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S.B. 237

This document includes Senate Committee Amendments incorporated into the bill on Tue, Mar 5, 2013 at 10:20 AM by cmillar. -->              1     

TAXATION OF SHORT-TERM LODGING

             2     
2013 GENERAL SESSION

             3     
STATE OF UTAH

             4     
Chief Sponsor: J. Stuart Adams

             5     
House Sponsor: Brad R. Wilson

             6     

             7      LONG TITLE
             8      General Description:
             9          This bill addresses the taxation of short-term lodging.
             10      Highlighted Provisions:
             11          This bill:
             12          .    defines terms;
             13          .    addresses the transactions related to short-term lodging that are subject to state and
             14      local sales and use taxes;
             15          .    addresses sales and use tax exemptions related to short-term lodging;
             16          .    addresses the remittance of sales and use taxes related to short-term lodging; and
             17          .    makes technical and conforming changes.
             18      Money Appropriated in this Bill:
             19          None
             20      Other Special Clauses:
             21          This bill provides effective dates.
             22      Utah Code Sections Affected:
             23      AMENDS:
             24          59-12-102 (Superseded 07/01/14), as last amended by Laws of Utah 2012, Chapters
             25      255, 312, 405, and 410
             26          59-12-102 (Effective 07/01/14), as last amended by Laws of Utah 2012, Chapters 255,
             27      312, 405, 410, and 424



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             28
         59-12-103 (Superseded 07/01/14), as last amended by Laws of Utah 2012, Chapters
             29      207, 212, 254, and 255
             30          59-12-103 (Effective 07/01/14), as last amended by Laws of Utah 2012, Chapters 207,
             31      212, 254, 255, and 424
             32          59-12-104, as last amended by Laws of Utah 2012, Chapters 255, 399, 405, and 410
             33          59-12-104.2, as last amended by Laws of Utah 2009, Chapter 203
             34          59-12-104.6, as enacted by Laws of Utah 2011, Chapter 288
             35          59-12-107, as last amended by Laws of Utah 2012, Chapters 178, 312, and 399
             36          59-12-107.1, as last amended by Laws of Utah 2008, Chapters 382 and 384
             37          59-12-301, as last amended by Laws of Utah 2012, Chapter 369
             38          59-12-352, as last amended by Laws of Utah 2009, Chapter 92
             39          59-12-353, as last amended by Laws of Utah 2004, Chapters 156 and 255
             40          59-12-603, as last amended by Laws of Utah 2011, Chapter 309
             41     

             42      Be it enacted by the Legislature of the state of Utah:
             43          Section 1. Section 59-12-102 (Superseded 07/01/14) is amended to read:
             44           59-12-102 (Superseded 07/01/14). Definitions.
             45          As used in this chapter:
             46          (1) "800 service" means a telecommunications service that:
             47          (a) allows a caller to dial a toll-free number without incurring a charge for the call; and
             48          (b) is typically marketed:
             49          (i) under the name 800 toll-free calling;
             50          (ii) under the name 855 toll-free calling;
             51          (iii) under the name 866 toll-free calling;
             52          (iv) under the name 877 toll-free calling;
             53          (v) under the name 888 toll-free calling; or
             54          (vi) under a name similar to Subsections (1)(b)(i) through (v) as designated by the
             55      Federal Communications Commission.
             56          (2) (a) "900 service" means an inbound toll telecommunications service that:
             57          (i) a subscriber purchases;
             58          (ii) allows a customer of the subscriber described in Subsection (2)(a)(i) to call in to



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             59
     the subscriber's:
             60          (A) prerecorded announcement; or
             61          (B) live service; and
             62          (iii) is typically marketed:
             63          (A) under the name 900 service; or
             64          (B) under a name similar to Subsection (2)(a)(iii)(A) as designated by the Federal
             65      Communications Commission.
             66          (b) "900 service" does not include a charge for:
             67          (i) a collection service a seller of a telecommunications service provides to a
             68      subscriber; or
             69          (ii) the following a subscriber sells to the subscriber's customer:
             70          (A) a product; or
             71          (B) a service.
             72          (3) (a) "Admission or user fees" includes season passes.
             73          (b) "Admission or user fees" does not include annual membership dues to private
             74      organizations.
             75          (4) "Agreement" means the Streamlined Sales and Use Tax Agreement adopted on
             76      November 12, 2002, including amendments made to the Streamlined Sales and Use Tax
             77      Agreement after November 12, 2002.
             78          (5) "Agreement combined tax rate" means the sum of the tax rates:
             79          (a) listed under Subsection (6); and
             80          (b) that are imposed within a local taxing jurisdiction.
             81          (6) "Agreement sales and use tax" means a tax imposed under:
             82          (a) Subsection 59-12-103 (2)(a)(i)(A);
             83          (b) Subsection 59-12-103 (2)(b)(i);
             84          (c) Subsection 59-12-103 (2)(c)(i);
             85          (d) Subsection 59-12-103 (2)(d)(i)(A)(I);
             86          (e) Section 59-12-204 ;
             87          (f) Section 59-12-401 ;
             88          (g) Section 59-12-402 ;
             89          (h) Section 59-12-703 ;



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             90
         (i) Section 59-12-802 ;
             91          (j) Section 59-12-804 ;
             92          (k) Section 59-12-1102 ;
             93          (l) Section 59-12-1302 ;
             94          (m) Section 59-12-1402 ;
             95          (n) Section 59-12-1802 ;
             96          (o) Section 59-12-2003 ;
             97          (p) Section 59-12-2103 ;
             98          (q) Section 59-12-2213 ;
             99          (r) Section 59-12-2214 ;
             100          (s) Section 59-12-2215 ;
             101          (t) Section 59-12-2216 ;
             102          (u) Section 59-12-2217 ; or
             103          (v) Section 59-12-2218 .
             104          (7) "Aircraft" is as defined in Section 72-10-102 .
             105          (8) "Aircraft maintenance, repair, and overhaul provider" means a business entity:
             106          (a) except for:
             107          (i) an airline as defined in Section 59-2-102 ; or
             108          (ii) an affiliated group, as defined in Section 59-7-101 , except that "affiliated group"
             109      includes a corporation that is qualified to do business but is not otherwise doing business in the
             110      state, of an airline; and
             111          (b) that has the workers, expertise, and facilities to perform the following, regardless of
             112      whether the business entity performs the following in this state:
             113          (i) check, diagnose, overhaul, and repair:
             114          (A) an onboard system of a fixed wing turbine powered aircraft; and
             115          (B) the parts that comprise an onboard system of a fixed wing turbine powered aircraft;
             116          (ii) assemble, change, dismantle, inspect, and test a fixed wing turbine powered aircraft
             117      engine;
             118          (iii) perform at least the following maintenance on a fixed wing turbine powered
             119      aircraft:
             120          (A) an inspection;



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             121
         (B) a repair, including a structural repair or modification;
             122          (C) changing landing gear; and
             123          (D) addressing issues related to an aging fixed wing turbine powered aircraft;
             124          (iv) completely remove the existing paint of a fixed wing turbine powered aircraft and
             125      completely apply new paint to the fixed wing turbine powered aircraft; and
             126          (v) refurbish the interior of a fixed wing turbine powered aircraft in a manner that
             127      results in a change in the fixed wing turbine powered aircraft's certification requirements by the
             128      authority that certifies the fixed wing turbine powered aircraft.
             129          (9) "Alcoholic beverage" means a beverage that:
             130          (a) is suitable for human consumption; and
             131          (b) contains .5% or more alcohol by volume.
             132          (10) "Alternative energy" means:
             133          (a) biomass energy;
             134          (b) geothermal energy;
             135          (c) hydroelectric energy;
             136          (d) solar energy;
             137          (e) wind energy; or
             138          (f) energy that is derived from:
             139          (i) coal-to-liquids;
             140          (ii) nuclear fuel;
             141          (iii) oil-impregnated diatomaceous earth;
             142          (iv) oil sands;
             143          (v) oil shale; or
             144          (vi) petroleum coke.
             145          (11) (a) Subject to Subsection (11)(b), "alternative energy electricity production
             146      facility" means a facility that:
             147          (i) uses alternative energy to produce electricity; and
             148          (ii) has a production capacity of 2 megawatts or greater.
             149          (b) A facility is an alternative energy electricity production facility regardless of
             150      whether the facility is:
             151          (i) connected to an electric grid; or



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             152
         (ii) located on the premises of an electricity consumer.
             153          (12) (a) "Ancillary service" means a service associated with, or incidental to, the
             154      provision of telecommunications service.
             155          (b) "Ancillary service" includes:
             156          (i) a conference bridging service;
             157          (ii) a detailed communications billing service;
             158          (iii) directory assistance;
             159          (iv) a vertical service; or
             160          (v) a voice mail service.
             161          (13) "Area agency on aging" is as defined in Section 62A-3-101 .
             162          (14) "Assisted amusement device" means an amusement device, skill device, or ride
             163      device that is started and stopped by an individual:
             164          (a) who is not the purchaser or renter of the right to use or operate the amusement
             165      device, skill device, or ride device; and
             166          (b) at the direction of the seller of the right to use the amusement device, skill device,
             167      or ride device.
             168          (15) "Assisted cleaning or washing of tangible personal property" means cleaning or
             169      washing of tangible personal property if the cleaning or washing labor is primarily performed
             170      by an individual:
             171          (a) who is not the purchaser of the cleaning or washing of the tangible personal
             172      property; and
             173          (b) at the direction of the seller of the cleaning or washing of the tangible personal
             174      property.
             175          (16) "Authorized carrier" means:
             176          (a) in the case of vehicles operated over public highways, the holder of credentials
             177      indicating that the vehicle is or will be operated pursuant to both the International Registration
             178      Plan and the International Fuel Tax Agreement;
             179          (b) in the case of aircraft, the holder of a Federal Aviation Administration operating
             180      certificate or air carrier's operating certificate; or
             181          (c) in the case of locomotives, freight cars, railroad work equipment, or other rolling
             182      stock, the holder of a certificate issued by the United States Surface Transportation Board.



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             183
         (17) (a) Except as provided in Subsection (17)(b), "biomass energy" means any of the
             184      following that is used as the primary source of energy to produce fuel or electricity:
             185          (i) material from a plant or tree; or
             186          (ii) other organic matter that is available on a renewable basis, including:
             187          (A) slash and brush from forests and woodlands;
             188          (B) animal waste;
             189          (C) methane produced:
             190          (I) at landfills; or
             191          (II) as a byproduct of the treatment of wastewater residuals;
             192          (D) aquatic plants; and
             193          (E) agricultural products.
             194          (b) "Biomass energy" does not include:
             195          (i) black liquor;
             196          (ii) treated woods; or
             197          (iii) biomass from municipal solid waste other than methane produced:
             198          (A) at landfills; or
             199          (B) as a byproduct of the treatment of wastewater residuals.
             200          (18) (a) "Bundled transaction" means the sale of two or more items of tangible personal
             201      property, products, or services if the tangible personal property, products, or services are:
             202          (i) distinct and identifiable; and
             203          (ii) sold for one nonitemized price.
             204          (b) "Bundled transaction" does not include:
             205          (i) the sale of tangible personal property if the sales price varies, or is negotiable, on
             206      the basis of the selection by the purchaser of the items of tangible personal property included in
             207      the transaction;
             208          (ii) the sale of real property;
             209          (iii) the sale of services to real property;
             210          (iv) the retail sale of tangible personal property and a service if:
             211          (A) the tangible personal property:
             212          (I) is essential to the use of the service; and
             213          (II) is provided exclusively in connection with the service; and



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         (B) the service is the true object of the transaction;
             215          (v) the retail sale of two services if:
             216          (A) one service is provided that is essential to the use or receipt of a second service;
             217          (B) the first service is provided exclusively in connection with the second service; and
             218          (C) the second service is the true object of the transaction;
             219          (vi) a transaction that includes tangible personal property or a product subject to
             220      taxation under this chapter and tangible personal property or a product that is not subject to
             221      taxation under this chapter if the:
             222          (A) seller's purchase price of the tangible personal property or product subject to
             223      taxation under this chapter is de minimis; or
             224          (B) seller's sales price of the tangible personal property or product subject to taxation
             225      under this chapter is de minimis; and
             226          (vii) the retail sale of tangible personal property that is not subject to taxation under
             227      this chapter and tangible personal property that is subject to taxation under this chapter if:
             228          (A) that retail sale includes:
             229          (I) food and food ingredients;
             230          (II) a drug;
             231          (III) durable medical equipment;
             232          (IV) mobility enhancing equipment;
             233          (V) an over-the-counter drug;
             234          (VI) a prosthetic device; or
             235          (VII) a medical supply; and
             236          (B) subject to Subsection (18)(f):
             237          (I) the seller's purchase price of the tangible personal property subject to taxation under
             238      this chapter is 50% or less of the seller's total purchase price of that retail sale; or
             239          (II) the seller's sales price of the tangible personal property subject to taxation under
             240      this chapter is 50% or less of the seller's total sales price of that retail sale.
             241          (c) (i) For purposes of Subsection (18)(a)(i), tangible personal property, a product, or a
             242      service that is distinct and identifiable does not include:
             243          (A) packaging that:
             244          (I) accompanies the sale of the tangible personal property, product, or service; and



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             245
         (II) is incidental or immaterial to the sale of the tangible personal property, product, or
             246      service;
             247          (B) tangible personal property, a product, or a service provided free of charge with the
             248      purchase of another item of tangible personal property, a product, or a service; or
             249          (C) an item of tangible personal property, a product, or a service included in the
             250      definition of "purchase price."
             251          (ii) For purposes of Subsection (18)(c)(i)(B), an item of tangible personal property, a
             252      product, or a service is provided free of charge with the purchase of another item of tangible
             253      personal property, a product, or a service if the sales price of the purchased item of tangible
             254      personal property, product, or service does not vary depending on the inclusion of the tangible
             255      personal property, product, or service provided free of charge.
             256          (d) (i) For purposes of Subsection (18)(a)(ii), property sold for one nonitemized price
             257      does not include a price that is separately identified by tangible personal property, product, or
             258      service on the following, regardless of whether the following is in paper format or electronic
             259      format:
             260          (A) a binding sales document; or
             261          (B) another supporting sales-related document that is available to a purchaser.
             262          (ii) For purposes of Subsection (18)(d)(i), a binding sales document or another
             263      supporting sales-related document that is available to a purchaser includes:
             264          (A) a bill of sale;
             265          (B) a contract;
             266          (C) an invoice;
             267          (D) a lease agreement;
             268          (E) a periodic notice of rates and services;
             269          (F) a price list;
             270          (G) a rate card;
             271          (H) a receipt; or
             272          (I) a service agreement.
             273          (e) (i) For purposes of Subsection (18)(b)(vi), the sales price of tangible personal
             274      property or a product subject to taxation under this chapter is de minimis if:
             275          (A) the seller's purchase price of the tangible personal property or product is 10% or



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             276
     less of the seller's total purchase price of the bundled transaction; or
             277          (B) the seller's sales price of the tangible personal property or product is 10% or less of
             278      the seller's total sales price of the bundled transaction.
             279          (ii) For purposes of Subsection (18)(b)(vi), a seller:
             280          (A) shall use the seller's purchase price or the seller's sales price to determine if the
             281      purchase price or sales price of the tangible personal property or product subject to taxation
             282      under this chapter is de minimis; and
             283          (B) may not use a combination of the seller's purchase price and the seller's sales price
             284      to determine if the purchase price or sales price of the tangible personal property or product
             285      subject to taxation under this chapter is de minimis.
             286          (iii) For purposes of Subsection (18)(b)(vi), a seller shall use the full term of a service
             287      contract to determine if the sales price of tangible personal property or a product is de minimis.
             288          (f) For purposes of Subsection (18)(b)(vii)(B), a seller may not use a combination of
             289      the seller's purchase price and the seller's sales price to determine if tangible personal property
             290      subject to taxation under this chapter is 50% or less of the seller's total purchase price or sales
             291      price of that retail sale.
             292          (19) "Certified automated system" means software certified by the governing board of
             293      the agreement that:
             294          (a) calculates the agreement sales and use tax imposed within a local taxing
             295      jurisdiction:
             296          (i) on a transaction; and
             297          (ii) in the states that are members of the agreement;
             298          (b) determines the amount of agreement sales and use tax to remit to a state that is a
             299      member of the agreement; and
             300          (c) maintains a record of the transaction described in Subsection (19)(a)(i).
             301          (20) "Certified service provider" means an agent certified:
             302          (a) by the governing board of the agreement; and
             303          (b) to perform all of a seller's sales and use tax functions for an agreement sales and
             304      use tax other than the seller's obligation under Section 59-12-124 to remit a tax on the seller's
             305      own purchases.
             306          (21) (a) Subject to Subsection (21)(b), "clothing" means all human wearing apparel



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             307
     suitable for general use.
             308          (b) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             309      commission shall make rules:
             310          (i) listing the items that constitute "clothing"; and
             311          (ii) that are consistent with the list of items that constitute "clothing" under the
             312      agreement.
             313          (22) "Coal-to-liquid" means the process of converting coal into a liquid synthetic fuel.
             314          (23) "Commercial use" means the use of gas, electricity, heat, coal, fuel oil, or other
             315      fuels that does not constitute industrial use under Subsection (51) or residential use under
             316      Subsection (101).
             317          (24) (a) "Common carrier" means a person engaged in or transacting the business of
             318      transporting passengers, freight, merchandise, or other property for hire within this state.
             319          (b) (i) "Common carrier" does not include a person who, at the time the person is
             320      traveling to or from that person's place of employment, transports a passenger to or from the
             321      passenger's place of employment.
             322          (ii) For purposes of Subsection (24)(b)(i), in accordance with Title 63G, Chapter 3,
             323      Utah Administrative Rulemaking Act, the commission may make rules defining what
             324      constitutes a person's place of employment.
             325          (25) "Component part" includes:
             326          (a) poultry, dairy, and other livestock feed, and their components;
             327          (b) baling ties and twine used in the baling of hay and straw;
             328          (c) fuel used for providing temperature control of orchards and commercial
             329      greenhouses doing a majority of their business in wholesale sales, and for providing power for
             330      off-highway type farm machinery; and
             331          (d) feed, seeds, and seedlings.
             332          (26) "Computer" means an electronic device that accepts information:
             333          (a) (i) in digital form; or
             334          (ii) in a form similar to digital form; and
             335          (b) manipulates that information for a result based on a sequence of instructions.
             336          (27) "Computer software" means a set of coded instructions designed to cause:
             337          (a) a computer to perform a task; or



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             338
         (b) automatic data processing equipment to perform a task.
             339          (28) "Computer software maintenance contract" means a contract that obligates a seller
             340      of computer software to provide a customer with:
             341          (a) future updates or upgrades to computer software;
             342          (b) support services with respect to computer software; or
             343          (c) a combination of Subsections (28)(a) and (b).
             344          (29) (a) "Conference bridging service" means an ancillary service that links two or
             345      more participants of an audio conference call or video conference call.
             346          (b) "Conference bridging service" may include providing a telephone number as part of
             347      the ancillary service described in Subsection (29)(a).
             348          (c) "Conference bridging service" does not include a telecommunications service used
             349      to reach the ancillary service described in Subsection (29)(a).
             350          (30) "Construction materials" means any tangible personal property that will be
             351      converted into real property.
             352          (31) "Delivered electronically" means delivered to a purchaser by means other than
             353      tangible storage media.
             354          (32) (a) "Delivery charge" means a charge:
             355          (i) by a seller of:
             356          (A) tangible personal property;
             357          (B) a product transferred electronically; or
             358          (C) services; and
             359          (ii) for preparation and delivery of the tangible personal property, product transferred
             360      electronically, or services described in Subsection (32)(a)(i) to a location designated by the
             361      purchaser.
             362          (b) "Delivery charge" includes a charge for the following:
             363          (i) transportation;
             364          (ii) shipping;
             365          (iii) postage;
             366          (iv) handling;
             367          (v) crating; or
             368          (vi) packing.



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             369
         (33) "Detailed telecommunications billing service" means an ancillary service of
             370      separately stating information pertaining to individual calls on a customer's billing statement.
             371          (34) "Dietary supplement" means a product, other than tobacco, that:
             372          (a) is intended to supplement the diet;
             373          (b) contains one or more of the following dietary ingredients:
             374          (i) a vitamin;
             375          (ii) a mineral;
             376          (iii) an herb or other botanical;
             377          (iv) an amino acid;
             378          (v) a dietary substance for use by humans to supplement the diet by increasing the total
             379      dietary intake; or
             380          (vi) a concentrate, metabolite, constituent, extract, or combination of any ingredient
             381      described in Subsections (34)(b)(i) through (v);
             382          (c) (i) except as provided in Subsection (34)(c)(ii), is intended for ingestion in:
             383          (A) tablet form;
             384          (B) capsule form;
             385          (C) powder form;
             386          (D) softgel form;
             387          (E) gelcap form; or
             388          (F) liquid form; or
             389          (ii) notwithstanding Subsection (34)(c)(i), if the product is not intended for ingestion in
             390      a form described in Subsections (34)(c)(i)(A) through (F), is not represented:
             391          (A) as conventional food; and
             392          (B) for use as a sole item of:
             393          (I) a meal; or
             394          (II) the diet; and
             395          (d) is required to be labeled as a dietary supplement:
             396          (i) identifiable by the "Supplemental Facts" box found on the label; and
             397          (ii) as required by 21 C.F.R. Sec. 101.36.
             398          (35) (a) "Direct mail" means printed material delivered or distributed by United States
             399      mail or other delivery service:



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             400
         (i) to:
             401          (A) a mass audience; or
             402          (B) addressees on a mailing list provided:
             403          (I) by a purchaser of the mailing list; or
             404          (II) at the discretion of the purchaser of the mailing list; and
             405          (ii) if the cost of the printed material is not billed directly to the recipients.
             406          (b) "Direct mail" includes tangible personal property supplied directly or indirectly by a
             407      purchaser to a seller of direct mail for inclusion in a package containing the printed material.
             408          (c) "Direct mail" does not include multiple items of printed material delivered to a
             409      single address.
             410          (36) "Directory assistance" means an ancillary service of providing:
             411          (a) address information; or
             412          (b) telephone number information.
             413          (37) (a) "Disposable home medical equipment or supplies" means medical equipment
             414      or supplies that:
             415          (i) cannot withstand repeated use; and
             416          (ii) are purchased by, for, or on behalf of a person other than:
             417          (A) a health care facility as defined in Section 26-21-2 ;
             418          (B) a health care provider as defined in Section 78B-3-403 ;
             419          (C) an office of a health care provider described in Subsection (37)(a)(ii)(B); or
             420          (D) a person similar to a person described in Subsections (37)(a)(ii)(A) through (C).
             421          (b) "Disposable home medical equipment or supplies" does not include:
             422          (i) a drug;
             423          (ii) durable medical equipment;
             424          (iii) a hearing aid;
             425          (iv) a hearing aid accessory;
             426          (v) mobility enhancing equipment; or
             427          (vi) tangible personal property used to correct impaired vision, including:
             428          (A) eyeglasses; or
             429          (B) contact lenses.
             430          (c) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the



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             431
     commission may by rule define what constitutes medical equipment or supplies.
             432          (38) (a) "Drug" means a compound, substance, or preparation, or a component of a
             433      compound, substance, or preparation that is:
             434          (i) recognized in:
             435          (A) the official United States Pharmacopoeia;
             436          (B) the official Homeopathic Pharmacopoeia of the United States;
             437          (C) the official National Formulary; or
             438          (D) a supplement to a publication listed in Subsections (38)(a)(i)(A) through (C);
             439          (ii) intended for use in the:
             440          (A) diagnosis of disease;
             441          (B) cure of disease;
             442          (C) mitigation of disease;
             443          (D) treatment of disease; or
             444          (E) prevention of disease; or
             445          (iii) intended to affect:
             446          (A) the structure of the body; or
             447          (B) any function of the body.
             448          (b) "Drug" does not include:
             449          (i) food and food ingredients;
             450          (ii) a dietary supplement;
             451          (iii) an alcoholic beverage; or
             452          (iv) a prosthetic device.
             453          (39) (a) Except as provided in Subsection (39)(c), "durable medical equipment" means
             454      equipment that:
             455          (i) can withstand repeated use;
             456          (ii) is primarily and customarily used to serve a medical purpose;
             457          (iii) generally is not useful to a person in the absence of illness or injury; and
             458          (iv) is not worn in or on the body.
             459          (b) "Durable medical equipment" includes parts used in the repair or replacement of the
             460      equipment described in Subsection (39)(a).
             461          (c) Notwithstanding Subsection (39)(a), "durable medical equipment" does not include



