water pipelines, other than the property listed in
802 Subsection (62)(c)(iii);
803 (B) a hot water heater;
804 (C) a water softener system; or
805 (D) a water filtration system, other than a water filtration system manufactured as part
806 of a refrigerator.
807 (c) "Permanently attached to real property" does not include:
808 (i) the attachment of portable or movable tangible personal property to real property if
809 that portable or movable tangible personal property is attached to real property only for:
810 (A) convenience;
811 (B) stability; or
812 (C) for an obvious temporary purpose;
813 (ii) the detachment of tangible personal property from real property other than the

814 detachment described in Subsection (62)(b)(ii); or
815 (iii) an attachment of the following tangible personal property to real property if the
816 attachment to real property is only through a line that supplies water, electricity, gas, telephone,
817 cable, or supplies a similar item as determined by the commission by rule made in accordance
818 with Title 63, Chapter 46a, Utah Administrative Rulemaking Act:
819 (A) a refrigerator;
820 (B) a washer;
821 (C) a dryer;
822 (D) a stove;
823 (E) a television;
824 (F) a computer;
825 (G) a telephone; or
826 (H) tangible personal property similar to Subsections (62)(c)(iii)(A) through (G) as
827 determined by the commission by rule made in accordance with Title 63, Chapter 46a, Utah
828 Administrative Rulemaking Act.
829 (63) "Person" includes any individual, firm, partnership, joint venture, association,
830 corporation, estate, trust, business trust, receiver, syndicate, this state, any county, city,
831 municipality, district, or other local governmental entity of the state, or any group or
832 combination acting as a unit.
833 (64) "Place of primary use":
834 (a) for telephone service other than mobile telecommunications service, means the
835 street address representative of where the purchaser's use of the telephone service primarily
836 occurs, which shall be:
837 (i) the residential street address of the purchaser; or
838 (ii) the primary business street address of the purchaser; or
839 (b) for mobile telecommunications service, is as defined in the Mobile
840 Telecommunications Sourcing Act, 4 U.S.C. Sec. 124.
841 (65) "Postproduction" means an activity related to the finishing or duplication of a

842 medium described in Subsection 59-12-104 (56)(a).
843 (66) (a) "Prepared food" means:
844 (i) food:
845 (A) sold in a heated state; or
846 (B) heated by a seller;
847 (ii) two or more food ingredients mixed or combined by the seller for sale as a single
848 item; or
849 (iii) except as provided in Subsection (66)(c), food sold with an eating utensil provided
850 by the seller, including a:
851 (A) plate;
852 (B) knife;
853 (C) fork;
854 (D) spoon;
855 (E) glass;
856 (F) cup;
857 (G) napkin; or
858 (H) straw.
859 (b) "Prepared food" does not include:
860 (i) food that a seller only:
861 (A) cuts;
862 (B) repackages; or
863 (C) pasteurizes; or
864 (ii) (A) the following:
865 (I) raw egg;
866 (II) raw fish;
867 (III) raw meat;
868 (IV) raw poultry; or
869 (V) a food containing an item described in Subsections (66)(b)(ii)(A)(I) through (IV);

870 and
871 (B) if the Food and Drug Administration recommends in Chapter 3, Part 401.11 of the
872 Food and Drug Administration's Food Code that a consumer cook the items described in
873 Subsection (66)(b)(ii)(A) to prevent food borne illness; or
874 (iii) the following if sold without eating utensils provided by the seller:
875 (A) food and food ingredients sold by a seller if the seller's proper primary classification
876 under the 2002 North American Industry Classification System of the federal Executive Office
877 of the President, Office of Management and Budget, is manufacturing in Sector 311, Food
878 Manufacturing, except for Subsector 3118, Bakeries and Tortilla Manufacturing;
879 (B) food and food ingredients sold in an unheated state:
880 (I) by weight or volume; and
881 (II) as a single item; or
882 (C) a bakery item, including:
883 (I) a bagel;
884 (II) a bar;
885 (III) a biscuit;
886 (IV) bread;
887 (V) a bun;
888 (VI) a cake;
889 (VII) a cookie;
890 (VIII) a croissant;
891 (IX) a danish;
892 (X) a donut;
893 (XI) a muffin;
894 (XII) a pastry;
895 (XIII) a pie;
896 (XIV) a roll;
897 (XV) a tart;

898 (XVI) a torte; or
899 (XVII) a tortilla.
900 (c) Notwithstanding Subsection (66)(a)(iii), an eating utensil provided by the seller does
901 not include the following used to transport the food:
902 (i) a container; or
903 (ii) packaging.
904 (67) "Prescription" means an order, formula, or recipe that is issued:
905 (a) (i) orally;
906 (ii) in writing;
907 (iii) electronically; or
908 (iv) by any other manner of transmission; and
909 (b) by a licensed practitioner authorized by the laws of a state.
910 (68) (a) Except as provided in Subsection (68)(b)(ii) or (iii), "prewritten computer
911 software" means computer software that is not designed and developed:
912 (i) by the author or other creator of the computer software; and
913 (ii) to the specifications of a specific purchaser.
914 (b) "Prewritten computer software" includes:
915 (i) a prewritten upgrade to computer software if the prewritten upgrade to the
916 computer software is not designed and developed:
917 (A) by the author or other creator of the computer software; and
918 (B) to the specifications of a specific purchaser;
919 (ii) notwithstanding Subsection (68)(a), computer software designed and developed by
920 the author or other creator of the computer software to the specifications of a specific purchaser
921 if the computer software is sold to a person other than the purchaser; or
922 (iii) notwithstanding Subsection (68)(a) and except as provided in Subsection (68)(c),
923 prewritten computer software or a prewritten portion of prewritten computer software:
924 (A) that is modified or enhanced to any degree; and
925 (B) if the modification or enhancement described in Subsection (68)(b)(iii)(A) is

