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S.B. 135

             1     

SALES AND USE TAX EXEMPTION FOR AN

             2     
ENERGY EFFICIENT STOVE OR ENERGY

             3     
EFFICIENT STOVE FUEL

             4     
2010 GENERAL SESSION

             5     
STATE OF UTAH

             6     
Chief Sponsor: Gene Davis

             7     
House Sponsor: Todd E. Kiser

             8     
             9      LONG TITLE
             10      General Description:
             11          This bill amends the Sales and Use Tax Act to provide a sales and use tax exemption.
             12      Highlighted Provisions:
             13          This bill:
             14          .    defines terms;
             15          .    provides a sales and use tax exemption for the purchase of an energy efficient stove
             16      or energy efficient stove fuel; and
             17          .    makes technical and conforming changes.
             18      Monies Appropriated in this Bill:
             19          None
             20      Other Special Clauses:
             21          This bill takes effect on July 1, 2010.
             22      Utah Code Sections Affected:
             23      AMENDS:
             24          59-12-102, as last amended by Laws of Utah 2009, Chapters 203 and 314
             25          59-12-104, as last amended by Laws of Utah 2009, Chapters 31, 203, 212, and 385
             26     
             27      Be it enacted by the Legislature of the state of Utah:


             28          Section 1. Section 59-12-102 is amended to read:
             29           59-12-102. Definitions.
             30          As used in this chapter:
             31          (1) "800 service" means a telecommunications service that:
             32          (a) allows a caller to dial a toll-free number without incurring a charge for the call; and
             33          (b) is typically marketed:
             34          (i) under the name 800 toll-free calling;
             35          (ii) under the name 855 toll-free calling;
             36          (iii) under the name 866 toll-free calling;
             37          (iv) under the name 877 toll-free calling;
             38          (v) under the name 888 toll-free calling; or
             39          (vi) under a name similar to Subsections (1)(b)(i) through (v) as designated by the
             40      Federal Communications Commission.
             41          (2) (a) "900 service" means an inbound toll telecommunications service that:
             42          (i) a subscriber purchases;
             43          (ii) allows a customer of the subscriber described in Subsection (2)(a)(i) to call in to
             44      the subscriber's:
             45          (A) prerecorded announcement; or
             46          (B) live service; and
             47          (iii) is typically marketed:
             48          (A) under the name 900 service; or
             49          (B) under a name similar to Subsection (2)(a)(iii)(A) as designated by the Federal
             50      Communications Commission.
             51          (b) "900 service" does not include a charge for:
             52          (i) a collection service a seller of a telecommunications service provides to a
             53      subscriber; or
             54          (ii) the following a subscriber sells to the subscriber's customer:
             55          (A) a product; or
             56          (B) a service.
             57          (3) (a) "Admission or user fees" includes season passes.
             58          (b) "Admission or user fees" does not include annual membership dues to private


             59      organizations.
             60          (4) "Agreement" means the Streamlined Sales and Use Tax Agreement adopted on
             61      November 12, 2002, including amendments made to the Streamlined Sales and Use Tax
             62      Agreement after November 12, 2002.
             63          (5) "Agreement combined tax rate" means the sum of the tax rates:
             64          (a) listed under Subsection (6); and
             65          (b) that are imposed within a local taxing jurisdiction.
             66          (6) "Agreement sales and use tax" means a tax imposed under:
             67          (a) Subsection 59-12-103 (2)(a)(i)(A);
             68          (b) Subsection 59-12-103 (2)(b)(i);
             69          (c) Subsection 59-12-103 (2)(c)(i);
             70          (d) Subsection 59-12-103 (2)(d)(i)(A)(I);
             71          (e) Section 59-12-204 ;
             72          (f) Section 59-12-401 ;
             73          (g) Section 59-12-402 ;
             74          (h) Section 59-12-501 ;
             75          (i) Section 59-12-502 ;
             76          (j) Section 59-12-703 ;
             77          (k) Section 59-12-802 ;
             78          (l) Section 59-12-804 ;
             79          (m) Section 59-12-1001 ;
             80          (n) Section 59-12-1102 ;
             81          (o) Section 59-12-1302 ;
             82          (p) Section 59-12-1402 ;
             83          (q) Section 59-12-1503 ;
             84          (r) Section 59-12-1703 ;
             85          (s) Section 59-12-1802 ;
             86          (t) Section 59-12-1903 ;
             87          (u) Section 59-12-2003 ; or
             88          (v) Section 59-12-2103 .
             89          (7) "Aircraft" is as defined in Section 72-10-102 .


             90          (8) "Alcoholic beverage" means a beverage that:
             91          (a) is suitable for human consumption; and
             92          (b) contains .5% or more alcohol by volume.
             93          (9) (a) "Ancillary service" means a service associated with, or incidental to, the
             94      provision of telecommunications service.
             95          (b) "Ancillary service" includes:
             96          (i) a conference bridging service;
             97          (ii) a detailed communications billing service;
             98          (iii) directory assistance;
             99          (iv) a vertical service; or
             100          (v) a voice mail service.
             101          (10) "Area agency on aging" is as defined in Section 62A-3-101 .
             102          (11) "Assisted amusement device" means an amusement device, skill device, or ride
             103      device that is started and stopped by an individual:
             104          (a) who is not the purchaser or renter of the right to use or operate the amusement
             105      device, skill device, or ride device; and
             106          (b) at the direction of the seller of the right to use the amusement device, skill device,
             107      or ride device.
             108          (12) "Assisted cleaning or washing of tangible personal property" means cleaning or
             109      washing of tangible personal property if the cleaning or washing labor is primarily performed
             110      by an individual:
             111          (a) who is not the purchaser of the cleaning or washing of the tangible personal
             112      property; and
             113          (b) at the direction of the seller of the cleaning or washing of the tangible personal
             114      property.
             115          (13) "Authorized carrier" means:
             116          (a) in the case of vehicles operated over public highways, the holder of credentials
             117      indicating that the vehicle is or will be operated pursuant to both the International Registration
             118      Plan and the International Fuel Tax Agreement;
             119          (b) in the case of aircraft, the holder of a Federal Aviation Administration operating
             120      certificate or air carrier's operating certificate; or


             121          (c) in the case of locomotives, freight cars, railroad work equipment, or other rolling
             122      stock, the holder of a certificate issued by the United States Surface Transportation Board.
             123          (14) (a) Except as provided in Subsection (14)(b), "biomass energy" means any of the
             124      following that is used as the primary source of energy to produce fuel or electricity:
             125          (i) material from a plant or tree; or
             126          (ii) other organic matter that is available on a renewable basis, including:
             127          (A) slash and brush from forests and woodlands;
             128          (B) animal waste;
             129          (C) methane produced:
             130          (I) at landfills; or
             131          (II) as a byproduct of the treatment of wastewater residuals;
             132          (D) aquatic plants; and
             133          (E) agricultural products.
             134          (b) "Biomass energy" does not include:
             135          (i) black liquor;
             136          (ii) treated woods; or
             137          (iii) biomass from municipal solid waste other than methane produced:
             138          (A) at landfills; or
             139          (B) as a byproduct of the treatment of wastewater residuals.
             140          (15) (a) "Bundled transaction" means the sale of two or more items of tangible personal
             141      property, products, or services if the tangible personal property, products, or services are:
             142          (i) distinct and identifiable; and
             143          (ii) sold for one nonitemized price.
             144          (b) "Bundled transaction" does not include:
             145          (i) the sale of tangible personal property if the sales price varies, or is negotiable, on
             146      the basis of the selection by the purchaser of the items of tangible personal property included in
             147      the transaction;
             148          (ii) the sale of real property;
             149          (iii) the sale of services to real property;
             150          (iv) the retail sale of tangible personal property and a service if:
             151          (A) the tangible personal property:


             152          (I) is essential to the use of the service; and
             153          (II) is provided exclusively in connection with the service; and
             154          (B) the service is the true object of the transaction;
             155          (v) the retail sale of two services if:
             156          (A) one service is provided that is essential to the use or receipt of a second service;
             157          (B) the first service is provided exclusively in connection with the second service; and
             158          (C) the second service is the true object of the transaction;
             159          (vi) a transaction that includes tangible personal property or a product subject to
             160      taxation under this chapter and tangible personal property or a product that is not subject to
             161      taxation under this chapter if the:
             162          (A) seller's purchase price of the tangible personal property or product subject to
             163      taxation under this chapter is de minimis; or
             164          (B) seller's sales price of the tangible personal property or product subject to taxation
             165      under this chapter is de minimis; and
             166          (vii) the retail sale of tangible personal property that is not subject to taxation under
             167      this chapter and tangible personal property that is subject to taxation under this chapter if:
             168          (A) that retail sale includes:
             169          (I) food and food ingredients;
             170          (II) a drug;
             171          (III) durable medical equipment;
             172          (IV) mobility enhancing equipment;
             173          (V) an over-the-counter drug;
             174          (VI) a prosthetic device; or
             175          (VII) a medical supply; and
             176          (B) subject to Subsection (15)(f):
             177          (I) the seller's purchase price of the tangible personal property subject to taxation under
             178      this chapter is 50% or less of the seller's total purchase price of that retail sale; or
             179          (II) the seller's sales price of the tangible personal property subject to taxation under
             180      this chapter is 50% or less of the seller's total sales price of that retail sale.
             181          (c) (i) For purposes of Subsection (15)(a)(i), tangible personal property, a product, or a
             182      service that is distinct and identifiable does not include:


             183          (A) packaging that:
             184          (I) accompanies the sale of the tangible personal property, product, or service; and
             185          (II) is incidental or immaterial to the sale of the tangible personal property, product, or
             186      service;
             187          (B) tangible personal property, a product, or a service provided free of charge with the
             188      purchase of another item of tangible personal property, a product, or a service; or
             189          (C) an item of tangible personal property, a product, or a service included in the
             190      definition of "purchase price."
             191          (ii) For purposes of Subsection (15)(c)(i)(B), an item of tangible personal property, a
             192      product, or a service is provided free of charge with the purchase of another item of tangible
             193      personal property, a product, or a service if the sales price of the purchased item of tangible
             194      personal property, product, or service does not vary depending on the inclusion of the tangible
             195      personal property, product, or service provided free of charge.
             196          (d) (i) For purposes of Subsection (15)(a)(ii), property sold for one nonitemized price
             197      does not include a price that is separately identified by product on the following, regardless of
             198      whether the following is in paper format or electronic format:
             199          (A) a binding sales document; or
             200          (B) another supporting sales-related document that is available to a purchaser.
             201          (ii) For purposes of Subsection (15)(d)(i), a binding sales document or another
             202      supporting sales-related document that is available to a purchaser includes:
             203          (A) a bill of sale;
             204          (B) a contract;
             205          (C) an invoice;
             206          (D) a lease agreement;
             207          (E) a periodic notice of rates and services;
             208          (F) a price list;
             209          (G) a rate card;
             210          (H) a receipt; or
             211          (I) a service agreement.
             212          (e) (i) For purposes of Subsection (15)(b)(vi), the sales price of tangible personal
             213      property or a product subject to taxation under this chapter is de minimis if:


             214          (A) the seller's purchase price of the tangible personal property or product is 10% or
             215      less of the seller's total purchase price of the bundled transaction; or
             216          (B) the seller's sales price of the tangible personal property or product is 10% or less of
             217      the seller's total sales price of the bundled transaction.
             218          (ii) For purposes of Subsection (15)(b)(vi), a seller:
             219          (A) shall use the seller's purchase price or the seller's sales price to determine if the
             220      purchase price or sales price of the tangible personal property or product subject to taxation
             221      under this chapter is de minimis; and
             222          (B) may not use a combination of the seller's purchase price and the seller's sales price
             223      to determine if the purchase price or sales price of the tangible personal property or product
             224      subject to taxation under this chapter is de minimis.
             225          (iii) For purposes of Subsection (15)(b)(vi), a seller shall use the full term of a service
             226      contract to determine if the sales price of tangible personal property or a product is de minimis.
             227          (f) For purposes of Subsection (15)(b)(vii)(B), a seller may not use a combination of
             228      the seller's purchase price and the seller's sales price to determine if tangible personal property
             229      subject to taxation under this chapter is 50% or less of the seller's total purchase price or sales
             230      price of that retail sale.
             231          (16) "Certified automated system" means software certified by the governing board of
             232      the agreement that:
             233          (a) calculates the agreement sales and use tax imposed within a local taxing
             234      jurisdiction:
             235          (i) on a transaction; and
             236          (ii) in the states that are members of the agreement;
             237          (b) determines the amount of agreement sales and use tax to remit to a state that is a
             238      member of the agreement; and
             239          (c) maintains a record of the transaction described in Subsection (16)(a)(i).
             240          (17) "Certified service provider" means an agent certified:
             241          (a) by the governing board of the agreement; and
             242          (b) to perform all of a seller's sales and use tax functions for an agreement sales and
             243      use tax other than the seller's obligation under Section 59-12-124 to remit a tax on the seller's
             244      own purchases.


