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First Substitute H.B. 157

Representative Brad J. Galvez proposes the following substitute bill:


             1     
CURRENCY AMENDMENTS

             2     
2012 GENERAL SESSION

             3     
STATE OF UTAH

             4     
Chief Sponsor: Brad J. Galvez

             5     
Senate Sponsor: John L. Valentine

             6     
             7      LONG TITLE
             8      General Description:
             9          This bill amends provisions related to currency.
             10      Highlighted Provisions:
             11          This bill:
             12          .    exempts specie legal tender from the Pawnshop and Secondhand Merchandise
             13      Transaction Information Act;
             14          .    addresses provisions related to specie legal tender, including:
             15              .    renaming the Legal Tender Act to the Specie Legal Tender Act;
             16              .    defining "specie legal tender" to mean gold or silver coin issued by the United
             17      States or certain other gold or silver coin if authorized by a court of competent
             18      jurisdiction or congress;
             19              .    providing that specie legal tender is legal tender in the state;
             20              .    providing that a person may not compel another person to tender or accept
             21      specie legal tender except as expressly provided by contract;
             22              .    repealing obsolete language;
             23              .    requiring the attorney general to enforce the Specie Legal Tender Act; and
             24              .    providing a severability clause;
             25          .    addresses an income tax credit for certain capital gains on a transaction involving


             26      legal tender;
             27          .    addresses a sales and use tax exemption for certain currency or coins;
             28          .    addresses the remittance of sales and use taxes on certain transactions involving
             29      specie legal tender;
             30          .    addresses the construction of a statute involving legal tender; and
             31          .    makes technical and conforming changes.
             32      Money Appropriated in this Bill:
             33          None
             34      Other Special Clauses:
             35          This bill provides an effective date.
             36          This bill provides for retrospective operation.
             37      Utah Code Sections Affected:
             38      AMENDS:
             39          13-32a-103.5, as enacted by Laws of Utah 2009, Chapter 272
             40          59-1-1501, as enacted by Laws of Utah 2011, Chapter 302
             41          59-1-1502, as enacted by Laws of Utah 2011, Chapter 302
             42          59-1-1503, as enacted by Laws of Utah 2011, Chapter 302
             43          59-10-1028, as enacted by Laws of Utah 2011, Chapter 302
             44          59-12-104, as last amended by Laws of Utah 2011, Chapters 288, 314, 370, and 391
             45          59-12-107, as last amended by Laws of Utah 2009, Chapter 212
             46      ENACTS:
             47          59-1-1501.1, Utah Code Annotated 1953
             48          59-1-1505, Utah Code Annotated 1953
             49          59-1-1506, Utah Code Annotated 1953
             50          68-3-15, Utah Code Annotated 1953
             51      REPEALS:
             52          59-1-1504, as enacted by Laws of Utah 2011, Chapter 302
             53     
             54      Be it enacted by the Legislature of the state of Utah:
             55          Section 1. Section 13-32a-103.5 is amended to read:
             56           13-32a-103.5. Applicability to coin dealers -- Specie legal tender exempt from


             57      chapter.
             58          (1) This chapter applies to coin dealers, except:
             59          (a) where provisions otherwise specifically address coin dealers[.]; or
             60          (b) as provided in Subsection (2).
             61          (2) Specie legal tender as defined in Section 59-1-1501.1 that is used as legal tender is
             62      exempt from this chapter.
             63          Section 2. Section 59-1-1501 is amended to read:
             64     
Part 15. Specie Legal Tender Act

             65           59-1-1501. Title.
             66          This part is known as the "Specie Legal Tender Act."
             67          Section 3. Section 59-1-1501.1 is enacted to read:
             68          59-1-1501.1. Definitions.
             69          Subject to Subsection 59-1-1502 (3), as used in this part, "specie legal tender" means
             70      gold or silver coin that is issued by the United States.
             71          Section 4. Section 59-1-1502 is amended to read:
             72           59-1-1502. Specie legal tender is legal tender in the state -- Person may not
             73      compel another person to tender or accept specie legal tender -- Court or congressional
             74      action to authorize gold or silver coin or bullion as legal tender.
             75          (1) [Gold and silver coin issued by the federal government] Specie legal tender is legal
             76      tender in the state.
             77          (2) [A] Except as expressly provided by contract, a person may not compel any other
             78      person to tender or accept [gold and silver coin that is issued by the federal government] specie
             79      legal tender.
             80          (3) Gold or silver coin or bullion, other than gold or silver coin that is issued by the
             81      United States, is considered to be specie legal tender and is legal tender in the state if:
             82          (a) a court of competent jurisdiction issues a final, unappealable judgment or order
             83      determining that the state may recognize the gold or silver coin or bullion, other than gold or
             84      silver coin that is issued by the United States, as legal tender in the state; or
             85          (b) congress enacts legislation that:
             86          (i) expressly provides that the gold or silver coin or bullion, other than gold or silver
             87      coin that is issued by the United States, is legal tender in the state; or


             88          (ii) expressly allows the state to recognize the gold or silver coin or bullion, other than
             89      gold or silver coin that is issued by the United States, as legal tender in the state.
             90          Section 5. Section 59-1-1503 is amended to read:
             91           59-1-1503. Nonrefundable credit -- Sales and use tax exemption -- Sales and use
             92      tax remittance.
             93          [(1) There is a nonrefundable credit established for any capital gains incurred from the
             94      exchange of gold and silver coin issued by the federal government for another form of legal
             95      tender as provided in Section 59-10-1028 .]
             96          (1) A nonrefundable individual income tax credit is allowed as provided in Section
             97      59-10-1028 related to a capital gain on a transaction involving the exchange of one form of
             98      legal tender for another form of legal tender.
             99          (2) [The exchange of gold and silver coin issued by the federal government for another
             100      form of legal tender is] Sales of currency or coin are exempt from sales and use taxes as
             101      provided in Subsection 59-12-104 (50).
             102          (3) The remittance of a sales and use tax on a transaction involving specie legal tender
             103      is as provided in Section 59-12-107 .
             104          Section 6. Section 59-1-1505 is enacted to read:
             105          59-1-1505. Attorney general to enforce part.
             106          The attorney general shall enforce this part.
             107          Section 7. Section 59-1-1506 is enacted to read:
             108          59-1-1506. Severability clause.
             109          If any provision of this part or the application of any provision to any person or
             110      circumstance is held invalid by a final decision of a court of competent jurisdiction, the
             111      remainder of this part shall be given effect without the invalid provision or application. The
             112      provisions of this part are severable.
             113          Section 8. Section 59-10-1028 is amended to read:
             114           59-10-1028. Nonrefundable tax credit for capital gain transactions on the
             115      exchange of one form of legal tender for another form of legal tender.
             116          (1) As used in this section:
             117          (a) "Capital gain transaction" means a transaction that results in a:
             118          (i) short-term capital gain; or


             119          (ii) long-term capital gain.
             120          (b) "Long-term capital gain" is as defined in Section 1222, Internal Revenue Code.
             121          (c) "Long-term capital loss" is as defined in Section 1222, Internal Revenue Code.
             122          (d) "Net capital gain" means the amount by which the sum of long-term capital gains
             123      and short-term capital gains on a claimant's, estate's, or trust's transactions from exchanges
             124      made for a taxable year of one form of legal tender for another form of legal tender exceeds the
             125      sum of long-term capital losses and short-term capital losses on those transactions for that
             126      taxable year.
             127          (e) "Short-term capital loss" is as defined in Section 1222, Internal Revenue Code.
             128          [(c)] (f) "Short-term capital gain" is as defined in Section 1222, Internal Revenue Code.
             129          (2) Except as provided in Section 59-10-1002.2 , for taxable years beginning on or after
             130      January 1, 2012, a claimant, estate, or trust may claim a nonrefundable tax credit equal to the
             131      product of:
             132          (a) [to the extent a capital gain is not offset by a capital loss under Chapter 1,
             133      Subchapter P, Capital Gains and Losses, Internal Revenue Code, the total] to the extent a net
             134      capital gain is included in taxable income, the amount of the claimant's, estate's, or trust's
             135      [short-term capital gain or long-term] net capital gain on [a] capital gain [transaction]
             136      transactions from [an exchange] exchanges made on or after January 1, 2012, [of gold or silver
             137      coin issued by the federal government] for a taxable year, of one form of legal tender for
             138      another form of legal tender; and
             139          (b) 5%.
             140          (3) A claimant, estate, or trust may not carry forward or carry back a tax credit under
             141      this section.
             142          (4) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             143      commission may make rules to implement this section.
             144          Section 9. Section 59-12-104 is amended to read:
             145           59-12-104. Exemptions.
             146          The following sales and uses are exempt from the taxes imposed by this chapter:
             147          (1) sales of aviation fuel, motor fuel, and special fuel subject to a Utah state excise tax
             148      under Chapter 13, Motor and Special Fuel Tax Act;
             149          (2) subject to Section 59-12-104.6 , sales to the state, its institutions, and its political


