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S.B. 195


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House Floor Amendments 3-5-2002 kj/rlr
             1
    
SALES AND USE TAX AMENDMENTS

             2     
2002 GENERAL SESSION

             3     
STATE OF UTAH

             4     
Sponsor: John W. Hickman

             5      This act modifies the Sales and Use Tax Act to expand the uses of a sales and use tax that
             6      may be imposed by a city or town for certain highway purposes to include funding a system
             7      for public transit. The act h [ creates an exemption from the requirement ] provides h that a city
             7a      or town h that has obtained voter approval to impose the sales and use tax is not required to h
             8      obtain h additional h voter approval to h [ impose the tax ] expand the uses of the sales and use
             8a      tax h . The act makes technical changes. This act takes
             9      effect on July 1, 2002.
             10      This act affects sections of Utah Code Annotated 1953 as follows:
             11      AMENDS:
             12          59-12-1001, as last amended by Chapters 253 and 319, Laws of Utah 2000
             13          59-12-1002, as enacted by Chapter 305, Laws of Utah 1997
             14      Be it enacted by the Legislature of the state of Utah:
             15          Section 1. Section 59-12-1001 is amended to read:
             16     
Part 10. Highways or Public Transportation Systems Tax

             17           59-12-1001. Authority to impose tax for highways or public transportation systems
             18      -- Ordinance requirements -- Voter approval requirements -- Election requirements -- Notice
             19      requirements -- Exceptions to voter approval requirements.
             20          (1) (a) Except as provided in Subsection (1)(b), a [municipality] city or town in which the
             21      transactions described in Subsection 59-12-103 (1) are not subject to a sales and use tax under
             22      Section 59-12-501 may as provided in this part impose a sales and use tax of 1/4% on the
             23      transactions described in Subsection 59-12-103 (1).
             24          (b) Notwithstanding Subsection (1)(a), a [municipality] city or town may not impose a tax
             25      under this section on:
             26          (i) the sales and uses described in Section 59-12-104 to the extent the sales and uses are
             27      exempt from taxation under Section 59-12-104 ; and



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             28
         (ii) any amounts paid or charged by a vendor that collects a tax under Subsection
             29      59-12-107 (1)(b).
             30          (2) (a) A city or town imposing a tax [imposed] under this part [by a municipality shall be
             31      used] may use the revenues generated by the tax:
             32          (i) for the construction and maintenance of highways under the jurisdiction of the
             33      [municipality] city or town imposing the tax[.]:
             34          (ii) subject to Subsection (2)(b), to fund a system for public transit; or
             35          (iii) for a combination of the purposes described in Subsections (2)(a)(i) and (ii).
             36          (b) (i) For purposes of Subsection (2)(a)(ii) and except as provided in Subsection (2)(b)(ii),
             37      "public transit" is as defined in Section 17A-2-1004 .
             38          (ii) Notwithstanding Subsection (2)(b)(i), "public transit" does not include a fixed
             39      guideway system.
             40          (3) To impose a [highways] tax under this part, the governing body of the [municipality]
             41      city or town shall:
             42          (a) pass an ordinance approving the tax; and
             43          (b) except as provided in Subsection (7), obtain voter approval for the tax as provided in
             44      Subsection (4).
             45          (4) To obtain voter approval for a [highways] tax under Subsection (3)(b), a [municipality]
             46      city or town shall:
             47          (a) hold [the highways tax] an election during:
             48          (i) a regular general election; or
             49          (ii) a municipal general election; and
             50          (b) publish notice of the election:
             51          (i) 15 days or more before the day on which the election is held; and
             52          (ii) in a newspaper of general circulation in the [municipality] city or town.
             53          (5) An ordinance approving a [highways] tax under this part shall provide an effective date
             54      for the tax as provided in Subsection (6).
             55          (6) (a) For purposes of this Subsection (6):
             56          (i) "Annexation" means an annexation to a city or town under Title 10, Chapter 2, Part 4,
             57      Annexation.
             58          (ii) "Annexing area" means an area that is annexed into a city or town.