             245          (18) (a) Subject to Subsection (18)(b), "clothing" means all human wearing apparel
             246      suitable for general use.
             247          (b) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             248      commission shall make rules:
             249          (i) listing the items that constitute "clothing"; and
             250          (ii) that are consistent with the list of items that constitute "clothing" under the
             251      agreement.
             252          (19) "Coal-to-liquid" means the process of converting coal into a liquid synthetic fuel.
             253          (20) "Commercial use" means the use of gas, electricity, heat, coal, fuel oil, or other
             254      fuels that does not constitute industrial use under Subsection [(46)] (48) or residential use
             255      under Subsection [(91)] (93).
             256          (21) (a) "Common carrier" means a person engaged in or transacting the business of
             257      transporting passengers, freight, merchandise, or other property for hire within this state.
             258          (b) (i) "Common carrier" does not include a person who, at the time the person is
             259      traveling to or from that person's place of employment, transports a passenger to or from the
             260      passenger's place of employment.
             261          (ii) For purposes of Subsection (21)(b)(i), in accordance with Title 63G, Chapter 3,
             262      Utah Administrative Rulemaking Act, the commission may make rules defining what
             263      constitutes a person's place of employment.
             264          (22) "Component part" includes:
             265          (a) poultry, dairy, and other livestock feed, and their components;
             266          (b) baling ties and twine used in the baling of hay and straw;
             267          (c) fuel used for providing temperature control of orchards and commercial
             268      greenhouses doing a majority of their business in wholesale sales, and for providing power for
             269      off-highway type farm machinery; and
             270          (d) feed, seeds, and seedlings.
             271          (23) "Computer" means an electronic device that accepts information:
             272          (a) (i) in digital form; or
             273          (ii) in a form similar to digital form; and
             274          (b) manipulates that information for a result based on a sequence of instructions.
             275          (24) "Computer software" means a set of coded instructions designed to cause:


             276          (a) a computer to perform a task; or
             277          (b) automatic data processing equipment to perform a task.
             278          (25) (a) "Conference bridging service" means an ancillary service that links two or
             279      more participants of an audio conference call or video conference call.
             280          (b) "Conference bridging service" includes providing a telephone number as part of the
             281      ancillary service described in Subsection (25)(a).
             282          (c) "Conference bridging service" does not include a telecommunications service used
             283      to reach the ancillary service described in Subsection (25)(a).
             284          (26) "Construction materials" means any tangible personal property that will be
             285      converted into real property.
             286          (27) "Delivered electronically" means delivered to a purchaser by means other than
             287      tangible storage media.
             288          (28) (a) "Delivery charge" means a charge:
             289          (i) by a seller of:
             290          (A) tangible personal property;
             291          (B) a product transferred electronically; or
             292          (C) services; and
             293          (ii) for preparation and delivery of the tangible personal property, product transferred
             294      electronically, or services described in Subsection (28)(a)(i) to a location designated by the
             295      purchaser.
             296          (b) "Delivery charge" includes a charge for the following:
             297          (i) transportation;
             298          (ii) shipping;
             299          (iii) postage;
             300          (iv) handling;
             301          (v) crating; or
             302          (vi) packing.
             303          (29) "Detailed telecommunications billing service" means an ancillary service of
             304      separately stating information pertaining to individual calls on a customer's billing statement.
             305          (30) "Dietary supplement" means a product, other than tobacco, that:
             306          (a) is intended to supplement the diet;


             307          (b) contains one or more of the following dietary ingredients:
             308          (i) a vitamin;
             309          (ii) a mineral;
             310          (iii) an herb or other botanical;
             311          (iv) an amino acid;
             312          (v) a dietary substance for use by humans to supplement the diet by increasing the total
             313      dietary intake; or
             314          (vi) a concentrate, metabolite, constituent, extract, or combination of any ingredient
             315      described in Subsections (30)(b)(i) through (v);
             316          (c) (i) except as provided in Subsection (30)(c)(ii), is intended for ingestion in:
             317          (A) tablet form;
             318          (B) capsule form;
             319          (C) powder form;
             320          (D) softgel form;
             321          (E) gelcap form; or
             322          (F) liquid form; or
             323          (ii) notwithstanding Subsection (30)(c)(i), if the product is not intended for ingestion in
             324      a form described in Subsections (30)(c)(i)(A) through (F), is not represented:
             325          (A) as conventional food; and
             326          (B) for use as a sole item of:
             327          (I) a meal; or
             328          (II) the diet; and
             329          (d) is required to be labeled as a dietary supplement:
             330          (i) identifiable by the "Supplemental Facts" box found on the label; and
             331          (ii) as required by 21 C.F.R. Sec. 101.36.
             332          (31) (a) "Direct mail" means printed material delivered or distributed by United States
             333      mail or other delivery service:
             334          (i) to:
             335          (A) a mass audience; or
             336          (B) addressees on a mailing list provided:
             337          (I) by a purchaser of the mailing list; or


             338          (II) at the discretion of the purchaser of the mailing list; and
             339          (ii) if the cost of the printed material is not billed directly to the recipients.
             340          (b) "Direct mail" includes tangible personal property supplied directly or indirectly by a
             341      purchaser to a seller of direct mail for inclusion in a package containing the printed material.
             342          (c) "Direct mail" does not include multiple items of printed material delivered to a
             343      single address.
             344          (32) "Directory assistance" means an ancillary service of providing:
             345          (a) address information; or
             346          (b) telephone number information.
             347          (33) (a) "Disposable home medical equipment or supplies" means medical equipment
             348      or supplies that:
             349          (i) cannot withstand repeated use; and
             350          (ii) are purchased by, for, or on behalf of a person other than:
             351          (A) a health care facility as defined in Section 26-21-2 ;
             352          (B) a health care provider as defined in Section 78B-3-403 ;
             353          (C) an office of a health care provider described in Subsection (33)(a)(ii)(B); or
             354          (D) a person similar to a person described in Subsections (33)(a)(ii)(A) through (C).
             355          (b) "Disposable home medical equipment or supplies" does not include:
             356          (i) a drug;
             357          (ii) durable medical equipment;
             358          (iii) a hearing aid;
             359          (iv) a hearing aid accessory;
             360          (v) mobility enhancing equipment; or
             361          (vi) tangible personal property used to correct impaired vision, including:
             362          (A) eyeglasses; or
             363          (B) contact lenses.
             364          (c) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             365      commission may by rule define what constitutes medical equipment or supplies.
             366          (34) (a) "Drug" means a compound, substance, or preparation, or a component of a
             367      compound, substance, or preparation that is:
             368          (i) recognized in:


             369          (A) the official United States Pharmacopoeia;
             370          (B) the official Homeopathic Pharmacopoeia of the United States;
             371          (C) the official National Formulary; or
             372          (D) a supplement to a publication listed in Subsections (34)(a)(i)(A) through (C);
             373          (ii) intended for use in the:
             374          (A) diagnosis of disease;
             375          (B) cure of disease;
             376          (C) mitigation of disease;
             377          (D) treatment of disease; or
             378          (E) prevention of disease; or
             379          (iii) intended to affect:
             380          (A) the structure of the body; or
             381          (B) any function of the body.
             382          (b) "Drug" does not include:
             383          (i) food and food ingredients;
             384          (ii) a dietary supplement;
             385          (iii) an alcoholic beverage; or
             386          (iv) a prosthetic device.
             387          (35) (a) Except as provided in Subsection (35)(c), "durable medical equipment" means
             388      equipment that:
             389          (i) can withstand repeated use;
             390          (ii) is primarily and customarily used to serve a medical purpose;
             391          (iii) generally is not useful to a person in the absence of illness or injury; and
             392          (iv) is not worn in or on the body.
             393          (b) "Durable medical equipment" includes parts used in the repair or replacement of the
             394      equipment described in Subsection (35)(a).
             395          (c) Notwithstanding Subsection (35)(a), "durable medical equipment" does not include
             396      mobility enhancing equipment.
             397          (36) "Electronic" means:
             398          (a) relating to technology; and
             399          (b) having:


             400          (i) electrical capabilities;
             401          (ii) digital capabilities;
             402          (iii) magnetic capabilities;
             403          (iv) wireless capabilities;
             404          (v) optical capabilities;
             405          (vi) electromagnetic capabilities; or
             406          (vii) capabilities similar to Subsections (36)(b)(i) through (vi).
             407          (37) "Employee" is as defined in Section 59-10-401 .
             408          (38) "Energy efficient stove" means a stove that:
             409          (a) uses the burning of energy efficient stove fuel to heat a dwelling or heat water for
             410      use in a dwelling; and
             411          (b) has a thermal efficiency rating of at least 75%, as measured using a lower heating
             412      value.
             413          (39) "Energy efficient stove fuel" means any plant-derived fuel available on a
             414      renewable or recurring basis, including agricultural crops and trees, wood and wood waste and
             415      residues including wood pellets, plants including aquatic plants, grasses, residues, and fibers.
             416          [(38)] (40) "Fixed guideway" means a public transit facility that uses and occupies:
             417          (a) rail for the use of public transit; or
             418          (b) a separate right-of-way for the use of public transit.
             419          [(39)] (41) "Fixed wireless service" means a telecommunications service that provides
             420      radio communication between fixed points.
             421          [(40)] (42) (a) "Food and food ingredients" means substances:
             422          (i) regardless of whether the substances are in:
             423          (A) liquid form;
             424          (B) concentrated form;
             425          (C) solid form;
             426          (D) frozen form;
             427          (E) dried form; or
             428          (F) dehydrated form; and
             429          (ii) that are:
             430          (A) sold for:


             431          (I) ingestion by humans; or
             432          (II) chewing by humans; and
             433          (B) consumed for the substance's:
             434          (I) taste; or
             435          (II) nutritional value.
             436          (b) "Food and food ingredients" includes an item described in Subsection [(75)]
             437      (77)(b)(iii).
             438          (c) "Food and food ingredients" does not include:
             439          (i) an alcoholic beverage;
             440          (ii) tobacco; or
             441          (iii) prepared food.
             442          [(41)] (43) (a) "Fundraising sales" means sales:
             443          (i) (A) made by a school; or
             444          (B) made by a school student;
             445          (ii) that are for the purpose of raising funds for the school to purchase equipment,
             446      materials, or provide transportation; and
             447          (iii) that are part of an officially sanctioned school activity.
             448          (b) For purposes of Subsection [(41)] (43)(a)(iii), "officially sanctioned school activity"
             449      means a school activity:
             450          (i) that is conducted in accordance with a formal policy adopted by the school or school
             451      district governing the authorization and supervision of fundraising activities;
             452          (ii) that does not directly or indirectly compensate an individual teacher or other
             453      educational personnel by direct payment, commissions, or payment in kind; and
             454          (iii) the net or gross revenues from which are deposited in a dedicated account
             455      controlled by the school or school district.
             456          [(42)] (44) "Geothermal energy" means energy contained in heat that continuously
             457      flows outward from the earth that is used as the sole source of energy to produce electricity.
             458          [(43)] (45) "Governing board of the agreement" means the governing board of the
             459      agreement that is:
             460          (a) authorized to administer the agreement; and
             461          (b) established in accordance with the agreement.


             462          [(44)] (46) (a) For purposes of Subsection 59-12-104 (41), "governmental entity"
             463      means:
             464          (i) the executive branch of the state, including all departments, institutions, boards,
             465      divisions, bureaus, offices, commissions, and committees;
             466          (ii) the judicial branch of the state, including the courts, the Judicial Council, the
             467      Office of the Court Administrator, and similar administrative units in the judicial branch;
             468          (iii) the legislative branch of the state, including the House of Representatives, the
             469      Senate, the Legislative Printing Office, the Office of Legislative Research and General
             470      Counsel, the Office of the Legislative Auditor General, and the Office of the Legislative Fiscal
             471      Analyst;
             472          (iv) the National Guard;
             473          (v) an independent entity as defined in Section 63E-1-102 ; or
             474          (vi) a political subdivision as defined in Section 17B-1-102 .
             475          (b) "Governmental entity" does not include the state systems of public and higher
             476      education, including:
             477          (i) a college campus of the Utah College of Applied Technology;
             478          (ii) a school;
             479          (iii) the State Board of Education;
             480          (iv) the State Board of Regents; or
             481          (v) a state institution of higher education as defined in Section 53B-3-102 .
             482          [(45)] (47) "Hydroelectric energy" means water used as the sole source of energy to
             483      produce electricity.
             484          [(46)] (48) "Industrial use" means the use of natural gas, electricity, heat, coal, fuel oil,
             485      or other fuels:
             486          (a) in mining or extraction of minerals;
             487          (b) in agricultural operations to produce an agricultural product up to the time of
             488      harvest or placing the agricultural product into a storage facility, including:
             489          (i) commercial greenhouses;
             490          (ii) irrigation pumps;
             491          (iii) farm machinery;
             492          (iv) implements of husbandry as defined in Subsection 41-1a-102 (23) that are not


             493      registered under Title 41, Chapter 1a, Part 2, Registration; and
             494          (v) other farming activities;
             495          (c) in manufacturing tangible personal property at an establishment described in SIC
             496      Codes 2000 to 3999 of the 1987 Standard Industrial Classification Manual of the federal
             497      Executive Office of the President, Office of Management and Budget;
             498          (d) by a scrap recycler if:
             499          (i) from a fixed location, the scrap recycler utilizes machinery or equipment to process
             500      one or more of the following items into prepared grades of processed materials for use in new
             501      products:
             502          (A) iron;
             503          (B) steel;
             504          (C) nonferrous metal;
             505          (D) paper;
             506          (E) glass;
             507          (F) plastic;
             508          (G) textile; or
             509          (H) rubber; and
             510          (ii) the new products under Subsection [(46)] (48)(d)(i) would otherwise be made with
             511      nonrecycled materials; or
             512          (e) in producing a form of energy or steam described in Subsection 54-2-1 (2)(a) by a
             513      cogeneration facility as defined in Section 54-2-1 .
             514          [(47)] (49) (a) Except as provided in Subsection [(47)] (49)(b), "installation charge"
             515      means a charge for installing:
             516          (i) tangible personal property; or
             517          (ii) a product transferred electronically.
             518          (b) "Installation charge" does not include a charge for repairs or renovations of:
             519          (i) tangible personal property; or
             520          (ii) a product transferred electronically.
             521          [(48)] (50) (a) "Lease" or "rental" means a transfer of possession or control of tangible
             522      personal property or a product transferred electronically for:
             523          (i) (A) a fixed term; or


             524          (B) an indeterminate term; and
             525          (ii) consideration.
             526          (b) "Lease" or "rental" includes an agreement covering a motor vehicle and trailer if the
             527      amount of consideration may be increased or decreased by reference to the amount realized
             528      upon sale or disposition of the property as defined in Section 7701(h)(1), Internal Revenue
             529      Code.
             530          (c) "Lease" or "rental" does not include:
             531          (i) a transfer of possession or control of property under a security agreement or
             532      deferred payment plan that requires the transfer of title upon completion of the required
             533      payments;
             534          (ii) a transfer of possession or control of property under an agreement that requires the
             535      transfer of title:
             536          (A) upon completion of required payments; and
             537          (B) if the payment of an option price does not exceed the greater of:
             538          (I) $100; or
             539          (II) 1% of the total required payments; or
             540          (iii) providing tangible personal property along with an operator for a fixed period of
             541      time or an indeterminate period of time if the operator is necessary for equipment to perform as
             542      designed.
             543          (d) For purposes of Subsection [(48)] (50)(c)(iii), an operator is necessary for
             544      equipment to perform as designed if the operator's duties exceed the:
             545          (i) set-up of tangible personal property;
             546          (ii) maintenance of tangible personal property; or
             547          (iii) inspection of tangible personal property.
             548          [(49)] (51) "Load and leave" means delivery to a purchaser by use of a tangible storage
             549      media if the tangible storage media is not physically transferred to the purchaser.
             550          [(50)] (52) "Local taxing jurisdiction" means a:
             551          (a) county that is authorized to impose an agreement sales and use tax;
             552          (b) city that is authorized to impose an agreement sales and use tax; or
             553          (c) town that is authorized to impose an agreement sales and use tax.
             554          [(51)] (53) "Manufactured home" is as defined in Section 58-56-3 .