             150      subdivisions; however, this exemption does not apply to sales of:
             151          (a) construction materials except:
             152          (i) construction materials purchased by or on behalf of institutions of the public
             153      education system as defined in Utah Constitution Article X, Section 2, provided the
             154      construction materials are clearly identified and segregated and installed or converted to real
             155      property which is owned by institutions of the public education system; and
             156          (ii) construction materials purchased by the state, its institutions, or its political
             157      subdivisions which are installed or converted to real property by employees of the state, its
             158      institutions, or its political subdivisions; or
             159          (b) tangible personal property in connection with the construction, operation,
             160      maintenance, repair, or replacement of a project, as defined in Section 11-13-103 , or facilities
             161      providing additional project capacity, as defined in Section 11-13-103 ;
             162          (3) (a) sales of an item described in Subsection (3)(b) from a vending machine if:
             163          (i) the proceeds of each sale do not exceed $1; and
             164          (ii) the seller or operator of the vending machine reports an amount equal to 150% of
             165      the cost of the item described in Subsection (3)(b) as goods consumed; and
             166          (b) Subsection (3)(a) applies to:
             167          (i) food and food ingredients; or
             168          (ii) prepared food;
             169          (4) (a) sales of the following to a commercial airline carrier for in-flight consumption:
             170          (i) alcoholic beverages;
             171          (ii) food and food ingredients; or
             172          (iii) prepared food;
             173          (b) sales of tangible personal property or a product transferred electronically:
             174          (i) to a passenger;
             175          (ii) by a commercial airline carrier; and
             176          (iii) during a flight for in-flight consumption or in-flight use by the passenger; or
             177          (c) services related to Subsection (4)(a) or (b);
             178          (5) (a) (i) beginning on July 1, 2008, and ending on September 30, 2008, sales of parts
             179      and equipment:
             180          (A) (I) by an establishment described in NAICS Code 336411 or 336412 of the 2002


             181      North American Industry Classification System of the federal Executive Office of the
             182      President, Office of Management and Budget; and
             183          (II) for:
             184          (Aa) installation in an aircraft, including services relating to the installation of parts or
             185      equipment in the aircraft;
             186          (Bb) renovation of an aircraft; or
             187          (Cc) repair of an aircraft; or
             188          (B) for installation in an aircraft operated by a common carrier in interstate or foreign
             189      commerce; or
             190          (ii) beginning on October 1, 2008, sales of parts and equipment for installation in an
             191      aircraft operated by a common carrier in interstate or foreign commerce; and
             192          (b) notwithstanding the time period of Subsection 59-1-1410 (8) for filing for a refund,
             193      a person may claim the exemption allowed by Subsection (5)(a)(i)(B) for a sale by filing for a
             194      refund:
             195          (i) if the sale is made on or after July 1, 2008, but on or before September 30, 2008;
             196          (ii) as if Subsection (5)(a)(i)(B) were in effect on the day on which the sale is made;
             197          (iii) if the person did not claim the exemption allowed by Subsection (5)(a)(i)(B) for
             198      the sale prior to filing for the refund;
             199          (iv) for sales and use taxes paid under this chapter on the sale;
             200          (v) in accordance with Section 59-1-1410 ; and
             201          (vi) subject to any extension allowed for filing for a refund under Section 59-1-1410 , if
             202      the person files for the refund on or before September 30, 2011;
             203          (6) sales of commercials, motion picture films, prerecorded audio program tapes or
             204      records, and prerecorded video tapes by a producer, distributor, or studio to a motion picture
             205      exhibitor, distributor, or commercial television or radio broadcaster;
             206          (7) (a) subject to Subsection (7)(b), sales of cleaning or washing of tangible personal
             207      property if the cleaning or washing of the tangible personal property is not assisted cleaning or
             208      washing of tangible personal property;
             209          (b) if a seller that sells at the same business location assisted cleaning or washing of
             210      tangible personal property and cleaning or washing of tangible personal property that is not
             211      assisted cleaning or washing of tangible personal property, the exemption described in


             212      Subsection (7)(a) applies if the seller separately accounts for the sales of the assisted cleaning
             213      or washing of the tangible personal property; and
             214          (c) for purposes of Subsection (7)(b) and in accordance with Title 63G, Chapter 3,
             215      Utah Administrative Rulemaking Act, the commission may make rules:
             216          (i) governing the circumstances under which sales are at the same business location;
             217      and
             218          (ii) establishing the procedures and requirements for a seller to separately account for
             219      sales of assisted cleaning or washing of tangible personal property;
             220          (8) sales made to or by religious or charitable institutions in the conduct of their regular
             221      religious or charitable functions and activities, if the requirements of Section 59-12-104.1 are
             222      fulfilled;
             223          (9) sales of a vehicle of a type required to be registered under the motor vehicle laws of
             224      this state if the vehicle is:
             225          (a) not registered in this state; and
             226          (b) (i) not used in this state; or
             227          (ii) used in this state:
             228          (A) if the vehicle is not used to conduct business, for a time period that does not
             229      exceed the longer of:
             230          (I) 30 days in any calendar year; or
             231          (II) the time period necessary to transport the vehicle to the borders of this state; or
             232          (B) if the vehicle is used to conduct business, for the time period necessary to transport
             233      the vehicle to the borders of this state;
             234          (10) (a) amounts paid for an item described in Subsection (10)(b) if:
             235          (i) the item is intended for human use; and
             236          (ii) (A) a prescription was issued for the item; or
             237          (B) the item was purchased by a hospital or other medical facility; and
             238          (b) (i) Subsection (10)(a) applies to:
             239          (A) a drug;
             240          (B) a syringe; or
             241          (C) a stoma supply; and
             242          (ii) in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the


             243      commission may by rule define the terms:
             244          (A) "syringe"; or
             245          (B) "stoma supply";
             246          (11) sales or use of property, materials, or services used in the construction of or
             247      incorporated in pollution control facilities allowed by Sections 19-2-123 through 19-2-127 ;
             248          (12) (a) sales of an item described in Subsection (12)(c) served by:
             249          (i) the following if the item described in Subsection (12)(c) is not available to the
             250      general public:
             251          (A) a church; or
             252          (B) a charitable institution;
             253          (ii) an institution of higher education if:
             254          (A) the item described in Subsection (12)(c) is not available to the general public; or
             255          (B) the item described in Subsection (12)(c) is prepaid as part of a student meal plan
             256      offered by the institution of higher education; or
             257          (b) sales of an item described in Subsection (12)(c) provided for a patient by:
             258          (i) a medical facility; or
             259          (ii) a nursing facility; and
             260          (c) Subsections (12)(a) and (b) apply to:
             261          (i) food and food ingredients;
             262          (ii) prepared food; or
             263          (iii) alcoholic beverages;
             264          (13) (a) except as provided in Subsection (13)(b), the sale of tangible personal property
             265      or a product transferred electronically by a person:
             266          (i) regardless of the number of transactions involving the sale of that tangible personal
             267      property or product transferred electronically by that person; and
             268          (ii) not regularly engaged in the business of selling that type of tangible personal
             269      property or product transferred electronically;
             270          (b) this Subsection (13) does not apply if:
             271          (i) the sale is one of a series of sales of a character to indicate that the person is
             272      regularly engaged in the business of selling that type of tangible personal property or product
             273      transferred electronically;


             274          (ii) the person holds that person out as regularly engaged in the business of selling that
             275      type of tangible personal property or product transferred electronically;
             276          (iii) the person sells an item of tangible personal property or product transferred
             277      electronically that the person purchased as a sale that is exempt under Subsection (25); or
             278          (iv) the sale is of a vehicle or vessel required to be titled or registered under the laws of
             279      this state in which case the tax is based upon:
             280          (A) the bill of sale or other written evidence of value of the vehicle or vessel being
             281      sold; or
             282          (B) in the absence of a bill of sale or other written evidence of value, the fair market
             283      value of the vehicle or vessel being sold at the time of the sale as determined by the
             284      commission; and
             285          (c) in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             286      commission shall make rules establishing the circumstances under which:
             287          (i) a person is regularly engaged in the business of selling a type of tangible personal
             288      property or product transferred electronically;
             289          (ii) a sale of tangible personal property or a product transferred electronically is one of
             290      a series of sales of a character to indicate that a person is regularly engaged in the business of
             291      selling that type of tangible personal property or product transferred electronically; or
             292          (iii) a person holds that person out as regularly engaged in the business of selling a type
             293      of tangible personal property or product transferred electronically;
             294          (14) (a) except as provided in Subsection (14)(b), amounts paid or charged on or after
             295      July 1, 2006, for a purchase or lease by a manufacturing facility except for a cogeneration
             296      facility, of the following:
             297          (i) machinery and equipment that:
             298          (A) are used:
             299          (I) for a manufacturing facility except for a manufacturing facility that is a scrap
             300      recycler described in Subsection 59-12-102 (55)(b):
             301          (Aa) in the manufacturing process;
             302          (Bb) to manufacture an item sold as tangible personal property; and
             303          (Cc) beginning on July 1, 2009, in a manufacturing facility described in this Subsection
             304      (14)(a)(i)(A)(I) in the state; or