926 designed and developed to the specifications of a specific purchaser.
927 (c) Notwithstanding Subsection (68)(b)(iii), "prewritten computer software" does not
928 include a modification or enhancement described in Subsection (68)(b)(iii) if the charges for the
929 modification or enhancement are:
930 (i) reasonable; and
931 (ii) separately stated on the invoice or other statement of price provided to the
932 purchaser.
933 (69) (a) "Prosthetic device" means a device that is worn on or in the body to:
934 (i) artificially replace a missing portion of the body;
935 (ii) prevent or correct a physical deformity or physical malfunction; or
936 (iii) support a weak or deformed portion of the body.
937 (b) "Prosthetic device" includes:
938 (i) parts used in the repairs or renovation of a prosthetic device;
939 (ii) replacement parts for a prosthetic device; or
940 (iii) a dental prosthesis.
941 (c) "Prosthetic device" does not include:
942 (i) corrective eyeglasses;
943 (ii) contact lenses; or
944 (iii) hearing aids.
945 (70) (a) "Protective equipment" means an item:
946 (i) for human wear; and
947 (ii) that is:
948 (A) designed as protection:
949 (I) to the wearer against injury or disease; or
950 (II) against damage or injury of other persons or property; and
951 (B) not suitable for general use.
952 (b) In accordance with Title 63, Chapter 46a, Utah Administrative Rulemaking Act, the
953 commission shall make rules:

954 (i) listing the items that constitute "protective equipment"; and
955 (ii) that are consistent with the list of items that constitute "protective equipment" under
956 the agreement.
957 (71) (a) For purposes of Subsection 59-12-104 (41), "publication" means any written or
958 printed matter, other than a photocopy:
959 (i) regardless of:
960 (A) characteristics;
961 (B) copyright;
962 (C) form;
963 (D) format;
964 (E) method of reproduction; or
965 (F) source; and
966 (ii) made available in printed or electronic format.
967 (b) In accordance with Title 63, Chapter 46a, Utah Administrative Rulemaking Act, the
968 commission may by rule define the term "photocopy."
969 (72) (a) "Purchase price" and "sales price" mean the total amount of consideration:
970 (i) valued in money; and
971 (ii) for which tangible personal property or services are:
972 (A) sold;
973 (B) leased; or
974 (C) rented.
975 (b) "Purchase price" and "sales price" include:
976 (i) the seller's cost of the tangible personal property or services sold;
977 (ii) expenses of the seller, including:
978 (A) the cost of materials used;
979 (B) a labor cost;
980 (C) a service cost;
981 (D) interest;

982 (E) a loss;
983 (F) the cost of transportation to the seller; or
984 (G) a tax imposed on the seller; or
985 (iii) a charge by the seller for any service necessary to complete the sale.
986 (c) "Purchase price" and "sales price" do not include:
987 (i) a discount:
988 (A) in a form including:
989 (I) cash;
990 (II) term; or
991 (III) coupon;
992 (B) that is allowed by a seller;
993 (C) taken by a purchaser on a sale; and
994 (D) that is not reimbursed by a third party; or
995 (ii) the following if separately stated on an invoice, bill of sale, or similar document
996 provided to the purchaser:
997 (A) the amount of a trade-in;
998 (B) the following from credit extended on the sale of tangible personal property or
999 services:
1000 (I) interest charges;
1001 (II) financing charges; or
1002 (III) carrying charges;
1003 (C) a tax or fee legally imposed directly on the consumer;
1004 (D) a delivery charge; or
1005 (E) an installation charge.
1006 (73) "Purchaser" means a person to whom:
1007 (a) a sale of tangible personal property is made; or
1008 (b) a service is furnished.
1009 (74) "Regularly rented" means:

1010 (a) rented to a guest for value three or more times during a calendar year; or
1011 (b) advertised or held out to the public as a place that is regularly rented to guests for
1012 value.
1013 (75) "Renewable energy" means:
1014 (a) biomass energy;
1015 (b) hydroelectric energy;
1016 (c) geothermal energy;
1017 (d) solar energy; or
1018 (e) wind energy.
1019 (76) (a) "Renewable energy production facility" means a facility that:
1020 (i) uses renewable energy to produce electricity; and
1021 (ii) has a production capacity of 20 kilowatts or greater.
1022 (b) A facility is a renewable energy production facility regardless of whether the facility
1023 is:
1024 (i) connected to an electric grid; or
1025 (ii) located on the premises of an electricity consumer.
1026 (77) "Rental" is as defined in Subsection (44).
1027 (78) "Repairs or renovations of tangible personal property" means:
1028 (a) a repair or renovation of tangible personal property that is not permanently attached
1029 to real property; or
1030 (b) attaching tangible personal property to other tangible personal property if the other
1031 tangible personal property to which the tangible personal property is attached is not
1032 permanently attached to real property.
1033 (79) "Research and development" means the process of inquiry or experimentation
1034 aimed at the discovery of facts, devices, technologies, or applications and the process of
1035 preparing those devices, technologies, or applications for marketing.
1036 (80) "Residential use" means the use in or around a home, apartment building, sleeping
1037 quarters, and similar facilities or accommodations.