             555          [(52)] (54) For purposes of Section 59-12-104 , "manufacturing facility" means:
             556          (a) an establishment described in SIC Codes 2000 to 3999 of the 1987 Standard
             557      Industrial Classification Manual of the federal Executive Office of the President, Office of
             558      Management and Budget;
             559          (b) a scrap recycler if:
             560          (i) from a fixed location, the scrap recycler utilizes machinery or equipment to process
             561      one or more of the following items into prepared grades of processed materials for use in new
             562      products:
             563          (A) iron;
             564          (B) steel;
             565          (C) nonferrous metal;
             566          (D) paper;
             567          (E) glass;
             568          (F) plastic;
             569          (G) textile; or
             570          (H) rubber; and
             571          (ii) the new products under Subsection [(52)] (54)(b)(i) would otherwise be made with
             572      nonrecycled materials; or
             573          (c) a cogeneration facility as defined in Section 54-2-1 .
             574          [(53)] (55) "Member of the immediate family of the producer" means a person who is
             575      related to a producer described in Subsection 59-12-104 (20)(a) as a:
             576          (a) child or stepchild, regardless of whether the child or stepchild is:
             577          (i) an adopted child or adopted stepchild; or
             578          (ii) a foster child or foster stepchild;
             579          (b) grandchild or stepgrandchild;
             580          (c) grandparent or stepgrandparent;
             581          (d) nephew or stepnephew;
             582          (e) niece or stepniece;
             583          (f) parent or stepparent;
             584          (g) sibling or stepsibling;
             585          (h) spouse;


             586          (i) person who is the spouse of a person described in Subsections [(53)] (55)(a) through
             587      (g); or
             588          (j) person similar to a person described in Subsections [(53)] (55)(a) through (i) as
             589      determined by the commission by rule made in accordance with Title 63G, Chapter 3, Utah
             590      Administrative Rulemaking Act.
             591          [(54)] (56) "Mobile home" is as defined in Section 58-56-3 .
             592          [(55)] (57) "Mobile telecommunications service" is as defined in the Mobile
             593      Telecommunications Sourcing Act, 4 U.S.C. Sec. 124.
             594          [(56)] (58) (a) "Mobile wireless service" means a telecommunications service,
             595      regardless of the technology used, if:
             596          (i) the origination point of the conveyance, routing, or transmission is not fixed;
             597          (ii) the termination point of the conveyance, routing, or transmission is not fixed; or
             598          (iii) the origination point described in Subsection [(56)] (58)(a)(i) and the termination
             599      point described in Subsection [(56)] (58)(a)(ii) are not fixed.
             600          (b) "Mobile wireless service" includes a telecommunications service that is provided
             601      by a commercial mobile radio service provider.
             602          (c) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             603      commission may by rule define "commercial mobile radio service provider."
             604          [(57)] (59) (a) Except as provided in Subsection [(57)] (59)(c), "mobility enhancing
             605      equipment" means equipment that is:
             606          (i) primarily and customarily used to provide or increase the ability to move from one
             607      place to another;
             608          (ii) appropriate for use in a:
             609          (A) home; or
             610          (B) motor vehicle; and
             611          (iii) not generally used by persons with normal mobility.
             612          (b) "Mobility enhancing equipment" includes parts used in the repair or replacement of
             613      the equipment described in Subsection [(57)] (59)(a).
             614          (c) Notwithstanding Subsection [(57)] (59)(a), "mobility enhancing equipment" does
             615      not include:
             616          (i) a motor vehicle;


             617          (ii) equipment on a motor vehicle if that equipment is normally provided by the motor
             618      vehicle manufacturer;
             619          (iii) durable medical equipment; or
             620          (iv) a prosthetic device.
             621          [(58)] (60) "Model 1 seller" means a seller that has selected a certified service provider
             622      as the seller's agent to perform all of the seller's sales and use tax functions for agreement sales
             623      and use taxes other than the seller's obligation under Section 59-12-124 to remit a tax on the
             624      seller's own purchases.
             625          [(59)] (61) "Model 2 seller" means a seller that:
             626          (a) except as provided in Subsection [(59)] (61)(b), has selected a certified automated
             627      system to perform the seller's sales tax functions for agreement sales and use taxes; and
             628          (b) notwithstanding Subsection [(59)] (61)(a), retains responsibility for remitting all of
             629      the sales tax:
             630          (i) collected by the seller; and
             631          (ii) to the appropriate local taxing jurisdiction.
             632          [(60)] (62) (a) Subject to Subsection [(60)] (62)(b), "model 3 seller" means a seller that
             633      has:
             634          (i) sales in at least five states that are members of the agreement;
             635          (ii) total annual sales revenues of at least $500,000,000;
             636          (iii) a proprietary system that calculates the amount of tax:
             637          (A) for an agreement sales and use tax; and
             638          (B) due to each local taxing jurisdiction; and
             639          (iv) entered into a performance agreement with the governing board of the agreement.
             640          (b) For purposes of Subsection [(60)] (62)(a), "model 3 seller" includes an affiliated
             641      group of sellers using the same proprietary system.
             642          [(61)] (63) "Modular home" means a modular unit as defined in Section 58-56-3 .
             643          [(62)] (64) "Motor vehicle" is as defined in Section 41-1a-102 .
             644          [(63)] (65) "Oil shale" means a group of fine black to dark brown shales containing
             645      bituminous material that yields petroleum upon distillation.
             646          [(64)] (66) (a) "Other fuels" means products that burn independently to produce heat or
             647      energy.


             648          (b) "Other fuels" includes oxygen when it is used in the manufacturing of tangible
             649      personal property.
             650          [(65)] (67) (a) "Paging service" means a telecommunications service that provides
             651      transmission of a coded radio signal for the purpose of activating a specific pager.
             652          (b) For purposes of Subsection [(65)] (67)(a), the transmission of a coded radio signal
             653      includes a transmission by message or sound.
             654          [(66)] (68) "Pawnbroker" is as defined in Section 13-32a-102 .
             655          [(67)] (69) "Pawn transaction" is as defined in Section 13-32a-102 .
             656          [(68)] (70) (a) "Permanently attached to real property" means that for tangible personal
             657      property attached to real property:
             658          (i) the attachment of the tangible personal property to the real property:
             659          (A) is essential to the use of the tangible personal property; and
             660          (B) suggests that the tangible personal property will remain attached to the real
             661      property in the same place over the useful life of the tangible personal property; or
             662          (ii) if the tangible personal property is detached from the real property, the detachment
             663      would:
             664          (A) cause substantial damage to the tangible personal property; or
             665          (B) require substantial alteration or repair of the real property to which the tangible
             666      personal property is attached.
             667          (b) "Permanently attached to real property" includes:
             668          (i) the attachment of an accessory to the tangible personal property if the accessory is:
             669          (A) essential to the operation of the tangible personal property; and
             670          (B) attached only to facilitate the operation of the tangible personal property;
             671          (ii) a temporary detachment of tangible personal property from real property for a
             672      repair or renovation if the repair or renovation is performed where the tangible personal
             673      property and real property are located; or
             674          (iii) property attached to oil, gas, or water pipelines, except for the property listed in
             675      Subsection [(68)] (70)(c)(iii) or (iv).
             676          (c) "Permanently attached to real property" does not include:
             677          (i) the attachment of portable or movable tangible personal property to real property if
             678      that portable or movable tangible personal property is attached to real property only for:


             679          (A) convenience;
             680          (B) stability; or
             681          (C) for an obvious temporary purpose;
             682          (ii) the detachment of tangible personal property from real property except for the
             683      detachment described in Subsection [(68)] (70)(b)(ii);
             684          (iii) an attachment of the following tangible personal property to real property if the
             685      attachment to real property is only through a line that supplies water, electricity, gas,
             686      telecommunications, cable, or supplies a similar item as determined by the commission by rule
             687      made in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act:
             688          (A) a computer;
             689          (B) a telephone;
             690          (C) a television; or
             691          (D) tangible personal property similar to Subsections [(68)] (70)(c)(iii)(A) through (C)
             692      as determined by the commission by rule made in accordance with Title 63G, Chapter 3, Utah
             693      Administrative Rulemaking Act; or
             694          (iv) an item listed in Subsection [(108)] (110)(c).
             695          [(69)] (71) "Person" includes any individual, firm, partnership, joint venture,
             696      association, corporation, estate, trust, business trust, receiver, syndicate, this state, any county,
             697      city, municipality, district, or other local governmental entity of the state, or any group or
             698      combination acting as a unit.
             699          [(70)] (72) "Place of primary use":
             700          (a) for telecommunications service other than mobile telecommunications service,
             701      means the street address representative of where the customer's use of the telecommunications
             702      service primarily occurs, which shall be:
             703          (i) the residential street address of the customer; or
             704          (ii) the primary business street address of the customer; or
             705          (b) for mobile telecommunications service, is as defined in the Mobile
             706      Telecommunications Sourcing Act, 4 U.S.C. Sec. 124.
             707          [(71)] (73) (a) "Postpaid calling service" means a telecommunications service a person
             708      obtains by making a payment on a call-by-call basis:
             709          (i) through the use of a:


             710          (A) bank card;
             711          (B) credit card;
             712          (C) debit card; or
             713          (D) travel card; or
             714          (ii) by a charge made to a telephone number that is not associated with the origination
             715      or termination of the telecommunications service.
             716          (b) "Postpaid calling service" includes a service, except for a prepaid wireless calling
             717      service, that would be a prepaid wireless calling service if the service were exclusively a
             718      telecommunications service.
             719          [(72)] (74) "Postproduction" means an activity related to the finishing or duplication of
             720      a medium described in Subsection 59-12-104 (54)(a).
             721          [(73)] (75) "Prepaid calling service" means a telecommunications service:
             722          (a) that allows a purchaser access to telecommunications service that is exclusively
             723      telecommunications service;
             724          (b) that:
             725          (i) is paid for in advance; and
             726          (ii) enables the origination of a call using an:
             727          (A) access number; or
             728          (B) authorization code;
             729          (c) that is dialed:
             730          (i) manually; or
             731          (ii) electronically; and
             732          (d) sold in predetermined units or dollars that decline:
             733          (i) by a known amount; and
             734          (ii) with use.
             735          [(74)] (76) "Prepaid wireless calling service" means a telecommunications service:
             736          (a) that provides the right to utilize:
             737          (i) mobile wireless service; and
             738          (ii) other service that is not a telecommunications service, including:
             739          (A) the download of a product transferred electronically;
             740          (B) a content service; or


             741          (C) an ancillary service;
             742          (b) that:
             743          (i) is paid for in advance; and
             744          (ii) enables the origination of a call using an:
             745          (A) access number; or
             746          (B) authorization code;
             747          (c) that is dialed:
             748          (i) manually; or
             749          (ii) electronically; and
             750          (d) sold in predetermined units or dollars that decline:
             751          (i) by a known amount; and
             752          (ii) with use.
             753          [(75)] (77) (a) "Prepared food" means:
             754          (i) food:
             755          (A) sold in a heated state; or
             756          (B) heated by a seller;
             757          (ii) two or more food ingredients mixed or combined by the seller for sale as a single
             758      item; or
             759          (iii) except as provided in Subsection [(75)] (77)(c), food sold with an eating utensil
             760      provided by the seller, including a:
             761          (A) plate;
             762          (B) knife;
             763          (C) fork;
             764          (D) spoon;
             765          (E) glass;
             766          (F) cup;
             767          (G) napkin; or
             768          (H) straw.
             769          (b) "Prepared food" does not include:
             770          (i) food that a seller only:
             771          (A) cuts;


             772          (B) repackages; or
             773          (C) pasteurizes; or
             774          (ii) (A) the following:
             775          (I) raw egg;
             776          (II) raw fish;
             777          (III) raw meat;
             778          (IV) raw poultry; or
             779          (V) a food containing an item described in Subsections [(75)] (77)(b)(ii)(A)(I) through
             780      (IV); and
             781          (B) if the Food and Drug Administration recommends in Chapter 3, Part 401.11 of the
             782      Food and Drug Administration's Food Code that a consumer cook the items described in
             783      Subsection [(75)] (77)(b)(ii)(A) to prevent food borne illness; or
             784          (iii) the following if sold without eating utensils provided by the seller:
             785          (A) food and food ingredients sold by a seller if the seller's proper primary
             786      classification under the 2002 North American Industry Classification System of the federal
             787      Executive Office of the President, Office of Management and Budget, is manufacturing in
             788      Sector 311, Food Manufacturing, except for Subsector 3118, Bakeries and Tortilla
             789      Manufacturing;
             790          (B) food and food ingredients sold in an unheated state:
             791          (I) by weight or volume; and
             792          (II) as a single item; or
             793          (C) a bakery item, including:
             794          (I) a bagel;
             795          (II) a bar;
             796          (III) a biscuit;
             797          (IV) bread;
             798          (V) a bun;
             799          (VI) a cake;
             800          (VII) a cookie;
             801          (VIII) a croissant;
             802          (IX) a danish;


             803          (X) a donut;
             804          (XI) a muffin;
             805          (XII) a pastry;
             806          (XIII) a pie;
             807          (XIV) a roll;
             808          (XV) a tart;
             809          (XVI) a torte; or
             810          (XVII) a tortilla.
             811          (c) Notwithstanding Subsection [(75)] (77)(a)(iii), an eating utensil provided by the
             812      seller does not include the following used to transport the food:
             813          (i) a container; or
             814          (ii) packaging.
             815          [(76)] (78) "Prescription" means an order, formula, or recipe that is issued:
             816          (a) (i) orally;
             817          (ii) in writing;
             818          (iii) electronically; or
             819          (iv) by any other manner of transmission; and
             820          (b) by a licensed practitioner authorized by the laws of a state.
             821          [(77)] (79) (a) Except as provided in Subsection [(77)] (79)(b)(ii) or (iii), "prewritten
             822      computer software" means computer software that is not designed and developed:
             823          (i) by the author or other creator of the computer software; and
             824          (ii) to the specifications of a specific purchaser.
             825          (b) "Prewritten computer software" includes:
             826          (i) a prewritten upgrade to computer software if the prewritten upgrade to the computer
             827      software is not designed and developed:
             828          (A) by the author or other creator of the computer software; and
             829          (B) to the specifications of a specific purchaser;
             830          (ii) notwithstanding Subsection [(77)] (79)(a), computer software designed and
             831      developed by the author or other creator of the computer software to the specifications of a
             832      specific purchaser if the computer software is sold to a person other than the purchaser; or
             833          (iii) notwithstanding Subsection [(77)] (79)(a) and except as provided in Subsection