             305          (II) for a manufacturing facility that is a scrap recycler described in Subsection
             306      59-12-102 (55)(b):
             307          (Aa) to process an item sold as tangible personal property; and
             308          (Bb) beginning on July 1, 2009, in a manufacturing facility described in this Subsection
             309      (14)(a)(i)(A)(II) in the state; and
             310          (B) have an economic life of three or more years; and
             311          (ii) normal operating repair or replacement parts that:
             312          (A) have an economic life of three or more years; and
             313          (B) are used:
             314          (I) for a manufacturing facility except for a manufacturing facility that is a scrap
             315      recycler described in Subsection 59-12-102 (55)(b):
             316          (Aa) in the manufacturing process; and
             317          (Bb) in a manufacturing facility described in this Subsection (14)(a)(ii)(B)(I) in the
             318      state; or
             319          (II) for a manufacturing facility that is a scrap recycler described in Subsection
             320      59-12-102 (55)(b):
             321          (Aa) to process an item sold as tangible personal property; and
             322          (Bb) in a manufacturing facility described in this Subsection (14)(a)(ii)(B)(II) in the
             323      state;
             324          (b) amounts paid or charged on or after July 1, 2005, for a purchase or lease by a
             325      manufacturing facility that is a cogeneration facility placed in service on or after May 1, 2006,
             326      of the following:
             327          (i) machinery and equipment that:
             328          (A) are used:
             329          (I) in the manufacturing process;
             330          (II) to manufacture an item sold as tangible personal property; and
             331          (III) beginning on July 1, 2009, in a manufacturing facility described in this Subsection
             332      (14)(b) in the state; and
             333          (B) have an economic life of three or more years; and
             334          (ii) normal operating repair or replacement parts that:
             335          (A) are used:


             336          (I) in the manufacturing process; and
             337          (II) in a manufacturing facility described in this Subsection (14)(b) in the state; and
             338          (B) have an economic life of three or more years;
             339          (c) amounts paid or charged for a purchase or lease made on or after January 1, 2008,
             340      by an establishment described in NAICS Subsector 212, Mining (except Oil and Gas), or
             341      NAICS Code 213113, Support Activities for Coal Mining, 213114, Support Activities for
             342      Metal Mining, or 213115, Support Activities for Nonmetallic Minerals (except Fuels) Mining,
             343      of the 2002 North American Industry Classification System of the federal Executive Office of
             344      the President, Office of Management and Budget, of the following:
             345          (i) machinery and equipment that:
             346          (A) are used:
             347          (I) (Aa) in the production process, other than the production of real property; or
             348          (Bb) in research and development; and
             349          (II) beginning on July 1, 2009, in an establishment described in this Subsection (14)(c)
             350      in the state; and
             351          (B) have an economic life of three or more years; and
             352          (ii) normal operating repair or replacement parts that:
             353          (A) have an economic life of three or more years; and
             354          (B) are used in:
             355          (I) (Aa) the production process, except for the production of real property; and
             356          (Bb) an establishment described in this Subsection (14)(c) in the state; or
             357          (II) (Aa) research and development; and
             358          (Bb) in an establishment described in this Subsection (14)(c) in the state;
             359          (d) (i) amounts paid or charged for a purchase or lease made on or after July 1, 2010,
             360      but on or before June 30, 2014, by an establishment described in NAICS Code 518112, Web
             361      Search Portals, of the 2002 North American Industry Classification System of the federal
             362      Executive Office of the President, Office of Management and Budget, of the following:
             363          (A) machinery and equipment that:
             364          (I) are used in the operation of the web search portal;
             365          (II) have an economic life of three or more years; and
             366          (III) are used in a new or expanding establishment described in this Subsection (14)(d)


             367      in the state; and
             368          (B) normal operating repair or replacement parts that:
             369          (I) are used in the operation of the web search portal;
             370          (II) have an economic life of three or more years; and
             371          (III) are used in a new or expanding establishment described in this Subsection (14)(d)
             372      in the state; or
             373          (ii) amounts paid or charged for a purchase or lease made on or after July 1, 2014, by
             374      an establishment described in NAICS Code 518112, Web Search Portals, of the 2002 North
             375      American Industry Classification System of the federal Executive Office of the President,
             376      Office of Management and Budget, of the following:
             377          (A) machinery and equipment that:
             378          (I) are used in the operation of the web search portal; and
             379          (II) have an economic life of three or more years; and
             380          (B) normal operating repair or replacement parts that:
             381          (I) are used in the operation of the web search portal; and
             382          (II) have an economic life of three or more years;
             383          (e) for purposes of this Subsection (14) and in accordance with Title 63G, Chapter 3,
             384      Utah Administrative Rulemaking Act, the commission:
             385          (i) shall by rule define the term "establishment"; and
             386          (ii) may by rule define what constitutes:
             387          (A) processing an item sold as tangible personal property;
             388          (B) the production process, except for the production of real property;
             389          (C) research and development; or
             390          (D) a new or expanding establishment described in Subsection (14)(d) in the state; and
             391          (f) on or before October 1, 2011, and every five years after October 1, 2011, the
             392      commission shall:
             393          (i) review the exemptions described in this Subsection (14) and make
             394      recommendations to the Revenue and Taxation Interim Committee concerning whether the
             395      exemptions should be continued, modified, or repealed; and
             396          (ii) include in its report:
             397          (A) an estimate of the cost of the exemptions;


             398          (B) the purpose and effectiveness of the exemptions; and
             399          (C) the benefits of the exemptions to the state;
             400          (15) (a) sales of the following if the requirements of Subsection (15)(b) are met:
             401          (i) tooling;
             402          (ii) special tooling;
             403          (iii) support equipment;
             404          (iv) special test equipment; or
             405          (v) parts used in the repairs or renovations of tooling or equipment described in
             406      Subsections (15)(a)(i) through (iv); and
             407          (b) sales of tooling, equipment, or parts described in Subsection (15)(a) are exempt if:
             408          (i) the tooling, equipment, or parts are used or consumed exclusively in the
             409      performance of any aerospace or electronics industry contract with the United States
             410      government or any subcontract under that contract; and
             411          (ii) under the terms of the contract or subcontract described in Subsection (15)(b)(i),
             412      title to the tooling, equipment, or parts is vested in the United States government as evidenced
             413      by:
             414          (A) a government identification tag placed on the tooling, equipment, or parts; or
             415          (B) listing on a government-approved property record if placing a government
             416      identification tag on the tooling, equipment, or parts is impractical;
             417          (16) sales of newspapers or newspaper subscriptions;
             418          (17) (a) except as provided in Subsection (17)(b), tangible personal property or a
             419      product transferred electronically traded in as full or part payment of the purchase price, except
             420      that for purposes of calculating sales or use tax upon vehicles not sold by a vehicle dealer,
             421      trade-ins are limited to other vehicles only, and the tax is based upon:
             422          (i) the bill of sale or other written evidence of value of the vehicle being sold and the
             423      vehicle being traded in; or
             424          (ii) in the absence of a bill of sale or other written evidence of value, the then existing
             425      fair market value of the vehicle being sold and the vehicle being traded in, as determined by the
             426      commission; and
             427          (b) notwithstanding Subsection (17)(a), Subsection (17)(a) does not apply to the
             428      following items of tangible personal property or products transferred electronically traded in as


             429      full or part payment of the purchase price:
             430          (i) money;
             431          (ii) electricity;
             432          (iii) water;
             433          (iv) gas; or
             434          (v) steam;
             435          (18) (a) (i) except as provided in Subsection (18)(b), sales of tangible personal property
             436      or a product transferred electronically used or consumed primarily and directly in farming
             437      operations, regardless of whether the tangible personal property or product transferred
             438      electronically:
             439          (A) becomes part of real estate; or
             440          (B) is installed by a:
             441          (I) farmer;
             442          (II) contractor; or
             443          (III) subcontractor; or
             444          (ii) sales of parts used in the repairs or renovations of tangible personal property or a
             445      product transferred electronically if the tangible personal property or product transferred
             446      electronically is exempt under Subsection (18)(a)(i); and
             447          (b) notwithstanding Subsection (18)(a), amounts paid or charged for the following are
             448      subject to the taxes imposed by this chapter:
             449          (i) (A) subject to Subsection (18)(b)(i)(B), the following if used in a manner that is
             450      incidental to farming:
             451          (I) machinery;
             452          (II) equipment;
             453          (III) materials; or
             454          (IV) supplies; and
             455          (B) tangible personal property that is considered to be used in a manner that is
             456      incidental to farming includes:
             457          (I) hand tools; or
             458          (II) maintenance and janitorial equipment and supplies;
             459          (ii) (A) subject to Subsection (18)(b)(ii)(B), tangible personal property or a product