1038 (81) "Retail sale" or "sale at retail" means a sale, lease, or rental for a purpose other
1039 than:
1040 (a) resale;
1041 (b) sublease; or
1042 (c) subrent.
1043 (82) (a) "Retailer" means any person engaged in a regularly organized business in
1044 tangible personal property or any other taxable transaction under Subsection 59-12-103 (1), and
1045 who is selling to the user or consumer and not for resale.
1046 (b) "Retailer" includes commission merchants, auctioneers, and any person regularly
1047 engaged in the business of selling to users or consumers within the state.
1048 (83) (a) "Sale" means any transfer of title, exchange, or barter, conditional or otherwise,
1049 in any manner, of tangible personal property or any other taxable transaction under Subsection
1050 59-12-103 (1), for consideration.
1051 (b) "Sale" includes:
1052 (i) installment and credit sales;
1053 (ii) any closed transaction constituting a sale;
1054 (iii) any sale of electrical energy, gas, services, or entertainment taxable under this
1055 chapter;
1056 (iv) any transaction if the possession of property is transferred but the seller retains the
1057 title as security for the payment of the price; and
1058 (v) any transaction under which right to possession, operation, or use of any article of
1059 tangible personal property is granted under a lease or contract and the transfer of possession
1060 would be taxable if an outright sale were made.
1061 (84) "Sale at retail" is as defined in Subsection (81).
1062 (85) "Sale-leaseback transaction" means a transaction by which title to tangible personal
1063 property that is subject to a tax under this chapter is transferred:
1064 (a) by a purchaser-lessee;
1065 (b) to a lessor;

1066 (c) for consideration; and
1067 (d) if:
1068 (i) the purchaser-lessee paid sales and use tax on the purchaser-lessee's initial purchase
1069 of the tangible personal property;
1070 (ii) the sale of the tangible personal property to the lessor is intended as a form of
1071 financing:
1072 (A) for the property; and
1073 (B) to the purchaser-lessee; and
1074 (iii) in accordance with generally accepted accounting principles, the purchaser-lessee is
1075 required to:
1076 (A) capitalize the property for financial reporting purposes; and
1077 (B) account for the lease payments as payments made under a financing arrangement.
1078 (86) "Sales price" is as defined in Subsection (72).
1079 (87) (a) "Sales relating to schools" means the following sales by, amounts paid to, or
1080 amounts charged by a school:
1081 (i) sales that are directly related to the school's educational functions or activities
1082 including:
1083 (A) the sale of:
1084 (I) textbooks;
1085 (II) textbook fees;
1086 (III) laboratory fees;
1087 (IV) laboratory supplies; or
1088 (V) safety equipment;
1089 (B) the sale of a uniform, protective equipment, or sports or recreational equipment
1090 that:
1091 (I) a student is specifically required to wear as a condition of participation in a
1092 school-related event or school-related activity; and
1093 (II) is not readily adaptable to general or continued usage to the extent that it takes the

1094 place of ordinary clothing;
1095 (C) sales of the following if the net or gross revenues generated by the sales are
1096 deposited into a school district fund or school fund dedicated to school meals:
1097 (I) food and food ingredients; or
1098 (II) prepared food; or
1099 (D) transportation charges for official school activities; or
1100 (ii) amounts paid to or amounts charged by a school for admission to a school-related
1101 event or school-related activity.
1102 (b) "Sales relating to schools" does not include:
1103 (i) bookstore sales of items that are not educational materials or supplies;
1104 (ii) except as provided in Subsection (87)(a)(i)(B):
1105 (A) clothing;
1106 (B) clothing accessories or equipment;
1107 (C) protective equipment; or
1108 (D) sports or recreational equipment; or
1109 (iii) amounts paid to or amounts charged by a school for admission to a school-related
1110 event or school-related activity if the amounts paid or charged are passed through to a person:
1111 (A) other than a:
1112 (I) school;
1113 (II) nonprofit organization authorized by a school board or a governing body of a
1114 private school to organize and direct a competitive secondary school activity; or
1115 (III) nonprofit association authorized by a school board or a governing body of a
1116 private school to organize and direct a competitive secondary school activity; and
1117 (B) that is required to collect sales and use taxes under this chapter.
1118 (c) In accordance with Title 63, Chapter 46a, Utah Administrative Rulemaking Act, the
1119 commission may make rules defining the term "passed through."
1120 (88) For purposes of this section and Section 59-12-104 , "school":
1121 (a) means:

1122 (i) an elementary school or a secondary school that:
1123 (A) is a:
1124 (I) public school; or
1125 (II) private school; and
1126 (B) provides instruction for one or more grades kindergarten through 12; or
1127 (ii) a public school district; and
1128 (b) includes the Electronic High School as defined in Section 53A-15-1002 .
1129 (89) "Seller" means a person that makes a sale, lease, or rental of:
1130 (a) tangible personal property; or
1131 (b) a service.
1132 (90) (a) "Semiconductor fabricating, processing, research, or development materials"
1133 means tangible personal property:
1134 (i) used primarily in the process of:
1135 (A) (I) manufacturing a semiconductor;
1136 (II) fabricating a semiconductor; or
1137 (III) research or development of a:
1138 (Aa) semiconductor; or
1139 (Bb) semiconductor manufacturing process; or
1140 (B) maintaining an environment suitable for a semiconductor; or
1141 (ii) consumed primarily in the process of:
1142 (A) (I) manufacturing a semiconductor;
1143 (II) fabricating a semiconductor; or
1144 (III) research or development of a:
1145 (Aa) semiconductor; or
1146 (Bb) semiconductor manufacturing process; or
1147 (B) maintaining an environment suitable for a semiconductor.
1148 (b) "Semiconductor fabricating, processing, research, or development materials"
1149 includes:

1150 (i) parts used in the repairs or renovations of tangible personal property described in
1151 Subsection (90)(a); or
1152 (ii) a chemical, catalyst, or other material used to:
1153 (A) produce or induce in a semiconductor a:
1154 (I) chemical change; or
1155 (II) physical change;
1156 (B) remove impurities from a semiconductor; or
1157 (C) improve the marketable condition of a semiconductor.
1158 (91) "Senior citizen center" means a facility having the primary purpose of providing
1159 services to the aged as defined in Section 62A-3-101 .
1160 (92) "Simplified electronic return" means the electronic return:
1161 (a) described in Section 318(C) of the agreement; and
1162 (b) approved by the governing board of the agreement.
1163 (93) "Solar energy" means the sun used as the sole source of energy for producing
1164 electricity.
1165 (94) (a) "Sports or recreational equipment" means an item:
1166 (i) designed for human use; and
1167 (ii) that is:
1168 (A) worn in conjunction with:
1169 (I) an athletic activity; or
1170 (II) a recreational activity; and
1171 (B) not suitable for general use.
1172 (b) In accordance with Title 63, Chapter 46a, Utah Administrative Rulemaking Act, the
1173 commission shall make rules:
1174 (i) listing the items that constitute "sports or recreational equipment"; and
1175 (ii) that are consistent with the list of items that constitute "sports or recreational
1176 equipment" under the agreement.
1177 (95) "State" means the state of Utah, its departments, and agencies.

1178 (96) "Storage" means any keeping or retention of tangible personal property or any
1179 other taxable transaction under Subsection 59-12-103 (1), in this state for any purpose except
1180 sale in the regular course of business.
1181 (97) (a) "Tangible personal property" means personal property that:
1182 (i) may be:
1183 (A) seen;
1184 (B) weighed;
1185 (C) measured;
1186 (D) felt; or
1187 (E) touched; or
1188 (ii) is in any manner perceptible to the senses.
1189 (b) "Tangible personal property" includes:
1190 (i) electricity;
1191 (ii) water;
1192 (iii) gas;
1193 (iv) steam; or
1194 (v) prewritten computer software.
1195 (98) "Tar sands" means impregnated sands that yield mixtures of liquid hydrocarbon
1196 and require further processing other than mechanical blending before becoming finished
1197 petroleum products.
1198 (99) (a) "Telecommunications enabling or facilitating equipment, machinery, or
1199 software" means an item listed in Subsection (99)(b) if that item is purchased or leased primarily
1200 to enable or facilitate one or more of the following to function:
1201 (i) telecommunications switching or routing equipment, machinery, or software; or
1202 (ii) telecommunications transmission equipment, machinery, or software.
1203 (b) The following apply to Subsection (99)(a):
1204 (i) a pole;
1205 (ii) software;

1206 (iii) a supplementary power supply;
1207 (iv) temperature or environmental equipment or machinery;
1208 (v) test equipment;
1209 (vi) a tower; or
1210 (vii) equipment, machinery, or software that functions similarly to an item listed in
1211 Subsections (99)(b)(i) through (vi) as determined by the commission by rule made in
1212 accordance with Subsection (99)(c).
1213 (c) In accordance with Title 63, Chapter 46a, Utah Administrative Rulemaking Act, the
1214 commission may by rule define what constitutes equipment, machinery, or software that
1215 functions similarly to an item listed in Subsections (99)(b)(i) through (vi).
1216 (100) "Telecommunications equipment, machinery, or software required for 911
1217 service" means equipment, machinery, or software that is required to comply with 47 C.F.R.
1218 Sec. 20.18.
1219 (101) "Telecommunications maintenance or repair equipment, machinery, or software"
1220 means equipment, machinery, or software purchased or leased primarily to maintain or repair
1221 one or more of the following, regardless of whether the equipment, machinery, or software is
1222 purchased or leased as a spare part or as an upgrade or modification to one or more of the
1223 following:
1224 (a) telecommunications enabling or facilitating equipment, machinery, or software;
1225 (b) telecommunications switching or routing equipment, machinery, or software; or
1226 (c) telecommunications transmission equipment, machinery, or software.
1227 (102) (a) "Telecommunications switching or routing equipment, machinery, or
1228 software" means an item listed in Subsection (102)(b) if that item is purchased or leased
1229 primarily for switching or routing:
1230 (i) voice communications;
1231 (ii) data communications; or
1232 (iii) telephone service.
1233 (b) The following apply to Subsection (102)(a):