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             462
     mobility enhancing equipment.
             463          (40) "Electronic" means:
             464          (a) relating to technology; and
             465          (b) having:
             466          (i) electrical capabilities;
             467          (ii) digital capabilities;
             468          (iii) magnetic capabilities;
             469          (iv) wireless capabilities;
             470          (v) optical capabilities;
             471          (vi) electromagnetic capabilities; or
             472          (vii) capabilities similar to Subsections (40)(b)(i) through (vi).
             473          (41) "Employee" is as defined in Section 59-10-401 .
             474          (42) "Fixed guideway" means a public transit facility that uses and occupies:
             475          (a) rail for the use of public transit; or
             476          (b) a separate right-of-way for the use of public transit.
             477          (43) "Fixed wing turbine powered aircraft" means an aircraft that:
             478          (a) is powered by turbine engines;
             479          (b) operates on jet fuel; and
             480          (c) has wings that are permanently attached to the fuselage of the aircraft.
             481          (44) "Fixed wireless service" means a telecommunications service that provides radio
             482      communication between fixed points.
             483          (45) (a) "Food and food ingredients" means substances:
             484          (i) regardless of whether the substances are in:
             485          (A) liquid form;
             486          (B) concentrated form;
             487          (C) solid form;
             488          (D) frozen form;
             489          (E) dried form; or
             490          (F) dehydrated form; and
             491          (ii) that are:
             492          (A) sold for:



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             493
         (I) ingestion by humans; or
             494          (II) chewing by humans; and
             495          (B) consumed for the substance's:
             496          (I) taste; or
             497          (II) nutritional value.
             498          (b) "Food and food ingredients" includes an item described in Subsection (86)(b)(iii).
             499          (c) "Food and food ingredients" does not include:
             500          (i) an alcoholic beverage;
             501          (ii) tobacco; or
             502          (iii) prepared food.
             503          (46) (a) "Fundraising sales" means sales:
             504          (i) (A) made by a school; or
             505          (B) made by a school student;
             506          (ii) that are for the purpose of raising funds for the school to purchase equipment,
             507      materials, or provide transportation; and
             508          (iii) that are part of an officially sanctioned school activity.
             509          (b) For purposes of Subsection (46)(a)(iii), "officially sanctioned school activity"
             510      means a school activity:
             511          (i) that is conducted in accordance with a formal policy adopted by the school or school
             512      district governing the authorization and supervision of fundraising activities;
             513          (ii) that does not directly or indirectly compensate an individual teacher or other
             514      educational personnel by direct payment, commissions, or payment in kind; and
             515          (iii) the net or gross revenues from which are deposited in a dedicated account
             516      controlled by the school or school district.
             517          (47) "Geothermal energy" means energy contained in heat that continuously flows
             518      outward from the earth that is used as the sole source of energy to produce electricity.
             519          (48) "Governing board of the agreement" means the governing board of the agreement
             520      that is:
             521          (a) authorized to administer the agreement; and
             522          (b) established in accordance with the agreement.
             523          (49) (a) For purposes of Subsection 59-12-104 (41), "governmental entity" means:



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             524
         (i) the executive branch of the state, including all departments, institutions, boards,
             525      divisions, bureaus, offices, commissions, and committees;
             526          (ii) the judicial branch of the state, including the courts, the Judicial Council, the
             527      Office of the Court Administrator, and similar administrative units in the judicial branch;
             528          (iii) the legislative branch of the state, including the House of Representatives, the
             529      Senate, the Legislative Printing Office, the Office of Legislative Research and General
             530      Counsel, the Office of the Legislative Auditor General, and the Office of the Legislative Fiscal
             531      Analyst;
             532          (iv) the National Guard;
             533          (v) an independent entity as defined in Section 63E-1-102 ; or
             534          (vi) a political subdivision as defined in Section 17B-1-102 .
             535          (b) "Governmental entity" does not include the state systems of public and higher
             536      education, including:
             537          (i) a college campus of the Utah College of Applied Technology;
             538          (ii) a school;
             539          (iii) the State Board of Education;
             540          (iv) the State Board of Regents; or
             541          (v) an institution of higher education.
             542          (50) "Hydroelectric energy" means water used as the sole source of energy to produce
             543      electricity.
             544          (51) "Industrial use" means the use of natural gas, electricity, heat, coal, fuel oil, or
             545      other fuels:
             546          (a) in mining or extraction of minerals;
             547          (b) in agricultural operations to produce an agricultural product up to the time of
             548      harvest or placing the agricultural product into a storage facility, including:
             549          (i) commercial greenhouses;
             550          (ii) irrigation pumps;
             551          (iii) farm machinery;
             552          (iv) implements of husbandry as defined in Subsection 41-1a-102 (23) that are not
             553      registered under Title 41, Chapter 1a, Part 2, Registration; and
             554          (v) other farming activities;



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             555
         (c) in manufacturing tangible personal property at an establishment described in SIC
             556      Codes 2000 to 3999 of the 1987 Standard Industrial Classification Manual of the federal
             557      Executive Office of the President, Office of Management and Budget;
             558          (d) by a scrap recycler if:
             559          (i) from a fixed location, the scrap recycler utilizes machinery or equipment to process
             560      one or more of the following items into prepared grades of processed materials for use in new
             561      products:
             562          (A) iron;
             563          (B) steel;
             564          (C) nonferrous metal;
             565          (D) paper;
             566          (E) glass;
             567          (F) plastic;
             568          (G) textile; or
             569          (H) rubber; and
             570          (ii) the new products under Subsection (51)(d)(i) would otherwise be made with
             571      nonrecycled materials; or
             572          (e) in producing a form of energy or steam described in Subsection 54-2-1 (2)(a) by a
             573      cogeneration facility as defined in Section 54-2-1 .
             574          (52) (a) Except as provided in Subsection (52)(b), "installation charge" means a charge
             575      for installing:
             576          (i) tangible personal property; or
             577          (ii) a product transferred electronically.
             578          (b) "Installation charge" does not include a charge for:
             579          (i) repairs or renovations of:
             580          (A) tangible personal property; or
             581          (B) a product transferred electronically; or
             582          (ii) attaching tangible personal property or a product transferred electronically:
             583          (A) to other tangible personal property; and
             584          (B) as part of a manufacturing or fabrication process.
             585          (53) "Institution of higher education" means an institution of higher education listed in



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             586
     Section 53B-2-101 .
             587          (54) (a) "Lease" or "rental" means a transfer of possession or control of tangible
             588      personal property or a product transferred electronically for:
             589          (i) (A) a fixed term; or
             590          (B) an indeterminate term; and
             591          (ii) consideration.
             592          (b) "Lease" or "rental" includes an agreement covering a motor vehicle and trailer if the
             593      amount of consideration may be increased or decreased by reference to the amount realized
             594      upon sale or disposition of the property as defined in Section 7701(h)(1), Internal Revenue
             595      Code.
             596          (c) "Lease" or "rental" does not include:
             597          (i) a transfer of possession or control of property under a security agreement or
             598      deferred payment plan that requires the transfer of title upon completion of the required
             599      payments;
             600          (ii) a transfer of possession or control of property under an agreement that requires the
             601      transfer of title:
             602          (A) upon completion of required payments; and
             603          (B) if the payment of an option price does not exceed the greater of:
             604          (I) $100; or
             605          (II) 1% of the total required payments; or
             606          (iii) providing tangible personal property along with an operator for a fixed period of
             607      time or an indeterminate period of time if the operator is necessary for equipment to perform as
             608      designed.
             609          (d) For purposes of Subsection (54)(c)(iii), an operator is necessary for equipment to
             610      perform as designed if the operator's duties exceed the:
             611          (i) set-up of tangible personal property;
             612          (ii) maintenance of tangible personal property; or
             613          (iii) inspection of tangible personal property.
             614          (55) "Life science establishment" means an establishment in this state that is classified
             615      under the following NAICS codes of the 2007 North American Industry Classification System
             616      of the federal Executive Office of the President, Office of Management and Budget:



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             617
         (a) NAICS Code 33911, Medical Equipment and Supplies Manufacturing;
             618          (b) NAICS Code 334510, Electromedical and Electrotherapeutic Apparatus
             619      Manufacturing; or
             620          (c) NAICS Code 334517, Irradiation Apparatus Manufacturing.
             621          (56) "Life science research and development facility" means a facility owned, leased,
             622      or rented by a life science establishment if research and development is performed in 51% or
             623      more of the total area of the facility.
             624          (57) "Load and leave" means delivery to a purchaser by use of a tangible storage media
             625      if the tangible storage media is not physically transferred to the purchaser.
             626          (58) "Local taxing jurisdiction" means a:
             627          (a) county that is authorized to impose an agreement sales and use tax;
             628          (b) city that is authorized to impose an agreement sales and use tax; or
             629          (c) town that is authorized to impose an agreement sales and use tax.
             630          (59) "Manufactured home" is as defined in Section 15A-1-302 .
             631          (60) For purposes of Section 59-12-104 , "manufacturing facility" means:
             632          (a) an establishment described in SIC Codes 2000 to 3999 of the 1987 Standard
             633      Industrial Classification Manual of the federal Executive Office of the President, Office of
             634      Management and Budget;
             635          (b) a scrap recycler if:
             636          (i) from a fixed location, the scrap recycler utilizes machinery or equipment to process
             637      one or more of the following items into prepared grades of processed materials for use in new
             638      products:
             639          (A) iron;
             640          (B) steel;
             641          (C) nonferrous metal;
             642          (D) paper;
             643          (E) glass;
             644          (F) plastic;
             645          (G) textile; or
             646          (H) rubber; and
             647          (ii) the new products under Subsection (60)(b)(i) would otherwise be made with



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             648
     nonrecycled materials; or
             649          (c) a cogeneration facility as defined in Section 54-2-1 .
             650          (61) "Member of the immediate family of the producer" means a person who is related
             651      to a producer described in Subsection 59-12-104 (20)(a) as a:
             652          (a) child or stepchild, regardless of whether the child or stepchild is:
             653          (i) an adopted child or adopted stepchild; or
             654          (ii) a foster child or foster stepchild;
             655          (b) grandchild or stepgrandchild;
             656          (c) grandparent or stepgrandparent;
             657          (d) nephew or stepnephew;
             658          (e) niece or stepniece;
             659          (f) parent or stepparent;
             660          (g) sibling or stepsibling;
             661          (h) spouse;
             662          (i) person who is the spouse of a person described in Subsections (61)(a) through (g);
             663      or
             664          (j) person similar to a person described in Subsections (61)(a) through (i) as
             665      determined by the commission by rule made in accordance with Title 63G, Chapter 3, Utah
             666      Administrative Rulemaking Act.
             667          (62) "Mobile home" is as defined in Section 15A-1-302 .
             668          (63) "Mobile telecommunications service" is as defined in the Mobile
             669      Telecommunications Sourcing Act, 4 U.S.C. Sec. 124.
             670          (64) (a) "Mobile wireless service" means a telecommunications service, regardless of
             671      the technology used, if:
             672          (i) the origination point of the conveyance, routing, or transmission is not fixed;
             673          (ii) the termination point of the conveyance, routing, or transmission is not fixed; or
             674          (iii) the origination point described in Subsection (64)(a)(i) and the termination point
             675      described in Subsection (64)(a)(ii) are not fixed.
             676          (b) "Mobile wireless service" includes a telecommunications service that is provided
             677      by a commercial mobile radio service provider.
             678          (c) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the



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             679
     commission may by rule define "commercial mobile radio service provider."
             680          (65) (a) Except as provided in Subsection (65)(c), "mobility enhancing equipment"
             681      means equipment that is:
             682          (i) primarily and customarily used to provide or increase the ability to move from one
             683      place to another;
             684          (ii) appropriate for use in a:
             685          (A) home; or
             686          (B) motor vehicle; and
             687          (iii) not generally used by persons with normal mobility.
             688          (b) "Mobility enhancing equipment" includes parts used in the repair or replacement of
             689      the equipment described in Subsection (65)(a).
             690          (c) Notwithstanding Subsection (65)(a), "mobility enhancing equipment" does not
             691      include:
             692          (i) a motor vehicle;
             693          (ii) equipment on a motor vehicle if that equipment is normally provided by the motor
             694      vehicle manufacturer;
             695          (iii) durable medical equipment; or
             696          (iv) a prosthetic device.
             697          (66) "Model 1 seller" means a seller registered under the agreement that has selected a
             698      certified service provider as the seller's agent to perform all of the seller's sales and use tax
             699      functions for agreement sales and use taxes other than the seller's obligation under Section
             700      59-12-124 to remit a tax on the seller's own purchases.
             701          (67) "Model 2 seller" means a seller registered under the agreement that:
             702          (a) except as provided in Subsection (67)(b), has selected a certified automated system
             703      to perform the seller's sales tax functions for agreement sales and use taxes; and
             704          (b) notwithstanding Subsection (67)(a), retains responsibility for remitting all of the
             705      sales tax:
             706          (i) collected by the seller; and
             707          (ii) to the appropriate local taxing jurisdiction.
             708          (68) (a) Subject to Subsection (68)(b), "model 3 seller" means a seller registered under
             709      the agreement that has:



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             710
         (i) sales in at least five states that are members of the agreement;
             711          (ii) total annual sales revenues of at least $500,000,000;
             712          (iii) a proprietary system that calculates the amount of tax:
             713          (A) for an agreement sales and use tax; and
             714          (B) due to each local taxing jurisdiction; and
             715          (iv) entered into a performance agreement with the governing board of the agreement.
             716          (b) For purposes of Subsection (68)(a), "model 3 seller" includes an affiliated group of
             717      sellers using the same proprietary system.
             718          (69) "Model 4 seller" means a seller that is registered under the agreement and is not a
             719      model 1 seller, model 2 seller, or model 3 seller.
             720          (70) "Modular home" means a modular unit as defined in Section 15A-1-302 .
             721          (71) "Motor vehicle" is as defined in Section 41-1a-102 .
             722          (72) "Oil sands" means impregnated bituminous sands that:
             723          (a) contain a heavy, thick form of petroleum that is released when heated, mixed with
             724      other hydrocarbons, or otherwise treated;
             725          (b) yield mixtures of liquid hydrocarbon; and
             726          (c) require further processing other than mechanical blending before becoming finished
             727      petroleum products.
             728          (73) "Oil shale" means a group of fine black to dark brown shales containing kerogen
             729      material that yields petroleum upon heating and distillation.
             730          (74) "Optional computer software maintenance contract" means a computer software
             731      maintenance contract that a customer is not obligated to purchase as a condition to the retail
             732      sale of computer software.
             733          (75) (a) "Other fuels" means products that burn independently to produce heat or
             734      energy.
             735          (b) "Other fuels" includes oxygen when it is used in the manufacturing of tangible
             736      personal property.
             737          (76) (a) "Paging service" means a telecommunications service that provides
             738      transmission of a coded radio signal for the purpose of activating a specific pager.
             739          (b) For purposes of Subsection (76)(a), the transmission of a coded radio signal
             740      includes a transmission by message or sound.



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             741
         (77) "Pawnbroker" is as defined in Section 13-32a-102 .
             742          (78) "Pawn transaction" is as defined in Section 13-32a-102 .
             743          (79) (a) "Permanently attached to real property" means that for tangible personal
             744      property attached to real property:
             745          (i) the attachment of the tangible personal property to the real property:
             746          (A) is essential to the use of the tangible personal property; and
             747          (B) suggests that the tangible personal property will remain attached to the real
             748      property in the same place over the useful life of the tangible personal property; or
             749          (ii) if the tangible personal property is detached from the real property, the detachment
             750      would:
             751          (A) cause substantial damage to the tangible personal property; or
             752          (B) require substantial alteration or repair of the real property to which the tangible
             753      personal property is attached.
             754          (b) "Permanently attached to real property" includes:
             755          (i) the attachment of an accessory to the tangible personal property if the accessory is:
             756          (A) essential to the operation of the tangible personal property; and
             757          (B) attached only to facilitate the operation of the tangible personal property;
             758          (ii) a temporary detachment of tangible personal property from real property for a
             759      repair or renovation if the repair or renovation is performed where the tangible personal
             760      property and real property are located; or
             761          (iii) property attached to oil, gas, or water pipelines, except for the property listed in
             762      Subsection (79)(c)(iii) or (iv).
             763          (c) "Permanently attached to real property" does not include:
             764          (i) the attachment of portable or movable tangible personal property to real property if
             765      that portable or movable tangible personal property is attached to real property only for:
             766          (A) convenience;
             767          (B) stability; or
             768          (C) for an obvious temporary purpose;
             769          (ii) the detachment of tangible personal property from real property except for the
             770      detachment described in Subsection (79)(b)(ii);
             771          (iii) an attachment of the following tangible personal property to real property if the



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             772
     attachment to real property is only through a line that supplies water, electricity, gas,
             773      telecommunications, cable, or supplies a similar item as determined by the commission by rule
             774      made in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act:
             775          (A) a computer;
             776          (B) a telephone;
             777          (C) a television; or
             778          (D) tangible personal property similar to Subsections (79)(c)(iii)(A) through (C) as
             779      determined by the commission by rule made in accordance with Title 63G, Chapter 3, Utah
             780      Administrative Rulemaking Act; or
             781          (iv) an item listed in Subsection [(117)] (124)(c).
             782          (80) "Person" includes any individual, firm, partnership, joint venture, association,
             783      corporation, estate, trust, business trust, receiver, syndicate, this state, any county, city,
             784      municipality, district, or other local governmental entity of the state, or any group or
             785      combination acting as a unit.
             786          (81) "Place of primary use":
             787          (a) for telecommunications service other than mobile telecommunications service,
             788      means the street address representative of where the customer's use of the telecommunications
             789      service primarily occurs, which shall be:
             790          (i) the residential street address of the customer; or
             791          (ii) the primary business street address of the customer; or
             792          (b) for mobile telecommunications service, is as defined in the Mobile
             793      Telecommunications Sourcing Act, 4 U.S.C. Sec. 124.
             794          (82) (a) "Postpaid calling service" means a telecommunications service a person
             795      obtains by making a payment on a call-by-call basis:
             796          (i) through the use of a:
             797          (A) bank card;
             798          (B) credit card;
             799          (C) debit card; or
             800          (D) travel card; or
             801          (ii) by a charge made to a telephone number that is not associated with the origination
             802      or termination of the telecommunications service.



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             803
         (b) "Postpaid calling service" includes a service, except for a prepaid wireless calling
             804      service, that would be a prepaid wireless calling service if the service were exclusively a
             805      telecommunications service.
             806          (83) "Postproduction" means an activity related to the finishing or duplication of a
             807      medium described in Subsection 59-12-104 (54)(a).
             808          (84) "Prepaid calling service" means a telecommunications service:
             809          (a) that allows a purchaser access to telecommunications service that is exclusively
             810      telecommunications service;
             811          (b) that:
             812          (i) is paid for in advance; and
             813          (ii) enables the origination of a call using an:
             814          (A) access number; or
             815          (B) authorization code;
             816          (c) that is dialed:
             817          (i) manually; or
             818          (ii) electronically; and
             819          (d) sold in predetermined units or dollars that decline:
             820          (i) by a known amount; and
             821          (ii) with use.
             822          (85) "Prepaid wireless calling service" means a telecommunications service:
             823          (a) that provides the right to utilize:
             824          (i) mobile wireless service; and
             825          (ii) other service that is not a telecommunications service, including:
             826          (A) the download of a product transferred electronically;
             827          (B) a content service; or
             828          (C) an ancillary service;
             829          (b) that:
             830          (i) is paid for in advance; and
             831          (ii) enables the origination of a call using an:
             832          (A) access number; or
             833          (B) authorization code;



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             834
         (c) that is dialed:
             835          (i) manually; or
             836          (ii) electronically; and
             837          (d) sold in predetermined units or dollars that decline:
             838          (i) by a known amount; and
             839          (ii) with use.
             840          (86) (a) "Prepared food" means:
             841          (i) food:
             842          (A) sold in a heated state; or
             843          (B) heated by a seller;
             844          (ii) two or more food ingredients mixed or combined by the seller for sale as a single
             845      item; or
             846          (iii) except as provided in Subsection (86)(c), food sold with an eating utensil provided
             847      by the seller, including a:
             848          (A) plate;
             849          (B) knife;
             850          (C) fork;
             851          (D) spoon;
             852          (E) glass;
             853          (F) cup;
             854          (G) napkin; or
             855          (H) straw.
             856          (b) "Prepared food" does not include:
             857          (i) food that a seller only:
             858          (A) cuts;
             859          (B) repackages; or
             860          (C) pasteurizes; or
             861          (ii) (A) the following:
             862          (I) raw egg;
             863          (II) raw fish;
             864          (III) raw meat;



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             865
         (IV) raw poultry; or
             866          (V) a food containing an item described in Subsections (86)(b)(ii)(A)(I) through (IV);
             867      and
             868          (B) if the Food and Drug Administration recommends in Chapter 3, Part 401.11 of the
             869      Food and Drug Administration's Food Code that a consumer cook the items described in
             870      Subsection (86)(b)(ii)(A) to prevent food borne illness; or
             871          (iii) the following if sold without eating utensils provided by the seller:
             872          (A) food and food ingredients sold by a seller if the seller's proper primary
             873      classification under the 2002 North American Industry Classification System of the federal
             874      Executive Office of the President, Office of Management and Budget, is manufacturing in
             875      Sector 311, Food Manufacturing, except for Subsector 3118, Bakeries and Tortilla
             876      Manufacturing;
             877          (B) food and food ingredients sold in an unheated state:
             878          (I) by weight or volume; and
             879          (II) as a single item; or
             880          (C) a bakery item, including:
             881          (I) a bagel;
             882          (II) a bar;
             883          (III) a biscuit;
             884          (IV) bread;
             885          (V) a bun;
             886          (VI) a cake;
             887          (VII) a cookie;
             888          (VIII) a croissant;
             889          (IX) a danish;
             890          (X) a donut;
             891          (XI) a muffin;
             892          (XII) a pastry;
             893          (XIII) a pie;
             894          (XIV) a roll;
             895          (XV) a tart;



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             896
         (XVI) a torte; or
             897          (XVII) a tortilla.
             898          (c) Notwithstanding Subsection (86)(a)(iii), an eating utensil provided by the seller
             899      does not include the following used to transport the food:
             900          (i) a container; or
             901          (ii) packaging.
             902          (87) "Prescription" means an order, formula, or recipe that is issued:
             903          (a) (i) orally;
             904          (ii) in writing;
             905          (iii) electronically; or
             906          (iv) by any other manner of transmission; and
             907          (b) by a licensed practitioner authorized by the laws of a state.
             908          (88) (a) Except as provided in Subsection (88)(b)(ii) or (iii), "prewritten computer
             909      software" means computer software that is not designed and developed:
             910          (i) by the author or other creator of the computer software; and
             911          (ii) to the specifications of a specific purchaser.
             912          (b) "Prewritten computer software" includes:
             913          (i) a prewritten upgrade to computer software if the prewritten upgrade to the computer
             914      software is not designed and developed:
             915          (A) by the author or other creator of the computer software; and
             916          (B) to the specifications of a specific purchaser;
             917          (ii) notwithstanding Subsection (88)(a), computer software designed and developed by
             918      the author or other creator of the computer software to the specifications of a specific purchaser
             919      if the computer software is sold to a person other than the purchaser; or
             920          (iii) notwithstanding Subsection (88)(a) and except as provided in Subsection (88)(c),
             921      prewritten computer software or a prewritten portion of prewritten computer software:
             922          (A) that is modified or enhanced to any degree; and
             923          (B) if the modification or enhancement described in Subsection (88)(b)(iii)(A) is
             924      designed and developed to the specifications of a specific purchaser.
             925          (c) Notwithstanding Subsection (88)(b)(iii), "prewritten computer software" does not
             926      include a modification or enhancement described in Subsection (88)(b)(iii) if the charges for