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             59
         (b) (i) If, on or after May 1, 2000, a city or town enacts or repeals a tax or changes the rate
             60      of a tax under this part, the enactment, repeal, or change shall take effect:
             61          (A) on the first day of a calendar quarter; and
             62          (B) after a 75-day period beginning on the date the commission receives notice meeting
             63      the requirements of Subsection (6)(b)(ii) from the city or town.
             64          (ii) The notice described in Subsection (6)(b)(i)(B) shall state:
             65          (A) that the city or town will enact or repeal a tax or change the rate of a tax under this
             66      part;
             67          (B) the statutory authority for the tax described in Subsection (6)(b)(ii)(A);
             68          (C) the effective date of the tax described in Subsection (6)(b)(ii)(A); and
             69          (D) if the city or town enacts the tax or changes the rate of the tax described in Subsection
             70      (6)(b)(ii)(A), the new rate of the tax.
             71          (c) (i) If, for an annexation that occurs on or after May 1, 2000, the annexation will result
             72      in a change in the rate of a tax under this part for an annexing area, the change shall take effect:
             73          (A) on the first day of a calendar quarter; and
             74          (B) after a 75-day period beginning on the date the commission receives notice meeting
             75      the requirements of Subsection (6)(c)(ii) from the city or town that annexes the annexing area.
             76          (ii) The notice described in Subsection (6)(c)(i)(B) shall state:
             77          (A) that the annexation described in Subsection (6)(c)(i) will result in a change in the rate
             78      of a tax under this part for the annexing area;
             79          (B) the statutory authority for the tax described in Subsection (6)(c)(ii)(A);
             80          (C) the effective date of the tax described in Subsection (6)(c)(ii)(A); and
             81          (D) the new rate of the tax described in Subsection (6)(c)(ii)(A).
             82          (7) (a) Except as provided in Subsection (7)(b), a [municipality] city or town is not subject
             83      to the voter approval requirements of Subsection (3)(b) if[,]:
             84          (i) on or before January 1, 1996, the [municipality] city or town imposed a licensee fee or
             85      tax on businesses based on gross receipts pursuant to Section 10-1-203 [.]; or
             86          (ii) the city or town:
             87          (A) on or before June 30, 2002, obtained voter approval in accordance with Subsection
             88      (3)(b) to impose a tax under this part for a purpose described in Subsection (2)(a)(i); and
             89          (B) on or after July 1, 2002, uses the revenues generated by a tax under this part for a



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             90
     purpose described in Subsection (2)(a).
             91          (b) [The] Notwithstanding Subsection (7)(a), the exception from the voter approval
             92      requirements in Subsection (7)(a)(i) does not apply to a [municipality] city or town that, on or
             93      before January 1, 1996, imposed a license fee or tax on only one class of businesses based on gross
             94      receipts pursuant to Section 10-1-203 .
             95          Section 2. Section 59-12-1002 is amended to read:
             96           59-12-1002. Collection of taxes by commission -- Charge for service.
             97          (1) The commission shall:
             98          (a) collect the [highways] tax imposed by a [municipality] city or town under this part; and
             99          (b) subject to the limitations of Subsection (2), transmit to the [municipality] city or town
             100      monthly by electronic funds transfer the revenues generated by the [highways] tax imposed by the
             101      [municipality] city or town.
             102          (2) (a) The commission shall charge a [municipality] city or town imposing a [highways]
             103      tax under this part a fee for administering the tax as provided in Subsections (2)(b) and (c).
             104          (b) The fee shall be in an amount equal to the costs of administering the [highways] tax
             105      under this part, except that the fee may not exceed 1-1/2% of the revenues generated in the
             106      [municipality] city or town by the tax under this part.
             107          (c) Fees under this Subsection (2) shall be:
             108          (i) placed in the Sales and Use Tax Administrative Fees Account; and
             109          (ii) used for sales tax administration as provided in Subsection 59-12-206 (2).
             110          Section 3. Effective date.
             111          This act takes effect on July 1, 2002.





Legislative Review Note
    as of 2-21-02 7:42 AM


A limited legal review of this legislation raises no obvious constitutional or statutory concerns.

Office of Legislative Research and General Counsel


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