1234 (i) a bridge;
1235 (ii) a computer;
1236 (iii) a cross connect;
1237 (iv) a modem;
1238 (v) a multiplexer;
1239 (vi) plug in circuitry;
1240 (vii) a router;
1241 (viii) software;
1242 (ix) a switch; or
1243 (x) equipment, machinery, or software that functions similarly to an item listed in
1244 Subsections (102)(b)(i) through (ix) as determined by the commission by rule made in
1245 accordance with Subsection (102)(c).
1246 (c) In accordance with Title 63, Chapter 46a, Utah Administrative Rulemaking Act, the
1247 commission may by rule define what constitutes equipment, machinery, or software that
1248 functions similarly to an item listed in Subsections (102)(b)(i) through (ix).
1249 (103) (a) "Telecommunications transmission equipment, machinery, or software" means
1250 an item listed in Subsection (103)(b) if that item is purchased or leased primarily for sending,
1251 receiving, or transporting:
1252 (i) voice communications;
1253 (ii) data communications; or
1254 (iii) telephone service.
1255 (b) The following apply to Subsection (103)(a):
1256 (i) an amplifier;
1257 (ii) a cable;
1258 (iii) a closure;
1259 (iv) a conduit;
1260 (v) a controller;
1261 (vi) a duplexer;

1262 (vii) a filter;
1263 (viii) an input device;
1264 (ix) an input/output device;
1265 (x) an insulator;
1266 (xi) microwave machinery or equipment;
1267 (xii) an oscillator;
1268 (xiii) an output device;
1269 (xiv) a pedestal;
1270 (xv) a power converter;
1271 (xvi) a power supply;
1272 (xvii) a radio channel;
1273 (xviii) a radio receiver;
1274 (xix) a radio transmitter;
1275 (xx) a repeater;
1276 (xxi) software;
1277 (xxii) a terminal;
1278 (xxiii) a timing unit;
1279 (xxiv) a transformer;
1280 (xxv) a wire; or
1281 (xxvi) equipment, machinery, or software that functions similarly to an item listed in
1282 Subsections (103)(b)(i) through (xxv) as determined by the commission by rule made in
1283 accordance with Subsection (103)(c).
1284 (c) In accordance with Title 63, Chapter 46a, Utah Administrative Rulemaking Act, the
1285 commission may by rule define what constitutes equipment, machinery, or software that
1286 functions similarly to an item listed in Subsections (103)(b)(i) through (xxv).
1287 (104) (a) "Telephone service" means a two-way transmission:
1288 (i) by:
1289 (A) wire;

1290 (B) radio;
1291 (C) lightwave; or
1292 (D) other electromagnetic means; and
1293 (ii) of one or more of the following:
1294 (A) a sign;
1295 (B) a signal;
1296 (C) writing;
1297 (D) an image;
1298 (E) sound;
1299 (F) a message;
1300 (G) data; or
1301 (H) other information of any nature.
1302 (b) "Telephone service" includes:
1303 (i) mobile telecommunications service;
1304 (ii) private communications service; or
1305 (iii) automated digital telephone answering service.
1306 (c) "Telephone service" does not include a service or a transaction that a state or a
1307 political subdivision of a state is prohibited from taxing as of July 1, 2001, under the Internet
1308 Tax Freedom Act, Pub. L. No. 105-277.
1309 (105) Notwithstanding where a call is billed or paid, "telephone service address" means:
1310 (a) if the location described in this Subsection (105)(a) is known, the location of the
1311 telephone service equipment:
1312 (i) to which a call is charged; and
1313 (ii) from which the call originates or terminates;
1314 (b) if the location described in Subsection (105)(a) is not known but the location
1315 described in this Subsection (105)(b) is known, the location of the origination point of the signal
1316 of the telephone service first identified by:
1317 (i) the telecommunications system of the seller; or

1318 (ii) if the system used to transport the signal is not that of the seller, information
1319 received by the seller from its service provider; or
1320 (c) if the locations described in Subsection (105)(a) or (b) are not known, the location
1321 of a purchaser's primary place of use.
1322 (106) (a) "Telephone service provider" means a person that:
1323 (i) owns, controls, operates, or manages a telephone service; and
1324 (ii) engages in an activity described in Subsection (106)(a)(i) for the shared use with or
1325 resale to any person of the telephone service.
1326 (b) A person described in Subsection (106)(a) is a telephone service provider whether
1327 or not the Public Service Commission of Utah regulates:
1328 (i) that person; or
1329 (ii) the telephone service that the person owns, controls, operates, or manages.
1330 (107) "Tobacco" means:
1331 (a) a cigarette;
1332 (b) a cigar;
1333 (c) chewing tobacco;
1334 (d) pipe tobacco; or
1335 (e) any other item that contains tobacco.
1336 (108) "Unassisted amusement device" means an amusement device, skill device, or ride
1337 device that is started and stopped by the purchaser or renter of the right to use or operate the
1338 amusement device, skill device, or ride device.
1339 (109) (a) "Use" means the exercise of any right or power over tangible personal
1340 property under Subsection 59-12-103 (1), incident to the ownership or the leasing of that
1341 property, item, or service.
1342 (b) "Use" does not include the sale, display, demonstration, or trial of that property in
1343 the regular course of business and held for resale.
1344 (110) (a) Subject to Subsection (110)(b), "vehicle" means the following that are
1345 required to be titled, registered, or titled and registered:

1346 (i) an aircraft as defined in Section 72-10-102 ;
1347 (ii) a vehicle as defined in Section 41-1a-102 ;
1348 (iii) an off-highway vehicle as defined in Section 41-22-2 ; or
1349 (iv) a vessel as defined in Section 41-1a-102 .
1350 (b) For purposes of Subsection 59-12-104 (33) only, "vehicle" includes:
1351 (i) a vehicle described in Subsection (110)(a); or
1352 (ii) (A) a locomotive;
1353 (B) a freight car;
1354 (C) railroad work equipment; or
1355 (D) other railroad rolling stock.
1356 (111) "Vehicle dealer" means a person engaged in the business of buying, selling, or
1357 exchanging a vehicle as defined in Subsection (110).
1358 (112) (a) Except as provided in Subsection (112)(b), "waste energy facility" means a
1359 facility that generates electricity:
1360 (i) using as the primary source of energy waste materials that would be placed in a
1361 landfill or refuse pit if it were not used to generate electricity, including:
1362 (A) tires;
1363 (B) waste coal; or
1364 (C) oil shale; and
1365 (ii) in amounts greater than actually required for the operation of the facility.
1366 (b) "Waste energy facility" does not include a facility that incinerates:
1367 (i) municipal solid waste;
1368 (ii) hospital waste as defined in 40 C.F.R. 60.51c; or
1369 (iii) medical/infectious waste as defined in 40 C.F.R. 60.51c.
1370 (113) "Watercraft" means a vessel as defined in Section 73-18-2 .
1371 (114) "Wind energy" means wind used as the sole source of energy to produce
1372 electricity.
1373 (115) "ZIP Code" means a Zoning Improvement Plan Code assigned to a geographic

1374 location by the United States Postal Service.
1375 Section 5. Section 59-12-103 is amended to read:
1376 59-12-103. Sales and use tax base -- Rates -- Effective dates -- Use of sales and use
1377 tax revenues.
1378 (1) A tax is imposed on the purchaser as provided in this part for amounts paid or
1379 charged for the following transactions:
1380 (a) retail sales of tangible personal property made within the state;
1381 (b) amounts paid:
1382 (i) to a:
1383 (A) telephone service provider regardless of whether the telephone service provider is
1384 municipally or privately owned; or
1385 (B) telegraph corporation:
1386 (I) as defined in Section 54-2-1 ; and
1387 (II) regardless of whether the telegraph corporation is municipally or privately owned;
1388 and
1389 (ii) for:
1390 (A) telephone service, other than mobile telecommunications service, that originates
1391 and terminates within the boundaries of this state;
1392 (B) mobile telecommunications service that originates and terminates within the
1393 boundaries of one state only to the extent permitted by the Mobile Telecommunications
1394 Sourcing Act, 4 U.S.C. Sec. 116 et seq.; or
1395 (C) telegraph service;
1396 (c) sales of the following for commercial use:
1397 (i) gas;
1398 (ii) electricity;
1399 (iii) heat;
1400 (iv) coal;
1401 (v) fuel oil; or

1402 (vi) other fuels;
1403 (d) sales of the following for residential use:
1404 (i) gas;
1405 (ii) electricity;
1406 (iii) heat;
1407 (iv) coal;
1408 (v) fuel oil; or
1409 (vi) other fuels;
1410 (e) sales of prepared food;
1411 (f) except as provided in Section 59-12-104 , amounts paid or charged as admission or
1412 user fees for theaters, movies, operas, museums, planetariums, shows of any type or nature,
1413 exhibitions, concerts, carnivals, amusement parks, amusement rides, circuses, menageries, fairs,
1414 races, contests, sporting events, dances, boxing matches, wrestling matches, closed circuit
1415 television broadcasts, billiard parlors, pool parlors, bowling lanes, golf, miniature golf, golf
1416 driving ranges, batting cages, skating rinks, ski lifts, ski runs, ski trails, snowmobile trails, tennis
1417 courts, swimming pools, water slides, river runs, jeep tours, boat tours, scenic cruises,
1418 horseback rides, sports activities, or any other amusement, entertainment, recreation, exhibition,
1419 cultural, or athletic activity;
1420 (g) amounts paid or charged for services for repairs or renovations of tangible personal
1421 property, unless Section 59-12-104 provides for an exemption from sales and use tax for:
1422 (i) the tangible personal property; and
1423 (ii) parts used in the repairs or renovations of the tangible personal property described
1424 in Subsection (1)(g)(i), whether or not any parts are actually used in the repairs or renovations
1425 of that tangible personal property;
1426 (h) except as provided in Subsection 59-12-104 (7), amounts paid or charged for
1427 assisted cleaning or washing of tangible personal property;
1428 (i) amounts paid or charged for tourist home, hotel, motel, or trailer court
1429 accommodations and services that are regularly rented for less than 30 consecutive days;

1430 (j) amounts paid or charged for laundry or dry cleaning services;
1431 (k) amounts paid or charged for leases or rentals of tangible personal property if within
1432 this state the tangible personal property is:
1433 (i) stored;
1434 (ii) used; or
1435 (iii) otherwise consumed;
1436 (l) amounts paid or charged for tangible personal property if within this state the
1437 tangible personal property is:
1438 (i) stored;
1439 (ii) used; or
1440 (iii) consumed; and
1441 (m) amounts paid or charged for prepaid telephone calling cards.
1442 (2) (a) Except as provided in Subsections (2)(b) through (e), a state tax and a local tax
1443 is imposed on a transaction described in Subsection (1) equal to the sum of:
1444 (i) a state tax imposed on the transaction at a tax rate equal to the sum of:
1445 (A) 4.65%; and
1446 (B) the tax rate the state imposes in accordance with Part 20, Supplemental State Sales
1447 and Use Tax Act, if the location of the transaction as determined under Section 59-12-207 is in
1448 a city, town, or the unincorporated area of a county in which the state imposes the tax under
1449 Part 20, Supplemental State Sales and Use Tax Act; and
1450 (ii) a local tax equal to the sum of the tax rates a county, city, or town imposes on the
1451 transaction under this chapter other than this part.
1452 (b) Except as provided in Subsection (2)(d) or (e), a state tax and a local tax is imposed
1453 on a transaction described in Subsection (1)(d) equal to the sum of:
1454 (i) a state tax imposed on the transaction at a tax rate of 2%; and
1455 (ii) a local tax equal to the sum of the tax rates a county, city, or town imposes on the
1456 transaction under this chapter other than this part.
1457 (c) Except as provided in Subsection (2)(d) or (e), beginning on January 1, 2007, a