             460      transferred electronically if the tangible personal property or product transferred electronically
             461      is used in an activity other than farming; and
             462          (B) tangible personal property or a product transferred electronically that is considered
             463      to be used in an activity other than farming includes:
             464          (I) office equipment and supplies; or
             465          (II) equipment and supplies used in:
             466          (Aa) the sale or distribution of farm products;
             467          (Bb) research; or
             468          (Cc) transportation; or
             469          (iii) a vehicle required to be registered by the laws of this state during the period
             470      ending two years after the date of the vehicle's purchase;
             471          (19) sales of hay;
             472          (20) exclusive sale during the harvest season of seasonal crops, seedling plants, or
             473      garden, farm, or other agricultural produce if the seasonal crops are, seedling plants are, or
             474      garden, farm, or other agricultural produce is sold by:
             475          (a) the producer of the seasonal crops, seedling plants, or garden, farm, or other
             476      agricultural produce;
             477          (b) an employee of the producer described in Subsection (20)(a); or
             478          (c) a member of the immediate family of the producer described in Subsection (20)(a);
             479          (21) purchases made using a coupon as defined in 7 U.S.C. Sec. 2012 that is issued
             480      under the Food Stamp Program, 7 U.S.C. Sec. 2011 et seq.;
             481          (22) sales of nonreturnable containers, nonreturnable labels, nonreturnable bags,
             482      nonreturnable shipping cases, and nonreturnable casings to a manufacturer, processor,
             483      wholesaler, or retailer for use in packaging tangible personal property to be sold by that
             484      manufacturer, processor, wholesaler, or retailer;
             485          (23) a product stored in the state for resale;
             486          (24) (a) purchases of a product if:
             487          (i) the product is:
             488          (A) purchased outside of this state;
             489          (B) brought into this state:
             490          (I) at any time after the purchase described in Subsection (24)(a)(i)(A); and


             491          (II) by a nonresident person who is not living or working in this state at the time of the
             492      purchase;
             493          (C) used for the personal use or enjoyment of the nonresident person described in
             494      Subsection (24)(a)(i)(B)(II) while that nonresident person is within the state; and
             495          (D) not used in conducting business in this state; and
             496          (ii) for:
             497          (A) a product other than a boat described in Subsection (24)(a)(ii)(B), the first use of
             498      the product for a purpose for which the product is designed occurs outside of this state;
             499          (B) a boat, the boat is registered outside of this state; or
             500          (C) a vehicle other than a vehicle sold to an authorized carrier, the vehicle is registered
             501      outside of this state;
             502          (b) the exemption provided for in Subsection (24)(a) does not apply to:
             503          (i) a lease or rental of a product; or
             504          (ii) a sale of a vehicle exempt under Subsection (33); and
             505          (c) in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, for
             506      purposes of Subsection (24)(a), the commission may by rule define what constitutes the
             507      following:
             508          (i) conducting business in this state if that phrase has the same meaning in this
             509      Subsection (24) as in Subsection (63);
             510          (ii) the first use of a product if that phrase has the same meaning in this Subsection (24)
             511      as in Subsection (63); or
             512          (iii) a purpose for which a product is designed if that phrase has the same meaning in
             513      this Subsection (24) as in Subsection (63);
             514          (25) a product purchased for resale in this state, in the regular course of business, either
             515      in its original form or as an ingredient or component part of a manufactured or compounded
             516      product;
             517          (26) a product upon which a sales or use tax was paid to some other state, or one of its
             518      subdivisions, except that the state shall be paid any difference between the tax paid and the tax
             519      imposed by this part and Part 2, Local Sales and Use Tax Act, and no adjustment is allowed if
             520      the tax paid was greater than the tax imposed by this part and Part 2, Local Sales and Use Tax
             521      Act;


             522          (27) any sale of a service described in Subsections 59-12-103 (1)(b), (c), and (d) to a
             523      person for use in compounding a service taxable under the subsections;
             524          (28) purchases made in accordance with the special supplemental nutrition program for
             525      women, infants, and children established in 42 U.S.C. Sec. 1786;
             526          (29) beginning on July 1, 1999, through June 30, 2014, sales or leases of rolls, rollers,
             527      refractory brick, electric motors, or other replacement parts used in the furnaces, mills, or ovens
             528      of a steel mill described in SIC Code 3312 of the 1987 Standard Industrial Classification
             529      Manual of the federal Executive Office of the President, Office of Management and Budget;
             530          (30) sales of a boat of a type required to be registered under Title 73, Chapter 18, State
             531      Boating Act, a boat trailer, or an outboard motor if the boat, boat trailer, or outboard motor is:
             532          (a) not registered in this state; and
             533          (b) (i) not used in this state; or
             534          (ii) used in this state:
             535          (A) if the boat, boat trailer, or outboard motor is not used to conduct business, for a
             536      time period that does not exceed the longer of:
             537          (I) 30 days in any calendar year; or
             538          (II) the time period necessary to transport the boat, boat trailer, or outboard motor to
             539      the borders of this state; or
             540          (B) if the boat, boat trailer, or outboard motor is used to conduct business, for the time
             541      period necessary to transport the boat, boat trailer, or outboard motor to the borders of this
             542      state;
             543          (31) sales of aircraft manufactured in Utah;
             544          (32) amounts paid for the purchase of telecommunications service for purposes of
             545      providing telecommunications service;
             546          (33) sales, leases, or uses of the following:
             547          (a) a vehicle by an authorized carrier; or
             548          (b) tangible personal property that is installed on a vehicle:
             549          (i) sold or leased to or used by an authorized carrier; and
             550          (ii) before the vehicle is placed in service for the first time;
             551          (34) (a) 45% of the sales price of any new manufactured home; and
             552          (b) 100% of the sales price of any used manufactured home;


             553          (35) sales relating to schools and fundraising sales;
             554          (36) sales or rentals of durable medical equipment if:
             555          (a) a person presents a prescription for the durable medical equipment; and
             556          (b) the durable medical equipment is used for home use only;
             557          (37) (a) sales to a ski resort of electricity to operate a passenger ropeway as defined in
             558      Section 72-11-102 ; and
             559          (b) the commission shall by rule determine the method for calculating sales exempt
             560      under Subsection (37)(a) that are not separately metered and accounted for in utility billings;
             561          (38) sales to a ski resort of:
             562          (a) snowmaking equipment;
             563          (b) ski slope grooming equipment;
             564          (c) passenger ropeways as defined in Section 72-11-102 ; or
             565          (d) parts used in the repairs or renovations of equipment or passenger ropeways
             566      described in Subsections (38)(a) through (c);
             567          (39) sales of natural gas, electricity, heat, coal, fuel oil, or other fuels for industrial use;
             568          (40) (a) subject to Subsection (40)(b), sales or rentals of the right to use or operate for
             569      amusement, entertainment, or recreation an unassisted amusement device as defined in Section
             570      59-12-102 ;
             571          (b) if a seller that sells or rents at the same business location the right to use or operate
             572      for amusement, entertainment, or recreation one or more unassisted amusement devices and
             573      one or more assisted amusement devices, the exemption described in Subsection (40)(a)
             574      applies if the seller separately accounts for the sales or rentals of the right to use or operate for
             575      amusement, entertainment, or recreation for the assisted amusement devices; and
             576          (c) for purposes of Subsection (40)(b) and in accordance with Title 63G, Chapter 3,
             577      Utah Administrative Rulemaking Act, the commission may make rules:
             578          (i) governing the circumstances under which sales are at the same business location;
             579      and
             580          (ii) establishing the procedures and requirements for a seller to separately account for
             581      the sales or rentals of the right to use or operate for amusement, entertainment, or recreation for
             582      assisted amusement devices;
             583          (41) (a) sales of photocopies by:


             584          (i) a governmental entity; or
             585          (ii) an entity within the state system of public education, including:
             586          (A) a school; or
             587          (B) the State Board of Education; or
             588          (b) sales of publications by a governmental entity;
             589          (42) amounts paid for admission to an athletic event at an institution of higher
             590      education that is subject to the provisions of Title IX of the Education Amendments of 1972,
             591      20 U.S.C. Sec. 1681 et seq.;
             592          (43) (a) sales made to or by:
             593          (i) an area agency on aging; or
             594          (ii) a senior citizen center owned by a county, city, or town; or
             595          (b) sales made by a senior citizen center that contracts with an area agency on aging;
             596          (44) sales or leases of semiconductor fabricating, processing, research, or development
             597      materials regardless of whether the semiconductor fabricating, processing, research, or
             598      development materials:
             599          (a) actually come into contact with a semiconductor; or
             600          (b) ultimately become incorporated into real property;
             601          (45) an amount paid by or charged to a purchaser for accommodations and services
             602      described in Subsection 59-12-103 (1)(i) to the extent the amount is exempt under Section
             603      59-12-104.2 ;
             604          (46) beginning on September 1, 2001, the lease or use of a vehicle issued a temporary
             605      sports event registration certificate in accordance with Section 41-3-306 for the event period
             606      specified on the temporary sports event registration certificate;
             607          (47) sales or uses of electricity, if the sales or uses are:
             608          (a) made under a tariff adopted by the Public Service Commission of Utah only for
             609      purchase of electricity produced from a new wind, geothermal, biomass, or solar power energy
             610      source, as designated in the tariff by the Public Service Commission of Utah; and
             611          (b) for an amount of electricity that is:
             612          (i) unrelated to the amount of electricity used by the person purchasing the electricity
             613      under the tariff described in Subsection (47)(a); and
             614          (ii) equivalent to the number of kilowatthours specified in the tariff described in