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             927
     the modification or enhancement are:
             928          (i) reasonable; and
             929          (ii) separately stated on the invoice or other statement of price provided to the
             930      purchaser.
             931          (89) (a) "Private communication service" means a telecommunications service:
             932          (i) that entitles a customer to exclusive or priority use of one or more communications
             933      channels between or among termination points; and
             934          (ii) regardless of the manner in which the one or more communications channels are
             935      connected.
             936          (b) "Private communications service" includes the following provided in connection
             937      with the use of one or more communications channels:
             938          (i) an extension line;
             939          (ii) a station;
             940          (iii) switching capacity; or
             941          (iv) another associated service that is provided in connection with the use of one or
             942      more communications channels as defined in Section 59-12-215 .
             943          (90) (a) Except as provided in Subsection (90)(b), "product transferred electronically"
             944      means a product transferred electronically that would be subject to a tax under this chapter if
             945      that product was transferred in a manner other than electronically.
             946          (b) "Product transferred electronically" does not include:
             947          (i) an ancillary service;
             948          (ii) computer software; or
             949          (iii) a telecommunications service.
             950          (91) (a) "Prosthetic device" means a device that is worn on or in the body to:
             951          (i) artificially replace a missing portion of the body;
             952          (ii) prevent or correct a physical deformity or physical malfunction; or
             953          (iii) support a weak or deformed portion of the body.
             954          (b) "Prosthetic device" includes:
             955          (i) parts used in the repairs or renovation of a prosthetic device;
             956          (ii) replacement parts for a prosthetic device;
             957          (iii) a dental prosthesis; or



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             958
         (iv) a hearing aid.
             959          (c) "Prosthetic device" does not include:
             960          (i) corrective eyeglasses; or
             961          (ii) contact lenses.
             962          (92) (a) "Protective equipment" means an item:
             963          (i) for human wear; and
             964          (ii) that is:
             965          (A) designed as protection:
             966          (I) to the wearer against injury or disease; or
             967          (II) against damage or injury of other persons or property; and
             968          (B) not suitable for general use.
             969          (b) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             970      commission shall make rules:
             971          (i) listing the items that constitute "protective equipment"; and
             972          (ii) that are consistent with the list of items that constitute "protective equipment"
             973      under the agreement.
             974          (93) (a) For purposes of Subsection 59-12-104 (41), "publication" means any written or
             975      printed matter, other than a photocopy:
             976          (i) regardless of:
             977          (A) characteristics;
             978          (B) copyright;
             979          (C) form;
             980          (D) format;
             981          (E) method of reproduction; or
             982          (F) source; and
             983          (ii) made available in printed or electronic format.
             984          (b) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             985      commission may by rule define the term "photocopy."
             986          (94) (a) "Purchase price" and "sales price" mean the total amount of consideration:
             987          (i) valued in money; and
             988          (ii) for which tangible personal property, a product transferred electronically, or



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             989
     services are:
             990          (A) sold;
             991          (B) leased; or
             992          (C) rented.
             993          (b) "Purchase price" and "sales price" include:
             994          (i) the seller's cost of the tangible personal property, a product transferred
             995      electronically, or services sold;
             996          (ii) expenses of the seller, including:
             997          (A) the cost of materials used;
             998          (B) a labor cost;
             999          (C) a service cost;
             1000          (D) interest;
             1001          (E) a loss;
             1002          (F) the cost of transportation to the seller; or
             1003          (G) a tax imposed on the seller;
             1004          (iii) a charge by the seller for any service necessary to complete the sale; or
             1005          (iv) consideration a seller receives from a person other than the purchaser if:
             1006          (A) (I) the seller actually receives consideration from a person other than the purchaser;
             1007      and
             1008          (II) the consideration described in Subsection (94)(b)(iv)(A)(I) is directly related to a
             1009      price reduction or discount on the sale;
             1010          (B) the seller has an obligation to pass the price reduction or discount through to the
             1011      purchaser;
             1012          (C) the amount of the consideration attributable to the sale is fixed and determinable by
             1013      the seller at the time of the sale to the purchaser; and
             1014          (D) (I) (Aa) the purchaser presents a certificate, coupon, or other documentation to the
             1015      seller to claim a price reduction or discount; and
             1016          (Bb) a person other than the seller authorizes, distributes, or grants the certificate,
             1017      coupon, or other documentation with the understanding that the person other than the seller
             1018      will reimburse any seller to whom the certificate, coupon, or other documentation is presented;
             1019          (II) the purchaser identifies that purchaser to the seller as a member of a group or



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             1020
     organization allowed a price reduction or discount, except that a preferred customer card that is
             1021      available to any patron of a seller does not constitute membership in a group or organization
             1022      allowed a price reduction or discount; or
             1023          (III) the price reduction or discount is identified as a third party price reduction or
             1024      discount on the:
             1025          (Aa) invoice the purchaser receives; or
             1026          (Bb) certificate, coupon, or other documentation the purchaser presents.
             1027          (c) "Purchase price" and "sales price" do not include:
             1028          (i) a discount:
             1029          (A) in a form including:
             1030          (I) cash;
             1031          (II) term; or
             1032          (III) coupon;
             1033          (B) that is allowed by a seller;
             1034          (C) taken by a purchaser on a sale; and
             1035          (D) that is not reimbursed by a third party; or
             1036          (ii) the following if separately stated on an invoice, bill of sale, or similar document
             1037      provided to the purchaser:
             1038          (A) the following from credit extended on the sale of tangible personal property or
             1039      services:
             1040          (I) a carrying charge;
             1041          (II) a financing charge; or
             1042          (III) an interest charge;
             1043          (B) a delivery charge;
             1044          (C) an installation charge;
             1045          (D) a manufacturer rebate on a motor vehicle; or
             1046          (E) a tax or fee legally imposed directly on the consumer.
             1047          (95) "Purchaser" means a person to whom:
             1048          (a) a sale of tangible personal property is made;
             1049          (b) a product is transferred electronically; or
             1050          (c) a service is furnished.



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             1051
         (96) "Regularly rented" means:
             1052          (a) rented to a guest for value three or more times during a calendar year; or
             1053          (b) advertised or held out to the public as a place that is regularly rented to guests for
             1054      value.
             1055          (97) "Rental" is as defined in Subsection (54).
             1056          (98) (a) Except as provided in Subsection (98)(b), "repairs or renovations of tangible
             1057      personal property" means:
             1058          (i) a repair or renovation of tangible personal property that is not permanently attached
             1059      to real property; or
             1060          (ii) attaching tangible personal property or a product transferred electronically to other
             1061      tangible personal property or detaching tangible personal property or a product transferred
             1062      electronically from other tangible personal property if:
             1063          (A) the other tangible personal property to which the tangible personal property or
             1064      product transferred electronically is attached or from which the tangible personal property or
             1065      product transferred electronically is detached is not permanently attached to real property; and
             1066          (B) the attachment of tangible personal property or a product transferred electronically
             1067      to other tangible personal property or detachment of tangible personal property or a product
             1068      transferred electronically from other tangible personal property is made in conjunction with a
             1069      repair or replacement of tangible personal property or a product transferred electronically.
             1070          (b) "Repairs or renovations of tangible personal property" does not include:
             1071          (i) attaching prewritten computer software to other tangible personal property if the
             1072      other tangible personal property to which the prewritten computer software is attached is not
             1073      permanently attached to real property; or
             1074          (ii) detaching prewritten computer software from other tangible personal property if the
             1075      other tangible personal property from which the prewritten computer software is detached is
             1076      not permanently attached to real property.
             1077          (99) "Research and development" means the process of inquiry or experimentation
             1078      aimed at the discovery of facts, devices, technologies, or applications and the process of
             1079      preparing those devices, technologies, or applications for marketing.
             1080          (100) (a) "Residential telecommunications services" means a telecommunications
             1081      service or an ancillary service that is provided to an individual for personal use:



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             1082
         (i) at a residential address; or
             1083          (ii) at an institution, including a nursing home or a school, if the telecommunications
             1084      service or ancillary service is provided to and paid for by the individual residing at the
             1085      institution rather than the institution.
             1086          (b) For purposes of Subsection (100)(a)(i), a residential address includes an:
             1087          (i) apartment; or
             1088          (ii) other individual dwelling unit.
             1089          (101) "Residential use" means the use in or around a home, apartment building,
             1090      sleeping quarters, and similar facilities or accommodations.
             1091          (102) "Retail sale" or "sale at retail" means a sale, lease, or rental for a purpose other
             1092      than:
             1093          (a) resale;
             1094          (b) sublease; or
             1095          (c) subrent.
             1096          (103) (a) "Retailer" means any person engaged in a regularly organized business in
             1097      tangible personal property or any other taxable transaction under Subsection 59-12-103 (1), and
             1098      who is selling to the user or consumer and not for resale.
             1099          (b) "Retailer" includes commission merchants, auctioneers, and any person regularly
             1100      engaged in the business of selling to users or consumers within the state.
             1101          (104) (a) "Sale" means any transfer of title, exchange, or barter, conditional or
             1102      otherwise, in any manner, of tangible personal property or any other taxable transaction under
             1103      Subsection 59-12-103 (1), for consideration.
             1104          (b) "Sale" includes:
             1105          (i) installment and credit sales;
             1106          (ii) any closed transaction constituting a sale;
             1107          (iii) any sale of electrical energy, gas, services, or entertainment taxable under this
             1108      chapter;
             1109          (iv) any transaction if the possession of property is transferred but the seller retains the
             1110      title as security for the payment of the price; and
             1111          (v) any transaction under which right to possession, operation, or use of any article of
             1112      tangible personal property is granted under a lease or contract and the transfer of possession



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             1113
     would be taxable if an outright sale were made.
             1114          (105) "Sale at retail" is as defined in Subsection (102).
             1115          (106) "Sale-leaseback transaction" means a transaction by which title to tangible
             1116      personal property or a product transferred electronically that is subject to a tax under this
             1117      chapter is transferred:
             1118          (a) by a purchaser-lessee;
             1119          (b) to a lessor;
             1120          (c) for consideration; and
             1121          (d) if:
             1122          (i) the purchaser-lessee paid sales and use tax on the purchaser-lessee's initial purchase
             1123      of the tangible personal property or product transferred electronically;
             1124          (ii) the sale of the tangible personal property or product transferred electronically to the
             1125      lessor is intended as a form of financing:
             1126          (A) for the tangible personal property or product transferred electronically; and
             1127          (B) to the purchaser-lessee; and
             1128          (iii) in accordance with generally accepted accounting principles, the purchaser-lessee
             1129      is required to:
             1130          (A) capitalize the tangible personal property or product transferred electronically for
             1131      financial reporting purposes; and
             1132          (B) account for the lease payments as payments made under a financing arrangement.
             1133          (107) "Sales price" is as defined in Subsection (94).
             1134          (108) (a) "Sales relating to schools" means the following sales by, amounts paid to, or
             1135      amounts charged by a school:
             1136          (i) sales that are directly related to the school's educational functions or activities
             1137      including:
             1138          (A) the sale of:
             1139          (I) textbooks;
             1140          (II) textbook fees;
             1141          (III) laboratory fees;
             1142          (IV) laboratory supplies; or
             1143          (V) safety equipment;



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             1144
         (B) the sale of a uniform, protective equipment, or sports or recreational equipment
             1145      that:
             1146          (I) a student is specifically required to wear as a condition of participation in a
             1147      school-related event or school-related activity; and
             1148          (II) is not readily adaptable to general or continued usage to the extent that it takes the
             1149      place of ordinary clothing;
             1150          (C) sales of the following if the net or gross revenues generated by the sales are
             1151      deposited into a school district fund or school fund dedicated to school meals:
             1152          (I) food and food ingredients; or
             1153          (II) prepared food; or
             1154          (D) transportation charges for official school activities; or
             1155          (ii) amounts paid to or amounts charged by a school for admission to a school-related
             1156      event or school-related activity.
             1157          (b) "Sales relating to schools" does not include:
             1158          (i) bookstore sales of items that are not educational materials or supplies;
             1159          (ii) except as provided in Subsection (108)(a)(i)(B):
             1160          (A) clothing;
             1161          (B) clothing accessories or equipment;
             1162          (C) protective equipment; or
             1163          (D) sports or recreational equipment; or
             1164          (iii) amounts paid to or amounts charged by a school for admission to a school-related
             1165      event or school-related activity if the amounts paid or charged are passed through to a person:
             1166          (A) other than a:
             1167          (I) school;
             1168          (II) nonprofit organization authorized by a school board or a governing body of a
             1169      private school to organize and direct a competitive secondary school activity; or
             1170          (III) nonprofit association authorized by a school board or a governing body of a
             1171      private school to organize and direct a competitive secondary school activity; and
             1172          (B) that is required to collect sales and use taxes under this chapter.
             1173          (c) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             1174      commission may make rules defining the term "passed through."



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             1175
         (109) For purposes of this section and Section 59-12-104 , "school":
             1176          (a) means:
             1177          (i) an elementary school or a secondary school that:
             1178          (A) is a:
             1179          (I) public school; or
             1180          (II) private school; and
             1181          (B) provides instruction for one or more grades kindergarten through 12; or
             1182          (ii) a public school district; and
             1183          (b) includes the Electronic High School as defined in Section 53A-15-1002 .
             1184          (110) "Seller" means a person that makes a sale, lease, or rental of:
             1185          (a) tangible personal property;
             1186          (b) a product transferred electronically; or
             1187          (c) a service.
             1188          (111) (a) "Semiconductor fabricating, processing, research, or development materials"
             1189      means tangible personal property or a product transferred electronically if the tangible personal
             1190      property or product transferred electronically is:
             1191          (i) used primarily in the process of:
             1192          (A) (I) manufacturing a semiconductor;
             1193          (II) fabricating a semiconductor; or
             1194          (III) research or development of a:
             1195          (Aa) semiconductor; or
             1196          (Bb) semiconductor manufacturing process; or
             1197          (B) maintaining an environment suitable for a semiconductor; or
             1198          (ii) consumed primarily in the process of:
             1199          (A) (I) manufacturing a semiconductor;
             1200          (II) fabricating a semiconductor; or
             1201          (III) research or development of a:
             1202          (Aa) semiconductor; or
             1203          (Bb) semiconductor manufacturing process; or
             1204          (B) maintaining an environment suitable for a semiconductor.
             1205          (b) "Semiconductor fabricating, processing, research, or development materials"



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             1206
     includes:
             1207          (i) parts used in the repairs or renovations of tangible personal property or a product
             1208      transferred electronically described in Subsection (111)(a); or
             1209          (ii) a chemical, catalyst, or other material used to:
             1210          (A) produce or induce in a semiconductor a:
             1211          (I) chemical change; or
             1212          (II) physical change;
             1213          (B) remove impurities from a semiconductor; or
             1214          (C) improve the marketable condition of a semiconductor.
             1215          (112) "Senior citizen center" means a facility having the primary purpose of providing
             1216      services to the aged as defined in Section 62A-3-101 .
             1217          (113) "Short-term lodging" means tourist home, cottage, hotel, motel, or trailer court
             1218      accommodations and services that are regularly rented for less than 30 consecutive days.
             1219          (114) (a) "Short-term lodging charge" means the full retail price charged for the sale,
             1220      use, or possession of short-term lodging.
             1221          (b) "Short-term lodging charge":
             1222          (i) includes any short-term lodging intermediary charge;
             1223          (ii) includes any other tangible personal property, product, or service, except for air
             1224      transportation or a vehicle rental, that is:
             1225          (A) purchased as part of a transaction that includes the purchase of short-term lodging;
             1226      and
             1227          (B) included, but not separately stated, on the invoice, bill of sale, or similar document
             1228      provided to the purchaser of the short-term lodging; and
             1229          (iii) excludes tax.
             1230          (115) "Short-term lodging intermediary" means a person who:
             1231          (a) is not a short-term lodging operator;
             1232          (b) facilitates the sale, use, or possession of short-term lodging, including brokering,
             1233      coordinating, or in any other way arranging for the purchase, sale, use, or possession of
             1234      short-term lodging by the general public; and
             1235          (c) charges a short-term lodging charge to a purchaser.
             1236          (116) (a) "Short-term lodging intermediary charge" means an amount charged by a



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             1237
     short-term lodging intermediary:
             1238          (i) to the purchaser of short-term lodging for facilitating the sale, use, or possession of
             1239      the short-term lodging; and
             1240          (ii) regardless of how the amount is characterized.
             1241          (b) "Short-term lodging intermediary charge" does not include a commission paid
             1242      directly by a short-term lodging operator to a person for facilitating the sale, use, or possession
             1243      of short-term lodging.
             1244          (117) (a) "Short-term lodging operator" means a person who:
             1245          (i) owns, operates, or manages short-term lodging; and
             1246          (ii) makes short-term lodging available to purchasers for compensation.
             1247          (b) "Short-term lodging operator" does not include:
             1248          (i) a travel agent who does not own, operate, or manage short-term lodging; or
             1249          (ii) another person who:
             1250          (A) does not own, operate, or manage short-term lodging; and
             1251          (B) arranges, books, brokers, coordinates, or facilitates a transaction involving
             1252      short-term lodging between a purchaser and a person who owns, operates, or manages
             1253      short-term lodging.
             1254          (118) "Short-term lodging operator charge" means the difference between the
             1255      short-term lodging charge and the short-term lodging intermediary charge.
             1256          [(113)] (119) "Simplified electronic return" means the electronic return:
             1257          (a) described in Section 318(C) of the agreement; and
             1258          (b) approved by the governing board of the agreement.
             1259          [(114)] (120) "Solar energy" means the sun used as the sole source of energy for
             1260      producing electricity.
             1261          [(115)] (121) (a) "Sports or recreational equipment" means an item:
             1262          (i) designed for human use; and
             1263          (ii) that is:
             1264          (A) worn in conjunction with:
             1265          (I) an athletic activity; or
             1266          (II) a recreational activity; and
             1267          (B) not suitable for general use.



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             1268
         (b) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             1269      commission shall make rules:
             1270          (i) listing the items that constitute "sports or recreational equipment"; and
             1271          (ii) that are consistent with the list of items that constitute "sports or recreational
             1272      equipment" under the agreement.
             1273          [(116)] (122) "State" means the state of Utah, its departments, and agencies.
             1274          [(117)] (123) "Storage" means any keeping or retention of tangible personal property or
             1275      any other taxable transaction under Subsection 59-12-103 (1), in this state for any purpose
             1276      except sale in the regular course of business.
             1277          [(118)] (124) (a) Except as provided in Subsection [(118)] (124)(d) or (e), "tangible
             1278      personal property" means personal property that:
             1279          (i) may be:
             1280          (A) seen;
             1281          (B) weighed;
             1282          (C) measured;
             1283          (D) felt; or
             1284          (E) touched; or
             1285          (ii) is in any manner perceptible to the senses.
             1286          (b) "Tangible personal property" includes:
             1287          (i) electricity;
             1288          (ii) water;
             1289          (iii) gas;
             1290          (iv) steam; or
             1291          (v) prewritten computer software, regardless of the manner in which the prewritten
             1292      computer software is transferred.
             1293          (c) "Tangible personal property" includes the following regardless of whether the item
             1294      is attached to real property:
             1295          (i) a dishwasher;
             1296          (ii) a dryer;
             1297          (iii) a freezer;
             1298          (iv) a microwave;



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             1299
         (v) a refrigerator;
             1300          (vi) a stove;
             1301          (vii) a washer; or
             1302          (viii) an item similar to Subsections [(118)] (124)(c)(i) through (vii) as determined by
             1303      the commission by rule made in accordance with Title 63G, Chapter 3, Utah Administrative
             1304      Rulemaking Act.
             1305          (d) "Tangible personal property" does not include a product that is transferred
             1306      electronically.
             1307          (e) "Tangible personal property" does not include the following if attached to real
             1308      property, regardless of whether the attachment to real property is only through a line that
             1309      supplies water, electricity, gas, telephone, cable, or supplies a similar item as determined by the
             1310      commission by rule made in accordance with Title 63G, Chapter 3, Utah Administrative
             1311      Rulemaking Act:
             1312          (i) a hot water heater;
             1313          (ii) a water filtration system; or
             1314          (iii) a water softener system.
             1315          [(119)] (125) (a) "Telecommunications enabling or facilitating equipment, machinery,
             1316      or software" means an item listed in Subsection [(119)] (125)(b) if that item is purchased or
             1317      leased primarily to enable or facilitate one or more of the following to function:
             1318          (i) telecommunications switching or routing equipment, machinery, or software; or
             1319          (ii) telecommunications transmission equipment, machinery, or software.
             1320          (b) The following apply to Subsection [(119)] (125)(a):
             1321          (i) a pole;
             1322          (ii) software;
             1323          (iii) a supplementary power supply;
             1324          (iv) temperature or environmental equipment or machinery;
             1325          (v) test equipment;
             1326          (vi) a tower; or
             1327          (vii) equipment, machinery, or software that functions similarly to an item listed in
             1328      Subsections [(119)] (125)(b)(i) through (vi) as determined by the commission by rule made in
             1329      accordance with Subsection [(119)] (125)(c).