             834      [(77)] (79)(c), prewritten computer software or a prewritten portion of prewritten computer
             835      software:
             836          (A) that is modified or enhanced to any degree; and
             837          (B) if the modification or enhancement described in Subsection [(77)] (79)(b)(iii)(A) is
             838      designed and developed to the specifications of a specific purchaser.
             839          (c) Notwithstanding Subsection [(77)] (79)(b)(iii), "prewritten computer software"
             840      does not include a modification or enhancement described in Subsection [(77)] (79)(b)(iii) if
             841      the charges for the modification or enhancement are:
             842          (i) reasonable; and
             843          (ii) separately stated on the invoice or other statement of price provided to the
             844      purchaser.
             845          [(78)] (80) (a) "Private communication service" means a telecommunications service:
             846          (i) that entitles a customer to exclusive or priority use of one or more communications
             847      channels between or among termination points; and
             848          (ii) regardless of the manner in which the one or more communications channels are
             849      connected.
             850          (b) "Private communications service" includes the following provided in connection
             851      with the use of one or more communications channels:
             852          (i) an extension line;
             853          (ii) a station;
             854          (iii) switching capacity; or
             855          (iv) another associated service that is provided in connection with the use of one or
             856      more communications channels as defined in Section 59-12-215 .
             857          [(79)] (81) (a) "Prosthetic device" means a device that is worn on or in the body to:
             858          (i) artificially replace a missing portion of the body;
             859          (ii) prevent or correct a physical deformity or physical malfunction; or
             860          (iii) support a weak or deformed portion of the body.
             861          (b) "Prosthetic device" includes:
             862          (i) parts used in the repairs or renovation of a prosthetic device;
             863          (ii) replacement parts for a prosthetic device;
             864          (iii) a dental prosthesis; or


             865          (iv) a hearing aid.
             866          (c) "Prosthetic device" does not include:
             867          (i) corrective eyeglasses; or
             868          (ii) contact lenses.
             869          [(80)] (82) (a) "Protective equipment" means an item:
             870          (i) for human wear; and
             871          (ii) that is:
             872          (A) designed as protection:
             873          (I) to the wearer against injury or disease; or
             874          (II) against damage or injury of other persons or property; and
             875          (B) not suitable for general use.
             876          (b) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             877      commission shall make rules:
             878          (i) listing the items that constitute "protective equipment"; and
             879          (ii) that are consistent with the list of items that constitute "protective equipment"
             880      under the agreement.
             881          [(81)] (83) (a) For purposes of Subsection 59-12-104 (41), "publication" means any
             882      written or printed matter, other than a photocopy:
             883          (i) regardless of:
             884          (A) characteristics;
             885          (B) copyright;
             886          (C) form;
             887          (D) format;
             888          (E) method of reproduction; or
             889          (F) source; and
             890          (ii) made available in printed or electronic format.
             891          (b) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             892      commission may by rule define the term "photocopy."
             893          [(82)] (84) (a) "Purchase price" and "sales price" mean the total amount of
             894      consideration:
             895          (i) valued in money; and


             896          (ii) for which tangible personal property, a product transferred electronically, or
             897      services are:
             898          (A) sold;
             899          (B) leased; or
             900          (C) rented.
             901          (b) "Purchase price" and "sales price" include:
             902          (i) the seller's cost of the tangible personal property, a product transferred
             903      electronically, or services sold;
             904          (ii) expenses of the seller, including:
             905          (A) the cost of materials used;
             906          (B) a labor cost;
             907          (C) a service cost;
             908          (D) interest;
             909          (E) a loss;
             910          (F) the cost of transportation to the seller; or
             911          (G) a tax imposed on the seller;
             912          (iii) a charge by the seller for any service necessary to complete the sale; or
             913          (iv) consideration a seller receives from a person other than the purchaser if:
             914          (A) (I) the seller actually receives consideration from a person other than the purchaser;
             915      and
             916          (II) the consideration described in Subsection [(82)] (84)(b)(iv)(A)(I) is directly related
             917      to a price reduction or discount on the sale;
             918          (B) the seller has an obligation to pass the price reduction or discount through to the
             919      purchaser;
             920          (C) the amount of the consideration attributable to the sale is fixed and determinable by
             921      the seller at the time of the sale to the purchaser; and
             922          (D) (I) (Aa) the purchaser presents a certificate, coupon, or other documentation to the
             923      seller to claim a price reduction or discount; and
             924          (Bb) a person other than the seller authorizes, distributes, or grants the certificate,
             925      coupon, or other documentation with the understanding that the person other than the seller
             926      will reimburse any seller to whom the certificate, coupon, or other documentation is presented;


             927          (II) the purchaser identifies that purchaser to the seller as a member of a group or
             928      organization allowed a price reduction or discount, except that a preferred customer card that is
             929      available to any patron of a seller does not constitute membership in a group or organization
             930      allowed a price reduction or discount; or
             931          (III) the price reduction or discount is identified as a third party price reduction or
             932      discount on the:
             933          (Aa) invoice the purchaser receives; or
             934          (Bb) certificate, coupon, or other documentation the purchaser presents.
             935          (c) "Purchase price" and "sales price" do not include:
             936          (i) a discount:
             937          (A) in a form including:
             938          (I) cash;
             939          (II) term; or
             940          (III) coupon;
             941          (B) that is allowed by a seller;
             942          (C) taken by a purchaser on a sale; and
             943          (D) that is not reimbursed by a third party; or
             944          (ii) the following if separately stated on an invoice, bill of sale, or similar document
             945      provided to the purchaser:
             946          (A) the following from credit extended on the sale of tangible personal property or
             947      services:
             948          (I) a carrying charge;
             949          (II) a financing charge; or
             950          (III) an interest charge;
             951          (B) a delivery charge;
             952          (C) an installation charge;
             953          (D) a manufacturer rebate on a motor vehicle; or
             954          (E) a tax or fee legally imposed directly on the consumer.
             955          [(83)] (85) "Purchaser" means a person to whom:
             956          (a) a sale of tangible personal property is made;
             957          (b) a product is transferred electronically; or


             958          (c) a service is furnished.
             959          [(84)] (86) "Regularly rented" means:
             960          (a) rented to a guest for value three or more times during a calendar year; or
             961          (b) advertised or held out to the public as a place that is regularly rented to guests for
             962      value.
             963          [(85)] (87) "Renewable energy" means:
             964          (a) biomass energy;
             965          (b) hydroelectric energy;
             966          (c) geothermal energy;
             967          (d) solar energy; or
             968          (e) wind energy.
             969          [(86)] (88) (a) "Renewable energy production facility" means a facility that:
             970          (i) uses renewable energy to produce electricity; and
             971          (ii) has a production capacity of 20 kilowatts or greater.
             972          (b) A facility is a renewable energy production facility regardless of whether the
             973      facility is:
             974          (i) connected to an electric grid; or
             975          (ii) located on the premises of an electricity consumer.
             976          [(87)] (89) "Rental" is as defined in Subsection [(48)] (50).
             977          [(88)] (90) "Repairs or renovations of tangible personal property" means:
             978          (a) a repair or renovation of tangible personal property that is not permanently attached
             979      to real property; or
             980          (b) attaching tangible personal property or a product that is transferred electronically to
             981      other tangible personal property if the other tangible personal property to which the tangible
             982      personal property or product that is transferred electronically is attached is not permanently
             983      attached to real property.
             984          [(89)] (91) "Research and development" means the process of inquiry or
             985      experimentation aimed at the discovery of facts, devices, technologies, or applications and the
             986      process of preparing those devices, technologies, or applications for marketing.
             987          [(90)] (92) (a) "Residential telecommunications services" means a telecommunications
             988      service or an ancillary service that is provided to an individual for personal use:


             989          (i) at a residential address; or
             990          (ii) at an institution, including a nursing home or a school, if the telecommunications
             991      service or ancillary service is provided to and paid for by the individual residing at the
             992      institution rather than the institution.
             993          (b) For purposes of Subsection [(90)] (92)(a), a residential address includes an:
             994          (i) apartment; or
             995          (ii) other individual dwelling unit.
             996          [(91)] (93) "Residential use" means the use in or around a home, apartment building,
             997      sleeping quarters, and similar facilities or accommodations.
             998          [(92)] (94) "Retail sale" or "sale at retail" means a sale, lease, or rental for a purpose
             999      other than:
             1000          (a) resale;
             1001          (b) sublease; or
             1002          (c) subrent.
             1003          [(93)] (95) (a) "Retailer" means any person engaged in a regularly organized business
             1004      in tangible personal property or any other taxable transaction under Subsection 59-12-103 (1),
             1005      and who is selling to the user or consumer and not for resale.
             1006          (b) "Retailer" includes commission merchants, auctioneers, and any person regularly
             1007      engaged in the business of selling to users or consumers within the state.
             1008          [(94)] (96) (a) "Sale" means any transfer of title, exchange, or barter, conditional or
             1009      otherwise, in any manner, of tangible personal property or any other taxable transaction under
             1010      Subsection 59-12-103 (1), for consideration.
             1011          (b) "Sale" includes:
             1012          (i) installment and credit sales;
             1013          (ii) any closed transaction constituting a sale;
             1014          (iii) any sale of electrical energy, gas, services, or entertainment taxable under this
             1015      chapter;
             1016          (iv) any transaction if the possession of property is transferred but the seller retains the
             1017      title as security for the payment of the price; and
             1018          (v) any transaction under which right to possession, operation, or use of any article of
             1019      tangible personal property is granted under a lease or contract and the transfer of possession


             1020      would be taxable if an outright sale were made.
             1021          [(95)] (97) "Sale at retail" is as defined in Subsection [(92)] (94).
             1022          [(96)] (98) "Sale-leaseback transaction" means a transaction by which title to tangible
             1023      personal property or a product transferred electronically that is subject to a tax under this
             1024      chapter is transferred:
             1025          (a) by a purchaser-lessee;
             1026          (b) to a lessor;
             1027          (c) for consideration; and
             1028          (d) if:
             1029          (i) the purchaser-lessee paid sales and use tax on the purchaser-lessee's initial purchase
             1030      of the tangible personal property or product transferred electronically;
             1031          (ii) the sale of the tangible personal property or product transferred electronically to the
             1032      lessor is intended as a form of financing:
             1033          (A) for the tangible personal property or product transferred electronically; and
             1034          (B) to the purchaser-lessee; and
             1035          (iii) in accordance with generally accepted accounting principles, the purchaser-lessee
             1036      is required to:
             1037          (A) capitalize the tangible personal property or product transferred electronically for
             1038      financial reporting purposes; and
             1039          (B) account for the lease payments as payments made under a financing arrangement.
             1040          [(97)] (99) "Sales price" is as defined in Subsection [(82)] (84).
             1041          [(98)] (100) (a) "Sales relating to schools" means the following sales by, amounts paid
             1042      to, or amounts charged by a school:
             1043          (i) sales that are directly related to the school's educational functions or activities
             1044      including:
             1045          (A) the sale of:
             1046          (I) textbooks;
             1047          (II) textbook fees;
             1048          (III) laboratory fees;
             1049          (IV) laboratory supplies; or
             1050          (V) safety equipment;


             1051          (B) the sale of a uniform, protective equipment, or sports or recreational equipment
             1052      that:
             1053          (I) a student is specifically required to wear as a condition of participation in a
             1054      school-related event or school-related activity; and
             1055          (II) is not readily adaptable to general or continued usage to the extent that it takes the
             1056      place of ordinary clothing;
             1057          (C) sales of the following if the net or gross revenues generated by the sales are
             1058      deposited into a school district fund or school fund dedicated to school meals:
             1059          (I) food and food ingredients; or
             1060          (II) prepared food; or
             1061          (D) transportation charges for official school activities; or
             1062          (ii) amounts paid to or amounts charged by a school for admission to a school-related
             1063      event or school-related activity.
             1064          (b) "Sales relating to schools" does not include:
             1065          (i) bookstore sales of items that are not educational materials or supplies;
             1066          (ii) except as provided in Subsection [(98)] (100)(a)(i)(B):
             1067          (A) clothing;
             1068          (B) clothing accessories or equipment;
             1069          (C) protective equipment; or
             1070          (D) sports or recreational equipment; or
             1071          (iii) amounts paid to or amounts charged by a school for admission to a school-related
             1072      event or school-related activity if the amounts paid or charged are passed through to a person:
             1073          (A) other than a:
             1074          (I) school;
             1075          (II) nonprofit organization authorized by a school board or a governing body of a
             1076      private school to organize and direct a competitive secondary school activity; or
             1077          (III) nonprofit association authorized by a school board or a governing body of a
             1078      private school to organize and direct a competitive secondary school activity; and
             1079          (B) that is required to collect sales and use taxes under this chapter.
             1080          (c) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             1081      commission may make rules defining the term "passed through."