             615      Subsection (47)(a) that may be purchased under the tariff described in Subsection (47)(a);
             616          (48) sales or rentals of mobility enhancing equipment if a person presents a
             617      prescription for the mobility enhancing equipment;
             618          (49) sales of water in a:
             619          (a) pipe;
             620          (b) conduit;
             621          (c) ditch; or
             622          (d) reservoir;
             623          (50) sales of currency or [coinage] coins that constitute legal tender of a state, the
             624      United States, or [of] a foreign nation;
             625          (51) (a) sales of an item described in Subsection (51)(b) if the item:
             626          (i) does not constitute legal tender of [any nation] a state, the United States, or a
             627      foreign nation; and
             628          (ii) has a gold, silver, or platinum content of [80%] 50% or more; and
             629          (b) Subsection (51)(a) applies to a gold, silver, or platinum:
             630          (i) ingot;
             631          (ii) bar;
             632          (iii) medallion; or
             633          (iv) decorative coin;
             634          (52) amounts paid on a sale-leaseback transaction;
             635          (53) sales of a prosthetic device:
             636          (a) for use on or in a human; and
             637          (b) (i) for which a prescription is required; or
             638          (ii) if the prosthetic device is purchased by a hospital or other medical facility;
             639          (54) (a) except as provided in Subsection (54)(b), purchases, leases, or rentals of
             640      machinery or equipment by an establishment described in Subsection (54)(c) if the machinery
             641      or equipment is primarily used in the production or postproduction of the following media for
             642      commercial distribution:
             643          (i) a motion picture;
             644          (ii) a television program;
             645          (iii) a movie made for television;


             646          (iv) a music video;
             647          (v) a commercial;
             648          (vi) a documentary; or
             649          (vii) a medium similar to Subsections (54)(a)(i) through (vi) as determined by the
             650      commission by administrative rule made in accordance with Subsection (54)(d); or
             651          (b) notwithstanding Subsection (54)(a), purchases, leases, or rentals of machinery or
             652      equipment by an establishment described in Subsection (54)(c) that is used for the production
             653      or postproduction of the following are subject to the taxes imposed by this chapter:
             654          (i) a live musical performance;
             655          (ii) a live news program; or
             656          (iii) a live sporting event;
             657          (c) the following establishments listed in the 1997 North American Industry
             658      Classification System of the federal Executive Office of the President, Office of Management
             659      and Budget, apply to Subsections (54)(a) and (b):
             660          (i) NAICS Code 512110; or
             661          (ii) NAICS Code 51219; and
             662          (d) in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             663      commission may by rule:
             664          (i) prescribe what constitutes a medium similar to Subsections (54)(a)(i) through (vi);
             665      or
             666          (ii) define:
             667          (A) "commercial distribution";
             668          (B) "live musical performance";
             669          (C) "live news program"; or
             670          (D) "live sporting event";
             671          (55) (a) leases of seven or more years or purchases made on or after July 1, 2004, but
             672      on or before June 30, 2019, of machinery or equipment that:
             673          (i) is leased or purchased for or by a facility that:
             674          (A) is a renewable energy production facility;
             675          (B) is located in the state; and
             676          (C) (I) becomes operational on or after July 1, 2004; or


             677          (II) has its generation capacity increased by one or more megawatts on or after July 1,
             678      2004, as a result of the use of the machinery or equipment;
             679          (ii) has an economic life of five or more years; and
             680          (iii) is used to make the facility or the increase in capacity of the facility described in
             681      Subsection (55)(a)(i) operational up to the point of interconnection with an existing
             682      transmission grid including:
             683          (A) a wind turbine;
             684          (B) generating equipment;
             685          (C) a control and monitoring system;
             686          (D) a power line;
             687          (E) substation equipment;
             688          (F) lighting;
             689          (G) fencing;
             690          (H) pipes; or
             691          (I) other equipment used for locating a power line or pole; and
             692          (b) this Subsection (55) does not apply to:
             693          (i) machinery or equipment used in construction of:
             694          (A) a new renewable energy production facility; or
             695          (B) the increase in the capacity of a renewable energy production facility;
             696          (ii) contracted services required for construction and routine maintenance activities;
             697      and
             698          (iii) unless the machinery or equipment is used or acquired for an increase in capacity
             699      of the facility described in Subsection (55)(a)(i)(C)(II), machinery or equipment used or
             700      acquired after:
             701          (A) the renewable energy production facility described in Subsection (55)(a)(i) is
             702      operational as described in Subsection (55)(a)(iii); or
             703          (B) the increased capacity described in Subsection (55)(a)(i) is operational as described
             704      in Subsection (55)(a)(iii);
             705          (56) (a) leases of seven or more years or purchases made on or after July 1, 2004, but
             706      on or before June 30, 2019, of machinery or equipment that:
             707          (i) is leased or purchased for or by a facility that:


             708          (A) is a waste energy production facility;
             709          (B) is located in the state; and
             710          (C) (I) becomes operational on or after July 1, 2004; or
             711          (II) has its generation capacity increased by one or more megawatts on or after July 1,
             712      2004, as a result of the use of the machinery or equipment;
             713          (ii) has an economic life of five or more years; and
             714          (iii) is used to make the facility or the increase in capacity of the facility described in
             715      Subsection (56)(a)(i) operational up to the point of interconnection with an existing
             716      transmission grid including:
             717          (A) generating equipment;
             718          (B) a control and monitoring system;
             719          (C) a power line;
             720          (D) substation equipment;
             721          (E) lighting;
             722          (F) fencing;
             723          (G) pipes; or
             724          (H) other equipment used for locating a power line or pole; and
             725          (b) this Subsection (56) does not apply to:
             726          (i) machinery or equipment used in construction of:
             727          (A) a new waste energy facility; or
             728          (B) the increase in the capacity of a waste energy facility;
             729          (ii) contracted services required for construction and routine maintenance activities;
             730      and
             731          (iii) unless the machinery or equipment is used or acquired for an increase in capacity
             732      described in Subsection (56)(a)(i)(C)(II), machinery or equipment used or acquired after:
             733          (A) the waste energy facility described in Subsection (56)(a)(i) is operational as
             734      described in Subsection (56)(a)(iii); or
             735          (B) the increased capacity described in Subsection (56)(a)(i) is operational as described
             736      in Subsection (56)(a)(iii);
             737          (57) (a) leases of five or more years or purchases made on or after July 1, 2004 but on
             738      or before June 30, 2019, of machinery or equipment that:


             739          (i) is leased or purchased for or by a facility that:
             740          (A) is located in the state;
             741          (B) produces fuel from biomass energy including:
             742          (I) methanol; or
             743          (II) ethanol; and
             744          (C) (I) becomes operational on or after July 1, 2004; or
             745          (II) has its capacity to produce fuel increase by 25% or more on or after July 1, 2004, as
             746      a result of the installation of the machinery or equipment;
             747          (ii) has an economic life of five or more years; and
             748          (iii) is installed on the facility described in Subsection (57)(a)(i);
             749          (b) this Subsection (57) does not apply to:
             750          (i) machinery or equipment used in construction of:
             751          (A) a new facility described in Subsection (57)(a)(i); or
             752          (B) the increase in capacity of the facility described in Subsection (57)(a)(i); or
             753          (ii) contracted services required for construction and routine maintenance activities;
             754      and
             755          (iii) unless the machinery or equipment is used or acquired for an increase in capacity
             756      described in Subsection (57)(a)(i)(C)(II), machinery or equipment used or acquired after:
             757          (A) the facility described in Subsection (57)(a)(i) is operational; or
             758          (B) the increased capacity described in Subsection (57)(a)(i) is operational;
             759          (58) (a) subject to Subsection (58)(b) or (c), sales of tangible personal property or a
             760      product transferred electronically to a person within this state if that tangible personal property
             761      or product transferred electronically is subsequently shipped outside the state and incorporated
             762      pursuant to contract into and becomes a part of real property located outside of this state;
             763          (b) the exemption under Subsection (58)(a) is not allowed to the extent that the other
             764      state or political entity to which the tangible personal property is shipped imposes a sales, use,
             765      gross receipts, or other similar transaction excise tax on the transaction against which the other
             766      state or political entity allows a credit for sales and use taxes imposed by this chapter; and
             767          (c) notwithstanding the time period of Subsection 59-1-1410 (8) for filing for a refund,
             768      a person may claim the exemption allowed by this Subsection (58) for a sale by filing for a
             769      refund:


             770          (i) if the sale is made on or after July 1, 2004, but on or before June 30, 2008;
             771          (ii) as if this Subsection (58) as in effect on July 1, 2008, were in effect on the day on
             772      which the sale is made;
             773          (iii) if the person did not claim the exemption allowed by this Subsection (58) for the
             774      sale prior to filing for the refund;
             775          (iv) for sales and use taxes paid under this chapter on the sale;
             776          (v) in accordance with Section 59-1-1410 ; and
             777          (vi) subject to any extension allowed for filing for a refund under Section 59-1-1410 , if
             778      the person files for the refund on or before June 30, 2011;
             779          (59) purchases:
             780          (a) of one or more of the following items in printed or electronic format:
             781          (i) a list containing information that includes one or more:
             782          (A) names; or
             783          (B) addresses; or
             784          (ii) a database containing information that includes one or more:
             785          (A) names; or
             786          (B) addresses; and
             787          (b) used to send direct mail;
             788          (60) redemptions or repurchases of a product by a person if that product was:
             789          (a) delivered to a pawnbroker as part of a pawn transaction; and
             790          (b) redeemed or repurchased within the time period established in a written agreement
             791      between the person and the pawnbroker for redeeming or repurchasing the product;
             792          (61) (a) purchases or leases of an item described in Subsection (61)(b) if the item:
             793          (i) is purchased or leased by, or on behalf of, a telecommunications service provider;
             794      and
             795          (ii) has a useful economic life of one or more years; and
             796          (b) the following apply to Subsection (61)(a):
             797          (i) telecommunications enabling or facilitating equipment, machinery, or software;
             798          (ii) telecommunications equipment, machinery, or software required for 911 service;
             799          (iii) telecommunications maintenance or repair equipment, machinery, or software;
             800          (iv) telecommunications switching or routing equipment, machinery, or software; or


             801          (v) telecommunications transmission equipment, machinery, or software;
             802          (62) (a) beginning on July 1, 2006, and ending on June 30, 2016, purchases of tangible
             803      personal property or a product transferred electronically that are used in the research and
             804      development of coal-to-liquids, oil shale, or tar sands technology; and
             805          (b) in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             806      commission may, for purposes of Subsection (62)(a), make rules defining what constitutes
             807      purchases of tangible personal property or a product transferred electronically that are used in
             808      the research and development of coal-to-liquids, oil shale, and tar sands technology;
             809          (63) (a) purchases of tangible personal property or a product transferred electronically
             810      if:
             811          (i) the tangible personal property or product transferred electronically is:
             812          (A) purchased outside of this state;
             813          (B) brought into this state at any time after the purchase described in Subsection
             814      (63)(a)(i)(A); and
             815          (C) used in conducting business in this state; and
             816          (ii) for:
             817          (A) tangible personal property or a product transferred electronically other than the
             818      tangible personal property described in Subsection (63)(a)(ii)(B), the first use of the property
             819      for a purpose for which the property is designed occurs outside of this state; or
             820          (B) a vehicle other than a vehicle sold to an authorized carrier, the vehicle is registered
             821      outside of this state;
             822          (b) the exemption provided for in Subsection (63)(a) does not apply to:
             823          (i) a lease or rental of tangible personal property or a product transferred electronically;
             824      or
             825          (ii) a sale of a vehicle exempt under Subsection (33); and
             826          (c) in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, for
             827      purposes of Subsection (63)(a), the commission may by rule define what constitutes the
             828      following:
             829          (i) conducting business in this state if that phrase has the same meaning in this
             830      Subsection (63) as in Subsection (24);
             831          (ii) the first use of tangible personal property or a product transferred electronically if


             832      that phrase has the same meaning in this Subsection (63) as in Subsection (24); or
             833          (iii) a purpose for which tangible personal property or a product transferred
             834      electronically is designed if that phrase has the same meaning in this Subsection (63) as in
             835      Subsection (24);
             836          (64) sales of disposable home medical equipment or supplies if:
             837          (a) a person presents a prescription for the disposable home medical equipment or
             838      supplies;
             839          (b) the disposable home medical equipment or supplies are used exclusively by the
             840      person to whom the prescription described in Subsection (64)(a) is issued; and
             841          (c) the disposable home medical equipment and supplies are listed as eligible for
             842      payment under:
             843          (i) Title XVIII, federal Social Security Act; or
             844          (ii) the state plan for medical assistance under Title XIX, federal Social Security Act;
             845          (65) sales:
             846          (a) to a public transit district under Title 17B, Chapter 2a, Part 8, Public Transit
             847      District Act; or
             848          (b) of tangible personal property to a subcontractor of a public transit district, if the
             849      tangible personal property is:
             850          (i) clearly identified; and
             851          (ii) installed or converted to real property owned by the public transit district;
             852          (66) sales of construction materials:
             853          (a) purchased on or after July 1, 2010;
             854          (b) purchased by, on behalf of, or for the benefit of an international airport:
             855          (i) located within a county of the first class; and
             856          (ii) that has a United States customs office on its premises; and
             857          (c) if the construction materials are:
             858          (i) clearly identified;
             859          (ii) segregated; and
             860          (iii) installed or converted to real property:
             861          (A) owned or operated by the international airport described in Subsection (66)(b); and
             862          (B) located at the international airport described in Subsection (66)(b);


             863          (67) sales of construction materials:
             864          (a) purchased on or after July 1, 2008;
             865          (b) purchased by, on behalf of, or for the benefit of a new airport:
             866          (i) located within a county of the second class; and
             867          (ii) that is owned or operated by a city in which an airline as defined in Section
             868      59-2-102 is headquartered; and
             869          (c) if the construction materials are:
             870          (i) clearly identified;
             871          (ii) segregated; and
             872          (iii) installed or converted to real property:
             873          (A) owned or operated by the new airport described in Subsection (67)(b);
             874          (B) located at the new airport described in Subsection (67)(b); and
             875          (C) as part of the construction of the new airport described in Subsection (67)(b);
             876          (68) sales of fuel to a common carrier that is a railroad for use in a locomotive engine;
             877          (69) purchases and sales described in Section 63H-4-111 ;
             878          (70) (a) sales of tangible personal property to an aircraft maintenance, repair, and
             879      overhaul provider for use in the maintenance, repair, overhaul, or refurbishment in this state of
             880      a fixed wing turbine powered aircraft if that fixed wing turbine powered aircraft's registration
             881      lists a state or country other than this state as the location of registry of the fixed wing turbine
             882      powered aircraft; or
             883          (b) sales of tangible personal property by an aircraft maintenance, repair, and overhaul
             884      provider in connection with the maintenance, repair, overhaul, or refurbishment in this state of
             885      a fixed wing turbine powered aircraft if that fixed wing turbine powered aircraft's registration
             886      lists a state or country other than this state as the location of registry of the fixed wing turbine
             887      powered aircraft;
             888          (71) subject to Section 59-12-104.4 , sales of a textbook for a higher education course:
             889          (a) to a person admitted to an institution of higher education; and
             890          (b) by a seller, other than a bookstore owned by an institution of higher education, if
             891      51% or more of that seller's sales revenue for the previous calendar quarter are sales of a
             892      textbook for a higher education course; and
             893          (72) a license fee or tax a municipality imposes in accordance with Subsection


             894      10-1-203 (5) on a purchaser from a business for which the municipality provides an enhanced
             895      level of municipal services.
             896          Section 10. Section 59-12-107 is amended to read:
             897           59-12-107. Collection, remittance, and payment of tax by sellers or other persons
             898      -- Returns -- Reports -- Direct payment by purchaser of vehicle -- Other liability for
             899      collection -- Rulemaking authority -- Credits -- Treatment of bad debt -- Penalties.
             900          (1) (a) Except as provided in Subsection (1)(d) or Section 59-12-107.1 or 59-12-123
             901      and subject to Subsection (1)(e), each seller shall pay or collect and remit the sales and use
             902      taxes imposed by this chapter if within this state the seller:
             903          (i) has or utilizes:
             904          (A) an office;
             905          (B) a distribution house;
             906          (C) a sales house;
             907          (D) a warehouse;
             908          (E) a service enterprise; or
             909          (F) a place of business similar to Subsections (1)(a)(i)(A) through (E);
             910          (ii) maintains a stock of goods;
             911          (iii) regularly solicits orders, regardless of whether or not the orders are accepted in the
             912      state, unless the seller's only activity in the state is:
             913          (A) advertising; or
             914          (B) solicitation by:
             915          (I) direct mail;
             916          (II) electronic mail;
             917          (III) the Internet;
             918          (IV) telecommunications service; or
             919          (V) a means similar to Subsection (1)(a)(iii)(A) or (B);
             920          (iv) regularly engages in the delivery of property in the state other than by:
             921          (A) common carrier; or
             922          (B) United States mail; or
             923          (v) regularly engages in an activity directly related to the leasing or servicing of
             924      property located within the state.