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             1330
         (c) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             1331      commission may by rule define what constitutes equipment, machinery, or software that
             1332      functions similarly to an item listed in Subsections [(119)] (125)(b)(i) through (vi).
             1333          [(120)] (126) "Telecommunications equipment, machinery, or software required for
             1334      911 service" means equipment, machinery, or software that is required to comply with 47
             1335      C.F.R. Sec. 20.18.
             1336          [(121)] (127) "Telecommunications maintenance or repair equipment, machinery, or
             1337      software" means equipment, machinery, or software purchased or leased primarily to maintain
             1338      or repair one or more of the following, regardless of whether the equipment, machinery, or
             1339      software is purchased or leased as a spare part or as an upgrade or modification to one or more
             1340      of the following:
             1341          (a) telecommunications enabling or facilitating equipment, machinery, or software;
             1342          (b) telecommunications switching or routing equipment, machinery, or software; or
             1343          (c) telecommunications transmission equipment, machinery, or software.
             1344          [(122)] (128) (a) "Telecommunications service" means the electronic conveyance,
             1345      routing, or transmission of audio, data, video, voice, or any other information or signal to a
             1346      point, or among or between points.
             1347          (b) "Telecommunications service" includes:
             1348          (i) an electronic conveyance, routing, or transmission with respect to which a computer
             1349      processing application is used to act:
             1350          (A) on the code, form, or protocol of the content;
             1351          (B) for the purpose of electronic conveyance, routing, or transmission; and
             1352          (C) regardless of whether the service:
             1353          (I) is referred to as voice over Internet protocol service; or
             1354          (II) is classified by the Federal Communications Commission as enhanced or value
             1355      added;
             1356          (ii) an 800 service;
             1357          (iii) a 900 service;
             1358          (iv) a fixed wireless service;
             1359          (v) a mobile wireless service;
             1360          (vi) a postpaid calling service;



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             1361
         (vii) a prepaid calling service;
             1362          (viii) a prepaid wireless calling service; or
             1363          (ix) a private communications service.
             1364          (c) "Telecommunications service" does not include:
             1365          (i) advertising, including directory advertising;
             1366          (ii) an ancillary service;
             1367          (iii) a billing and collection service provided to a third party;
             1368          (iv) a data processing and information service if:
             1369          (A) the data processing and information service allows data to be:
             1370          (I) (Aa) acquired;
             1371          (Bb) generated;
             1372          (Cc) processed;
             1373          (Dd) retrieved; or
             1374          (Ee) stored; and
             1375          (II) delivered by an electronic transmission to a purchaser; and
             1376          (B) the purchaser's primary purpose for the underlying transaction is the processed data
             1377      or information;
             1378          (v) installation or maintenance of the following on a customer's premises:
             1379          (A) equipment; or
             1380          (B) wiring;
             1381          (vi) Internet access service;
             1382          (vii) a paging service;
             1383          (viii) a product transferred electronically, including:
             1384          (A) music;
             1385          (B) reading material;
             1386          (C) a ring tone;
             1387          (D) software; or
             1388          (E) video;
             1389          (ix) a radio and television audio and video programming service:
             1390          (A) regardless of the medium; and
             1391          (B) including:



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             1392
         (I) furnishing conveyance, routing, or transmission of a television audio and video
             1393      programming service by a programming service provider;
             1394          (II) cable service as defined in 47 U.S.C. Sec. 522(6); or
             1395          (III) audio and video programming services delivered by a commercial mobile radio
             1396      service provider as defined in 47 C.F.R. Sec. 20.3;
             1397          (x) a value-added nonvoice data service; or
             1398          (xi) tangible personal property.
             1399          [(123)] (129) (a) "Telecommunications service provider" means a person that:
             1400          (i) owns, controls, operates, or manages a telecommunications service; and
             1401          (ii) engages in an activity described in Subsection [(123)] (129)(a)(i) for the shared use
             1402      with or resale to any person of the telecommunications service.
             1403          (b) A person described in Subsection [(123)] (129)(a) is a telecommunications service
             1404      provider whether or not the Public Service Commission of Utah regulates:
             1405          (i) that person; or
             1406          (ii) the telecommunications service that the person owns, controls, operates, or
             1407      manages.
             1408          [(124)] (130) (a) "Telecommunications switching or routing equipment, machinery, or
             1409      software" means an item listed in Subsection [(124)] (130)(b) if that item is purchased or
             1410      leased primarily for switching or routing:
             1411          (i) an ancillary service;
             1412          (ii) data communications;
             1413          (iii) voice communications; or
             1414          (iv) telecommunications service.
             1415          (b) The following apply to Subsection [(124)] (130)(a):
             1416          (i) a bridge;
             1417          (ii) a computer;
             1418          (iii) a cross connect;
             1419          (iv) a modem;
             1420          (v) a multiplexer;
             1421          (vi) plug in circuitry;
             1422          (vii) a router;



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             1423
         (viii) software;
             1424          (ix) a switch; or
             1425          (x) equipment, machinery, or software that functions similarly to an item listed in
             1426      Subsections [(124)] (130)(b)(i) through (ix) as determined by the commission by rule made in
             1427      accordance with Subsection [(124)] (130)(c).
             1428          (c) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             1429      commission may by rule define what constitutes equipment, machinery, or software that
             1430      functions similarly to an item listed in Subsections [(124)] (130)(b)(i) through (ix).
             1431          [(125)] (131) (a) "Telecommunications transmission equipment, machinery, or
             1432      software" means an item listed in Subsection [(125)] (131)(b) if that item is purchased or
             1433      leased primarily for sending, receiving, or transporting:
             1434          (i) an ancillary service;
             1435          (ii) data communications;
             1436          (iii) voice communications; or
             1437          (iv) telecommunications service.
             1438          (b) The following apply to Subsection [(125)] (131)(a):
             1439          (i) an amplifier;
             1440          (ii) a cable;
             1441          (iii) a closure;
             1442          (iv) a conduit;
             1443          (v) a controller;
             1444          (vi) a duplexer;
             1445          (vii) a filter;
             1446          (viii) an input device;
             1447          (ix) an input/output device;
             1448          (x) an insulator;
             1449          (xi) microwave machinery or equipment;
             1450          (xii) an oscillator;
             1451          (xiii) an output device;
             1452          (xiv) a pedestal;
             1453          (xv) a power converter;



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             1454
         (xvi) a power supply;
             1455          (xvii) a radio channel;
             1456          (xviii) a radio receiver;
             1457          (xix) a radio transmitter;
             1458          (xx) a repeater;
             1459          (xxi) software;
             1460          (xxii) a terminal;
             1461          (xxiii) a timing unit;
             1462          (xxiv) a transformer;
             1463          (xxv) a wire; or
             1464          (xxvi) equipment, machinery, or software that functions similarly to an item listed in
             1465      Subsections [(125)] (131)(b)(i) through (xxv) as determined by the commission by rule made in
             1466      accordance with Subsection [(125)] (131)(c).
             1467          (c) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             1468      commission may by rule define what constitutes equipment, machinery, or software that
             1469      functions similarly to an item listed in Subsections [(125)] (131)(b)(i) through (xxv).
             1470          [(126)] (132) (a) "Textbook for a higher education course" means a textbook or other
             1471      printed material that is required for a course:
             1472          (i) offered by an institution of higher education; and
             1473          (ii) that the purchaser of the textbook or other printed material attends or will attend.
             1474          (b) "Textbook for a higher education course" includes a textbook in electronic format.
             1475          (133) "Travel package" means short-term lodging sold with the following for a single
             1476      retail price:
             1477          (a) air transportation; or
             1478          (b) a vehicle rental.
             1479          [(127)] (134) "Tobacco" means:
             1480          (a) a cigarette;
             1481          (b) a cigar;
             1482          (c) chewing tobacco;
             1483          (d) pipe tobacco; or
             1484          (e) any other item that contains tobacco.



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             1485
         [(128)] (135) "Unassisted amusement device" means an amusement device, skill
             1486      device, or ride device that is started and stopped by the purchaser or renter of the right to use or
             1487      operate the amusement device, skill device, or ride device.
             1488          [(129)] (136) (a) "Use" means the exercise of any right or power over tangible personal
             1489      property, a product transferred electronically, or a service under Subsection 59-12-103 (1),
             1490      incident to the ownership or the leasing of that tangible personal property, product transferred
             1491      electronically, or service.
             1492          (b) "Use" does not include the sale, display, demonstration, or trial of tangible personal
             1493      property, a product transferred electronically, or a service in the regular course of business and
             1494      held for resale.
             1495          [(130)] (137) "Value-added nonvoice data service" means a service:
             1496          (a) that otherwise meets the definition of a telecommunications service except that a
             1497      computer processing application is used to act primarily for a purpose other than conveyance,
             1498      routing, or transmission; and
             1499          (b) with respect to which a computer processing application is used to act on data or
             1500      information:
             1501          (i) code;
             1502          (ii) content;
             1503          (iii) form; or
             1504          (iv) protocol.
             1505          [(131)] (138) (a) Subject to Subsection [(131)] (138)(b), "vehicle" means the following
             1506      that are required to be titled, registered, or titled and registered:
             1507          (i) an aircraft as defined in Section 72-10-102 ;
             1508          (ii) a vehicle as defined in Section 41-1a-102 ;
             1509          (iii) an off-highway vehicle as defined in Section 41-22-2 ; or
             1510          (iv) a vessel as defined in Section 41-1a-102 .
             1511          (b) For purposes of Subsection 59-12-104 (33) only, "vehicle" includes:
             1512          (i) a vehicle described in Subsection (131)(a); or
             1513          (ii) (A) a locomotive;
             1514          (B) a freight car;
             1515          (C) railroad work equipment; or



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             1516
         (D) other railroad rolling stock.
             1517          [(132)] (139) "Vehicle dealer" means a person engaged in the business of buying,
             1518      selling, or exchanging a vehicle as defined in Subsection [(131)] (138).
             1519          [(133)] (140) (a) "Vertical service" means an ancillary service that:
             1520          (i) is offered in connection with one or more telecommunications services; and
             1521          (ii) offers an advanced calling feature that allows a customer to:
             1522          (A) identify a caller; and
             1523          (B) manage multiple calls and call connections.
             1524          (b) "Vertical service" includes an ancillary service that allows a customer to manage a
             1525      conference bridging service.
             1526          [(134)] (141) (a) "Voice mail service" means an ancillary service that enables a
             1527      customer to receive, send, or store a recorded message.
             1528          (b) "Voice mail service" does not include a vertical service that a customer is required
             1529      to have in order to utilize a voice mail service.
             1530          [(135)] (142) (a) Except as provided in Subsection [(135)] (142)(b), "waste energy
             1531      facility" means a facility that generates electricity:
             1532          (i) using as the primary source of energy waste materials that would be placed in a
             1533      landfill or refuse pit if it were not used to generate electricity, including:
             1534          (A) tires;
             1535          (B) waste coal;
             1536          (C) oil shale; or
             1537          (D) municipal solid waste; and
             1538          (ii) in amounts greater than actually required for the operation of the facility.
             1539          (b) "Waste energy facility" does not include a facility that incinerates:
             1540          (i) hospital waste as defined in 40 C.F.R. 60.51c; or
             1541          (ii) medical/infectious waste as defined in 40 C.F.R. 60.51c.
             1542          [(136)] (143) "Watercraft" means a vessel as defined in Section 73-18-2 .
             1543          [(137)] (144) "Wind energy" means wind used as the sole source of energy to produce
             1544      electricity.
             1545          [(138)] (145) "ZIP Code" means a Zoning Improvement Plan Code assigned to a
             1546      geographic location by the United States Postal Service.



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             1547
         Section 2. Section 59-12-102 (Effective 07/01/14) is amended to read:
             1548           59-12-102 (Effective 07/01/14). Definitions.
             1549          As used in this chapter:
             1550          (1) "800 service" means a telecommunications service that:
             1551          (a) allows a caller to dial a toll-free number without incurring a charge for the call; and
             1552          (b) is typically marketed:
             1553          (i) under the name 800 toll-free calling;
             1554          (ii) under the name 855 toll-free calling;
             1555          (iii) under the name 866 toll-free calling;
             1556          (iv) under the name 877 toll-free calling;
             1557          (v) under the name 888 toll-free calling; or
             1558          (vi) under a name similar to Subsections (1)(b)(i) through (v) as designated by the
             1559      Federal Communications Commission.
             1560          (2) (a) "900 service" means an inbound toll telecommunications service that:
             1561          (i) a subscriber purchases;
             1562          (ii) allows a customer of the subscriber described in Subsection (2)(a)(i) to call in to
             1563      the subscriber's:
             1564          (A) prerecorded announcement; or
             1565          (B) live service; and
             1566          (iii) is typically marketed:
             1567          (A) under the name 900 service; or
             1568          (B) under a name similar to Subsection (2)(a)(iii)(A) as designated by the Federal
             1569      Communications Commission.
             1570          (b) "900 service" does not include a charge for:
             1571          (i) a collection service a seller of a telecommunications service provides to a
             1572      subscriber; or
             1573          (ii) the following a subscriber sells to the subscriber's customer:
             1574          (A) a product; or
             1575          (B) a service.
             1576          (3) (a) "Admission or user fees" includes season passes.
             1577          (b) "Admission or user fees" does not include annual membership dues to private



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             1578
     organizations.
             1579          (4) "Agreement" means the Streamlined Sales and Use Tax Agreement adopted on
             1580      November 12, 2002, including amendments made to the Streamlined Sales and Use Tax
             1581      Agreement after November 12, 2002.
             1582          (5) "Agreement combined tax rate" means the sum of the tax rates:
             1583          (a) listed under Subsection (6); and
             1584          (b) that are imposed within a local taxing jurisdiction.
             1585          (6) "Agreement sales and use tax" means a tax imposed under:
             1586          (a) Subsection 59-12-103 (2)(a)(i)(A);
             1587          (b) Subsection 59-12-103 (2)(b)(i);
             1588          (c) Subsection 59-12-103 (2)(c)(i);
             1589          (d) Subsection 59-12-103 (2)(d)(i)(A)(I);
             1590          (e) Section 59-12-204 ;
             1591          (f) Section 59-12-401 ;
             1592          (g) Section 59-12-402 ;
             1593          (h) Section 59-12-703 ;
             1594          (i) Section 59-12-802 ;
             1595          (j) Section 59-12-804 ;
             1596          (k) Section 59-12-1102 ;
             1597          (l) Section 59-12-1302 ;
             1598          (m) Section 59-12-1402 ;
             1599          (n) Section 59-12-1802 ;
             1600          (o) Section 59-12-2003 ;
             1601          (p) Section 59-12-2103 ;
             1602          (q) Section 59-12-2213 ;
             1603          (r) Section 59-12-2214 ;
             1604          (s) Section 59-12-2215 ;
             1605          (t) Section 59-12-2216 ;
             1606          (u) Section 59-12-2217 ; or
             1607          (v) Section 59-12-2218 .
             1608          (7) "Aircraft" is as defined in Section 72-10-102 .



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             1609
         (8) "Aircraft maintenance, repair, and overhaul provider" means a business entity:
             1610          (a) except for:
             1611          (i) an airline as defined in Section 59-2-102 ; or
             1612          (ii) an affiliated group, as defined in Section 59-7-101 , except that "affiliated group"
             1613      includes a corporation that is qualified to do business but is not otherwise doing business in the
             1614      state, of an airline; and
             1615          (b) that has the workers, expertise, and facilities to perform the following, regardless of
             1616      whether the business entity performs the following in this state:
             1617          (i) check, diagnose, overhaul, and repair:
             1618          (A) an onboard system of a fixed wing turbine powered aircraft; and
             1619          (B) the parts that comprise an onboard system of a fixed wing turbine powered aircraft;
             1620          (ii) assemble, change, dismantle, inspect, and test a fixed wing turbine powered aircraft
             1621      engine;
             1622          (iii) perform at least the following maintenance on a fixed wing turbine powered
             1623      aircraft:
             1624          (A) an inspection;
             1625          (B) a repair, including a structural repair or modification;
             1626          (C) changing landing gear; and
             1627          (D) addressing issues related to an aging fixed wing turbine powered aircraft;
             1628          (iv) completely remove the existing paint of a fixed wing turbine powered aircraft and
             1629      completely apply new paint to the fixed wing turbine powered aircraft; and
             1630          (v) refurbish the interior of a fixed wing turbine powered aircraft in a manner that
             1631      results in a change in the fixed wing turbine powered aircraft's certification requirements by the
             1632      authority that certifies the fixed wing turbine powered aircraft.
             1633          (9) "Alcoholic beverage" means a beverage that:
             1634          (a) is suitable for human consumption; and
             1635          (b) contains .5% or more alcohol by volume.
             1636          (10) "Alternative energy" means:
             1637          (a) biomass energy;
             1638          (b) geothermal energy;
             1639          (c) hydroelectric energy;



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             1640
         (d) solar energy;
             1641          (e) wind energy; or
             1642          (f) energy that is derived from:
             1643          (i) coal-to-liquids;
             1644          (ii) nuclear fuel;
             1645          (iii) oil-impregnated diatomaceous earth;
             1646          (iv) oil sands;
             1647          (v) oil shale; or
             1648          (vi) petroleum coke.
             1649          (11) (a) Subject to Subsection (11)(b), "alternative energy electricity production
             1650      facility" means a facility that:
             1651          (i) uses alternative energy to produce electricity; and
             1652          (ii) has a production capacity of 2 megawatts or greater.
             1653          (b) A facility is an alternative energy electricity production facility regardless of
             1654      whether the facility is:
             1655          (i) connected to an electric grid; or
             1656          (ii) located on the premises of an electricity consumer.
             1657          (12) (a) "Ancillary service" means a service associated with, or incidental to, the
             1658      provision of telecommunications service.
             1659          (b) "Ancillary service" includes:
             1660          (i) a conference bridging service;
             1661          (ii) a detailed communications billing service;
             1662          (iii) directory assistance;
             1663          (iv) a vertical service; or
             1664          (v) a voice mail service.
             1665          (13) "Area agency on aging" is as defined in Section 62A-3-101 .
             1666          (14) "Assisted amusement device" means an amusement device, skill device, or ride
             1667      device that is started and stopped by an individual:
             1668          (a) who is not the purchaser or renter of the right to use or operate the amusement
             1669      device, skill device, or ride device; and
             1670          (b) at the direction of the seller of the right to use the amusement device, skill device,



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             1671
     or ride device.
             1672          (15) "Assisted cleaning or washing of tangible personal property" means cleaning or
             1673      washing of tangible personal property if the cleaning or washing labor is primarily performed
             1674      by an individual:
             1675          (a) who is not the purchaser of the cleaning or washing of the tangible personal
             1676      property; and
             1677          (b) at the direction of the seller of the cleaning or washing of the tangible personal
             1678      property.
             1679          (16) "Authorized carrier" means:
             1680          (a) in the case of vehicles operated over public highways, the holder of credentials
             1681      indicating that the vehicle is or will be operated pursuant to both the International Registration
             1682      Plan and the International Fuel Tax Agreement;
             1683          (b) in the case of aircraft, the holder of a Federal Aviation Administration operating
             1684      certificate or air carrier's operating certificate; or
             1685          (c) in the case of locomotives, freight cars, railroad work equipment, or other rolling
             1686      stock, the holder of a certificate issued by the United States Surface Transportation Board.
             1687          (17) (a) Except as provided in Subsection (17)(b), "biomass energy" means any of the
             1688      following that is used as the primary source of energy to produce fuel or electricity:
             1689          (i) material from a plant or tree; or
             1690          (ii) other organic matter that is available on a renewable basis, including:
             1691          (A) slash and brush from forests and woodlands;
             1692          (B) animal waste;
             1693          (C) methane produced:
             1694          (I) at landfills; or
             1695          (II) as a byproduct of the treatment of wastewater residuals;
             1696          (D) aquatic plants; and
             1697          (E) agricultural products.
             1698          (b) "Biomass energy" does not include:
             1699          (i) black liquor;
             1700          (ii) treated woods; or
             1701          (iii) biomass from municipal solid waste other than methane produced:



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             1702
         (A) at landfills; or
             1703          (B) as a byproduct of the treatment of wastewater residuals.
             1704          (18) (a) "Bundled transaction" means the sale of two or more items of tangible personal
             1705      property, products, or services if the tangible personal property, products, or services are:
             1706          (i) distinct and identifiable; and
             1707          (ii) sold for one nonitemized price.
             1708          (b) "Bundled transaction" does not include:
             1709          (i) the sale of tangible personal property if the sales price varies, or is negotiable, on
             1710      the basis of the selection by the purchaser of the items of tangible personal property included in
             1711      the transaction;
             1712          (ii) the sale of real property;
             1713          (iii) the sale of services to real property;
             1714          (iv) the retail sale of tangible personal property and a service if:
             1715          (A) the tangible personal property:
             1716          (I) is essential to the use of the service; and
             1717          (II) is provided exclusively in connection with the service; and
             1718          (B) the service is the true object of the transaction;
             1719          (v) the retail sale of two services if:
             1720          (A) one service is provided that is essential to the use or receipt of a second service;
             1721          (B) the first service is provided exclusively in connection with the second service; and
             1722          (C) the second service is the true object of the transaction;
             1723          (vi) a transaction that includes tangible personal property or a product subject to
             1724      taxation under this chapter and tangible personal property or a product that is not subject to
             1725      taxation under this chapter if the:
             1726          (A) seller's purchase price of the tangible personal property or product subject to
             1727      taxation under this chapter is de minimis; or
             1728          (B) seller's sales price of the tangible personal property or product subject to taxation
             1729      under this chapter is de minimis; and
             1730          (vii) the retail sale of tangible personal property that is not subject to taxation under
             1731      this chapter and tangible personal property that is subject to taxation under this chapter if:
             1732          (A) that retail sale includes:



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             1733
         (I) food and food ingredients;
             1734          (II) a drug;
             1735          (III) durable medical equipment;
             1736          (IV) mobility enhancing equipment;
             1737          (V) an over-the-counter drug;
             1738          (VI) a prosthetic device; or
             1739          (VII) a medical supply; and
             1740          (B) subject to Subsection (18)(f):
             1741          (I) the seller's purchase price of the tangible personal property subject to taxation under
             1742      this chapter is 50% or less of the seller's total purchase price of that retail sale; or
             1743          (II) the seller's sales price of the tangible personal property subject to taxation under
             1744      this chapter is 50% or less of the seller's total sales price of that retail sale.
             1745          (c) (i) For purposes of Subsection (18)(a)(i), tangible personal property, a product, or a
             1746      service that is distinct and identifiable does not include:
             1747          (A) packaging that:
             1748          (I) accompanies the sale of the tangible personal property, product, or service; and
             1749          (II) is incidental or immaterial to the sale of the tangible personal property, product, or
             1750      service;
             1751          (B) tangible personal property, a product, or a service provided free of charge with the
             1752      purchase of another item of tangible personal property, a product, or a service; or
             1753          (C) an item of tangible personal property, a product, or a service included in the
             1754      definition of "purchase price."
             1755          (ii) For purposes of Subsection (18)(c)(i)(B), an item of tangible personal property, a
             1756      product, or a service is provided free of charge with the purchase of another item of tangible
             1757      personal property, a product, or a service if the sales price of the purchased item of tangible
             1758      personal property, product, or service does not vary depending on the inclusion of the tangible
             1759      personal property, product, or service provided free of charge.
             1760          (d) (i) For purposes of Subsection (18)(a)(ii), property sold for one nonitemized price
             1761      does not include a price that is separately identified by tangible personal property, product, or
             1762      service on the following, regardless of whether the following is in paper format or electronic
             1763      format:



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             1764
         (A) a binding sales document; or
             1765          (B) another supporting sales-related document that is available to a purchaser.
             1766          (ii) For purposes of Subsection (18)(d)(i), a binding sales document or another
             1767      supporting sales-related document that is available to a purchaser includes:
             1768          (A) a bill of sale;
             1769          (B) a contract;
             1770          (C) an invoice;
             1771          (D) a lease agreement;
             1772          (E) a periodic notice of rates and services;
             1773          (F) a price list;
             1774          (G) a rate card;
             1775          (H) a receipt; or
             1776          (I) a service agreement.
             1777          (e) (i) For purposes of Subsection (18)(b)(vi), the sales price of tangible personal
             1778      property or a product subject to taxation under this chapter is de minimis if:
             1779          (A) the seller's purchase price of the tangible personal property or product is 10% or
             1780      less of the seller's total purchase price of the bundled transaction; or
             1781          (B) the seller's sales price of the tangible personal property or product is 10% or less of
             1782      the seller's total sales price of the bundled transaction.
             1783          (ii) For purposes of Subsection (18)(b)(vi), a seller:
             1784          (A) shall use the seller's purchase price or the seller's sales price to determine if the
             1785      purchase price or sales price of the tangible personal property or product subject to taxation
             1786      under this chapter is de minimis; and
             1787          (B) may not use a combination of the seller's purchase price and the seller's sales price
             1788      to determine if the purchase price or sales price of the tangible personal property or product
             1789      subject to taxation under this chapter is de minimis.
             1790          (iii) For purposes of Subsection (18)(b)(vi), a seller shall use the full term of a service
             1791      contract to determine if the sales price of tangible personal property or a product is de minimis.
             1792          (f) For purposes of Subsection (18)(b)(vii)(B), a seller may not use a combination of
             1793      the seller's purchase price and the seller's sales price to determine if tangible personal property
             1794      subject to taxation under this chapter is 50% or less of the seller's total purchase price or sales



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             1795
     price of that retail sale.
             1796          (19) "Certified automated system" means software certified by the governing board of
             1797      the agreement that:
             1798          (a) calculates the agreement sales and use tax imposed within a local taxing
             1799      jurisdiction:
             1800          (i) on a transaction; and
             1801          (ii) in the states that are members of the agreement;
             1802          (b) determines the amount of agreement sales and use tax to remit to a state that is a
             1803      member of the agreement; and
             1804          (c) maintains a record of the transaction described in Subsection (19)(a)(i).
             1805          (20) "Certified service provider" means an agent certified:
             1806          (a) by the governing board of the agreement; and
             1807          (b) to perform all of a seller's sales and use tax functions for an agreement sales and
             1808      use tax other than the seller's obligation under Section 59-12-124 to remit a tax on the seller's
             1809      own purchases.
             1810          (21) (a) Subject to Subsection (21)(b), "clothing" means all human wearing apparel
             1811      suitable for general use.
             1812          (b) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             1813      commission shall make rules:
             1814          (i) listing the items that constitute "clothing"; and
             1815          (ii) that are consistent with the list of items that constitute "clothing" under the
             1816      agreement.
             1817          (22) "Coal-to-liquid" means the process of converting coal into a liquid synthetic fuel.
             1818          (23) "Commercial use" means the use of gas, electricity, heat, coal, fuel oil, or other
             1819      fuels that does not constitute industrial use under Subsection (51) or residential use under
             1820      Subsection (101).
             1821          (24) (a) "Common carrier" means a person engaged in or transacting the business of
             1822      transporting passengers, freight, merchandise, or other property for hire within this state.
             1823          (b) (i) "Common carrier" does not include a person who, at the time the person is
             1824      traveling to or from that person's place of employment, transports a passenger to or from the
             1825      passenger's place of employment.