             1082          [(99)] (101) For purposes of this section and Section 59-12-104 , "school":
             1083          (a) means:
             1084          (i) an elementary school or a secondary school that:
             1085          (A) is a:
             1086          (I) public school; or
             1087          (II) private school; and
             1088          (B) provides instruction for one or more grades kindergarten through 12; or
             1089          (ii) a public school district; and
             1090          (b) includes the Electronic High School as defined in Section 53A-15-1002 .
             1091          [(100)] (102) "Seller" means a person that makes a sale, lease, or rental of:
             1092          (a) tangible personal property;
             1093          (b) a product transferred electronically; or
             1094          (c) a service.
             1095          [(101)] (103) (a) "Semiconductor fabricating, processing, research, or development
             1096      materials" means tangible personal property or a product transferred electronically if the
             1097      tangible personal property or product transferred electronically is:
             1098          (i) used primarily in the process of:
             1099          (A) (I) manufacturing a semiconductor;
             1100          (II) fabricating a semiconductor; or
             1101          (III) research or development of a:
             1102          (Aa) semiconductor; or
             1103          (Bb) semiconductor manufacturing process; or
             1104          (B) maintaining an environment suitable for a semiconductor; or
             1105          (ii) consumed primarily in the process of:
             1106          (A) (I) manufacturing a semiconductor;
             1107          (II) fabricating a semiconductor; or
             1108          (III) research or development of a:
             1109          (Aa) semiconductor; or
             1110          (Bb) semiconductor manufacturing process; or
             1111          (B) maintaining an environment suitable for a semiconductor.
             1112          (b) "Semiconductor fabricating, processing, research, or development materials"


             1113      includes:
             1114          (i) parts used in the repairs or renovations of tangible personal property or a product
             1115      transferred electronically described in Subsection [(101)] (103)(a); or
             1116          (ii) a chemical, catalyst, or other material used to:
             1117          (A) produce or induce in a semiconductor a:
             1118          (I) chemical change; or
             1119          (II) physical change;
             1120          (B) remove impurities from a semiconductor; or
             1121          (C) improve the marketable condition of a semiconductor.
             1122          [(102)] (104) "Senior citizen center" means a facility having the primary purpose of
             1123      providing services to the aged as defined in Section 62A-3-101 .
             1124          [(103)] (105) "Simplified electronic return" means the electronic return:
             1125          (a) described in Section 318(C) of the agreement; and
             1126          (b) approved by the governing board of the agreement.
             1127          [(104)] (106) "Solar energy" means the sun used as the sole source of energy for
             1128      producing electricity.
             1129          [(105)] (107) (a) "Sports or recreational equipment" means an item:
             1130          (i) designed for human use; and
             1131          (ii) that is:
             1132          (A) worn in conjunction with:
             1133          (I) an athletic activity; or
             1134          (II) a recreational activity; and
             1135          (B) not suitable for general use.
             1136          (b) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             1137      commission shall make rules:
             1138          (i) listing the items that constitute "sports or recreational equipment"; and
             1139          (ii) that are consistent with the list of items that constitute "sports or recreational
             1140      equipment" under the agreement.
             1141          [(106)] (108) "State" means the state of Utah, its departments, and agencies.
             1142          [(107)] (109) "Storage" means any keeping or retention of tangible personal property or
             1143      any other taxable transaction under Subsection 59-12-103 (1), in this state for any purpose


             1144      except sale in the regular course of business.
             1145          [(108)] (110) (a) Except as provided in Subsection [(108)] (110) (d) or (e), "tangible
             1146      personal property" means personal property that:
             1147          (i) may be:
             1148          (A) seen;
             1149          (B) weighed;
             1150          (C) measured;
             1151          (D) felt; or
             1152          (E) touched; or
             1153          (ii) is in any manner perceptible to the senses.
             1154          (b) "Tangible personal property" includes:
             1155          (i) electricity;
             1156          (ii) water;
             1157          (iii) gas;
             1158          (iv) steam; or
             1159          (v) prewritten computer software.
             1160          (c) "Tangible personal property" includes the following regardless of whether the item
             1161      is attached to real property:
             1162          (i) a dishwasher;
             1163          (ii) a dryer;
             1164          (iii) a freezer;
             1165          (iv) a microwave;
             1166          (v) a refrigerator;
             1167          (vi) a stove;
             1168          (vii) a washer; or
             1169          (viii) an item similar to Subsections [(108)] (110)(c)(i) through (vii) as determined by
             1170      the commission by rule made in accordance with Title 63G, Chapter 3, Utah Administrative
             1171      Rulemaking Act.
             1172          (d) "Tangible personal property" does not include a product that is transferred
             1173      electronically.
             1174          (e) "Tangible personal property" does not include the following if attached to real


             1175      property, regardless of whether the attachment to real property is only through a line that
             1176      supplies water, electricity, gas, telephone, cable, or supplies a similar item as determined by the
             1177      commission by rule made in accordance with Title 63G, Chapter 3, Utah Administrative
             1178      Rulemaking Act:
             1179          (i) a hot water heater;
             1180          (ii) a water filtration system; or
             1181          (iii) a water softener system.
             1182          [(109)] (111) "Tar sands" means impregnated sands that yield mixtures of liquid
             1183      hydrocarbon and require further processing other than mechanical blending before becoming
             1184      finished petroleum products.
             1185          [(110)] (112) (a) "Telecommunications enabling or facilitating equipment, machinery,
             1186      or software" means an item listed in Subsection [(110)] (112)(b) if that item is purchased or
             1187      leased primarily to enable or facilitate one or more of the following to function:
             1188          (i) telecommunications switching or routing equipment, machinery, or software; or
             1189          (ii) telecommunications transmission equipment, machinery, or software.
             1190          (b) The following apply to Subsection [(110)] (112)(a):
             1191          (i) a pole;
             1192          (ii) software;
             1193          (iii) a supplementary power supply;
             1194          (iv) temperature or environmental equipment or machinery;
             1195          (v) test equipment;
             1196          (vi) a tower; or
             1197          (vii) equipment, machinery, or software that functions similarly to an item listed in
             1198      Subsections [(110)] (112)(b)(i) through (vi) as determined by the commission by rule made in
             1199      accordance with Subsection [(110)] (112)(c).
             1200          (c) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             1201      commission may by rule define what constitutes equipment, machinery, or software that
             1202      functions similarly to an item listed in Subsections [(110)] (112)(b)(i) through (vi).
             1203          [(111)] (113) "Telecommunications equipment, machinery, or software required for
             1204      911 service" means equipment, machinery, or software that is required to comply with 47
             1205      C.F.R. Sec. 20.18.


             1206          [(112)] (114) "Telecommunications maintenance or repair equipment, machinery, or
             1207      software" means equipment, machinery, or software purchased or leased primarily to maintain
             1208      or repair one or more of the following, regardless of whether the equipment, machinery, or
             1209      software is purchased or leased as a spare part or as an upgrade or modification to one or more
             1210      of the following:
             1211          (a) telecommunications enabling or facilitating equipment, machinery, or software;
             1212          (b) telecommunications switching or routing equipment, machinery, or software; or
             1213          (c) telecommunications transmission equipment, machinery, or software.
             1214          [(113)] (115) (a) "Telecommunications service" means the electronic conveyance,
             1215      routing, or transmission of audio, data, video, voice, or any other information or signal to a
             1216      point, or among or between points.
             1217          (b) "Telecommunications service" includes:
             1218          (i) an electronic conveyance, routing, or transmission with respect to which a computer
             1219      processing application is used to act:
             1220          (A) on the code, form, or protocol of the content;
             1221          (B) for the purpose of electronic conveyance, routing, or transmission; and
             1222          (C) regardless of whether the service:
             1223          (I) is referred to as voice over Internet protocol service; or
             1224          (II) is classified by the Federal Communications Commission as enhanced or value
             1225      added;
             1226          (ii) an 800 service;
             1227          (iii) a 900 service;
             1228          (iv) a fixed wireless service;
             1229          (v) a mobile wireless service;
             1230          (vi) a postpaid calling service;
             1231          (vii) a prepaid calling service;
             1232          (viii) a prepaid wireless calling service; or
             1233          (ix) a private communications service.
             1234          (c) "Telecommunications service" does not include:
             1235          (i) advertising, including directory advertising;
             1236          (ii) an ancillary service;


             1237          (iii) a billing and collection service provided to a third party;
             1238          (iv) a data processing and information service if:
             1239          (A) the data processing and information service allows data to be:
             1240          (I) (Aa) acquired;
             1241          (Bb) generated;
             1242          (Cc) processed;
             1243          (Dd) retrieved; or
             1244          (Ee) stored; and
             1245          (II) delivered by an electronic transmission to a purchaser; and
             1246          (B) the purchaser's primary purpose for the underlying transaction is the processed data
             1247      or information;
             1248          (v) installation or maintenance of the following on a customer's premises:
             1249          (A) equipment; or
             1250          (B) wiring;
             1251          (vi) Internet access service;
             1252          (vii) a paging service;
             1253          (viii) a product transferred electronically, including:
             1254          (A) music;
             1255          (B) reading material;
             1256          (C) a ring tone;
             1257          (D) software; or
             1258          (E) video;
             1259          (ix) a radio and television audio and video programming service:
             1260          (A) regardless of the medium; and
             1261          (B) including:
             1262          (I) furnishing conveyance, routing, or transmission of a television audio and video
             1263      programming service by a programming service provider;
             1264          (II) cable service as defined in 47 U.S.C. Sec. 522(6); or
             1265          (III) audio and video programming services delivered by a commercial mobile radio
             1266      service provider as defined in 47 C.F.R. Sec. 20.3;
             1267          (x) a value-added nonvoice data service; or


             1268          (xi) tangible personal property.
             1269          [(114)] (116) (a) "Telecommunications service provider" means a person that:
             1270          (i) owns, controls, operates, or manages a telecommunications service; and
             1271          (ii) engages in an activity described in Subsection [(114)] (116)(a)(i) for the shared use
             1272      with or resale to any person of the telecommunications service.
             1273          (b) A person described in Subsection [(114)] (116)(a) is a telecommunications service
             1274      provider whether or not the Public Service Commission of Utah regulates:
             1275          (i) that person; or
             1276          (ii) the telecommunications service that the person owns, controls, operates, or
             1277      manages.
             1278          [(115)] (117) (a) "Telecommunications switching or routing equipment, machinery, or
             1279      software" means an item listed in Subsection [(115)] (117)(b) if that item is purchased or
             1280      leased primarily for switching or routing:
             1281          (i) an ancillary service;
             1282          (ii) data communications;
             1283          (iii) voice communications; or
             1284          (iv) telecommunications service.
             1285          (b) The following apply to Subsection [(115)] (117)(a):
             1286          (i) a bridge;
             1287          (ii) a computer;
             1288          (iii) a cross connect;
             1289          (iv) a modem;
             1290          (v) a multiplexer;
             1291          (vi) plug in circuitry;
             1292          (vii) a router;
             1293          (viii) software;
             1294          (ix) a switch; or
             1295          (x) equipment, machinery, or software that functions similarly to an item listed in
             1296      Subsections [(115)] (117)(b)(i) through (ix) as determined by the commission by rule made in
             1297      accordance with Subsection [(115)] (117)(c).
             1298          (c) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the


             1299      commission may by rule define what constitutes equipment, machinery, or software that
             1300      functions similarly to an item listed in Subsections [(115)] (117)(b)(i) through (ix).
             1301          [(116)] (118) (a) "Telecommunications transmission equipment, machinery, or
             1302      software" means an item listed in Subsection [(116)] (118)(b) if that item is purchased or
             1303      leased primarily for sending, receiving, or transporting:
             1304          (i) an ancillary service;
             1305          (ii) data communications;
             1306          (iii) voice communications; or
             1307          (iv) telecommunications service.
             1308          (b) The following apply to Subsection [(116)] (118)(a):
             1309          (i) an amplifier;
             1310          (ii) a cable;
             1311          (iii) a closure;
             1312          (iv) a conduit;
             1313          (v) a controller;
             1314          (vi) a duplexer;
             1315          (vii) a filter;
             1316          (viii) an input device;
             1317          (ix) an input/output device;
             1318          (x) an insulator;
             1319          (xi) microwave machinery or equipment;
             1320          (xii) an oscillator;
             1321          (xiii) an output device;
             1322          (xiv) a pedestal;
             1323          (xv) a power converter;
             1324          (xvi) a power supply;
             1325          (xvii) a radio channel;
             1326          (xviii) a radio receiver;
             1327          (xix) a radio transmitter;
             1328          (xx) a repeater;
             1329          (xxi) software;


             1330          (xxii) a terminal;
             1331          (xxiii) a timing unit;
             1332          (xxiv) a transformer;
             1333          (xxv) a wire; or
             1334          (xxvi) equipment, machinery, or software that functions similarly to an item listed in
             1335      Subsections [(116)] (118)(b)(i) through (xxv) as determined by the commission by rule made in
             1336      accordance with Subsection [(116)] (118)(c).
             1337          (c) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             1338      commission may by rule define what constitutes equipment, machinery, or software that
             1339      functions similarly to an item listed in Subsections [(116)] (118)(b)(i) through (xxv).
             1340          [(117)] (119) "Tobacco" means:
             1341          (a) a cigarette;
             1342          (b) a cigar;
             1343          (c) chewing tobacco;
             1344          (d) pipe tobacco; or
             1345          (e) any other item that contains tobacco.
             1346          [(118)] (120) "Unassisted amusement device" means an amusement device, skill
             1347      device, or ride device that is started and stopped by the purchaser or renter of the right to use or
             1348      operate the amusement device, skill device, or ride device.
             1349          [(119)] (121) (a) "Use" means the exercise of any right or power over tangible personal
             1350      property, a product transferred electronically, or a service under Subsection 59-12-103 (1),
             1351      incident to the ownership or the leasing of that tangible personal property, product transferred
             1352      electronically, or service.
             1353          (b) "Use" does not include the sale, display, demonstration, or trial of tangible personal
             1354      property, a product transferred electronically, or a service in the regular course of business and
             1355      held for resale.
             1356          [(120)] (122) "Value-added nonvoice data service" means a service:
             1357          (a) that otherwise meets the definition of a telecommunications service except that a
             1358      computer processing application is used to act primarily for a purpose other than conveyance,
             1359      routing, or transmission; and
             1360          (b) with respect to which a computer processing application is used to act on data or


             1361      information:
             1362          (i) code;
             1363          (ii) content;
             1364          (iii) form; or
             1365          (iv) protocol.
             1366          [(121)] (123) (a) Subject to Subsection [(121)] (123)(b), "vehicle" means the following
             1367      that are required to be titled, registered, or titled and registered:
             1368          (i) an aircraft as defined in Section 72-10-102 ;
             1369          (ii) a vehicle as defined in Section 41-1a-102 ;
             1370          (iii) an off-highway vehicle as defined in Section 41-22-2 ; or
             1371          (iv) a vessel as defined in Section 41-1a-102 .
             1372          (b) For purposes of Subsection 59-12-104 (33) only, "vehicle" includes:
             1373          (i) a vehicle described in Subsection [(121)] (123)(a); or
             1374          (ii) (A) a locomotive;
             1375          (B) a freight car;
             1376          (C) railroad work equipment; or
             1377          (D) other railroad rolling stock.
             1378          [(122)] (124) "Vehicle dealer" means a person engaged in the business of buying,
             1379      selling, or exchanging a vehicle as defined in Subsection [(121)] (123).
             1380          [(123)] (125) (a) "Vertical service" means an ancillary service that:
             1381          (i) is offered in connection with one or more telecommunications services; and
             1382          (ii) offers an advanced calling feature that allows a customer to:
             1383          (A) identify a caller; and
             1384          (B) manage multiple calls and call connections.
             1385          (b) "Vertical service" includes an ancillary service that allows a customer to manage a
             1386      conference bridging service.
             1387          [(124)] (126) (a) "Voice mail service" means an ancillary service that enables a
             1388      customer to receive, send, or store a recorded message.
             1389          (b) "Voice mail service" does not include a vertical service that a customer is required
             1390      to have in order to utilize a voice mail service.
             1391          [(125)] (127) (a) Except as provided in Subsection [(125)] (127)(b), "waste energy