             925          (b) A seller that does not meet one or more of the criteria provided for in Subsection
             926      (1)(a):
             927          (i) except as provided in Subsection (1)(b)(ii), may voluntarily:
             928          (A) collect a tax on a transaction described in Subsection 59-12-103 (1); and
             929          (B) remit the tax to the commission as provided in this part; or
             930          (ii) notwithstanding Subsection (1)(b)(i), shall collect a tax on a transaction described
             931      in Subsection 59-12-103 (1) if Section 59-12-103.1 requires the seller to collect the tax.
             932          (c) The collection and remittance of a tax under this chapter by a seller that is
             933      registered under the agreement may not be used as a factor in determining whether that seller is
             934      required by Subsection (1)(a) to:
             935          (i) pay a tax, fee, or charge under:
             936          (A) Title 10, Chapter 1, Part 3, Municipal Energy Sales and Use Tax Act;
             937          (B) Title 10, Chapter 1, Part 4, Municipal Telecommunications License Tax Act;
             938          (C) Section 19-6-714 ;
             939          (D) Section 19-6-805 ;
             940          (E) Section 69-2-5 ;
             941          (F) Section 69-2-5.5 ;
             942          (G) Section 69-2-5.6 ; or
             943          (H) this title; or
             944          (ii) collect and remit a tax, fee, or charge under:
             945          (A) Title 10, Chapter 1, Part 3, Municipal Energy Sales and Use Tax Act;
             946          (B) Title 10, Chapter 1, Part 4, Municipal Telecommunications License Tax Act;
             947          (C) Section 19-6-714 ;
             948          (D) Section 19-6-805 ;
             949          (E) Section 69-2-5 ;
             950          (F) Section 69-2-5.5 ;
             951          (G) Section 69-2-5.6 ; or
             952          (H) this title.
             953          (d) A person shall pay a use tax imposed by this chapter on a transaction described in
             954      Subsection 59-12-103 (1) if:
             955          (i) the seller did not collect a tax imposed by this chapter on the transaction; and


             956          (ii) the person:
             957          (A) stores the tangible personal property or product transferred electronically in the
             958      state;
             959          (B) uses the tangible personal property or product transferred electronically in the state;
             960      or
             961          (C) consumes the tangible personal property or product transferred electronically in the
             962      state.
             963          (e) The ownership of property that is located at the premises of a printer's facility with
             964      which the retailer has contracted for printing and that consists of the final printed product,
             965      property that becomes a part of the final printed product, or copy from which the printed
             966      product is produced, shall not result in the retailer being considered to have or maintain an
             967      office, distribution house, sales house, warehouse, service enterprise, or other place of
             968      business, or to maintain a stock of goods, within this state.
             969          (f) (i) As used in this Subsection (1)(f):
             970          (A) "Affiliated group" is as defined in Section 59-7-101 , except that "affiliated group"
             971      includes a corporation that is qualified to do business but is not otherwise doing business in
             972      this state.
             973          (B) "Common ownership" is as defined in Section 59-7-101 .
             974          (C) "Related seller" means a seller that:
             975          (I) is not required to pay or collect and remit sales and use taxes under Subsection
             976      (1)(a) or Section 59-12-103.1 ;
             977          (II) is:
             978          (Aa) related to a seller that is required to pay or collect and remit sales and use taxes
             979      under Subsection (1)(a) as part of an affiliated group or because of common ownership; or
             980          (Bb) a limited liability company owned by the parent corporation of an affiliated group
             981      if that parent corporation of the affiliated group is required to pay or collect and remit sales and
             982      use taxes under Subsection (1)(a); and
             983          (III) does not voluntarily collect and remit a tax under Subsection (1)(b)(i).
             984          (ii) A seller is not required to pay or collect and remit sales and use taxes under
             985      Subsection (1)(a):
             986          (A) if the seller is a related seller;


             987          (B) if the seller to which the related seller is related does not engage in any of the
             988      following activities on behalf of the related seller:
             989          (I) advertising;
             990          (II) marketing;
             991          (III) sales; or
             992          (IV) other services; and
             993          (C) if the seller to which the related seller is related accepts the return of an item sold
             994      by the related seller, the seller to which the related seller is related accepts the return of that
             995      item:
             996          (I) sold by a seller that is not a related seller; and
             997          (II) on the same terms as the return of an item sold by that seller to which the related
             998      seller is related.
             999          (2) (a) Except as provided in Section 59-12-107.1 , a tax under this chapter shall be
             1000      collected from a purchaser.
             1001          (b) A seller may not collect as tax an amount, without regard to fractional parts of one
             1002      cent, in excess of the tax computed at the rates prescribed by this chapter.
             1003          (c) (i) Each seller shall:
             1004          (A) give the purchaser a receipt for the tax collected; or
             1005          (B) bill the tax as a separate item and declare the name of this state and the seller's
             1006      sales and use tax license number on the invoice for the sale.
             1007          (ii) The receipt or invoice is prima facie evidence that the seller has collected the tax
             1008      and relieves the purchaser of the liability for reporting the tax to the commission as a
             1009      consumer.
             1010          (d) A seller is not required to maintain a separate account for the tax collected, but is
             1011      considered to be a person charged with receipt, safekeeping, and transfer of public money.
             1012          (e) Taxes collected by a seller pursuant to this chapter shall be held in trust for the
             1013      benefit of the state and for payment to the commission in the manner and at the time provided
             1014      for in this chapter.
             1015          (f) If any seller, during any reporting period, collects as a tax an amount in excess of
             1016      the lawful state and local percentage of total taxable sales allowed under this chapter, the seller
             1017      shall remit to the commission the full amount of the tax imposed under this chapter, plus any


             1018      excess.
             1019          (g) If the accounting methods regularly employed by the seller in the transaction of the
             1020      seller's business are such that reports of sales made during a calendar month or quarterly period
             1021      will impose unnecessary hardships, the commission may accept reports at intervals that will, in
             1022      the commission's opinion, better suit the convenience of the taxpayer or seller and will not
             1023      jeopardize collection of the tax.
             1024          (h) (i) For a purchase paid with specie legal tender as defined in Section 59-1-1501.1 ,
             1025      and until such time as the commission accepts specie legal tender for the payment of a tax
             1026      under this chapter, if the commission requires a seller to remit a tax under this chapter in legal
             1027      tender other than specie legal tender, the seller shall state on the seller's books and records and
             1028      on an invoice, bill of sale, or similar document provided to the purchaser:
             1029          (A) the purchase price in specie legal tender and in the legal tender the seller is
             1030      required to remit to the commission;
             1031          (B) subject to Subsection (2)(h)(ii), the amount of tax due under this chapter in specie
             1032      legal tender and in the legal tender the seller is required to remit to the commission;
             1033          (C) the tax rate under this chapter applicable to the purchase; and
             1034          (D) the date of the purchase.
             1035          (ii) (A) Subject to Subsection (2)(h)(ii)(B), for purposes of determining the amount of
             1036      tax due under Subsection (2)(h)(i), a seller shall use the most recent London fixing price for the
             1037      specie legal tender the purchaser paid.
             1038          (B) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             1039      commission may make rules for determining the amount of tax due under Subsection (2)(h)(i)
             1040      if the London fixing price is not available for a particular day.
             1041          (3) (a) Except as provided in Subsections (4) through (6) and Section 59-12-108 , the
             1042      sales or use tax imposed by this chapter is due and payable to the commission quarterly on or
             1043      before the last day of the month next succeeding each calendar quarterly period.
             1044          (b) (i) Each seller shall, on or before the last day of the month next succeeding each
             1045      calendar quarterly period, file with the commission a return for the preceding quarterly period.
             1046          (ii) The seller shall remit with the return under Subsection (3)(b)(i) the amount of the
             1047      tax required under this chapter to be collected or paid for the period covered by the return.
             1048          (c) Except as provided in Subsection (4)(c), a return shall contain information and be in


             1049      a form the commission prescribes by rule.
             1050          (d) The sales tax as computed in the return shall be based upon the total nonexempt
             1051      sales made during the period, including both cash and charge sales.
             1052          (e) The use tax as computed in the return shall be based upon the total amount of
             1053      purchases for storage, use, or other consumption in this state made during the period, including
             1054      both by cash and by charge.
             1055          (f) (i) Subject to Subsection (3)(f)(ii) and in accordance with Title 63G, Chapter 3,
             1056      Utah Administrative Rulemaking Act, the commission may by rule extend the time for making
             1057      returns and paying the taxes.
             1058          (ii) An extension under Subsection (3)(f)(i) may not be for more than 90 days.
             1059          (g) The commission may require returns and payment of the tax to be made for other
             1060      than quarterly periods if the commission considers it necessary in order to ensure the payment
             1061      of the tax imposed by this chapter.
             1062          (h) (i) The commission may require a seller that files a simplified electronic return with
             1063      the commission to file an additional electronic report with the commission.
             1064          (ii) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             1065      commission may make rules providing:
             1066          (A) the information required to be included in the additional electronic report described
             1067      in Subsection (3)(h)(i); and
             1068          (B) one or more due dates for filing the additional electronic report described in
             1069      Subsection (3)(h)(i).
             1070          (4) (a) As used in this Subsection (4) and Subsection (5)(b), "remote seller" means a
             1071      seller that is:
             1072          (i) registered under the agreement;
             1073          (ii) described in Subsection (1)(b); and
             1074          (iii) not a:
             1075          (A) model 1 seller;
             1076          (B) model 2 seller; or
             1077          (C) model 3 seller.
             1078          (b) (i) Except as provided in Subsection (4)(b)(ii), a tax a remote seller collects in
             1079      accordance with Subsection (1)(b) is due and payable:


             1080          (A) to the commission;
             1081          (B) annually; and
             1082          (C) on or before the last day of the month immediately following the last day of each
             1083      calendar year.
             1084          (ii) The commission may require that a tax a remote seller collects in accordance with
             1085      Subsection (1)(b) be due and payable:
             1086          (A) to the commission; and
             1087          (B) on the last day of the month immediately following any month in which the seller
             1088      accumulates a total of at least $1,000 in agreement sales and use tax.
             1089          (c) (i) If a remote seller remits a tax to the commission in accordance with Subsection
             1090      (4)(b), the remote seller shall file a return:
             1091          (A) with the commission;
             1092          (B) with respect to the tax;
             1093          (C) containing information prescribed by the commission; and
             1094          (D) on a form prescribed by the commission.
             1095          (ii) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             1096      commission shall make rules prescribing:
             1097          (A) the information required to be contained in a return described in Subsection
             1098      (4)(a)(i); and
             1099          (B) the form described in Subsection (4)(c)(i)(D).
             1100          (d) A tax a remote seller collects in accordance with this Subsection (4) shall be
             1101      calculated on the basis of the total amount of taxable transactions under Subsection
             1102      59-12-103 (1) the remote seller completes, including:
             1103          (i) a cash transaction; and
             1104          (ii) a charge transaction.
             1105          (5) (a) Except as provided in Subsection (5)(b), a tax a seller that files a simplified
             1106      electronic return collects in accordance with this chapter is due and payable:
             1107          (i) monthly on or before the last day of the month immediately following the month for
             1108      which the seller collects a tax under this chapter; and
             1109          (ii) for the month for which the seller collects a tax under this chapter.
             1110          (b) A tax a remote seller that files a simplified electronic return collects in accordance


             1111      with this chapter is due and payable as provided in Subsection (4).
             1112          (6) (a) On each vehicle sale made by other than a regular licensed vehicle dealer, the
             1113      purchaser shall pay the sales or use tax directly to the commission if the vehicle is subject to
             1114      titling or registration under the laws of this state.
             1115          (b) The commission shall collect the tax described in Subsection (6)(a) when the
             1116      vehicle is titled or registered.
             1117          (7) If any sale of tangible personal property or any other taxable transaction under
             1118      Subsection 59-12-103 (1), is made by a wholesaler to a retailer, the wholesaler is not
             1119      responsible for the collection or payment of the tax imposed on the sale and the retailer is
             1120      responsible for the collection or payment of the tax imposed on the sale if:
             1121          (a) the retailer represents that the personal property is purchased by the retailer for
             1122      resale; and
             1123          (b) the personal property is not subsequently resold.
             1124          (8) If any sale of property or service subject to the tax is made to a person prepaying
             1125      sales or use tax in accordance with Title 63M, Chapter 5, Resource Development Act, or to a
             1126      contractor or subcontractor of that person, the person to whom such payment or consideration
             1127      is payable is not responsible for the collection or payment of the sales or use tax and the person
             1128      prepaying the sales or use tax is responsible for the collection or payment of the sales or use tax
             1129      if the person prepaying the sales or use tax represents that the amount prepaid as sales or use
             1130      tax has not been fully credited against sales or use tax due and payable under the rules
             1131      promulgated by the commission.
             1132          (9) (a) For purposes of this Subsection (9):
             1133          (i) Except as provided in Subsection (9)(a)(ii), "bad debt" is as defined in Section 166,
             1134      Internal Revenue Code.
             1135          (ii) Notwithstanding Subsection (9)(a)(i), "bad debt" does not include:
             1136          (A) an amount included in the purchase price of tangible personal property, a product
             1137      transferred electronically, or a service that is:
             1138          (I) not a transaction described in Subsection 59-12-103 (1); or
             1139          (II) exempt under Section 59-12-104 ;
             1140          (B) a financing charge;
             1141          (C) interest;


             1142          (D) a tax imposed under this chapter on the purchase price of tangible personal
             1143      property, a product transferred electronically, or a service;
             1144          (E) an uncollectible amount on tangible personal property or a product transferred
             1145      electronically that:
             1146          (I) is subject to a tax under this chapter; and
             1147          (II) remains in the possession of a seller until the full purchase price is paid;
             1148          (F) an expense incurred in attempting to collect any debt; or
             1149          (G) an amount that a seller does not collect on repossessed property.
             1150          (b) A seller may deduct bad debt from the total amount from which a tax under this
             1151      chapter is calculated on a return.
             1152          (c) A seller may file a refund claim with the commission if:
             1153          (i) the amount of bad debt for the time period described in Subsection (9)(e) exceeds
             1154      the amount of the seller's sales that are subject to a tax under this chapter for that same time
             1155      period; and
             1156          (ii) as provided in Section 59-1-1410 .
             1157          (d) A bad debt deduction under this section may not include interest.
             1158          (e) A bad debt may be deducted under this Subsection (9) on a return for the time
             1159      period during which the bad debt:
             1160          (i) is written off as uncollectible in the seller's books and records; and
             1161          (ii) would be eligible for a bad debt deduction:
             1162          (A) for federal income tax purposes; and
             1163          (B) if the seller were required to file a federal income tax return.
             1164          (f) If a seller recovers any portion of bad debt for which the seller makes a deduction or
             1165      claims a refund under this Subsection (9), the seller shall report and remit a tax under this
             1166      chapter:
             1167          (i) on the portion of the bad debt the seller recovers; and
             1168          (ii) on a return filed for the time period for which the portion of the bad debt is
             1169      recovered.
             1170          (g) For purposes of reporting a recovery of a portion of bad debt under Subsection
             1171      (9)(f), a seller shall apply amounts received on the bad debt in the following order:
             1172          (i) in a proportional amount:


             1173          (A) to the purchase price of the tangible personal property, product transferred
             1174      electronically, or service; and
             1175          (B) to the tax due under this chapter on the tangible personal property, product
             1176      transferred electronically, or service; and
             1177          (ii) to:
             1178          (A) interest charges;
             1179          (B) service charges; and
             1180          (C) other charges.
             1181          (h) A seller's certified service provider may make a deduction or claim a refund for bad
             1182      debt on behalf of the seller:
             1183          (i) in accordance with this Subsection (9); and
             1184          (ii) if the certified service provider credits or refunds the entire amount of the bad debt
             1185      deduction or refund to the seller.
             1186          (i) A seller may allocate bad debt among the states that are members of the agreement
             1187      if the seller's books and records support that allocation.
             1188          (10) (a) A seller may not, with intent to evade any tax, fail to timely remit the full
             1189      amount of tax required by this chapter.
             1190          (b) A violation of this section is punishable as provided in Section 59-1-401 .
             1191          (c) Each person who fails to pay any tax to the state or any amount of tax required to be
             1192      paid to the state, except amounts determined to be due by the commission under Chapter 1,
             1193      Part 14, Assessment, Collections, and Refunds Act, or Section 59-12-111 , within the time
             1194      required by this chapter, or who fails to file any return as required by this chapter, shall pay, in
             1195      addition to the tax, penalties and interest as provided in Section 59-1-401 .
             1196          (d) For purposes of prosecution under this section, each quarterly tax period in which a
             1197      seller, with intent to evade any tax, collects a tax and fails to timely remit the full amount of the
             1198      tax required to be remitted, constitutes a separate offense.
             1199          Section 11. Section 68-3-15 is enacted to read:
             1200          68-3-15. Construction of certain statutes related to legal tender.
             1201          A statute may not be construed so as to create a significant impediment to the use of
             1202      one form of legal tender over another form of legal tender in a private transaction.
             1203          Section 12. Repealer.


             1204          This bill repeals:
             1205          Section 59-1-1504, Revenue and Taxation Interim Committee study.
             1206          Section 13. Effective date -- Retrospective operation.
             1207          (1) Except as provided in Subsections (2) and (3), this bill takes effect on May 8, 2012.
             1208          (2) The amendments to Sections 59-12-104 and 59-12-107 take effect on July 1, 2012.
             1209          (3) The amendments to Section 59-10-1028 have retrospective operation for a taxable
             1210      year beginning on or after January 1, 2012.


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