1458 state tax and a local tax is imposed on amounts paid or charged for food and food ingredients
1459 equal to the sum of:
1460 (i) a state tax imposed on the amounts paid or charged for food and food ingredients at
1461 a tax rate of 1.75%; and
1462 (ii) a local tax equal to the sum of the tax rates a county, city, or town imposes on the
1463 amounts paid or charged for food and food ingredients under this chapter other than this part.
1464 (d) Except as provided in Subsection (2)(e), if a seller collects a tax in accordance with
1465 Subsection 59-12-107 (1)(b) on a transaction described in Subsection (1), a state tax and a local
1466 tax is imposed on the transaction equal to the sum of:
1467 (i) a state tax imposed on the transaction at a tax rate of:
1468 (A) the sum of:
1469 [(A)] (I) 4.65% for a transaction other than a transaction described in Subsection
1470 (2)(d)(i)(B) or (2)(d)(i)(C); and
1471 (II) the tax rate the state imposes in accordance with Part 20, Supplemental State Sales
1472 and Use Tax Act, if the location of the transaction as determined under Section 59-12-207 is in
1473 a city, town, or the unincorporated area of a county in which the state imposes the tax under
1474 Part 20, Supplemental State Sales and Use Tax Act;
1475 (B) 2% for a transaction described in Subsection (1)(d); or
1476 (C) beginning on January 1, 2007, 1.75% on the amounts paid or charged for food and
1477 food ingredients; and
1478 (ii) a local tax imposed on the transaction at a tax rate equal to the sum of the following
1479 tax rates:
1480 (A) the tax rate authorized by Section 59-12-204 , but only if all of the counties, cities,
1481 and towns in the state impose the tax authorized by Section 59-12-204 ; and
1482 (B) the tax rate authorized by Section 59-12-1102 , but only if all of the counties in the
1483 state impose the tax authorized by Section 59-12-1102 .
1484 (e) (i) A state tax and a local tax is imposed on an entire bundled transaction as
1485 provided in this Subsection (2)(e) if the bundled transaction is attributable to food and food

1486 ingredients and tangible personal property other than food and food ingredients.
1487 (ii) If the tax on a bundled transaction described in Subsection (2)(e)(i) is collected by a
1488 seller other than a seller that collects a tax in accordance with Subsection 59-12-107 (1)(b),
1489 beginning on January 1, 2007, a state tax and a local tax is imposed on the entire bundled
1490 transaction equal to the sum of:
1491 (A) a state tax imposed on the entire bundled transaction [at] equal to the sum of:
1492 (I) the tax rate described in Subsection (2)(a)(i)(A); and
1493 (II) the tax rate the state imposes in accordance with Part 20, Supplemental State Sales
1494 and Use Tax Act, if the location of the transaction as determined under Section 59-12-207 is in
1495 a city, town, or the unincorporated area of a county in which the state imposes the tax under
1496 Part 20, Supplemental State Sales and Use Tax Act; and
1497 (B) a local tax imposed on the entire bundled transaction at the sum of the tax rates
1498 described in Subsection (2)(a)(ii).
1499 (iii) If the tax on a bundled transaction described in Subsection (2)(e)(i) is collected by a
1500 seller in accordance with Subsection 59-12-107 (1)(b), beginning on January 1, 2007, a state tax
1501 and a local tax is imposed on the entire bundled transaction equal to the sum of:
1502 (A) a state tax imposed on the entire bundled transaction [at] equal to the sum of:
1503 (I) the tax rate described in Subsection (2)(d)(i)(A); and
1504 (II) the tax rate the state imposes in accordance with Part 20, Supplemental State Sales
1505 and Use Tax Act, if the location of the transaction as determined under Section 59-12-207 is in
1506 a city, town, or the unincorporated area of a county in which the state imposes the tax under
1507 Part 20, Supplemental State Sales and Use Tax Act; and
1508 (B) a local tax imposed on the entire bundled transaction at a tax rate equal to the sum
1509 of the following tax rates:
1510 (I) the tax rate authorized by Section 59-12-204 , but only if all of the counties, cities,
1511 and towns in the state impose the tax authorized by Section 59-12-204 ; and
1512 (II) the tax rate authorized by Section 59-12-1102 , but only if all of the counties in the
1513 state impose the tax authorized by Section 59-12-1102 .