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             1826
         (ii) For purposes of Subsection (24)(b)(i), in accordance with Title 63G, Chapter 3,
             1827      Utah Administrative Rulemaking Act, the commission may make rules defining what
             1828      constitutes a person's place of employment.
             1829          (25) "Component part" includes:
             1830          (a) poultry, dairy, and other livestock feed, and their components;
             1831          (b) baling ties and twine used in the baling of hay and straw;
             1832          (c) fuel used for providing temperature control of orchards and commercial
             1833      greenhouses doing a majority of their business in wholesale sales, and for providing power for
             1834      off-highway type farm machinery; and
             1835          (d) feed, seeds, and seedlings.
             1836          (26) "Computer" means an electronic device that accepts information:
             1837          (a) (i) in digital form; or
             1838          (ii) in a form similar to digital form; and
             1839          (b) manipulates that information for a result based on a sequence of instructions.
             1840          (27) "Computer software" means a set of coded instructions designed to cause:
             1841          (a) a computer to perform a task; or
             1842          (b) automatic data processing equipment to perform a task.
             1843          (28) "Computer software maintenance contract" means a contract that obligates a seller
             1844      of computer software to provide a customer with:
             1845          (a) future updates or upgrades to computer software;
             1846          (b) support services with respect to computer software; or
             1847          (c) a combination of Subsections (28)(a) and (b).
             1848          (29) (a) "Conference bridging service" means an ancillary service that links two or
             1849      more participants of an audio conference call or video conference call.
             1850          (b) "Conference bridging service" may include providing a telephone number as part of
             1851      the ancillary service described in Subsection (29)(a).
             1852          (c) "Conference bridging service" does not include a telecommunications service used
             1853      to reach the ancillary service described in Subsection (29)(a).
             1854          (30) "Construction materials" means any tangible personal property that will be
             1855      converted into real property.
             1856          (31) "Delivered electronically" means delivered to a purchaser by means other than



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             1857
     tangible storage media.
             1858          (32) (a) "Delivery charge" means a charge:
             1859          (i) by a seller of:
             1860          (A) tangible personal property;
             1861          (B) a product transferred electronically; or
             1862          (C) services; and
             1863          (ii) for preparation and delivery of the tangible personal property, product transferred
             1864      electronically, or services described in Subsection (32)(a)(i) to a location designated by the
             1865      purchaser.
             1866          (b) "Delivery charge" includes a charge for the following:
             1867          (i) transportation;
             1868          (ii) shipping;
             1869          (iii) postage;
             1870          (iv) handling;
             1871          (v) crating; or
             1872          (vi) packing.
             1873          (33) "Detailed telecommunications billing service" means an ancillary service of
             1874      separately stating information pertaining to individual calls on a customer's billing statement.
             1875          (34) "Dietary supplement" means a product, other than tobacco, that:
             1876          (a) is intended to supplement the diet;
             1877          (b) contains one or more of the following dietary ingredients:
             1878          (i) a vitamin;
             1879          (ii) a mineral;
             1880          (iii) an herb or other botanical;
             1881          (iv) an amino acid;
             1882          (v) a dietary substance for use by humans to supplement the diet by increasing the total
             1883      dietary intake; or
             1884          (vi) a concentrate, metabolite, constituent, extract, or combination of any ingredient
             1885      described in Subsections (34)(b)(i) through (v);
             1886          (c) (i) except as provided in Subsection (34)(c)(ii), is intended for ingestion in:
             1887          (A) tablet form;



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             1888
         (B) capsule form;
             1889          (C) powder form;
             1890          (D) softgel form;
             1891          (E) gelcap form; or
             1892          (F) liquid form; or
             1893          (ii) notwithstanding Subsection (34)(c)(i), if the product is not intended for ingestion in
             1894      a form described in Subsections (34)(c)(i)(A) through (F), is not represented:
             1895          (A) as conventional food; and
             1896          (B) for use as a sole item of:
             1897          (I) a meal; or
             1898          (II) the diet; and
             1899          (d) is required to be labeled as a dietary supplement:
             1900          (i) identifiable by the "Supplemental Facts" box found on the label; and
             1901          (ii) as required by 21 C.F.R. Sec. 101.36.
             1902          (35) (a) "Direct mail" means printed material delivered or distributed by United States
             1903      mail or other delivery service:
             1904          (i) to:
             1905          (A) a mass audience; or
             1906          (B) addressees on a mailing list provided:
             1907          (I) by a purchaser of the mailing list; or
             1908          (II) at the discretion of the purchaser of the mailing list; and
             1909          (ii) if the cost of the printed material is not billed directly to the recipients.
             1910          (b) "Direct mail" includes tangible personal property supplied directly or indirectly by a
             1911      purchaser to a seller of direct mail for inclusion in a package containing the printed material.
             1912          (c) "Direct mail" does not include multiple items of printed material delivered to a
             1913      single address.
             1914          (36) "Directory assistance" means an ancillary service of providing:
             1915          (a) address information; or
             1916          (b) telephone number information.
             1917          (37) (a) "Disposable home medical equipment or supplies" means medical equipment
             1918      or supplies that:



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             1919
         (i) cannot withstand repeated use; and
             1920          (ii) are purchased by, for, or on behalf of a person other than:
             1921          (A) a health care facility as defined in Section 26-21-2 ;
             1922          (B) a health care provider as defined in Section 78B-3-403 ;
             1923          (C) an office of a health care provider described in Subsection (37)(a)(ii)(B); or
             1924          (D) a person similar to a person described in Subsections (37)(a)(ii)(A) through (C).
             1925          (b) "Disposable home medical equipment or supplies" does not include:
             1926          (i) a drug;
             1927          (ii) durable medical equipment;
             1928          (iii) a hearing aid;
             1929          (iv) a hearing aid accessory;
             1930          (v) mobility enhancing equipment; or
             1931          (vi) tangible personal property used to correct impaired vision, including:
             1932          (A) eyeglasses; or
             1933          (B) contact lenses.
             1934          (c) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             1935      commission may by rule define what constitutes medical equipment or supplies.
             1936          (38) (a) "Drug" means a compound, substance, or preparation, or a component of a
             1937      compound, substance, or preparation that is:
             1938          (i) recognized in:
             1939          (A) the official United States Pharmacopoeia;
             1940          (B) the official Homeopathic Pharmacopoeia of the United States;
             1941          (C) the official National Formulary; or
             1942          (D) a supplement to a publication listed in Subsections (38)(a)(i)(A) through (C);
             1943          (ii) intended for use in the:
             1944          (A) diagnosis of disease;
             1945          (B) cure of disease;
             1946          (C) mitigation of disease;
             1947          (D) treatment of disease; or
             1948          (E) prevention of disease; or
             1949          (iii) intended to affect:



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             1950
         (A) the structure of the body; or
             1951          (B) any function of the body.
             1952          (b) "Drug" does not include:
             1953          (i) food and food ingredients;
             1954          (ii) a dietary supplement;
             1955          (iii) an alcoholic beverage; or
             1956          (iv) a prosthetic device.
             1957          (39) (a) Except as provided in Subsection (39)(c), "durable medical equipment" means
             1958      equipment that:
             1959          (i) can withstand repeated use;
             1960          (ii) is primarily and customarily used to serve a medical purpose;
             1961          (iii) generally is not useful to a person in the absence of illness or injury; and
             1962          (iv) is not worn in or on the body.
             1963          (b) "Durable medical equipment" includes parts used in the repair or replacement of the
             1964      equipment described in Subsection (39)(a).
             1965          (c) Notwithstanding Subsection (39)(a), "durable medical equipment" does not include
             1966      mobility enhancing equipment.
             1967          (40) "Electronic" means:
             1968          (a) relating to technology; and
             1969          (b) having:
             1970          (i) electrical capabilities;
             1971          (ii) digital capabilities;
             1972          (iii) magnetic capabilities;
             1973          (iv) wireless capabilities;
             1974          (v) optical capabilities;
             1975          (vi) electromagnetic capabilities; or
             1976          (vii) capabilities similar to Subsections (40)(b)(i) through (vi).
             1977          (41) "Employee" is as defined in Section 59-10-401 .
             1978          (42) "Fixed guideway" means a public transit facility that uses and occupies:
             1979          (a) rail for the use of public transit; or
             1980          (b) a separate right-of-way for the use of public transit.



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             1981
         (43) "Fixed wing turbine powered aircraft" means an aircraft that:
             1982          (a) is powered by turbine engines;
             1983          (b) operates on jet fuel; and
             1984          (c) has wings that are permanently attached to the fuselage of the aircraft.
             1985          (44) "Fixed wireless service" means a telecommunications service that provides radio
             1986      communication between fixed points.
             1987          (45) (a) "Food and food ingredients" means substances:
             1988          (i) regardless of whether the substances are in:
             1989          (A) liquid form;
             1990          (B) concentrated form;
             1991          (C) solid form;
             1992          (D) frozen form;
             1993          (E) dried form; or
             1994          (F) dehydrated form; and
             1995          (ii) that are:
             1996          (A) sold for:
             1997          (I) ingestion by humans; or
             1998          (II) chewing by humans; and
             1999          (B) consumed for the substance's:
             2000          (I) taste; or
             2001          (II) nutritional value.
             2002          (b) "Food and food ingredients" includes an item described in Subsection (86)(b)(iii).
             2003          (c) "Food and food ingredients" does not include:
             2004          (i) an alcoholic beverage;
             2005          (ii) tobacco; or
             2006          (iii) prepared food.
             2007          (46) (a) "Fundraising sales" means sales:
             2008          (i) (A) made by a school; or
             2009          (B) made by a school student;
             2010          (ii) that are for the purpose of raising funds for the school to purchase equipment,
             2011      materials, or provide transportation; and



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             2012
         (iii) that are part of an officially sanctioned school activity.
             2013          (b) For purposes of Subsection (46)(a)(iii), "officially sanctioned school activity"
             2014      means a school activity:
             2015          (i) that is conducted in accordance with a formal policy adopted by the school or school
             2016      district governing the authorization and supervision of fundraising activities;
             2017          (ii) that does not directly or indirectly compensate an individual teacher or other
             2018      educational personnel by direct payment, commissions, or payment in kind; and
             2019          (iii) the net or gross revenues from which are deposited in a dedicated account
             2020      controlled by the school or school district.
             2021          (47) "Geothermal energy" means energy contained in heat that continuously flows
             2022      outward from the earth that is used as the sole source of energy to produce electricity.
             2023          (48) "Governing board of the agreement" means the governing board of the agreement
             2024      that is:
             2025          (a) authorized to administer the agreement; and
             2026          (b) established in accordance with the agreement.
             2027          (49) (a) For purposes of Subsection 59-12-104 (41), "governmental entity" means:
             2028          (i) the executive branch of the state, including all departments, institutions, boards,
             2029      divisions, bureaus, offices, commissions, and committees;
             2030          (ii) the judicial branch of the state, including the courts, the Judicial Council, the
             2031      Office of the Court Administrator, and similar administrative units in the judicial branch;
             2032          (iii) the legislative branch of the state, including the House of Representatives, the
             2033      Senate, the Legislative Printing Office, the Office of Legislative Research and General
             2034      Counsel, the Office of the Legislative Auditor General, and the Office of the Legislative Fiscal
             2035      Analyst;
             2036          (iv) the National Guard;
             2037          (v) an independent entity as defined in Section 63E-1-102 ; or
             2038          (vi) a political subdivision as defined in Section 17B-1-102 .
             2039          (b) "Governmental entity" does not include the state systems of public and higher
             2040      education, including:
             2041          (i) a college campus of the Utah College of Applied Technology;
             2042          (ii) a school;



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             2043
         (iii) the State Board of Education;
             2044          (iv) the State Board of Regents; or
             2045          (v) an institution of higher education.
             2046          (50) "Hydroelectric energy" means water used as the sole source of energy to produce
             2047      electricity.
             2048          (51) "Industrial use" means the use of natural gas, electricity, heat, coal, fuel oil, or
             2049      other fuels:
             2050          (a) in mining or extraction of minerals;
             2051          (b) in agricultural operations to produce an agricultural product up to the time of
             2052      harvest or placing the agricultural product into a storage facility, including:
             2053          (i) commercial greenhouses;
             2054          (ii) irrigation pumps;
             2055          (iii) farm machinery;
             2056          (iv) implements of husbandry as defined in Subsection 41-1a-102 (23) that are not
             2057      registered under Title 41, Chapter 1a, Part 2, Registration; and
             2058          (v) other farming activities;
             2059          (c) in manufacturing tangible personal property at an establishment described in SIC
             2060      Codes 2000 to 3999 of the 1987 Standard Industrial Classification Manual of the federal
             2061      Executive Office of the President, Office of Management and Budget;
             2062          (d) by a scrap recycler if:
             2063          (i) from a fixed location, the scrap recycler utilizes machinery or equipment to process
             2064      one or more of the following items into prepared grades of processed materials for use in new
             2065      products:
             2066          (A) iron;
             2067          (B) steel;
             2068          (C) nonferrous metal;
             2069          (D) paper;
             2070          (E) glass;
             2071          (F) plastic;
             2072          (G) textile; or
             2073          (H) rubber; and



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             2074
         (ii) the new products under Subsection (51)(d)(i) would otherwise be made with
             2075      nonrecycled materials; or
             2076          (e) in producing a form of energy or steam described in Subsection 54-2-1 (2)(a) by a
             2077      cogeneration facility as defined in Section 54-2-1 .
             2078          (52) (a) Except as provided in Subsection (52)(b), "installation charge" means a charge
             2079      for installing:
             2080          (i) tangible personal property; or
             2081          (ii) a product transferred electronically.
             2082          (b) "Installation charge" does not include a charge for:
             2083          (i) repairs or renovations of:
             2084          (A) tangible personal property; or
             2085          (B) a product transferred electronically; or
             2086          (ii) attaching tangible personal property or a product transferred electronically:
             2087          (A) to other tangible personal property; and
             2088          (B) as part of a manufacturing or fabrication process.
             2089          (53) "Institution of higher education" means an institution of higher education listed in
             2090      Section 53B-2-101 .
             2091          (54) (a) "Lease" or "rental" means a transfer of possession or control of tangible
             2092      personal property or a product transferred electronically for:
             2093          (i) (A) a fixed term; or
             2094          (B) an indeterminate term; and
             2095          (ii) consideration.
             2096          (b) "Lease" or "rental" includes an agreement covering a motor vehicle and trailer if the
             2097      amount of consideration may be increased or decreased by reference to the amount realized
             2098      upon sale or disposition of the property as defined in Section 7701(h)(1), Internal Revenue
             2099      Code.
             2100          (c) "Lease" or "rental" does not include:
             2101          (i) a transfer of possession or control of property under a security agreement or
             2102      deferred payment plan that requires the transfer of title upon completion of the required
             2103      payments;
             2104          (ii) a transfer of possession or control of property under an agreement that requires the



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             2105
     transfer of title:
             2106          (A) upon completion of required payments; and
             2107          (B) if the payment of an option price does not exceed the greater of:
             2108          (I) $100; or
             2109          (II) 1% of the total required payments; or
             2110          (iii) providing tangible personal property along with an operator for a fixed period of
             2111      time or an indeterminate period of time if the operator is necessary for equipment to perform as
             2112      designed.
             2113          (d) For purposes of Subsection (54)(c)(iii), an operator is necessary for equipment to
             2114      perform as designed if the operator's duties exceed the:
             2115          (i) set-up of tangible personal property;
             2116          (ii) maintenance of tangible personal property; or
             2117          (iii) inspection of tangible personal property.
             2118          (55) "Life science establishment" means an establishment in this state that is classified
             2119      under the following NAICS codes of the 2007 North American Industry Classification System
             2120      of the federal Executive Office of the President, Office of Management and Budget:
             2121          (a) NAICS Code 33911, Medical Equipment and Supplies Manufacturing;
             2122          (b) NAICS Code 334510, Electromedical and Electrotherapeutic Apparatus
             2123      Manufacturing; or
             2124          (c) NAICS Code 334517, Irradiation Apparatus Manufacturing.
             2125          (56) "Life science research and development facility" means a facility owned, leased,
             2126      or rented by a life science establishment if research and development is performed in 51% or
             2127      more of the total area of the facility.
             2128          (57) "Load and leave" means delivery to a purchaser by use of a tangible storage media
             2129      if the tangible storage media is not physically transferred to the purchaser.
             2130          (58) "Local taxing jurisdiction" means a:
             2131          (a) county that is authorized to impose an agreement sales and use tax;
             2132          (b) city that is authorized to impose an agreement sales and use tax; or
             2133          (c) town that is authorized to impose an agreement sales and use tax.
             2134          (59) "Manufactured home" is as defined in Section 15A-1-302 .
             2135          (60) For purposes of Section 59-12-104 , "manufacturing facility" means:



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             2136
         (a) an establishment described in SIC Codes 2000 to 3999 of the 1987 Standard
             2137      Industrial Classification Manual of the federal Executive Office of the President, Office of
             2138      Management and Budget;
             2139          (b) a scrap recycler if:
             2140          (i) from a fixed location, the scrap recycler utilizes machinery or equipment to process
             2141      one or more of the following items into prepared grades of processed materials for use in new
             2142      products:
             2143          (A) iron;
             2144          (B) steel;
             2145          (C) nonferrous metal;
             2146          (D) paper;
             2147          (E) glass;
             2148          (F) plastic;
             2149          (G) textile; or
             2150          (H) rubber; and
             2151          (ii) the new products under Subsection (60)(b)(i) would otherwise be made with
             2152      nonrecycled materials; or
             2153          (c) a cogeneration facility as defined in Section 54-2-1 .
             2154          (61) "Member of the immediate family of the producer" means a person who is related
             2155      to a producer described in Subsection 59-12-104 (20)(a) as a:
             2156          (a) child or stepchild, regardless of whether the child or stepchild is:
             2157          (i) an adopted child or adopted stepchild; or
             2158          (ii) a foster child or foster stepchild;
             2159          (b) grandchild or stepgrandchild;
             2160          (c) grandparent or stepgrandparent;
             2161          (d) nephew or stepnephew;
             2162          (e) niece or stepniece;
             2163          (f) parent or stepparent;
             2164          (g) sibling or stepsibling;
             2165          (h) spouse;
             2166          (i) person who is the spouse of a person described in Subsections (61)(a) through (g);



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             2167
     or
             2168          (j) person similar to a person described in Subsections (61)(a) through (i) as
             2169      determined by the commission by rule made in accordance with Title 63G, Chapter 3, Utah
             2170      Administrative Rulemaking Act.
             2171          (62) "Mobile home" is as defined in Section 15A-1-302 .
             2172          (63) "Mobile telecommunications service" is as defined in the Mobile
             2173      Telecommunications Sourcing Act, 4 U.S.C. Sec. 124.
             2174          (64) (a) "Mobile wireless service" means a telecommunications service, regardless of
             2175      the technology used, if:
             2176          (i) the origination point of the conveyance, routing, or transmission is not fixed;
             2177          (ii) the termination point of the conveyance, routing, or transmission is not fixed; or
             2178          (iii) the origination point described in Subsection (64)(a)(i) and the termination point
             2179      described in Subsection (64)(a)(ii) are not fixed.
             2180          (b) "Mobile wireless service" includes a telecommunications service that is provided
             2181      by a commercial mobile radio service provider.
             2182          (c) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             2183      commission may by rule define "commercial mobile radio service provider."
             2184          (65) (a) Except as provided in Subsection (65)(c), "mobility enhancing equipment"
             2185      means equipment that is:
             2186          (i) primarily and customarily used to provide or increase the ability to move from one
             2187      place to another;
             2188          (ii) appropriate for use in a:
             2189          (A) home; or
             2190          (B) motor vehicle; and
             2191          (iii) not generally used by persons with normal mobility.
             2192          (b) "Mobility enhancing equipment" includes parts used in the repair or replacement of
             2193      the equipment described in Subsection (65)(a).
             2194          (c) Notwithstanding Subsection (65)(a), "mobility enhancing equipment" does not
             2195      include:
             2196          (i) a motor vehicle;
             2197          (ii) equipment on a motor vehicle if that equipment is normally provided by the motor



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             2198
     vehicle manufacturer;
             2199          (iii) durable medical equipment; or
             2200          (iv) a prosthetic device.
             2201          (66) "Model 1 seller" means a seller registered under the agreement that has selected a
             2202      certified service provider as the seller's agent to perform all of the seller's sales and use tax
             2203      functions for agreement sales and use taxes other than the seller's obligation under Section
             2204      59-12-124 to remit a tax on the seller's own purchases.
             2205          (67) "Model 2 seller" means a seller registered under the agreement that:
             2206          (a) except as provided in Subsection (67)(b), has selected a certified automated system
             2207      to perform the seller's sales tax functions for agreement sales and use taxes; and
             2208          (b) notwithstanding Subsection (67)(a), retains responsibility for remitting all of the
             2209      sales tax:
             2210          (i) collected by the seller; and
             2211          (ii) to the appropriate local taxing jurisdiction.
             2212          (68) (a) Subject to Subsection (68)(b), "model 3 seller" means a seller registered under
             2213      the agreement that has:
             2214          (i) sales in at least five states that are members of the agreement;
             2215          (ii) total annual sales revenues of at least $500,000,000;
             2216          (iii) a proprietary system that calculates the amount of tax:
             2217          (A) for an agreement sales and use tax; and
             2218          (B) due to each local taxing jurisdiction; and
             2219          (iv) entered into a performance agreement with the governing board of the agreement.
             2220          (b) For purposes of Subsection (68)(a), "model 3 seller" includes an affiliated group of
             2221      sellers using the same proprietary system.
             2222          (69) "Model 4 seller" means a seller that is registered under the agreement and is not a
             2223      model 1 seller, model 2 seller, or model 3 seller.
             2224          (70) "Modular home" means a modular unit as defined in Section 15A-1-302 .
             2225          (71) "Motor vehicle" is as defined in Section 41-1a-102 .
             2226          (72) "Oil sands" means impregnated bituminous sands that:
             2227          (a) contain a heavy, thick form of petroleum that is released when heated, mixed with
             2228      other hydrocarbons, or otherwise treated;



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             2229
         (b) yield mixtures of liquid hydrocarbon; and
             2230          (c) require further processing other than mechanical blending before becoming finished
             2231      petroleum products.
             2232          (73) "Oil shale" means a group of fine black to dark brown shales containing kerogen
             2233      material that yields petroleum upon heating and distillation.
             2234          (74) "Optional computer software maintenance contract" means a computer software
             2235      maintenance contract that a customer is not obligated to purchase as a condition to the retail
             2236      sale of computer software.
             2237          (75) (a) "Other fuels" means products that burn independently to produce heat or
             2238      energy.
             2239          (b) "Other fuels" includes oxygen when it is used in the manufacturing of tangible
             2240      personal property.
             2241          (76) (a) "Paging service" means a telecommunications service that provides
             2242      transmission of a coded radio signal for the purpose of activating a specific pager.
             2243          (b) For purposes of Subsection (76)(a), the transmission of a coded radio signal
             2244      includes a transmission by message or sound.
             2245          (77) "Pawnbroker" is as defined in Section 13-32a-102 .
             2246          (78) "Pawn transaction" is as defined in Section 13-32a-102 .
             2247          (79) (a) "Permanently attached to real property" means that for tangible personal
             2248      property attached to real property:
             2249          (i) the attachment of the tangible personal property to the real property:
             2250          (A) is essential to the use of the tangible personal property; and
             2251          (B) suggests that the tangible personal property will remain attached to the real
             2252      property in the same place over the useful life of the tangible personal property; or
             2253          (ii) if the tangible personal property is detached from the real property, the detachment
             2254      would:
             2255          (A) cause substantial damage to the tangible personal property; or
             2256          (B) require substantial alteration or repair of the real property to which the tangible
             2257      personal property is attached.
             2258          (b) "Permanently attached to real property" includes:
             2259          (i) the attachment of an accessory to the tangible personal property if the accessory is:



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             2260
         (A) essential to the operation of the tangible personal property; and
             2261          (B) attached only to facilitate the operation of the tangible personal property;
             2262          (ii) a temporary detachment of tangible personal property from real property for a
             2263      repair or renovation if the repair or renovation is performed where the tangible personal
             2264      property and real property are located; or
             2265          (iii) property attached to oil, gas, or water pipelines, except for the property listed in
             2266      Subsection (79)(c)(iii) or (iv).
             2267          (c) "Permanently attached to real property" does not include:
             2268          (i) the attachment of portable or movable tangible personal property to real property if
             2269      that portable or movable tangible personal property is attached to real property only for:
             2270          (A) convenience;
             2271          (B) stability; or
             2272          (C) for an obvious temporary purpose;
             2273          (ii) the detachment of tangible personal property from real property except for the
             2274      detachment described in Subsection (79)(b)(ii);
             2275          (iii) an attachment of the following tangible personal property to real property if the
             2276      attachment to real property is only through a line that supplies water, electricity, gas,
             2277      telecommunications, cable, or supplies a similar item as determined by the commission by rule
             2278      made in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act:
             2279          (A) a computer;
             2280          (B) a telephone;
             2281          (C) a television; or
             2282          (D) tangible personal property similar to Subsections (79)(c)(iii)(A) through (C) as
             2283      determined by the commission by rule made in accordance with Title 63G, Chapter 3, Utah
             2284      Administrative Rulemaking Act; or
             2285          (iv) an item listed in Subsection [(117)] (124)(c).
             2286          (80) "Person" includes any individual, firm, partnership, joint venture, association,
             2287      corporation, estate, trust, business trust, receiver, syndicate, this state, any county, city,
             2288      municipality, district, or other local governmental entity of the state, or any group or
             2289      combination acting as a unit.
             2290          (81) "Place of primary use":



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             2291
         (a) for telecommunications service other than mobile telecommunications service,
             2292      means the street address representative of where the customer's use of the telecommunications
             2293      service primarily occurs, which shall be:
             2294          (i) the residential street address of the customer; or
             2295          (ii) the primary business street address of the customer; or
             2296          (b) for mobile telecommunications service, is as defined in the Mobile
             2297      Telecommunications Sourcing Act, 4 U.S.C. Sec. 124.
             2298          (82) (a) "Postpaid calling service" means a telecommunications service a person
             2299      obtains by making a payment on a call-by-call basis:
             2300          (i) through the use of a:
             2301          (A) bank card;
             2302          (B) credit card;
             2303          (C) debit card; or
             2304          (D) travel card; or
             2305          (ii) by a charge made to a telephone number that is not associated with the origination
             2306      or termination of the telecommunications service.
             2307          (b) "Postpaid calling service" includes a service, except for a prepaid wireless calling
             2308      service, that would be a prepaid wireless calling service if the service were exclusively a
             2309      telecommunications service.
             2310          (83) "Postproduction" means an activity related to the finishing or duplication of a
             2311      medium described in Subsection 59-12-104 (54)(a).
             2312          (84) "Prepaid calling service" means a telecommunications service:
             2313          (a) that allows a purchaser access to telecommunications service that is exclusively
             2314      telecommunications service;
             2315          (b) that:
             2316          (i) is paid for in advance; and
             2317          (ii) enables the origination of a call using an:
             2318          (A) access number; or
             2319          (B) authorization code;
             2320          (c) that is dialed:
             2321          (i) manually; or



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             2322
         (ii) electronically; and
             2323          (d) sold in predetermined units or dollars that decline:
             2324          (i) by a known amount; and
             2325          (ii) with use.
             2326          (85) "Prepaid wireless calling service" means a telecommunications service:
             2327          (a) that provides the right to utilize:
             2328          (i) mobile wireless service; and
             2329          (ii) other service that is not a telecommunications service, including:
             2330          (A) the download of a product transferred electronically;
             2331          (B) a content service; or
             2332          (C) an ancillary service;
             2333          (b) that:
             2334          (i) is paid for in advance; and
             2335          (ii) enables the origination of a call using an:
             2336          (A) access number; or
             2337          (B) authorization code;
             2338          (c) that is dialed:
             2339          (i) manually; or
             2340          (ii) electronically; and
             2341          (d) sold in predetermined units or dollars that decline:
             2342          (i) by a known amount; and
             2343          (ii) with use.
             2344          (86) (a) "Prepared food" means:
             2345          (i) food:
             2346          (A) sold in a heated state; or
             2347          (B) heated by a seller;
             2348          (ii) two or more food ingredients mixed or combined by the seller for sale as a single
             2349      item; or
             2350          (iii) except as provided in Subsection (86)(c), food sold with an eating utensil provided
             2351      by the seller, including a:
             2352          (A) plate;



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             2353
         (B) knife;
             2354          (C) fork;
             2355          (D) spoon;
             2356          (E) glass;
             2357          (F) cup;
             2358          (G) napkin; or
             2359          (H) straw.
             2360          (b) "Prepared food" does not include:
             2361          (i) food that a seller only:
             2362          (A) cuts;
             2363          (B) repackages; or
             2364          (C) pasteurizes; or
             2365          (ii) (A) the following:
             2366          (I) raw egg;
             2367          (II) raw fish;
             2368          (III) raw meat;
             2369          (IV) raw poultry; or
             2370          (V) a food containing an item described in Subsections (86)(b)(ii)(A)(I) through (IV);
             2371      and
             2372          (B) if the Food and Drug Administration recommends in Chapter 3, Part 401.11 of the
             2373      Food and Drug Administration's Food Code that a consumer cook the items described in
             2374      Subsection (86)(b)(ii)(A) to prevent food borne illness; or
             2375          (iii) the following if sold without eating utensils provided by the seller:
             2376          (A) food and food ingredients sold by a seller if the seller's proper primary
             2377      classification under the 2002 North American Industry Classification System of the federal
             2378      Executive Office of the President, Office of Management and Budget, is manufacturing in
             2379      Sector 311, Food Manufacturing, except for Subsector 3118, Bakeries and Tortilla
             2380      Manufacturing;
             2381          (B) food and food ingredients sold in an unheated state:
             2382          (I) by weight or volume; and
             2383          (II) as a single item; or



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             2384
         (C) a bakery item, including:
             2385          (I) a bagel;
             2386          (II) a bar;
             2387          (III) a biscuit;
             2388          (IV) bread;
             2389          (V) a bun;
             2390          (VI) a cake;
             2391          (VII) a cookie;
             2392          (VIII) a croissant;
             2393          (IX) a danish;
             2394          (X) a donut;
             2395          (XI) a muffin;
             2396          (XII) a pastry;
             2397          (XIII) a pie;
             2398          (XIV) a roll;
             2399          (XV) a tart;
             2400          (XVI) a torte; or
             2401          (XVII) a tortilla.
             2402          (c) Notwithstanding Subsection (86)(a)(iii), an eating utensil provided by the seller
             2403      does not include the following used to transport the food:
             2404          (i) a container; or
             2405          (ii) packaging.
             2406          (87) "Prescription" means an order, formula, or recipe that is issued:
             2407          (a) (i) orally;
             2408          (ii) in writing;
             2409          (iii) electronically; or
             2410          (iv) by any other manner of transmission; and
             2411          (b) by a licensed practitioner authorized by the laws of a state.
             2412          (88) (a) Except as provided in Subsection (88)(b)(ii) or (iii), "prewritten computer
             2413      software" means computer software that is not designed and developed:
             2414          (i) by the author or other creator of the computer software; and



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             2415
         (ii) to the specifications of a specific purchaser.
             2416          (b) "Prewritten computer software" includes:
             2417          (i) a prewritten upgrade to computer software if the prewritten upgrade to the computer
             2418      software is not designed and developed:
             2419          (A) by the author or other creator of the computer software; and
             2420          (B) to the specifications of a specific purchaser;
             2421          (ii) notwithstanding Subsection (88)(a), computer software designed and developed by
             2422      the author or other creator of the computer software to the specifications of a specific purchaser
             2423      if the computer software is sold to a person other than the purchaser; or
             2424          (iii) notwithstanding Subsection (88)(a) and except as provided in Subsection (88)(c),
             2425      prewritten computer software or a prewritten portion of prewritten computer software:
             2426          (A) that is modified or enhanced to any degree; and
             2427          (B) if the modification or enhancement described in Subsection (88)(b)(iii)(A) is
             2428      designed and developed to the specifications of a specific purchaser.
             2429          (c) Notwithstanding Subsection (88)(b)(iii), "prewritten computer software" does not
             2430      include a modification or enhancement described in Subsection (88)(b)(iii) if the charges for
             2431      the modification or enhancement are:
             2432          (i) reasonable; and
             2433          (ii) subject to Subsections 59-12-103 (2)(e)(ii) and (2)(f)(i), separately stated on the
             2434      invoice or other statement of price provided to the purchaser at the time of sale or later, as
             2435      demonstrated by:
             2436          (A) the books and records the seller keeps at the time of the transaction in the regular
             2437      course of business, including books and records the seller keeps at the time of the transaction in
             2438      the regular course of business for nontax purposes;
             2439          (B) a preponderance of the facts and circumstances at the time of the transaction; and
             2440          (C) the understanding of all of the parties to the transaction.
             2441          (89) (a) "Private communication service" means a telecommunications service:
             2442          (i) that entitles a customer to exclusive or priority use of one or more communications
             2443      channels between or among termination points; and
             2444          (ii) regardless of the manner in which the one or more communications channels are
             2445      connected.



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             2446
         (b) "Private communications service" includes the following provided in connection
             2447      with the use of one or more communications channels:
             2448          (i) an extension line;
             2449          (ii) a station;
             2450          (iii) switching capacity; or
             2451          (iv) another associated service that is provided in connection with the use of one or
             2452      more communications channels as defined in Section 59-12-215 .
             2453          (90) (a) Except as provided in Subsection (90)(b), "product transferred electronically"
             2454      means a product transferred electronically that would be subject to a tax under this chapter if
             2455      that product was transferred in a manner other than electronically.
             2456          (b) "Product transferred electronically" does not include:
             2457          (i) an ancillary service;
             2458          (ii) computer software; or
             2459          (iii) a telecommunications service.
             2460          (91) (a) "Prosthetic device" means a device that is worn on or in the body to:
             2461          (i) artificially replace a missing portion of the body;
             2462          (ii) prevent or correct a physical deformity or physical malfunction; or
             2463          (iii) support a weak or deformed portion of the body.
             2464          (b) "Prosthetic device" includes:
             2465          (i) parts used in the repairs or renovation of a prosthetic device;
             2466          (ii) replacement parts for a prosthetic device;
             2467          (iii) a dental prosthesis; or
             2468          (iv) a hearing aid.
             2469          (c) "Prosthetic device" does not include:
             2470          (i) corrective eyeglasses; or
             2471          (ii) contact lenses.
             2472          (92) (a) "Protective equipment" means an item:
             2473          (i) for human wear; and
             2474          (ii) that is:
             2475          (A) designed as protection:
             2476          (I) to the wearer against injury or disease; or



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             2477
         (II) against damage or injury of other persons or property; and
             2478          (B) not suitable for general use.
             2479          (b) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             2480      commission shall make rules:
             2481          (i) listing the items that constitute "protective equipment"; and
             2482          (ii) that are consistent with the list of items that constitute "protective equipment"
             2483      under the agreement.
             2484          (93) (a) For purposes of Subsection 59-12-104 (41), "publication" means any written or
             2485      printed matter, other than a photocopy:
             2486          (i) regardless of:
             2487          (A) characteristics;
             2488          (B) copyright;
             2489          (C) form;
             2490          (D) format;
             2491          (E) method of reproduction; or
             2492          (F) source; and
             2493          (ii) made available in printed or electronic format.
             2494          (b) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             2495      commission may by rule define the term "photocopy."
             2496          (94) (a) "Purchase price" and "sales price" mean the total amount of consideration:
             2497          (i) valued in money; and
             2498          (ii) for which tangible personal property, a product transferred electronically, or
             2499      services are:
             2500          (A) sold;
             2501          (B) leased; or
             2502          (C) rented.
             2503          (b) "Purchase price" and "sales price" include:
             2504          (i) the seller's cost of the tangible personal property, a product transferred
             2505      electronically, or services sold;
             2506          (ii) expenses of the seller, including:
             2507          (A) the cost of materials used;



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             2508
         (B) a labor cost;
             2509          (C) a service cost;
             2510          (D) interest;
             2511          (E) a loss;
             2512          (F) the cost of transportation to the seller; or
             2513          (G) a tax imposed on the seller;
             2514          (iii) a charge by the seller for any service necessary to complete the sale; or
             2515          (iv) consideration a seller receives from a person other than the purchaser if:
             2516          (A) (I) the seller actually receives consideration from a person other than the purchaser;
             2517      and
             2518          (II) the consideration described in Subsection (94)(b)(iv)(A)(I) is directly related to a
             2519      price reduction or discount on the sale;
             2520          (B) the seller has an obligation to pass the price reduction or discount through to the
             2521      purchaser;
             2522          (C) the amount of the consideration attributable to the sale is fixed and determinable by
             2523      the seller at the time of the sale to the purchaser; and
             2524          (D) (I) (Aa) the purchaser presents a certificate, coupon, or other documentation to the
             2525      seller to claim a price reduction or discount; and
             2526          (Bb) a person other than the seller authorizes, distributes, or grants the certificate,
             2527      coupon, or other documentation with the understanding that the person other than the seller
             2528      will reimburse any seller to whom the certificate, coupon, or other documentation is presented;
             2529          (II) the purchaser identifies that purchaser to the seller as a member of a group or
             2530      organization allowed a price reduction or discount, except that a preferred customer card that is
             2531      available to any patron of a seller does not constitute membership in a group or organization
             2532      allowed a price reduction or discount; or
             2533          (III) the price reduction or discount is identified as a third party price reduction or
             2534      discount on the:
             2535          (Aa) invoice the purchaser receives; or
             2536          (Bb) certificate, coupon, or other documentation the purchaser presents.
             2537          (c) "Purchase price" and "sales price" do not include:
             2538          (i) a discount:



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             2539
         (A) in a form including:
             2540          (I) cash;
             2541          (II) term; or
             2542          (III) coupon;
             2543          (B) that is allowed by a seller;
             2544          (C) taken by a purchaser on a sale; and
             2545          (D) that is not reimbursed by a third party; or
             2546          (ii) subject to Subsections 59-12-103 (2)(e)(ii) and (2)(f)(i), the following if separately
             2547      stated on an invoice, bill of sale, or similar document provided to the purchaser at the time of
             2548      sale or later, as demonstrated by the books and records the seller keeps at the time of the
             2549      transaction in the regular course of business, including books and records the seller keeps at the
             2550      time of the transaction in the regular course of business for nontax purposes, by a
             2551      preponderance of the facts and circumstances at the time of the transaction, and by the
             2552      understanding of all of the parties to the transaction:
             2553          (A) the following from credit extended on the sale of tangible personal property or
             2554      services:
             2555          (I) a carrying charge;
             2556          (II) a financing charge; or
             2557          (III) an interest charge;
             2558          (B) a delivery charge;
             2559          (C) an installation charge;
             2560          (D) a manufacturer rebate on a motor vehicle; or
             2561          (E) a tax or fee legally imposed directly on the consumer.
             2562          (95) "Purchaser" means a person to whom:
             2563          (a) a sale of tangible personal property is made;
             2564          (b) a product is transferred electronically; or
             2565          (c) a service is furnished.
             2566          (96) "Regularly rented" means:
             2567          (a) rented to a guest for value three or more times during a calendar year; or
             2568          (b) advertised or held out to the public as a place that is regularly rented to guests for
             2569      value.



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             2570
         (97) "Rental" is as defined in Subsection (54).
             2571          (98) (a) Except as provided in Subsection (98)(b), "repairs or renovations of tangible
             2572      personal property" means:
             2573          (i) a repair or renovation of tangible personal property that is not permanently attached
             2574      to real property; or
             2575          (ii) attaching tangible personal property or a product transferred electronically to other
             2576      tangible personal property or detaching tangible personal property or a product transferred
             2577      electronically from other tangible personal property if:
             2578          (A) the other tangible personal property to which the tangible personal property or
             2579      product transferred electronically is attached or from which the tangible personal property or
             2580      product transferred electronically is detached is not permanently attached to real property; and
             2581          (B) the attachment of tangible personal property or a product transferred electronically
             2582      to other tangible personal property or detachment of tangible personal property or a product
             2583      transferred electronically from other tangible personal property is made in conjunction with a
             2584      repair or replacement of tangible personal property or a product transferred electronically.
             2585          (b) "Repairs or renovations of tangible personal property" does not include:
             2586          (i) attaching prewritten computer software to other tangible personal property if the
             2587      other tangible personal property to which the prewritten computer software is attached is not
             2588      permanently attached to real property; or
             2589          (ii) detaching prewritten computer software from other tangible personal property if the
             2590      other tangible personal property from which the prewritten computer software is detached is
             2591      not permanently attached to real property.
             2592          (99) "Research and development" means the process of inquiry or experimentation
             2593      aimed at the discovery of facts, devices, technologies, or applications and the process of
             2594      preparing those devices, technologies, or applications for marketing.
             2595          (100) (a) "Residential telecommunications services" means a telecommunications
             2596      service or an ancillary service that is provided to an individual for personal use:
             2597          (i) at a residential address; or
             2598          (ii) at an institution, including a nursing home or a school, if the telecommunications
             2599      service or ancillary service is provided to and paid for by the individual residing at the
             2600      institution rather than the institution.



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             2601
         (b) For purposes of Subsection (100)(a)(i), a residential address includes an:
             2602          (i) apartment; or
             2603          (ii) other individual dwelling unit.
             2604          (101) "Residential use" means the use in or around a home, apartment building,
             2605      sleeping quarters, and similar facilities or accommodations.
             2606          (102) "Retail sale" or "sale at retail" means a sale, lease, or rental for a purpose other
             2607      than:
             2608          (a) resale;
             2609          (b) sublease; or
             2610          (c) subrent.
             2611          (103) (a) "Retailer" means any person engaged in a regularly organized business in
             2612      tangible personal property or any other taxable transaction under Subsection 59-12-103 (1), and
             2613      who is selling to the user or consumer and not for resale.
             2614          (b) "Retailer" includes commission merchants, auctioneers, and any person regularly
             2615      engaged in the business of selling to users or consumers within the state.
             2616          (104) (a) "Sale" means any transfer of title, exchange, or barter, conditional or
             2617      otherwise, in any manner, of tangible personal property or any other taxable transaction under
             2618      Subsection 59-12-103 (1), for consideration.
             2619          (b) "Sale" includes:
             2620          (i) installment and credit sales;
             2621          (ii) any closed transaction constituting a sale;
             2622          (iii) any sale of electrical energy, gas, services, or entertainment taxable under this
             2623      chapter;
             2624          (iv) any transaction if the possession of property is transferred but the seller retains the
             2625      title as security for the payment of the price; and
             2626          (v) any transaction under which right to possession, operation, or use of any article of
             2627      tangible personal property is granted under a lease or contract and the transfer of possession
             2628      would be taxable if an outright sale were made.
             2629          (105) "Sale at retail" is as defined in Subsection (102).
             2630          (106) "Sale-leaseback transaction" means a transaction by which title to tangible
             2631      personal property or a product transferred electronically that is subject to a tax under this



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             2632
     chapter is transferred:
             2633          (a) by a purchaser-lessee;
             2634          (b) to a lessor;
             2635          (c) for consideration; and
             2636          (d) if:
             2637          (i) the purchaser-lessee paid sales and use tax on the purchaser-lessee's initial purchase
             2638      of the tangible personal property or product transferred electronically;
             2639          (ii) the sale of the tangible personal property or product transferred electronically to the
             2640      lessor is intended as a form of financing:
             2641          (A) for the tangible personal property or product transferred electronically; and
             2642          (B) to the purchaser-lessee; and
             2643          (iii) in accordance with generally accepted accounting principles, the purchaser-lessee
             2644      is required to:
             2645          (A) capitalize the tangible personal property or product transferred electronically for
             2646      financial reporting purposes; and
             2647          (B) account for the lease payments as payments made under a financing arrangement.
             2648          (107) "Sales price" is as defined in Subsection (94).
             2649          (108) (a) "Sales relating to schools" means the following sales by, amounts paid to, or
             2650      amounts charged by a school:
             2651          (i) sales that are directly related to the school's educational functions or activities
             2652      including:
             2653          (A) the sale of:
             2654          (I) textbooks;
             2655          (II) textbook fees;
             2656          (III) laboratory fees;
             2657          (IV) laboratory supplies; or
             2658          (V) safety equipment;
             2659          (B) the sale of a uniform, protective equipment, or sports or recreational equipment
             2660      that:
             2661          (I) a student is specifically required to wear as a condition of participation in a
             2662      school-related event or school-related activity; and



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             2663
         (II) is not readily adaptable to general or continued usage to the extent that it takes the
             2664      place of ordinary clothing;
             2665          (C) sales of the following if the net or gross revenues generated by the sales are
             2666      deposited into a school district fund or school fund dedicated to school meals:
             2667          (I) food and food ingredients; or
             2668          (II) prepared food; or
             2669          (D) transportation charges for official school activities; or
             2670          (ii) amounts paid to or amounts charged by a school for admission to a school-related
             2671      event or school-related activity.
             2672          (b) "Sales relating to schools" does not include:
             2673          (i) bookstore sales of items that are not educational materials or supplies;
             2674          (ii) except as provided in Subsection (108)(a)(i)(B):
             2675          (A) clothing;
             2676          (B) clothing accessories or equipment;
             2677          (C) protective equipment; or
             2678          (D) sports or recreational equipment; or
             2679          (iii) amounts paid to or amounts charged by a school for admission to a school-related
             2680      event or school-related activity if the amounts paid or charged are passed through to a person:
             2681          (A) other than a:
             2682          (I) school;
             2683          (II) nonprofit organization authorized by a school board or a governing body of a
             2684      private school to organize and direct a competitive secondary school activity; or
             2685          (III) nonprofit association authorized by a school board or a governing body of a
             2686      private school to organize and direct a competitive secondary school activity; and
             2687          (B) that is required to collect sales and use taxes under this chapter.
             2688          (c) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             2689      commission may make rules defining the term "passed through."
             2690          (109) For purposes of this section and Section 59-12-104 , "school":
             2691          (a) means:
             2692          (i) an elementary school or a secondary school that:
             2693          (A) is a:



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             2694
         (I) public school; or
             2695          (II) private school; and
             2696          (B) provides instruction for one or more grades kindergarten through 12; or
             2697          (ii) a public school district; and
             2698          (b) includes the Electronic High School as defined in Section 53A-15-1002 .
             2699          (110) "Seller" means a person that makes a sale, lease, or rental of:
             2700          (a) tangible personal property;
             2701          (b) a product transferred electronically; or
             2702          (c) a service.
             2703          (111) (a) "Semiconductor fabricating, processing, research, or development materials"
             2704      means tangible personal property or a product transferred electronically if the tangible personal
             2705      property or product transferred electronically is:
             2706          (i) used primarily in the process of:
             2707          (A) (I) manufacturing a semiconductor;
             2708          (II) fabricating a semiconductor; or
             2709          (III) research or development of a:
             2710          (Aa) semiconductor; or
             2711          (Bb) semiconductor manufacturing process; or
             2712          (B) maintaining an environment suitable for a semiconductor; or
             2713          (ii) consumed primarily in the process of:
             2714          (A) (I) manufacturing a semiconductor;
             2715          (II) fabricating a semiconductor; or
             2716          (III) research or development of a:
             2717          (Aa) semiconductor; or
             2718          (Bb) semiconductor manufacturing process; or
             2719          (B) maintaining an environment suitable for a semiconductor.
             2720          (b) "Semiconductor fabricating, processing, research, or development materials"
             2721      includes:
             2722          (i) parts used in the repairs or renovations of tangible personal property or a product
             2723      transferred electronically described in Subsection (111)(a); or
             2724          (ii) a chemical, catalyst, or other material used to:



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             2725
         (A) produce or induce in a semiconductor a:
             2726          (I) chemical change; or
             2727          (II) physical change;
             2728          (B) remove impurities from a semiconductor; or
             2729          (C) improve the marketable condition of a semiconductor.
             2730          (112) "Senior citizen center" means a facility having the primary purpose of providing
             2731      services to the aged as defined in Section 62A-3-101 .
             2732          (113) "Short-term lodging" means tourist home, cottage, hotel, motel, or trailer court
             2733      accommodations and services that are regularly rented for less than 30 consecutive days.
             2734          (114) (a) "Short-term lodging charge" means the full retail price charged for the sale,
             2735      use, or possession of short-term lodging.
             2736          (b) "Short-term lodging charge":
             2737          (i) includes any short-term lodging intermediary charge;
             2738          (ii) includes any other tangible personal property, product, or service, except for air
             2739      transportation or a vehicle rental, that is:
             2740          (A) purchased as part of a transaction that includes the purchase of short-term lodging;
             2741      and
             2742          (B) included, but not separately stated, on the invoice, bill of sale, or similar document
             2743      provided to the purchaser of the short-term lodging; and
             2744          (iii) excludes tax.
             2745          (115) "Short-term lodging intermediary" means a person who:
             2746          (a) is not a short-term lodging operator;
             2747          (b) facilitates the sale, use, or possession of short-term lodging, including brokering,
             2748      coordinating, or in any other way arranging for the purchase, sale, use, or possession of
             2749      short-term lodging by the general public; and
             2750          (c) charges a short-term lodging charge to a purchaser.
             2751          (116) (a) "Short-term lodging intermediary charge" means an amount charged by a
             2752      short-term lodging intermediary:
             2753          (i) to the purchaser of short-term lodging for facilitating the sale, use, or possession of
             2754      the short-term lodging; and
             2755          (ii) regardless of how the amount is characterized.