             1392      facility" means a facility that generates electricity:
             1393          (i) using as the primary source of energy waste materials that would be placed in a
             1394      landfill or refuse pit if it were not used to generate electricity, including:
             1395          (A) tires;
             1396          (B) waste coal; or
             1397          (C) oil shale; and
             1398          (ii) in amounts greater than actually required for the operation of the facility.
             1399          (b) "Waste energy facility" does not include a facility that incinerates:
             1400          (i) municipal solid waste;
             1401          (ii) hospital waste as defined in 40 C.F.R. 60.51c; or
             1402          (iii) medical/infectious waste as defined in 40 C.F.R. 60.51c.
             1403          [(126)] (128) "Watercraft" means a vessel as defined in Section 73-18-2 .
             1404          [(127)] (129) "Wind energy" means wind used as the sole source of energy to produce
             1405      electricity.
             1406          [(128)] (130) "ZIP Code" means a Zoning Improvement Plan Code assigned to a
             1407      geographic location by the United States Postal Service.
             1408          Section 2. Section 59-12-104 is amended to read:
             1409           59-12-104. Exemptions.
             1410          The following sales and uses are exempt from the taxes imposed by this chapter:
             1411          (1) sales of aviation fuel, motor fuel, and special fuel subject to a Utah state excise tax
             1412      under Chapter 13, Motor and Special Fuel Tax Act;
             1413          (2) sales to the state, its institutions, and its political subdivisions; however, this
             1414      exemption does not apply to sales of:
             1415          (a) construction materials except:
             1416          (i) construction materials purchased by or on behalf of institutions of the public
             1417      education system as defined in Utah Constitution Article X, Section 2, provided the
             1418      construction materials are clearly identified and segregated and installed or converted to real
             1419      property which is owned by institutions of the public education system; and
             1420          (ii) construction materials purchased by the state, its institutions, or its political
             1421      subdivisions which are installed or converted to real property by employees of the state, its
             1422      institutions, or its political subdivisions; or


             1423          (b) tangible personal property in connection with the construction, operation,
             1424      maintenance, repair, or replacement of a project, as defined in Section 11-13-103 , or facilities
             1425      providing additional project capacity, as defined in Section 11-13-103 ;
             1426          (3) (a) sales of an item described in Subsection (3)(b) from a vending machine if:
             1427          (i) the proceeds of each sale do not exceed $1; and
             1428          (ii) the seller or operator of the vending machine reports an amount equal to 150% of
             1429      the cost of the item described in Subsection (3)(b) as goods consumed; and
             1430          (b) Subsection (3)(a) applies to:
             1431          (i) food and food ingredients; or
             1432          (ii) prepared food;
             1433          (4) (a) sales of the following to a commercial airline carrier for in-flight consumption:
             1434          (i) alcoholic beverages;
             1435          (ii) food and food ingredients; or
             1436          (iii) prepared food;
             1437          (b) sales of tangible personal property or a product transferred electronically:
             1438          (i) to a passenger;
             1439          (ii) by a commercial airline carrier; and
             1440          (iii) during a flight for in-flight consumption or in-flight use by the passenger; or
             1441          (c) services related to Subsection (4)(a) or (b);
             1442          (5) (a) (i) beginning on July 1, 2008, and ending on September 30, 2008, sales of parts
             1443      and equipment:
             1444          (A) (I) by an establishment described in NAICS Code 336411 or 336412 of the 2002
             1445      North American Industry Classification System of the federal Executive Office of the
             1446      President, Office of Management and Budget; and
             1447          (II) for:
             1448          (Aa) installation in an aircraft, including services relating to the installation of parts or
             1449      equipment in the aircraft;
             1450          (Bb) renovation of an aircraft; or
             1451          (Cc) repair of an aircraft; or
             1452          (B) for installation in an aircraft operated by a common carrier in interstate or foreign
             1453      commerce; or


             1454          (ii) beginning on October 1, 2008, sales of parts and equipment for installation in an
             1455      aircraft operated by a common carrier in interstate or foreign commerce; and
             1456          (b) notwithstanding the time period of Subsection 59-1-1410 (8) for filing for a refund,
             1457      a person may claim the exemption allowed by Subsection (5)(a)(i)(B) for a sale by filing for a
             1458      refund:
             1459          (i) if the sale is made on or after July 1, 2008, but on or before September 30, 2008;
             1460          (ii) as if Subsection (5)(a)(i)(B) were in effect on the day on which the sale is made;
             1461          (iii) if the person did not claim the exemption allowed by Subsection (5)(a)(i)(B) for
             1462      the sale prior to filing for the refund;
             1463          (iv) for sales and use taxes paid under this chapter on the sale;
             1464          (v) in accordance with Section 59-1-1410 ; and
             1465          (vi) subject to any extension allowed for filing for a refund under Section 59-1-1410 , if
             1466      the person files for the refund on or before September 30, 2011;
             1467          (6) sales of commercials, motion picture films, prerecorded audio program tapes or
             1468      records, and prerecorded video tapes by a producer, distributor, or studio to a motion picture
             1469      exhibitor, distributor, or commercial television or radio broadcaster;
             1470          (7) (a) subject to Subsection (7)(b), sales of cleaning or washing of tangible personal
             1471      property if the cleaning or washing of the tangible personal property is not assisted cleaning or
             1472      washing of tangible personal property;
             1473          (b) if a seller that sells at the same business location assisted cleaning or washing of
             1474      tangible personal property and cleaning or washing of tangible personal property that is not
             1475      assisted cleaning or washing of tangible personal property, the exemption described in
             1476      Subsection (7)(a) applies if the seller separately accounts for the sales of the assisted cleaning
             1477      or washing of the tangible personal property; and
             1478          (c) for purposes of Subsection (7)(b) and in accordance with Title 63G, Chapter 3,
             1479      Utah Administrative Rulemaking Act, the commission may make rules:
             1480          (i) governing the circumstances under which sales are at the same business location;
             1481      and
             1482          (ii) establishing the procedures and requirements for a seller to separately account for
             1483      sales of assisted cleaning or washing of tangible personal property;
             1484          (8) sales made to or by religious or charitable institutions in the conduct of their regular


             1485      religious or charitable functions and activities, if the requirements of Section 59-12-104.1 are
             1486      fulfilled;
             1487          (9) sales of a vehicle of a type required to be registered under the motor vehicle laws of
             1488      this state if the vehicle is:
             1489          (a) not registered in this state; and
             1490          (b) (i) not used in this state; or
             1491          (ii) used in this state:
             1492          (A) if the vehicle is not used to conduct business, for a time period that does not
             1493      exceed the longer of:
             1494          (I) 30 days in any calendar year; or
             1495          (II) the time period necessary to transport the vehicle to the borders of this state; or
             1496          (B) if the vehicle is used to conduct business, for the time period necessary to transport
             1497      the vehicle to the borders of this state;
             1498          (10) (a) amounts paid for an item described in Subsection (10)(b) if:
             1499          (i) the item is intended for human use; and
             1500          (ii) (A) a prescription was issued for the item; or
             1501          (B) the item was purchased by a hospital or other medical facility; and
             1502          (b) (i) Subsection (10)(a) applies to:
             1503          (A) a drug;
             1504          (B) a syringe; or
             1505          (C) a stoma supply; and
             1506          (ii) in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             1507      commission may by rule define the terms:
             1508          (A) "syringe"; or
             1509          (B) "stoma supply";
             1510          (11) sales or use of property, materials, or services used in the construction of or
             1511      incorporated in pollution control facilities allowed by Sections 19-2-123 through 19-2-127 ;
             1512          (12) (a) sales of an item described in Subsection (12)(c) served by:
             1513          (i) the following if the item described in Subsection (12)(c) is not available to the
             1514      general public:
             1515          (A) a church; or


             1516          (B) a charitable institution;
             1517          (ii) an institution of higher education if:
             1518          (A) the item described in Subsection (12)(c) is not available to the general public; or
             1519          (B) the item described in Subsection (12)(c) is prepaid as part of a student meal plan
             1520      offered by the institution of higher education; or
             1521          (b) sales of an item described in Subsection (12)(c) provided for a patient by:
             1522          (i) a medical facility; or
             1523          (ii) a nursing facility; and
             1524          (c) Subsections (12)(a) and (b) apply to:
             1525          (i) food and food ingredients;
             1526          (ii) prepared food; or
             1527          (iii) alcoholic beverages;
             1528          (13) (a) except as provided in Subsection (13)(b), the sale of tangible personal property
             1529      or a product transferred electronically by a person:
             1530          (i) regardless of the number of transactions involving the sale of that tangible personal
             1531      property or product transferred electronically by that person; and
             1532          (ii) not regularly engaged in the business of selling that type of tangible personal
             1533      property or product transferred electronically;
             1534          (b) this Subsection (13) does not apply if:
             1535          (i) the sale is one of a series of sales of a character to indicate that the person is
             1536      regularly engaged in the business of selling that type of tangible personal property or product
             1537      transferred electronically;
             1538          (ii) the person holds that person out as regularly engaged in the business of selling that
             1539      type of tangible personal property or product transferred electronically;
             1540          (iii) the person sells an item of tangible personal property or product transferred
             1541      electronically that the person purchased as a sale that is exempt under Subsection (25); or
             1542          (iv) the sale is of a vehicle or vessel required to be titled or registered under the laws of
             1543      this state in which case the tax is based upon:
             1544          (A) the bill of sale or other written evidence of value of the vehicle or vessel being
             1545      sold; or
             1546          (B) in the absence of a bill of sale or other written evidence of value, the fair market


             1547      value of the vehicle or vessel being sold at the time of the sale as determined by the
             1548      commission; and
             1549          (c) in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             1550      commission shall make rules establishing the circumstances under which:
             1551          (i) a person is regularly engaged in the business of selling a type of tangible personal
             1552      property or product transferred electronically;
             1553          (ii) a sale of tangible personal property or a product transferred electronically is one of
             1554      a series of sales of a character to indicate that a person is regularly engaged in the business of
             1555      selling that type of tangible personal property or product transferred electronically; or
             1556          (iii) a person holds that person out as regularly engaged in the business of selling a type
             1557      of tangible personal property or product transferred electronically;
             1558          (14) (a) except as provided in Subsection (14)(b), amounts paid or charged on or after
             1559      July 1, 2006, for a purchase or lease by a manufacturing facility except for a cogeneration
             1560      facility, for the following:
             1561          (i) machinery and equipment that:
             1562          (A) are used:
             1563          (I) for a manufacturing facility except for a manufacturing facility that is a scrap
             1564      recycler described in Subsection 59-12-102 [(52)](54)(b):
             1565          (Aa) in the manufacturing process;
             1566          (Bb) to manufacture an item sold as tangible personal property; and
             1567          (Cc) beginning on July 1, 2009, in a manufacturing facility described in this Subsection
             1568      (14)(a)(i)(A)(I) in the state; or
             1569          (II) for a manufacturing facility that is a scrap recycler described in Subsection
             1570      59-12-102 [(52)](54)(b):
             1571          (Aa) to process an item sold as tangible personal property; and
             1572          (Bb) beginning on July 1, 2009, in a manufacturing facility described in this Subsection
             1573      (14)(a)(i)(A)(II) in the state; and
             1574          (B) have an economic life of three or more years; and
             1575          (ii) normal operating repair or replacement parts that:
             1576          (A) have an economic life of three or more years; and
             1577          (B) are used:


             1578          (I) for a manufacturing facility except for a manufacturing facility that is a scrap
             1579      recycler described in Subsection 59-12-102 [(52)](54)(b):
             1580          (Aa) in the manufacturing process; and
             1581          (Bb) in a manufacturing facility described in this Subsection (14)(a)(ii)(B)(I) in the
             1582      state; or
             1583          (II) for a manufacturing facility that is a scrap recycler described in Subsection
             1584      59-12-102 [(52)](54)(b):
             1585          (Aa) to process an item sold as tangible personal property; and
             1586          (Bb) in a manufacturing facility described in this Subsection (14)(a)(ii)(B)(II) in the
             1587      state;
             1588          (b) amounts paid or charged on or after July 1, 2005, for a purchase or lease by a
             1589      manufacturing facility that is a cogeneration facility placed in service on or after May 1, 2006,
             1590      for the following:
             1591          (i) machinery and equipment that:
             1592          (A) are used:
             1593          (I) in the manufacturing process;
             1594          (II) to manufacture an item sold as tangible personal property; and
             1595          (III) beginning on July 1, 2009, in a manufacturing facility described in this Subsection
             1596      (14)(b) in the state; and
             1597          (B) have an economic life of three or more years; and
             1598          (ii) normal operating repair or replacement parts that:
             1599          (A) are used:
             1600          (I) in the manufacturing process; and
             1601          (II) in a manufacturing facility described in this Subsection (14)(b) in the state; and
             1602          (B) have an economic life of three or more years;
             1603          (c) amounts paid or charged for a purchase or lease made on or after January 1, 2008,
             1604      by an establishment described in NAICS Subsector 212, Mining (except Oil and Gas), or
             1605      NAICS Code 213113, Support Activities for Coal Mining, 213114, Support Activities for
             1606      Metal Mining, or 213115, Support Activities for Nonmetallic Minerals (except Fuels) Mining,
             1607      of the 2002 North American Industry Classification System of the federal Executive Office of
             1608      the President, Office of Management and Budget:


             1609          (i) machinery and equipment that:
             1610          (A) are used:
             1611          (I) (Aa) in the production process, other than the production of real property; or
             1612          (Bb) in research and development; and
             1613          (II) beginning on July 1, 2009, in an establishment described in this Subsection (14)(c)
             1614      in the state; and
             1615          (B) have an economic life of three or more years; and
             1616          (ii) normal operating repair or replacement parts that:
             1617          (A) have an economic life of three or more years; and
             1618          (B) are used in:
             1619          (I) (Aa) the production process, except for the production of real property; and
             1620          (Bb) an establishment described in this Subsection (14)(c) in the state; or
             1621          (II) (Aa) research and development; and
             1622          (Bb) in an establishment described in this Subsection (14)(c) in the state;
             1623          (d) for purposes of this Subsection (14) and in accordance with Title 63G, Chapter 3,
             1624      Utah Administrative Rulemaking Act, the commission:
             1625          (i) shall by rule define the term "establishment"; and
             1626          (ii) may by rule define what constitutes:
             1627          (A) processing an item sold as tangible personal property;
             1628          (B) the production process, except for the production of real property; or
             1629          (C) research and development; and
             1630          (e) on or before October 1, 2011, and every five years after October 1, 2011, the
             1631      commission shall:
             1632          (i) review the exemptions described in this Subsection (14) and make
             1633      recommendations to the Revenue and Taxation Interim Committee concerning whether the
             1634      exemptions should be continued, modified, or repealed; and
             1635          (ii) include in its report:
             1636          (A) an estimate of the cost of the exemptions;
             1637          (B) the purpose and effectiveness of the exemptions; and
             1638          (C) the benefits of the exemptions to the state;
             1639          (15) (a) sales of the following if the requirements of Subsection (15)(b) are met:


             1640          (i) tooling;
             1641          (ii) special tooling;
             1642          (iii) support equipment;
             1643          (iv) special test equipment; or
             1644          (v) parts used in the repairs or renovations of tooling or equipment described in
             1645      Subsections (15)(a)(i) through (iv); and
             1646          (b) sales of tooling, equipment, or parts described in Subsection (15)(a) are exempt if:
             1647          (i) the tooling, equipment, or parts are used or consumed exclusively in the
             1648      performance of any aerospace or electronics industry contract with the United States
             1649      government or any subcontract under that contract; and
             1650          (ii) under the terms of the contract or subcontract described in Subsection (15)(b)(i),
             1651      title to the tooling, equipment, or parts is vested in the United States government as evidenced
             1652      by:
             1653          (A) a government identification tag placed on the tooling, equipment, or parts; or
             1654          (B) listing on a government-approved property record if placing a government
             1655      identification tag on the tooling, equipment, or parts is impractical;
             1656          (16) sales of newspapers or newspaper subscriptions;
             1657          (17) (a) except as provided in Subsection (17)(b), tangible personal property or a
             1658      product transferred electronically traded in as full or part payment of the purchase price, except
             1659      that for purposes of calculating sales or use tax upon vehicles not sold by a vehicle dealer,
             1660      trade-ins are limited to other vehicles only, and the tax is based upon:
             1661          (i) the bill of sale or other written evidence of value of the vehicle being sold and the
             1662      vehicle being traded in; or
             1663          (ii) in the absence of a bill of sale or other written evidence of value, the then existing
             1664      fair market value of the vehicle being sold and the vehicle being traded in, as determined by the
             1665      commission; and
             1666          (b) notwithstanding Subsection (17)(a), Subsection (17)(a) does not apply to the
             1667      following items of tangible personal property or products transferred electronically traded in as
             1668      full or part payment of the purchase price:
             1669          (i) money;
             1670          (ii) electricity;


             1671          (iii) water;
             1672          (iv) gas; or
             1673          (v) steam;
             1674          (18) (a) (i) except as provided in Subsection (18)(b), sales of tangible personal property
             1675      or a product transferred electronically used or consumed primarily and directly in farming
             1676      operations, regardless of whether the tangible personal property or product transferred
             1677      electronically:
             1678          (A) becomes part of real estate; or
             1679          (B) is installed by a:
             1680          (I) farmer;
             1681          (II) contractor; or
             1682          (III) subcontractor; or
             1683          (ii) sales of parts used in the repairs or renovations of tangible personal property or a
             1684      product transferred electronically if the tangible personal property or product transferred
             1685      electronically is exempt under Subsection (18)(a)(i); and
             1686          (b) notwithstanding Subsection (18)(a), amounts paid or charged for the following are
             1687      subject to the taxes imposed by this chapter:
             1688          (i) (A) subject to Subsection (18)(b)(i)(B), the following if used in a manner that is
             1689      incidental to farming:
             1690          (I) machinery;
             1691          (II) equipment;
             1692          (III) materials; or
             1693          (IV) supplies; and
             1694          (B) tangible personal property that is considered to be used in a manner that is
             1695      incidental to farming includes:
             1696          (I) hand tools; or
             1697          (II) maintenance and janitorial equipment and supplies;
             1698          (ii) (A) subject to Subsection (18)(b)(ii)(B), tangible personal property or a product
             1699      transferred electronically if the tangible personal property or product transferred electronically
             1700      is used in an activity other than farming; and
             1701          (B) tangible personal property or a product transferred electronically that is considered


             1702      to be used in an activity other than farming includes:
             1703          (I) office equipment and supplies; or
             1704          (II) equipment and supplies used in:
             1705          (Aa) the sale or distribution of farm products;
             1706          (Bb) research; or
             1707          (Cc) transportation; or
             1708          (iii) a vehicle required to be registered by the laws of this state during the period
             1709      ending two years after the date of the vehicle's purchase;
             1710          (19) sales of hay;
             1711          (20) exclusive sale during the harvest season of seasonal crops, seedling plants, or
             1712      garden, farm, or other agricultural produce if the seasonal crops are, seedling plants are, or
             1713      garden, farm, or other agricultural produce is sold by:
             1714          (a) the producer of the seasonal crops, seedling plants, or garden, farm, or other
             1715      agricultural produce;
             1716          (b) an employee of the producer described in Subsection (20)(a); or
             1717          (c) a member of the immediate family of the producer described in Subsection (20)(a);
             1718          (21) purchases made using a coupon as defined in 7 U.S.C. Sec. 2012 that is issued
             1719      under the Food Stamp Program, 7 U.S.C. Sec. 2011 et seq.;
             1720          (22) sales of nonreturnable containers, nonreturnable labels, nonreturnable bags,
             1721      nonreturnable shipping cases, and nonreturnable casings to a manufacturer, processor,
             1722      wholesaler, or retailer for use in packaging tangible personal property to be sold by that
             1723      manufacturer, processor, wholesaler, or retailer;
             1724          (23) a product stored in the state for resale;
             1725          (24) (a) purchases of a product if:
             1726          (i) the product is:
             1727          (A) purchased outside of this state;
             1728          (B) brought into this state:
             1729          (I) at any time after the purchase described in Subsection (24)(a)(i)(A); and
             1730          (II) by a nonresident person who is not living or working in this state at the time of the
             1731      purchase;
             1732          (C) used for the personal use or enjoyment of the nonresident person described in


             1733      Subsection (24)(a)(i)(B)(II) while that nonresident person is within the state; and
             1734          (D) not used in conducting business in this state; and
             1735          (ii) for:
             1736          (A) a product other than a boat described in Subsection (24)(a)(ii)(B), the first use of
             1737      the product for a purpose for which the product is designed occurs outside of this state;
             1738          (B) a boat, the boat is registered outside of this state; or
             1739          (C) a vehicle other than a vehicle sold to an authorized carrier, the vehicle is registered
             1740      outside of this state;
             1741          (b) the exemption provided for in Subsection (24)(a) does not apply to:
             1742          (i) a lease or rental of a product; or
             1743          (ii) a sale of a vehicle exempt under Subsection (33); and
             1744          (c) in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, for
             1745      purposes of Subsection (24)(a), the commission may by rule define what constitutes the
             1746      following:
             1747          (i) conducting business in this state if that phrase has the same meaning in this
             1748      Subsection (24) as in Subsection (63);
             1749          (ii) the first use of a product if that phrase has the same meaning in this Subsection (24)
             1750      as in Subsection (63); or
             1751          (iii) a purpose for which a product is designed if that phrase has the same meaning in
             1752      this Subsection (24) as in Subsection (63);
             1753          (25) a product purchased for resale in this state, in the regular course of business, either
             1754      in its original form or as an ingredient or component part of a manufactured or compounded
             1755      product;
             1756          (26) a product upon which a sales or use tax was paid to some other state, or one of its
             1757      subdivisions, except that the state shall be paid any difference between the tax paid and the tax
             1758      imposed by this part and Part 2, Local Sales and Use Tax Act, and no adjustment is allowed if
             1759      the tax paid was greater than the tax imposed by this part and Part 2, Local Sales and Use Tax
             1760      Act;
             1761          (27) any sale of a service described in Subsections 59-12-103 (1)(b), (c), and (d) to a
             1762      person for use in compounding a service taxable under the subsections;
             1763          (28) purchases made in accordance with the special supplemental nutrition program for


             1764      women, infants, and children established in 42 U.S.C. Sec. 1786;
             1765          (29) beginning on July 1, 1999, through June 30, 2014, sales or leases of rolls, rollers,
             1766      refractory brick, electric motors, or other replacement parts used in the furnaces, mills, or ovens
             1767      of a steel mill described in SIC Code 3312 of the 1987 Standard Industrial Classification
             1768      Manual of the federal Executive Office of the President, Office of Management and Budget;
             1769          (30) sales of a boat of a type required to be registered under Title 73, Chapter 18, State
             1770      Boating Act, a boat trailer, or an outboard motor if the boat, boat trailer, or outboard motor is:
             1771          (a) not registered in this state; and
             1772          (b) (i) not used in this state; or
             1773          (ii) used in this state:
             1774          (A) if the boat, boat trailer, or outboard motor is not used to conduct business, for a
             1775      time period that does not exceed the longer of:
             1776          (I) 30 days in any calendar year; or
             1777          (II) the time period necessary to transport the boat, boat trailer, or outboard motor to
             1778      the borders of this state; or
             1779          (B) if the boat, boat trailer, or outboard motor is used to conduct business, for the time
             1780      period necessary to transport the boat, boat trailer, or outboard motor to the borders of this
             1781      state;
             1782          (31) sales of aircraft manufactured in Utah;
             1783          (32) amounts paid for the purchase of telecommunications service for purposes of
             1784      providing telecommunications service;
             1785          (33) sales, leases, or uses of the following:
             1786          (a) a vehicle by an authorized carrier; or
             1787          (b) tangible personal property that is installed on a vehicle:
             1788          (i) sold or leased to or used by an authorized carrier; and
             1789          (ii) before the vehicle is placed in service for the first time;
             1790          (34) (a) 45% of the sales price of any new manufactured home; and
             1791          (b) 100% of the sales price of any used manufactured home;
             1792          (35) sales relating to schools and fundraising sales;
             1793          (36) sales or rentals of durable medical equipment if:
             1794          (a) a person presents a prescription for the durable medical equipment; and


             1795          (b) the durable medical equipment is used for home use only;
             1796          (37) (a) sales to a ski resort of electricity to operate a passenger ropeway as defined in
             1797      Section 72-11-102 ; and
             1798          (b) the commission shall by rule determine the method for calculating sales exempt
             1799      under Subsection (37)(a) that are not separately metered and accounted for in utility billings;
             1800          (38) sales to a ski resort of:
             1801          (a) snowmaking equipment;
             1802          (b) ski slope grooming equipment;
             1803          (c) passenger ropeways as defined in Section 72-11-102 ; or
             1804          (d) parts used in the repairs or renovations of equipment or passenger ropeways
             1805      described in Subsections (38)(a) through (c);
             1806          (39) sales of natural gas, electricity, heat, coal, fuel oil, or other fuels for industrial use;
             1807          (40) (a) subject to Subsection (40)(b), sales or rentals of the right to use or operate for
             1808      amusement, entertainment, or recreation an unassisted amusement device as defined in Section
             1809      59-12-102 ;
             1810          (b) if a seller that sells or rents at the same business location the right to use or operate
             1811      for amusement, entertainment, or recreation one or more unassisted amusement devices and
             1812      one or more assisted amusement devices, the exemption described in Subsection (40)(a)
             1813      applies if the seller separately accounts for the sales or rentals of the right to use or operate for
             1814      amusement, entertainment, or recreation for the assisted amusement devices; and
             1815          (c) for purposes of Subsection (40)(b) and in accordance with Title 63G, Chapter 3,
             1816      Utah Administrative Rulemaking Act, the commission may make rules:
             1817          (i) governing the circumstances under which sales are at the same business location;
             1818      and
             1819          (ii) establishing the procedures and requirements for a seller to separately account for
             1820      the sales or rentals of the right to use or operate for amusement, entertainment, or recreation for
             1821      assisted amusement devices;
             1822          (41) (a) sales of photocopies by:
             1823          (i) a governmental entity; or
             1824          (ii) an entity within the state system of public education, including:
             1825          (A) a school; or


             1826          (B) the State Board of Education; or
             1827          (b) sales of publications by a governmental entity;
             1828          (42) amounts paid for admission to an athletic event at an institution of higher
             1829      education that is subject to the provisions of Title IX of the Education Amendments of 1972,
             1830      20 U.S.C. Sec. 1681 et seq.;
             1831          (43) (a) sales made to or by:
             1832          (i) an area agency on aging; or
             1833          (ii) a senior citizen center owned by a county, city, or town; or
             1834          (b) sales made by a senior citizen center that contracts with an area agency on aging;
             1835          (44) sales or leases of semiconductor fabricating, processing, research, or development
             1836      materials regardless of whether the semiconductor fabricating, processing, research, or
             1837      development materials:
             1838          (a) actually come into contact with a semiconductor; or
             1839          (b) ultimately become incorporated into real property;
             1840          (45) an amount paid by or charged to a purchaser for accommodations and services
             1841      described in Subsection 59-12-103 (1)(i) to the extent the amount is exempt under Section
             1842      59-12-104.2 ;
             1843          (46) beginning on September 1, 2001, the lease or use of a vehicle issued a temporary
             1844      sports event registration certificate in accordance with Section 41-3-306 for the event period
             1845      specified on the temporary sports event registration certificate;
             1846          (47) sales or uses of electricity, if the sales or uses are:
             1847          (a) made under a tariff adopted by the Public Service Commission of Utah only for
             1848      purchase of electricity produced from a new wind, geothermal, biomass, or solar power energy
             1849      source, as designated in the tariff by the Public Service Commission of Utah; and
             1850          (b) for an amount of electricity that is:
             1851          (i) unrelated to the amount of electricity used by the person purchasing the electricity
             1852      under the tariff described in Subsection (47)(a); and
             1853          (ii) equivalent to the number of kilowatthours specified in the tariff described in
             1854      Subsection (47)(a) that may be purchased under the tariff described in Subsection (47)(a);
             1855          (48) sales or rentals of mobility enhancing equipment if a person presents a
             1856      prescription for the mobility enhancing equipment;