1514 (f) Subject to Subsections (2)(g) and (h), a tax rate repeal or tax rate change for a tax
1515 rate imposed under the following shall take effect on the first day of a calendar quarter:
1516 (i) Subsection (2)(a)(i)(A);
1517 (ii) Subsection (2)(b)(i);
1518 (iii) Subsection (2)(c)(i);
1519 (iv) Subsection (2)(d)(i)(A)(I);
1520 (v) Subsection (2)(e)(ii)(A)(I); or
1521 (vi) Subsection (2)(e)(iii)(A)(I).
1522 (g) (i) For a transaction described in Subsection (2)(g)(iii), a tax rate increase shall take
1523 effect on the first day of the first billing period that begins after the effective date of the tax rate
1524 increase if the billing period for the transaction begins before the effective date of a tax rate
1525 increase imposed under:
1526 (A) Subsection (2)(a)(i)(A);
1527 (B) Subsection (2)(b)(i);
1528 (C) Subsection (2)(c)(i);
1529 (D) Subsection (2)(d)(i)(A)(I);
1530 (E) Subsection (2)(e)(ii)(A)(I); or
1531 (F) Subsection (2)(e)(iii)(A)(I).
1532 (ii) For a transaction described in Subsection (2)(g)(iii), the repeal of a tax or a tax rate
1533 decrease shall take effect on the first day of the last billing period that began before the effective
1534 date of the repeal of the tax or the tax rate decrease if the billing period for the transaction
1535 begins before the effective date of the repeal of the tax or the tax rate decrease imposed under:
1536 (A) Subsection (2)(a)(i)(A);
1537 (B) Subsection (2)(b)(i);
1538 (C) Subsection (2)(c)(i);
1539 (D) Subsection (2)(d)(i)(A)(I);
1540 (E) Subsection (2)(e)(ii)(A)(I); or
1541 (F) Subsection (2)(e)(iii)(A)(I).

1542 (iii) Subsections (2)(g)(i) and (ii) apply to transactions subject to a tax under:
1543 (A) Subsection (1)(b);
1544 (B) Subsection (1)(c);
1545 (C) Subsection (1)(d);
1546 (D) Subsection (1)(e);
1547 (E) Subsection (1)(f);
1548 (F) Subsection (1)(g);
1549 (G) Subsection (1)(h);
1550 (H) Subsection (1)(i);
1551 (I) Subsection (1)(j); or
1552 (J) Subsection (1)(k).
1553 (h) (i) For a tax rate described in Subsection (2)(h)(ii), if a tax due on a catalogue sale is
1554 computed on the basis of sales and use tax rates published in the catalogue, a tax rate repeal or
1555 change in a tax rate takes effect:
1556 (A) on the first day of a calendar quarter; and
1557 (B) beginning 60 days after the effective date of the tax rate repeal or tax rate change.
1558 (ii) Subsection (2)(h)(i) applies to the tax rates described in the following:
1559 (A) Subsection (2)(a)(i)(A);
1560 (B) Subsection (2)(b)(i);
1561 (C) Subsection (2)(c)(i);
1562 (D) Subsection (2)(d)(i)(A)(I);
1563 (E) Subsection (2)(e)(ii)(A)(I); or
1564 (F) Subsection (2)(e)(iii)(A)(I).
1565 (iii) In accordance with Title 63, Chapter 46a, Utah Administrative Rulemaking Act, the
1566 commission may by rule define the term "catalogue sale."
1567 (3) (a) Except as provided in Subsections (4) through (10), the following state taxes
1568 shall be deposited into the General Fund:
1569 (i) the tax imposed by Subsection (2)(a)(i)(A);

1570 (ii) the tax imposed by Subsection (2)(b)(i);
1571 (iii) the tax imposed by Subsection (2)(c)(i);
1572 (iv) the tax imposed by Subsection (2)(d)(i)(A)(I);
1573 (v) the tax imposed by Subsection (2)(e)(ii)(A)(I); and
1574 (vi) the tax imposed by Subsection (2)(e)(iii)(A)(I).
1575 (b) The following local taxes shall be distributed to a county, city, or town as provided
1576 in this chapter:
1577 (i) the tax imposed by Subsection (2)(a)(ii);
1578 (ii) the tax imposed by Subsection (2)(b)(ii);
1579 (iii) the tax imposed by Subsection (2)(c)(ii); and
1580 (iv) the tax imposed by Subsection (2)(e)(ii)(B).
1581 (c) (i) Notwithstanding any provision of this chapter, each county, city, or town in the
1582 state shall receive the county's, city's, or town's proportionate share of the revenues generated
1583 by the following local taxes as provided in Subsection (3)(c)(ii):
1584 (A) the local tax described in Subsection (2)(d)(ii); and
1585 (B) the local tax described in Subsection (2)(e)(iii)(B).
1586 (ii) For revenues generated by a tax described in Subsection (3)(c)(i), the commission
1587 shall determine a county's, city's, or town's proportionate share of the revenues by:
1588 (A) calculating an amount equal to the population of the unincorporated area of the
1589 county, city, or town divided by the total population of the state; and
1590 (B) multiplying the amount determined under Subsection (3)(c)(ii)(A) by the total
1591 amount of revenues generated by the taxes described in Subsection (3)(c)(i) for all counties,
1592 cities, and towns.
1593 (iii) (A) Except as provided in Subsection (3)(c)(iii)(B), population figures for purposes
1594 of this section shall be derived from the most recent official census or census estimate of the
1595 United States Census Bureau.
1596 (B) If a needed population estimate is not available from the United States Census
1597 Bureau, population figures shall be derived from the estimate from the Utah Population

1598 Estimates Committee created by executive order of the governor.
1599 (4) (a) Notwithstanding Subsection (3)(a), for a fiscal year beginning on or after July 1,
1600 2003, the lesser of the following amounts shall be used as provided in Subsections (4)(b)
1601 through (g):
1602 (i) for taxes listed under Subsection (3)(a), the amount of tax revenue generated:
1603 (A) by a 1/16% tax rate on the transactions described in Subsection (1); and
1604 (B) for the fiscal year; or
1605 (ii) $17,500,000.
1606