             1857          (49) sales of water in a:
             1858          (a) pipe;
             1859          (b) conduit;
             1860          (c) ditch; or
             1861          (d) reservoir;
             1862          (50) sales of currency or coinage that constitute legal tender of the United States or of a
             1863      foreign nation;
             1864          (51) (a) sales of an item described in Subsection (51)(b) if the item:
             1865          (i) does not constitute legal tender of any nation; and
             1866          (ii) has a gold, silver, or platinum content of 80% or more; and
             1867          (b) Subsection (51)(a) applies to a gold, silver, or platinum:
             1868          (i) ingot;
             1869          (ii) bar;
             1870          (iii) medallion; or
             1871          (iv) decorative coin;
             1872          (52) amounts paid on a sale-leaseback transaction;
             1873          (53) sales of a prosthetic device:
             1874          (a) for use on or in a human; and
             1875          (b) (i) for which a prescription is required; or
             1876          (ii) if the prosthetic device is purchased by a hospital or other medical facility;
             1877          (54) (a) except as provided in Subsection (54)(b), purchases, leases, or rentals of
             1878      machinery or equipment by an establishment described in Subsection (54)(c) if the machinery
             1879      or equipment is primarily used in the production or postproduction of the following media for
             1880      commercial distribution:
             1881          (i) a motion picture;
             1882          (ii) a television program;
             1883          (iii) a movie made for television;
             1884          (iv) a music video;
             1885          (v) a commercial;
             1886          (vi) a documentary; or
             1887          (vii) a medium similar to Subsections (54)(a)(i) through (vi) as determined by the


             1888      commission by administrative rule made in accordance with Subsection (54)(d); or
             1889          (b) notwithstanding Subsection (54)(a), purchases, leases, or rentals of machinery or
             1890      equipment by an establishment described in Subsection (54)(c) that is used for the production
             1891      or postproduction of the following are subject to the taxes imposed by this chapter:
             1892          (i) a live musical performance;
             1893          (ii) a live news program; or
             1894          (iii) a live sporting event;
             1895          (c) the following establishments listed in the 1997 North American Industry
             1896      Classification System of the federal Executive Office of the President, Office of Management
             1897      and Budget, apply to Subsections (54)(a) and (b):
             1898          (i) NAICS Code 512110; or
             1899          (ii) NAICS Code 51219; and
             1900          (d) in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             1901      commission may by rule:
             1902          (i) prescribe what constitutes a medium similar to Subsections (54)(a)(i) through (vi);
             1903      or
             1904          (ii) define:
             1905          (A) "commercial distribution";
             1906          (B) "live musical performance";
             1907          (C) "live news program"; or
             1908          (D) "live sporting event";
             1909          (55) (a) leases of seven or more years or purchases made on or after July 1, 2004 but on
             1910      or before June 30, 2019, of machinery or equipment that:
             1911          (i) is leased or purchased for or by a facility that:
             1912          (A) is a renewable energy production facility;
             1913          (B) is located in the state; and
             1914          (C) (I) becomes operational on or after July 1, 2004; or
             1915          (II) has its generation capacity increased by one or more megawatts on or after July 1,
             1916      2004 as a result of the use of the machinery or equipment;
             1917          (ii) has an economic life of five or more years; and
             1918          (iii) is used to make the facility or the increase in capacity of the facility described in


             1919      Subsection (55)(a)(i) operational up to the point of interconnection with an existing
             1920      transmission grid including:
             1921          (A) a wind turbine;
             1922          (B) generating equipment;
             1923          (C) a control and monitoring system;
             1924          (D) a power line;
             1925          (E) substation equipment;
             1926          (F) lighting;
             1927          (G) fencing;
             1928          (H) pipes; or
             1929          (I) other equipment used for locating a power line or pole; and
             1930          (b) this Subsection (55) does not apply to:
             1931          (i) machinery or equipment used in construction of:
             1932          (A) a new renewable energy production facility; or
             1933          (B) the increase in the capacity of a renewable energy production facility;
             1934          (ii) contracted services required for construction and routine maintenance activities;
             1935      and
             1936          (iii) unless the machinery or equipment is used or acquired for an increase in capacity
             1937      of the facility described in Subsection (55)(a)(i)(C)(II), machinery or equipment used or
             1938      acquired after:
             1939          (A) the renewable energy production facility described in Subsection (55)(a)(i) is
             1940      operational as described in Subsection (55)(a)(iii); or
             1941          (B) the increased capacity described in Subsection (55)(a)(i) is operational as described
             1942      in Subsection (55)(a)(iii);
             1943          (56) (a) leases of seven or more years or purchases made on or after July 1, 2004 but on
             1944      or before June 30, 2019, of machinery or equipment that:
             1945          (i) is leased or purchased for or by a facility that:
             1946          (A) is a waste energy production facility;
             1947          (B) is located in the state; and
             1948          (C) (I) becomes operational on or after July 1, 2004; or
             1949          (II) has its generation capacity increased by one or more megawatts on or after July 1,


             1950      2004 as a result of the use of the machinery or equipment;
             1951          (ii) has an economic life of five or more years; and
             1952          (iii) is used to make the facility or the increase in capacity of the facility described in
             1953      Subsection (56)(a)(i) operational up to the point of interconnection with an existing
             1954      transmission grid including:
             1955          (A) generating equipment;
             1956          (B) a control and monitoring system;
             1957          (C) a power line;
             1958          (D) substation equipment;
             1959          (E) lighting;
             1960          (F) fencing;
             1961          (G) pipes; or
             1962          (H) other equipment used for locating a power line or pole; and
             1963          (b) this Subsection (56) does not apply to:
             1964          (i) machinery or equipment used in construction of:
             1965          (A) a new waste energy facility; or
             1966          (B) the increase in the capacity of a waste energy facility;
             1967          (ii) contracted services required for construction and routine maintenance activities;
             1968      and
             1969          (iii) unless the machinery or equipment is used or acquired for an increase in capacity
             1970      described in Subsection (56)(a)(i)(C)(II), machinery or equipment used or acquired after:
             1971          (A) the waste energy facility described in Subsection (56)(a)(i) is operational as
             1972      described in Subsection (56)(a)(iii); or
             1973          (B) the increased capacity described in Subsection (56)(a)(i) is operational as described
             1974      in Subsection (56)(a)(iii);
             1975          (57) (a) leases of five or more years or purchases made on or after July 1, 2004 but on
             1976      or before June 30, 2019, of machinery or equipment that:
             1977          (i) is leased or purchased for or by a facility that:
             1978          (A) is located in the state;
             1979          (B) produces fuel from biomass energy including:
             1980          (I) methanol; or


             1981          (II) ethanol; and
             1982          (C) (I) becomes operational on or after July 1, 2004; or
             1983          (II) has its capacity to produce fuel increase by 25% or more on or after July 1, 2004 as
             1984      a result of the installation of the machinery or equipment;
             1985          (ii) has an economic life of five or more years; and
             1986          (iii) is installed on the facility described in Subsection (57)(a)(i);
             1987          (b) this Subsection (57) does not apply to:
             1988          (i) machinery or equipment used in construction of:
             1989          (A) a new facility described in Subsection (57)(a)(i); or
             1990          (B) the increase in capacity of the facility described in Subsection (57)(a)(i); or
             1991          (ii) contracted services required for construction and routine maintenance activities;
             1992      and
             1993          (iii) unless the machinery or equipment is used or acquired for an increase in capacity
             1994      described in Subsection (57)(a)(i)(C)(II), machinery or equipment used or acquired after:
             1995          (A) the facility described in Subsection (57)(a)(i) is operational; or
             1996          (B) the increased capacity described in Subsection (57)(a)(i) is operational;
             1997          (58) (a) subject to Subsection (58)(b) or (c), sales of tangible personal property or a
             1998      product transferred electronically to a person within this state if that tangible personal property
             1999      or product transferred electronically is subsequently shipped outside the state and incorporated
             2000      pursuant to contract into and becomes a part of real property located outside of this state;
             2001          (b) the exemption under Subsection (58)(a) is not allowed to the extent that the other
             2002      state or political entity to which the tangible personal property is shipped imposes a sales, use,
             2003      gross receipts, or other similar transaction excise tax on the transaction against which the other
             2004      state or political entity allows a credit for sales and use taxes imposed by this chapter; and
             2005          (c) notwithstanding the time period of Subsection 59-1-1410 (8) for filing for a refund,
             2006      a person may claim the exemption allowed by this Subsection (58) for a sale by filing for a
             2007      refund:
             2008          (i) if the sale is made on or after July 1, 2004, but on or before June 30, 2008;
             2009          (ii) as if this Subsection (58) as in effect on July 1, 2008, were in effect on the day on
             2010      which the sale is made;
             2011          (iii) if the person did not claim the exemption allowed by this Subsection (58) for the


             2012      sale prior to filing for the refund;
             2013          (iv) for sales and use taxes paid under this chapter on the sale;
             2014          (v) in accordance with Section 59-1-1410 ; and
             2015          (vi) subject to any extension allowed for filing for a refund under Section 59-1-1410 , if
             2016      the person files for the refund on or before June 30, 2011;
             2017          (59) purchases:
             2018          (a) of one or more of the following items in printed or electronic format:
             2019          (i) a list containing information that includes one or more:
             2020          (A) names; or
             2021          (B) addresses; or
             2022          (ii) a database containing information that includes one or more:
             2023          (A) names; or
             2024          (B) addresses; and
             2025          (b) used to send direct mail;
             2026          (60) redemptions or repurchases of a product by a person if that product was:
             2027          (a) delivered to a pawnbroker as part of a pawn transaction; and
             2028          (b) redeemed or repurchased within the time period established in a written agreement
             2029      between the person and the pawnbroker for redeeming or repurchasing the product;
             2030          (61) (a) purchases or leases of an item described in Subsection (61)(b) if the item:
             2031          (i) is purchased or leased by, or on behalf of, a telecommunications service provider;
             2032      and
             2033          (ii) has a useful economic life of one or more years; and
             2034          (b) the following apply to Subsection (61)(a):
             2035          (i) telecommunications enabling or facilitating equipment, machinery, or software;
             2036          (ii) telecommunications equipment, machinery, or software required for 911 service;
             2037          (iii) telecommunications maintenance or repair equipment, machinery, or software;
             2038          (iv) telecommunications switching or routing equipment, machinery, or software; or
             2039          (v) telecommunications transmission equipment, machinery, or software;
             2040          (62) (a) beginning on July 1, 2006, and ending on June 30, 2016, purchases of tangible
             2041      personal property or a product transferred electronically that are used in the research and
             2042      development of coal-to-liquids, oil shale, or tar sands technology; and


             2043          (b) in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             2044      commission may, for purposes of Subsection (62)(a), make rules defining what constitutes
             2045      purchases of tangible personal property or a product transferred electronically that are used in
             2046      the research and development of coal-to-liquids, oil shale, and tar sands technology;
             2047          (63) (a) purchases of tangible personal property or a product transferred electronically
             2048      if:
             2049          (i) the tangible personal property or product transferred electronically is:
             2050          (A) purchased outside of this state;
             2051          (B) brought into this state at any time after the purchase described in Subsection
             2052      (63)(a)(i)(A); and
             2053          (C) used in conducting business in this state; and
             2054          (ii) for:
             2055          (A) tangible personal property or a product transferred electronically other than the
             2056      tangible personal property described in Subsection (63)(a)(ii)(B), the first use of the property
             2057      for a purpose for which the property is designed occurs outside of this state; or
             2058          (B) a vehicle other than a vehicle sold to an authorized carrier, the vehicle is registered
             2059      outside of this state;
             2060          (b) the exemption provided for in Subsection (63)(a) does not apply to:
             2061          (i) a lease or rental of tangible personal property or a product transferred electronically;
             2062      or
             2063          (ii) a sale of a vehicle exempt under Subsection (33); and
             2064          (c) in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, for
             2065      purposes of Subsection (63)(a), the commission may by rule define what constitutes the
             2066      following:
             2067          (i) conducting business in this state if that phrase has the same meaning in this
             2068      Subsection (63) as in Subsection (24);
             2069          (ii) the first use of tangible personal property or a product transferred electronically if
             2070      that phrase has the same meaning in this Subsection (63) as in Subsection (24); or
             2071          (iii) a purpose for which tangible personal property or a product transferred
             2072      electronically is designed if that phrase has the same meaning in this Subsection (63) as in
             2073      Subsection (24);


             2074          (64) sales of disposable home medical equipment or supplies if:
             2075          (a) a person presents a prescription for the disposable home medical equipment or
             2076      supplies;
             2077          (b) the disposable home medical equipment or supplies are used exclusively by the
             2078      person to whom the prescription described in Subsection (64)(a) is issued; and
             2079          (c) the disposable home medical equipment and supplies are listed as eligible for
             2080      payment under:
             2081          (i) Title XVIII, federal Social Security Act; or
             2082          (ii) the state plan for medical assistance under Title XIX, federal Social Security Act;
             2083          (65) sales:
             2084          (a) to a public transit district under Title 17B, Chapter 2a, Part 8, Public Transit
             2085      District Act; or
             2086          (b) of tangible personal property to a subcontractor of a public transit district, if the
             2087      tangible personal property is:
             2088          (i) clearly identified; and
             2089          (ii) installed or converted to real property owned by the public transit district;
             2090          (66) sales of construction materials:
             2091          (a) purchased on or after July 1, 2010;
             2092          (b) purchased by, on behalf of, or for the benefit of an international airport:
             2093          (i) located within a county of the first class; and
             2094          (ii) that has a United States customs office on its premises; and
             2095          (c) if the construction materials are:
             2096          (i) clearly identified;
             2097          (ii) segregated; and
             2098          (iii) installed or converted to real property:
             2099          (A) owned or operated by the international airport described in Subsection (66)(b); and
             2100          (B) located at the international airport described in Subsection (66)(b);
             2101          (67) sales of construction materials:
             2102          (a) purchased on or after July 1, 2008;
             2103          (b) purchased by, on behalf of, or for the benefit of a new airport:
             2104          (i) located within a county of the second class; and


             2105          (ii) that is owned or operated by a city in which an airline as defined in Section
             2106      59-2-102 is headquartered; and
             2107          (c) if the construction materials are:
             2108          (i) clearly identified;
             2109          (ii) segregated; and
             2110          (iii) installed or converted to real property:
             2111          (A) owned or operated by the new airport described in Subsection (67)(b);
             2112          (B) located at the new airport described in Subsection (67)(b); and
             2113          (C) as part of the construction of the new airport described in Subsection (67)(b); [and]
             2114          (68) sales of fuel to a common carrier that is a railroad for use in a locomotive
             2115      engine[.]; and
             2116          (69) purchases of:
             2117          (a) an energy efficient stove; or
             2118          (b) energy efficient stove fuel.
             2119          Section 3. Effective date.
             2120          This bill takes effect on July 1, 2010.




Legislative Review Note
    as of 2-2-10 11:59 AM


Office of Legislative Research and General Counsel


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