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             2756
         (b) "Short-term lodging intermediary charge" does not include a commission paid
             2757      directly by a short-term lodging operator to a person for facilitating the sale, use, or possession
             2758      of short-term lodging.
             2759          (117) (a) "Short-term lodging operator" means a person who:
             2760          (i) owns, operates, or manages short-term lodging; and
             2761          (ii) makes short-term lodging available to purchasers for compensation.
             2762          (b) "Short-term lodging operator" does not include:
             2763          (i) a travel agent who does not own, operate, or manage short-term lodging; or
             2764          (ii) another person who:
             2765          (A) does not own, operate, or manage short-term lodging; and
             2766          (B) arranges, books, brokers, coordinates, or facilitates a transaction involving
             2767      short-term lodging between a purchaser and a person who owns, operates, or manages
             2768      short-term lodging.
             2769          (118) "Short-term lodging operator charge" means the difference between the
             2770      short-term lodging charge and the short-term lodging intermediary charge.
             2771          [(113)] (119) "Simplified electronic return" means the electronic return:
             2772          (a) described in Section 318(C) of the agreement; and
             2773          (b) approved by the governing board of the agreement.
             2774          [(114)] (120) "Solar energy" means the sun used as the sole source of energy for
             2775      producing electricity.
             2776          [(115)] (121) (a) "Sports or recreational equipment" means an item:
             2777          (i) designed for human use; and
             2778          (ii) that is:
             2779          (A) worn in conjunction with:
             2780          (I) an athletic activity; or
             2781          (II) a recreational activity; and
             2782          (B) not suitable for general use.
             2783          (b) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             2784      commission shall make rules:
             2785          (i) listing the items that constitute "sports or recreational equipment"; and
             2786          (ii) that are consistent with the list of items that constitute "sports or recreational



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             2787
     equipment" under the agreement.
             2788          [(116)] (122) "State" means the state of Utah, its departments, and agencies.
             2789          [(117)] (123) "Storage" means any keeping or retention of tangible personal property or
             2790      any other taxable transaction under Subsection 59-12-103 (1), in this state for any purpose
             2791      except sale in the regular course of business.
             2792          [(118)] (124) (a) Except as provided in Subsection [(118)] (124)(d) or (e), "tangible
             2793      personal property" means personal property that:
             2794          (i) may be:
             2795          (A) seen;
             2796          (B) weighed;
             2797          (C) measured;
             2798          (D) felt; or
             2799          (E) touched; or
             2800          (ii) is in any manner perceptible to the senses.
             2801          (b) "Tangible personal property" includes:
             2802          (i) electricity;
             2803          (ii) water;
             2804          (iii) gas;
             2805          (iv) steam; or
             2806          (v) prewritten computer software, regardless of the manner in which the prewritten
             2807      computer software is transferred.
             2808          (c) "Tangible personal property" includes the following regardless of whether the item
             2809      is attached to real property:
             2810          (i) a dishwasher;
             2811          (ii) a dryer;
             2812          (iii) a freezer;
             2813          (iv) a microwave;
             2814          (v) a refrigerator;
             2815          (vi) a stove;
             2816          (vii) a washer; or
             2817          (viii) an item similar to Subsections [(118)] (124)(c)(i) through (vii) as determined by



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             2818
     the commission by rule made in accordance with Title 63G, Chapter 3, Utah Administrative
             2819      Rulemaking Act.
             2820          (d) "Tangible personal property" does not include a product that is transferred
             2821      electronically.
             2822          (e) "Tangible personal property" does not include the following if attached to real
             2823      property, regardless of whether the attachment to real property is only through a line that
             2824      supplies water, electricity, gas, telephone, cable, or supplies a similar item as determined by the
             2825      commission by rule made in accordance with Title 63G, Chapter 3, Utah Administrative
             2826      Rulemaking Act:
             2827          (i) a hot water heater;
             2828          (ii) a water filtration system; or
             2829          (iii) a water softener system.
             2830          [(119)] (125) (a) "Telecommunications enabling or facilitating equipment, machinery,
             2831      or software" means an item listed in Subsection [(119)] (125)(b) if that item is purchased or
             2832      leased primarily to enable or facilitate one or more of the following to function:
             2833          (i) telecommunications switching or routing equipment, machinery, or software; or
             2834          (ii) telecommunications transmission equipment, machinery, or software.
             2835          (b) The following apply to Subsection [(119)] (125)(a):
             2836          (i) a pole;
             2837          (ii) software;
             2838          (iii) a supplementary power supply;
             2839          (iv) temperature or environmental equipment or machinery;
             2840          (v) test equipment;
             2841          (vi) a tower; or
             2842          (vii) equipment, machinery, or software that functions similarly to an item listed in
             2843      Subsections [(119)] (125)(b)(i) through (vi) as determined by the commission by rule made in
             2844      accordance with Subsection [(119)] (125)(c).
             2845          (c) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             2846      commission may by rule define what constitutes equipment, machinery, or software that
             2847      functions similarly to an item listed in Subsections [(119)] (125)(b)(i) through (vi).
             2848          [(120)] (126) "Telecommunications equipment, machinery, or software required for



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             2849
     911 service" means equipment, machinery, or software that is required to comply with 47
             2850      C.F.R. Sec. 20.18.
             2851          [(121)] (127) "Telecommunications maintenance or repair equipment, machinery, or
             2852      software" means equipment, machinery, or software purchased or leased primarily to maintain
             2853      or repair one or more of the following, regardless of whether the equipment, machinery, or
             2854      software is purchased or leased as a spare part or as an upgrade or modification to one or more
             2855      of the following:
             2856          (a) telecommunications enabling or facilitating equipment, machinery, or software;
             2857          (b) telecommunications switching or routing equipment, machinery, or software; or
             2858          (c) telecommunications transmission equipment, machinery, or software.
             2859          [(122)] (128) (a) "Telecommunications service" means the electronic conveyance,
             2860      routing, or transmission of audio, data, video, voice, or any other information or signal to a
             2861      point, or among or between points.
             2862          (b) "Telecommunications service" includes:
             2863          (i) an electronic conveyance, routing, or transmission with respect to which a computer
             2864      processing application is used to act:
             2865          (A) on the code, form, or protocol of the content;
             2866          (B) for the purpose of electronic conveyance, routing, or transmission; and
             2867          (C) regardless of whether the service:
             2868          (I) is referred to as voice over Internet protocol service; or
             2869          (II) is classified by the Federal Communications Commission as enhanced or value
             2870      added;
             2871          (ii) an 800 service;
             2872          (iii) a 900 service;
             2873          (iv) a fixed wireless service;
             2874          (v) a mobile wireless service;
             2875          (vi) a postpaid calling service;
             2876          (vii) a prepaid calling service;
             2877          (viii) a prepaid wireless calling service; or
             2878          (ix) a private communications service.
             2879          (c) "Telecommunications service" does not include:



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             2880
         (i) advertising, including directory advertising;
             2881          (ii) an ancillary service;
             2882          (iii) a billing and collection service provided to a third party;
             2883          (iv) a data processing and information service if:
             2884          (A) the data processing and information service allows data to be:
             2885          (I) (Aa) acquired;
             2886          (Bb) generated;
             2887          (Cc) processed;
             2888          (Dd) retrieved; or
             2889          (Ee) stored; and
             2890          (II) delivered by an electronic transmission to a purchaser; and
             2891          (B) the purchaser's primary purpose for the underlying transaction is the processed data
             2892      or information;
             2893          (v) installation or maintenance of the following on a customer's premises:
             2894          (A) equipment; or
             2895          (B) wiring;
             2896          (vi) Internet access service;
             2897          (vii) a paging service;
             2898          (viii) a product transferred electronically, including:
             2899          (A) music;
             2900          (B) reading material;
             2901          (C) a ring tone;
             2902          (D) software; or
             2903          (E) video;
             2904          (ix) a radio and television audio and video programming service:
             2905          (A) regardless of the medium; and
             2906          (B) including:
             2907          (I) furnishing conveyance, routing, or transmission of a television audio and video
             2908      programming service by a programming service provider;
             2909          (II) cable service as defined in 47 U.S.C. Sec. 522(6); or
             2910          (III) audio and video programming services delivered by a commercial mobile radio



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             2911
     service provider as defined in 47 C.F.R. Sec. 20.3;
             2912          (x) a value-added nonvoice data service; or
             2913          (xi) tangible personal property.
             2914          [(123)] (129) (a) "Telecommunications service provider" means a person that:
             2915          (i) owns, controls, operates, or manages a telecommunications service; and
             2916          (ii) engages in an activity described in Subsection [(123)] (129)(a)(i) for the shared use
             2917      with or resale to any person of the telecommunications service.
             2918          (b) A person described in Subsection [(123)] (129)(a) is a telecommunications service
             2919      provider whether or not the Public Service Commission of Utah regulates:
             2920          (i) that person; or
             2921          (ii) the telecommunications service that the person owns, controls, operates, or
             2922      manages.
             2923          [(124)] (130) (a) "Telecommunications switching or routing equipment, machinery, or
             2924      software" means an item listed in Subsection [(124)] (130)(b) if that item is purchased or
             2925      leased primarily for switching or routing:
             2926          (i) an ancillary service;
             2927          (ii) data communications;
             2928          (iii) voice communications; or
             2929          (iv) telecommunications service.
             2930          (b) The following apply to Subsection [(124)] (130)(a):
             2931          (i) a bridge;
             2932          (ii) a computer;
             2933          (iii) a cross connect;
             2934          (iv) a modem;
             2935          (v) a multiplexer;
             2936          (vi) plug in circuitry;
             2937          (vii) a router;
             2938          (viii) software;
             2939          (ix) a switch; or
             2940          (x) equipment, machinery, or software that functions similarly to an item listed in
             2941      Subsections [(124)] (130)(b)(i) through (ix) as determined by the commission by rule made in



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             2942
     accordance with Subsection [(124)] (130)(c).
             2943          (c) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             2944      commission may by rule define what constitutes equipment, machinery, or software that
             2945      functions similarly to an item listed in Subsections [(124)] (130)(b)(i) through (ix).
             2946          [(125)] (131) (a) "Telecommunications transmission equipment, machinery, or
             2947      software" means an item listed in Subsection [(125)] (131)(b) if that item is purchased or
             2948      leased primarily for sending, receiving, or transporting:
             2949          (i) an ancillary service;
             2950          (ii) data communications;
             2951          (iii) voice communications; or
             2952          (iv) telecommunications service.
             2953          (b) The following apply to Subsection [(125)] (131)(a):
             2954          (i) an amplifier;
             2955          (ii) a cable;
             2956          (iii) a closure;
             2957          (iv) a conduit;
             2958          (v) a controller;
             2959          (vi) a duplexer;
             2960          (vii) a filter;
             2961          (viii) an input device;
             2962          (ix) an input/output device;
             2963          (x) an insulator;
             2964          (xi) microwave machinery or equipment;
             2965          (xii) an oscillator;
             2966          (xiii) an output device;
             2967          (xiv) a pedestal;
             2968          (xv) a power converter;
             2969          (xvi) a power supply;
             2970          (xvii) a radio channel;
             2971          (xviii) a radio receiver;
             2972          (xix) a radio transmitter;



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             2973
         (xx) a repeater;
             2974          (xxi) software;
             2975          (xxii) a terminal;
             2976          (xxiii) a timing unit;
             2977          (xxiv) a transformer;
             2978          (xxv) a wire; or
             2979          (xxvi) equipment, machinery, or software that functions similarly to an item listed in
             2980      Subsections [(125)] (131)(b)(i) through (xxv) as determined by the commission by rule made in
             2981      accordance with Subsection [(125)] (131)(c).
             2982          (c) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             2983      commission may by rule define what constitutes equipment, machinery, or software that
             2984      functions similarly to an item listed in Subsections [(125)] (131)(b)(i) through (xxv).
             2985          [(126)] (132) (a) "Textbook for a higher education course" means a textbook or other
             2986      printed material that is required for a course:
             2987          (i) offered by an institution of higher education; and
             2988          (ii) that the purchaser of the textbook or other printed material attends or will attend.
             2989          (b) "Textbook for a higher education course" includes a textbook in electronic format.
             2990          (133) "Travel package" means short-term lodging sold with the following for a single
             2991      retail price:
             2992          (a) air transportation; or
             2993          (b) a vehicle rental.
             2994          [(127)] (134) "Tobacco" means:
             2995          (a) a cigarette;
             2996          (b) a cigar;
             2997          (c) chewing tobacco;
             2998          (d) pipe tobacco; or
             2999          (e) any other item that contains tobacco.
             3000          [(128)] (135) "Unassisted amusement device" means an amusement device, skill
             3001      device, or ride device that is started and stopped by the purchaser or renter of the right to use or
             3002      operate the amusement device, skill device, or ride device.
             3003          [(129)] (136) (a) "Use" means the exercise of any right or power over tangible personal



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             3004
     property, a product transferred electronically, or a service under Subsection 59-12-103 (1),
             3005      incident to the ownership or the leasing of that tangible personal property, product transferred
             3006      electronically, or service.
             3007          (b) "Use" does not include the sale, display, demonstration, or trial of tangible personal
             3008      property, a product transferred electronically, or a service in the regular course of business and
             3009      held for resale.
             3010          [(130)] (137) "Value-added nonvoice data service" means a service:
             3011          (a) that otherwise meets the definition of a telecommunications service except that a
             3012      computer processing application is used to act primarily for a purpose other than conveyance,
             3013      routing, or transmission; and
             3014          (b) with respect to which a computer processing application is used to act on data or
             3015      information:
             3016          (i) code;
             3017          (ii) content;
             3018          (iii) form; or
             3019          (iv) protocol.
             3020          [(131)] (138) (a) Subject to Subsection [(131)] (138)(b), "vehicle" means the following
             3021      that are required to be titled, registered, or titled and registered:
             3022          (i) an aircraft as defined in Section 72-10-102 ;
             3023          (ii) a vehicle as defined in Section 41-1a-102 ;
             3024          (iii) an off-highway vehicle as defined in Section 41-22-2 ; or
             3025          (iv) a vessel as defined in Section 41-1a-102 .
             3026          (b) For purposes of Subsection 59-12-104 (33) only, "vehicle" includes:
             3027          (i) a vehicle described in Subsection [(131)] (138)(a); or
             3028          (ii) (A) a locomotive;
             3029          (B) a freight car;
             3030          (C) railroad work equipment; or
             3031          (D) other railroad rolling stock.
             3032          [(132)] (139) "Vehicle dealer" means a person engaged in the business of buying,
             3033      selling, or exchanging a vehicle as defined in Subsection [(131)] (138).
             3034          [(133)] (140) (a) "Vertical service" means an ancillary service that:



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             3035
         (i) is offered in connection with one or more telecommunications services; and
             3036          (ii) offers an advanced calling feature that allows a customer to:
             3037          (A) identify a caller; and
             3038          (B) manage multiple calls and call connections.
             3039          (b) "Vertical service" includes an ancillary service that allows a customer to manage a
             3040      conference bridging service.
             3041          [(134)] (141) (a) "Voice mail service" means an ancillary service that enables a
             3042      customer to receive, send, or store a recorded message.
             3043          (b) "Voice mail service" does not include a vertical service that a customer is required
             3044      to have in order to utilize a voice mail service.
             3045          [(135)] (142) (a) Except as provided in Subsection [(135)] (142)(b), "waste energy
             3046      facility" means a facility that generates electricity:
             3047          (i) using as the primary source of energy waste materials that would be placed in a
             3048      landfill or refuse pit if it were not used to generate electricity, including:
             3049          (A) tires;
             3050          (B) waste coal;
             3051          (C) oil shale; or
             3052          (D) municipal solid waste; and
             3053          (ii) in amounts greater than actually required for the operation of the facility.
             3054          (b) "Waste energy facility" does not include a facility that incinerates:
             3055          (i) hospital waste as defined in 40 C.F.R. 60.51c; or
             3056          (ii) medical/infectious waste as defined in 40 C.F.R. 60.51c.
             3057          [(136)] (143) "Watercraft" means a vessel as defined in Section 73-18-2 .
             3058          [(137)] (144) "Wind energy" means wind used as the sole source of energy to produce
             3059      electricity.
             3060          [(138)] (145) "ZIP Code" means a Zoning Improvement Plan Code assigned to a
             3061      geographic location by the United States Postal Service.
             3062          Section 3. Section 59-12-103 (Superseded 07/01/14) is amended to read:
             3063           59-12-103 (Superseded 07/01/14). Sales and use tax base -- Rates -- Effective dates
             3064      -- Use of sales and use tax revenues.
             3065          (1) A tax is imposed on the purchaser as provided in this part for amounts paid or



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             3066
     charged for the following transactions:
             3067          (a) retail sales of tangible personal property made within the state;
             3068          (b) amounts paid for:
             3069          (i) telecommunications service, other than mobile telecommunications service, that
             3070      originates and terminates within the boundaries of this state;
             3071          (ii) mobile telecommunications service that originates and terminates within the
             3072      boundaries of one state only to the extent permitted by the Mobile Telecommunications
             3073      Sourcing Act, 4 U.S.C. Sec. 116 et seq.; or
             3074          (iii) an ancillary service associated with a:
             3075          (A) telecommunications service described in Subsection (1)(b)(i); or
             3076          (B) mobile telecommunications service described in Subsection (1)(b)(ii);
             3077          (c) sales of the following for commercial use:
             3078          (i) gas;
             3079          (ii) electricity;
             3080          (iii) heat;
             3081          (iv) coal;
             3082          (v) fuel oil; or
             3083          (vi) other fuels;
             3084          (d) sales of the following for residential use:
             3085          (i) gas;
             3086          (ii) electricity;
             3087          (iii) heat;
             3088          (iv) coal;
             3089          (v) fuel oil; or
             3090          (vi) other fuels;
             3091          (e) sales of prepared food;
             3092          (f) except as provided in Section 59-12-104 , amounts paid or charged as admission or
             3093      user fees for theaters, movies, operas, museums, planetariums, shows of any type or nature,
             3094      exhibitions, concerts, carnivals, amusement parks, amusement rides, circuses, menageries,
             3095      fairs, races, contests, sporting events, dances, boxing matches, wrestling matches, closed circuit
             3096      television broadcasts, billiard parlors, pool parlors, bowling lanes, golf, miniature golf, golf



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             3097
     driving ranges, batting cages, skating rinks, ski lifts, ski runs, ski trails, snowmobile trails,
             3098      tennis courts, swimming pools, water slides, river runs, jeep tours, boat tours, scenic cruises,
             3099      horseback rides, sports activities, or any other amusement, entertainment, recreation,
             3100      exhibition, cultural, or athletic activity;
             3101          (g) amounts paid or charged for services for repairs or renovations of tangible personal
             3102      property, unless Section 59-12-104 provides for an exemption from sales and use tax for:
             3103          (i) the tangible personal property; and
             3104          (ii) parts used in the repairs or renovations of the tangible personal property described
             3105      in Subsection (1)(g)(i), whether or not any parts are actually used in the repairs or renovations
             3106      of that tangible personal property;
             3107          (h) except as provided in Subsection 59-12-104 (7), amounts paid or charged for
             3108      assisted cleaning or washing of tangible personal property;
             3109          (i) subject to Subsection 59-12-107 (3)(i), amounts paid or charged for [tourist home,
             3110      hotel, motel, or trailer court accommodations and services that are regularly rented for less than
             3111      30 consecutive days] short-term lodging;
             3112          (j) amounts paid or charged for laundry or dry cleaning services;
             3113          (k) amounts paid or charged for leases or rentals of tangible personal property if within
             3114      this state the tangible personal property is:
             3115          (i) stored;
             3116          (ii) used; or
             3117          (iii) otherwise consumed;
             3118          (l) amounts paid or charged for tangible personal property if within this state the
             3119      tangible personal property is:
             3120          (i) stored;
             3121          (ii) used; or
             3122          (iii) consumed; and
             3123          (m) amounts paid or charged for a sale:
             3124          (i) (A) of a product transferred electronically; or
             3125          (B) of a repair or renovation of a product transferred electronically; and
             3126          (ii) regardless of whether the sale provides:
             3127          (A) a right of permanent use of the product; or



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             3128
         (B) a right to use the product that is less than a permanent use, including a right:
             3129          (I) for a definite or specified length of time; and
             3130          (II) that terminates upon the occurrence of a condition.
             3131          (2) (a) Except as provided in Subsections (2)(b) through (e), a state tax and a local tax
             3132      is imposed on a transaction described in Subsection (1) equal to the sum of:
             3133          (i) a state tax imposed on the transaction at a tax rate equal to the sum of:
             3134          (A) 4.70%; and
             3135          (B) (I) the tax rate the state imposes in accordance with Part 18, Additional State Sales
             3136      and Use Tax Act, if the location of the transaction as determined under Sections 59-12-211
             3137      through 59-12-215 is in a county in which the state imposes the tax under Part 18, Additional
             3138      State Sales and Use Tax Act; and
             3139          (II) the tax rate the state imposes in accordance with Part 20, Supplemental State Sales
             3140      and Use Tax Act, if the location of the transaction as determined under Sections 59-12-211
             3141      through 59-12-215 is in a city, town, or the unincorporated area of a county in which the state
             3142      imposes the tax under Part 20, Supplemental State Sales and Use Tax Act; and
             3143          (ii) a local tax equal to the sum of the tax rates a county, city, or town imposes on the
             3144      transaction under this chapter other than this part.
             3145          (b) Except as provided in Subsection (2)(d) or (e), a state tax and a local tax is imposed
             3146      on a transaction described in Subsection (1)(d) equal to the sum of:
             3147          (i) a state tax imposed on the transaction at a tax rate of 2%; and
             3148          (ii) a local tax equal to the sum of the tax rates a county, city, or town imposes on the
             3149      transaction under this chapter other than this part.
             3150          (c) Except as provided in Subsection (2)(d) or (e), a state tax and a local tax is imposed
             3151      on amounts paid or charged for food and food ingredients equal to the sum of:
             3152          (i) a state tax imposed on the amounts paid or charged for food and food ingredients at
             3153      a tax rate of 1.75%; and
             3154          (ii) a local tax equal to the sum of the tax rates a county, city, or town imposes on the
             3155      amounts paid or charged for food and food ingredients under this chapter other than this part.
             3156          (d) (i) For a bundled transaction that is attributable to food and food ingredients and
             3157      tangible personal property other than food and food ingredients, a state tax and a local tax is
             3158      imposed on the entire bundled transaction equal to the sum of:



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             3159
         (A) a state tax imposed on the entire bundled transaction equal to the sum of:
             3160          (I) the tax rate described in Subsection (2)(a)(i)(A); and
             3161          (II) (Aa) the tax rate the state imposes in accordance with Part 18, Additional State
             3162      Sales and Use Tax Act, if the location of the transaction as determined under Sections
             3163      59-12-211 through 59-12-215 is in a county in which the state imposes the tax under Part 18,
             3164      Additional State Sales and Use Tax Act; and
             3165          (Bb) the tax rate the state imposes in accordance with Part 20, Supplemental State
             3166      Sales and Use Tax Act, if the location of the transaction as determined under Sections
             3167      59-12-211 through 59-12-215 is in a city, town, or the unincorporated area of a county in which
             3168      the state imposes the tax under Part 20, Supplemental State Sales and Use Tax Act; and
             3169          (B) a local tax imposed on the entire bundled transaction at the sum of the tax rates
             3170      described in Subsection (2)(a)(ii).
             3171          (ii) If an optional computer software maintenance contract is a bundled transaction that
             3172      consists of taxable and nontaxable products that are not separately itemized on an invoice or
             3173      similar billing document, the purchase of the optional computer software maintenance contract
             3174      is 40% taxable under this chapter and 60% nontaxable under this chapter.
             3175          (iii) Subject to Subsection (2)(d)(iv), for a bundled transaction other than a bundled
             3176      transaction described in Subsection (2)(d)(i) or (ii):
             3177          (A) if the sales price of the bundled transaction is attributable to tangible personal
             3178      property, a product, or a service that is subject to taxation under this chapter and tangible
             3179      personal property, a product, or service that is not subject to taxation under this chapter, the
             3180      entire bundled transaction is subject to taxation under this chapter unless:
             3181          (I) the seller is able to identify by reasonable and verifiable standards the tangible
             3182      personal property, product, or service that is not subject to taxation under this chapter from the
             3183      books and records the seller keeps in the seller's regular course of business; or
             3184          (II) state or federal law provides otherwise; or
             3185          (B) if the sales price of a bundled transaction is attributable to two or more items of
             3186      tangible personal property, products, or services that are subject to taxation under this chapter
             3187      at different rates, the entire bundled transaction is subject to taxation under this chapter at the
             3188      higher tax rate unless:
             3189          (I) the seller is able to identify by reasonable and verifiable standards the tangible



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             3190
     personal property, product, or service that is subject to taxation under this chapter at the lower
             3191      tax rate from the books and records the seller keeps in the seller's regular course of business; or
             3192          (II) state or federal law provides otherwise.
             3193          (iv) For purposes of Subsection (2)(d)(iii), books and records that a seller keeps in the
             3194      seller's regular course of business includes books and records the seller keeps in the regular
             3195      course of business for nontax purposes.
             3196          (e) Subject to Subsections (2)(f) and (g), a tax rate repeal or tax rate change for a tax
             3197      rate imposed under the following shall take effect on the first day of a calendar quarter:
             3198          (i) Subsection (2)(a)(i)(A);
             3199          (ii) Subsection (2)(b)(i);
             3200          (iii) Subsection (2)(c)(i); or
             3201          (iv) Subsection (2)(d)(i)(A)(I).
             3202          (f) (i) A tax rate increase takes effect on the first day of the first billing period that
             3203      begins on or after the effective date of the tax rate increase if the billing period for the
             3204      transaction begins before the effective date of a tax rate increase imposed under:
             3205          (A) Subsection (2)(a)(i)(A);
             3206          (B) Subsection (2)(b)(i);
             3207          (C) Subsection (2)(c)(i); or
             3208          (D) Subsection (2)(d)(i)(A)(I).
             3209          (ii) The repeal of a tax or a tax rate decrease applies to a billing period if the billing
             3210      statement for the billing period is rendered on or after the effective date of the repeal of the tax
             3211      or the tax rate decrease imposed under:
             3212          (A) Subsection (2)(a)(i)(A);
             3213          (B) Subsection (2)(b)(i);
             3214          (C) Subsection (2)(c)(i); or
             3215          (D) Subsection (2)(d)(i)(A)(I).
             3216          (g) (i) For a tax rate described in Subsection (2)(g)(ii), if a tax due on a catalogue sale
             3217      is computed on the basis of sales and use tax rates published in the catalogue, a tax rate repeal
             3218      or change in a tax rate takes effect:
             3219          (A) on the first day of a calendar quarter; and
             3220          (B) beginning 60 days after the effective date of the tax rate repeal or tax rate change.



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             3221
         (ii) Subsection (2)(g)(i) applies to the tax rates described in the following:
             3222          (A) Subsection (2)(a)(i)(A);
             3223          (B) Subsection (2)(b)(i);
             3224          (C) Subsection (2)(c)(i); or
             3225          (D) Subsection (2)(d)(i)(A)(I).
             3226          (iii) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act,
             3227      the commission may by rule define the term "catalogue sale."
             3228          (3) (a) The following state taxes shall be deposited into the General Fund:
             3229          (i) the tax imposed by Subsection (2)(a)(i)(A);
             3230          (ii) the tax imposed by Subsection (2)(b)(i);
             3231          (iii) the tax imposed by Subsection (2)(c)(i); or
             3232          (iv) the tax imposed by Subsection (2)(d)(i)(A)(I).
             3233          (b) The following local taxes shall be distributed to a county, city, or town as provided
             3234      in this chapter:
             3235          (i) the tax imposed by Subsection (2)(a)(ii);
             3236          (ii) the tax imposed by Subsection (2)(b)(ii);
             3237          (iii) the tax imposed by Subsection (2)(c)(ii); and
             3238          (iv) the tax imposed by Subsection (2)(d)(i)(B).
             3239          (4) (a) Notwithstanding Subsection (3)(a), for a fiscal year beginning on or after July 1,
             3240      2003, the lesser of the following amounts shall be used as provided in Subsections (4)(b)
             3241      through (g):
             3242          (i) for taxes listed under Subsection (3)(a), the amount of tax revenue generated:
             3243          (A) by a 1/16% tax rate on the transactions described in Subsection (1); and
             3244          (B) for the fiscal year; or
             3245          (ii) $17,500,000.
             3246          (b) (i) For a fiscal year beginning on or after July 1, 2003, 14% of the amount
             3247      described in Subsection (4)(a) shall be transferred each year as dedicated credits to the
             3248      Department of Natural Resources to:
             3249          (A) implement the measures described in Subsections 79-2-303 (3)(a) through (d) to
             3250      protect sensitive plant and animal species; or
             3251          (B) award grants, up to the amount authorized by the Legislature in an appropriations



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             3252
     act, to political subdivisions of the state to implement the measures described in Subsections
             3253      79-2-303 (3)(a) through (d) to protect sensitive plant and animal species.
             3254          (ii) Money transferred to the Department of Natural Resources under Subsection
             3255      (4)(b)(i) may not be used to assist the United States Fish and Wildlife Service or any other
             3256      person to list or attempt to have listed a species as threatened or endangered under the
             3257      Endangered Species Act of 1973, 16 U.S.C. Sec. 1531 et seq.
             3258          (iii) At the end of each fiscal year:
             3259          (A) 50% of any unexpended dedicated credits shall lapse to the Water Resources
             3260      Conservation and Development Fund created in Section 73-10-24 ;
             3261          (B) 25% of any unexpended dedicated credits shall lapse to the Utah Wastewater Loan
             3262      Program Subaccount created in Section 73-10c-5 ; and
             3263          (C) 25% of any unexpended dedicated credits shall lapse to the Drinking Water Loan
             3264      Program Subaccount created in Section 73-10c-5 .
             3265          (c) For a fiscal year beginning on or after July 1, 2003, 3% of the amount described in
             3266      Subsection (4)(a) shall be deposited each year in the Agriculture Resource Development Fund
             3267      created in Section 4-18-6 .
             3268          (d) (i) For a fiscal year beginning on or after July 1, 2003, 1% of the amount described
             3269      in Subsection (4)(a) shall be transferred each year as dedicated credits to the Division of Water
             3270      Rights to cover the costs incurred in hiring legal and technical staff for the adjudication of
             3271      water rights.
             3272          (ii) At the end of each fiscal year:
             3273          (A) 50% of any unexpended dedicated credits shall lapse to the Water Resources
             3274      Conservation and Development Fund created in Section 73-10-24 ;
             3275          (B) 25% of any unexpended dedicated credits shall lapse to the Utah Wastewater Loan
             3276      Program Subaccount created in Section 73-10c-5 ; and
             3277          (C) 25% of any unexpended dedicated credits shall lapse to the Drinking Water Loan
             3278      Program Subaccount created in Section 73-10c-5 .
             3279          (e) (i) For a fiscal year beginning on or after July 1, 2003, 41% of the amount described
             3280      in Subsection (4)(a) shall be deposited in the Water Resources Conservation and Development
             3281      Fund created in Section 73-10-24 for use by the Division of Water Resources.
             3282          (ii) In addition to the uses allowed of the Water Resources Conservation and



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             3283
     Development Fund under Section 73-10-24 , the Water Resources Conservation and
             3284      Development Fund may also be used to:
             3285          (A) conduct hydrologic and geotechnical investigations by the Division of Water
             3286      Resources in a cooperative effort with other state, federal, or local entities, for the purpose of
             3287      quantifying surface and ground water resources and describing the hydrologic systems of an
             3288      area in sufficient detail so as to enable local and state resource managers to plan for and
             3289      accommodate growth in water use without jeopardizing the resource;
             3290          (B) fund state required dam safety improvements; and
             3291          (C) protect the state's interest in interstate water compact allocations, including the
             3292      hiring of technical and legal staff.
             3293          (f) For a fiscal year beginning on or after July 1, 2003, 20.5% of the amount described
             3294      in Subsection (4)(a) shall be deposited in the Utah Wastewater Loan Program Subaccount
             3295      created in Section 73-10c-5 for use by the Water Quality Board to fund wastewater projects.
             3296          (g) For a fiscal year beginning on or after July 1, 2003, 20.5% of the amount described
             3297      in Subsection (4)(a) shall be deposited in the Drinking Water Loan Program Subaccount
             3298      created in Section 73-10c-5 for use by the Division of Drinking Water to:
             3299          (i) provide for the installation and repair of collection, treatment, storage, and
             3300      distribution facilities for any public water system, as defined in Section 19-4-102 ;
             3301          (ii) develop underground sources of water, including springs and wells; and
             3302          (iii) develop surface water sources.
             3303          (5) (a) Notwithstanding Subsection (3)(a), for a fiscal year beginning on or after July 1,
             3304      2006, the difference between the following amounts shall be expended as provided in this
             3305      Subsection (5), if that difference is greater than $1:
             3306          (i) for taxes listed under Subsection (3)(a), the amount of tax revenue generated for the
             3307      fiscal year by a 1/16% tax rate on the transactions described in Subsection (1); and
             3308          (ii) $17,500,000.
             3309          (b) (i) The first $500,000 of the difference described in Subsection (5)(a) shall be:
             3310          (A) transferred each fiscal year to the Department of Natural Resources as dedicated
             3311      credits; and
             3312          (B) expended by the Department of Natural Resources for watershed rehabilitation or
             3313      restoration.



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             3314
         (ii) At the end of each fiscal year, 100% of any unexpended dedicated credits described
             3315      in Subsection (5)(b)(i) shall lapse to the Water Resources Conservation and Development Fund
             3316      created in Section 73-10-24 .
             3317          (c) (i) After making the transfer required by Subsection (5)(b)(i), $150,000 of the
             3318      remaining difference described in Subsection (5)(a) shall be:
             3319          (A) transferred each fiscal year to the Division of Water Resources as dedicated
             3320      credits; and
             3321          (B) expended by the Division of Water Resources for cloud-seeding projects
             3322      authorized by Title 73, Chapter 15, Modification of Weather.
             3323          (ii) At the end of each fiscal year, 100% of any unexpended dedicated credits described
             3324      in Subsection (5)(c)(i) shall lapse to the Water Resources Conservation and Development Fund
             3325      created in Section 73-10-24 .
             3326          (d) After making the transfers required by Subsections (5)(b) and (c), 94% of the
             3327      remaining difference described in Subsection (5)(a) shall be deposited into the Water
             3328      Resources Conservation and Development Fund created in Section 73-10-24 for use by the
             3329      Division of Water Resources for:
             3330          (i) preconstruction costs:
             3331          (A) as defined in Subsection 73-26-103 (6) for projects authorized by Title 73, Chapter
             3332      26, Bear River Development Act; and
             3333          (B) as defined in Subsection 73-28-103 (8) for the Lake Powell Pipeline project
             3334      authorized by Title 73, Chapter 28, Lake Powell Pipeline Development Act;
             3335          (ii) the cost of employing a civil engineer to oversee any project authorized by Title 73,
             3336      Chapter 26, Bear River Development Act;
             3337          (iii) the cost of employing a civil engineer to oversee the Lake Powell Pipeline project
             3338      authorized by Title 73, Chapter 28, Lake Powell Pipeline Development Act; and
             3339          (iv) other uses authorized under Sections 73-10-24 , 73-10-25.1 , 73-10-30 , and
             3340      Subsection (4)(e)(ii) after funding the uses specified in Subsections (5)(d)(i) through (iii).
             3341          (e) After making the transfers required by Subsections (5)(b) and (c) and subject to
             3342      Subsection (5)(f), 6% of the remaining difference described in Subsection (5)(a) shall be
             3343      transferred each year as dedicated credits to the Division of Water Rights to cover the costs
             3344      incurred for employing additional technical staff for the administration of water rights.



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             3345
         (f) At the end of each fiscal year, any unexpended dedicated credits described in
             3346      Subsection (5)(e) over $150,000 lapse to the Water Resources Conservation and Development
             3347      Fund created in Section 73-10-24 .
             3348          (6) Notwithstanding Subsection (3)(a), for a fiscal year beginning on or after July 1,
             3349      2003, and for taxes listed under Subsection (3)(a), the amount of revenue generated by a 1/16%
             3350      tax rate on the transactions described in Subsection (1) for the fiscal year shall be deposited in
             3351      the Transportation Fund created by Section 72-2-102 .
             3352          (7) Notwithstanding Subsection (3)(a), beginning on July 1, 2012, the Division of
             3353      Finance shall deposit into the Transportation Investment Fund of 2005 created in Section
             3354      72-2-124 a portion of the taxes listed under Subsection (3)(a) equal to the revenues generated
             3355      by a 1/64% tax rate on the taxable transactions under Subsection (1).
             3356          (8) (a) Notwithstanding Subsection (3)(a), in addition to the amounts deposited in
             3357      Subsection (7), and subject to Subsection (8)(b), for a fiscal year beginning on or after July 1,
             3358      2012, the Division of Finance shall deposit into the Transportation Investment Fund of 2005
             3359      created by Section 72-2-124 :
             3360          (i) a portion of the taxes listed under Subsection (3)(a) in an amount equal to 8.3% of
             3361      the revenues collected from the following taxes, which represents a portion of the
             3362      approximately 17% of sales and use tax revenues generated annually by the sales and use tax
             3363      on vehicles and vehicle-related products:
             3364          (A) the tax imposed by Subsection (2)(a)(i)(A);
             3365          (B) the tax imposed by Subsection (2)(b)(i);
             3366          (C) the tax imposed by Subsection (2)(c)(i); and
             3367          (D) the tax imposed by Subsection (2)(d)(i)(A)(I); plus
             3368          (ii) an amount equal to 30% of the growth in the amount of revenues collected in the
             3369      current fiscal year from the sales and use taxes described in Subsections (8)(a)(i)(A) through
             3370      (D) that exceeds the amount collected from the sales and use taxes described in Subsections
             3371      (8)(a)(i)(A) through (D) in the 2010-11 fiscal year.
             3372          (b) (i) Subject to Subsections (8)(b)(ii) and (iii), in any fiscal year that the portion of
             3373      the sales and use taxes deposited under Subsection (8)(a) represents an amount that is a total
             3374      lower percentage of the sales and use taxes described in Subsections (8)(a)(i)(A) through (D)
             3375      generated in the current fiscal year than the total percentage of sales and use taxes deposited in



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             3376
     the previous fiscal year, the Division of Finance shall deposit an amount under Subsection
             3377      (8)(a) equal to the product of:
             3378          (A) the total percentage of sales and use taxes deposited under Subsection (8)(a) in the
             3379      previous fiscal year; and
             3380          (B) the total sales and use tax revenue generated by the taxes described in Subsections
             3381      (8)(a)(i)(A) through (D) in the current fiscal year.
             3382          (ii) In any fiscal year in which the portion of the sales and use taxes deposited under
             3383      Subsection (8)(a) would exceed 17% of the revenues collected from the sales and use taxes
             3384      described in Subsections (8)(a)(i)(A) through (D) in the current fiscal year, the Division of
             3385      Finance shall deposit 17% of the revenues collected from the sales and use taxes described in
             3386      Subsections (8)(a)(i)(A) through (D) for the current fiscal year under Subsection (8)(a).
             3387          (iii) In all subsequent fiscal years after a year in which 17% of the revenues collected
             3388      from the sales and use taxes described in Subsections (8)(a)(i)(A) through (D) was deposited
             3389      under Subsection (8)(a), the Division of Finance shall annually deposit 17% of the revenues
             3390      collected from the sales and use taxes described in Subsections (8)(a)(i)(A) through (D) in the
             3391      current fiscal year under Subsection (8)(a).
             3392          (9) Notwithstanding Subsection (3)(a), and in addition to the amounts deposited under
             3393      Subsections (7) and (8), for a fiscal year beginning on or after July 1, 2012, the Division of
             3394      Finance shall annually deposit $90,000,000 of the revenues generated by the taxes listed under
             3395      Subsection (3)(a) into the Transportation Investment Fund of 2005 created by Section
             3396      72-2-124 .
             3397          (10) Notwithstanding Subsection (3)(a), for each fiscal year beginning with fiscal year
             3398      2009-10, $533,750 shall be deposited into the Qualified Emergency Food Agencies Fund
             3399      created by Section 35A-8-1009 and expended as provided in Section 35A-8-1009 .
             3400          (11) (a) Notwithstanding Subsection (3)(a), except as provided in Subsection (11)(b),
             3401      and in addition to any amounts deposited under Subsections (7), (8), and (9), beginning on July
             3402      1, 2012, the Division of Finance shall deposit into the Transportation Investment Fund of 2005
             3403      created by Section 72-2-124 the amount of tax revenue generated by a .025% tax rate on the
             3404      transactions described in Subsection (1).
             3405          (b) For purposes of Subsection (11)(a), the Division of Finance may not deposit into
             3406      the Transportation Investment Fund of 2005 any tax revenue generated by amounts paid or



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             3407
     charged for food and food ingredients, except for tax revenue generated by a bundled
             3408      transaction attributable to food and food ingredients and tangible personal property other than
             3409      food and food ingredients described in Subsection (2)(d).
             3410          (12) (a) Notwithstanding Subsection (3)(a), and except as provided in Subsection
             3411      (12)(b), beginning on January 1, 2009, the Division of Finance shall deposit into the
             3412      Transportation Fund created by Section 72-2-102 the amount of tax revenue generated by a
             3413      .025% tax rate on the transactions described in Subsection (1) to be expended to address
             3414      chokepoints in construction management.
             3415          (b) For purposes of Subsection (12)(a), the Division of Finance may not deposit into
             3416      the Transportation Fund any tax revenue generated by amounts paid or charged for food and
             3417      food ingredients, except for tax revenue generated by a bundled transaction attributable to food
             3418      and food ingredients and tangible personal property other than food and food ingredients
             3419      described in Subsection (2)(d).
             3420          Section 4. Section 59-12-103 (Effective 07/01/14) is amended to read:
             3421           59-12-103 (Effective 07/01/14). Sales and use tax base -- Rates -- Effective dates --
             3422      Use of sales and use tax revenues.
             3423          (1) A tax is imposed on the purchaser as provided in this part for amounts paid or
             3424      charged for the following transactions:
             3425          (a) retail sales of tangible personal property made within the state;
             3426          (b) amounts paid for:
             3427          (i) telecommunications service, other than mobile telecommunications service, that
             3428      originates and terminates within the boundaries of this state;
             3429          (ii) mobile telecommunications service that originates and terminates within the
             3430      boundaries of one state only to the extent permitted by the Mobile Telecommunications
             3431      Sourcing Act, 4 U.S.C. Sec. 116 et seq.; or
             3432          (iii) an ancillary service associated with a:
             3433          (A) telecommunications service described in Subsection (1)(b)(i); or
             3434          (B) mobile telecommunications service described in Subsection (1)(b)(ii);
             3435          (c) sales of the following for commercial use:
             3436          (i) gas;
             3437          (ii) electricity;



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             3438
         (iii) heat;
             3439          (iv) coal;
             3440          (v) fuel oil; or
             3441          (vi) other fuels;
             3442          (d) sales of the following for residential use:
             3443          (i) gas;
             3444          (ii) electricity;
             3445          (iii) heat;
             3446          (iv) coal;
             3447          (v) fuel oil; or
             3448          (vi) other fuels;
             3449          (e) sales of prepared food;
             3450          (f) except as provided in Section 59-12-104 , amounts paid or charged as admission or
             3451      user fees for theaters, movies, operas, museums, planetariums, shows of any type or nature,
             3452      exhibitions, concerts, carnivals, amusement parks, amusement rides, circuses, menageries,
             3453      fairs, races, contests, sporting events, dances, boxing matches, wrestling matches, closed circuit
             3454      television broadcasts, billiard parlors, pool parlors, bowling lanes, golf, miniature golf, golf
             3455      driving ranges, batting cages, skating rinks, ski lifts, ski runs, ski trails, snowmobile trails,
             3456      tennis courts, swimming pools, water slides, river runs, jeep tours, boat tours, scenic cruises,
             3457      horseback rides, sports activities, or any other amusement, entertainment, recreation,
             3458      exhibition, cultural, or athletic activity;
             3459          (g) amounts paid or charged for services for repairs or renovations of tangible personal
             3460      property, unless Section 59-12-104 provides for an exemption from sales and use tax for:
             3461          (i) the tangible personal property; and
             3462          (ii) parts used in the repairs or renovations of the tangible personal property described
             3463      in Subsection (1)(g)(i), whether or not any parts are actually used in the repairs or renovations
             3464      of that tangible personal property;
             3465          (h) except as provided in Subsection 59-12-104 (7), amounts paid or charged for
             3466      assisted cleaning or washing of tangible personal property;
             3467          (i) subject to Subsection 59-12-107 (3)(i), amounts paid or charged for [tourist home,
             3468      hotel, motel, or trailer court accommodations and services that are regularly rented for less than



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             3469
     30 consecutive days] short-term lodging;
             3470          (j) amounts paid or charged for laundry or dry cleaning services;
             3471          (k) amounts paid or charged for leases or rentals of tangible personal property if within
             3472      this state the tangible personal property is:
             3473          (i) stored;
             3474          (ii) used; or
             3475          (iii) otherwise consumed;
             3476          (l) amounts paid or charged for tangible personal property if within this state the
             3477      tangible personal property is:
             3478          (i) stored;
             3479          (ii) used; or
             3480          (iii) consumed; and
             3481          (m) amounts paid or charged for a sale:
             3482          (i) (A) of a product transferred electronically; or
             3483          (B) of a repair or renovation of a product transferred electronically; and
             3484          (ii) regardless of whether the sale provides:
             3485          (A) a right of permanent use of the product; or
             3486          (B) a right to use the product that is less than a permanent use, including a right:
             3487          (I) for a definite or specified length of time; and
             3488          (II) that terminates upon the occurrence of a condition.
             3489          (2) (a) Except as provided in Subsections (2)(b) through (e), a state tax and a local tax
             3490      is imposed on a transaction described in Subsection (1) equal to the sum of:
             3491          (i) a state tax imposed on the transaction at a tax rate equal to the sum of:
             3492          (A) 4.70%; and
             3493          (B) (I) the tax rate the state imposes in accordance with Part 18, Additional State Sales
             3494      and Use Tax Act, if the location of the transaction as determined under Sections 59-12-211
             3495      through 59-12-215 is in a county in which the state imposes the tax under Part 18, Additional
             3496      State Sales and Use Tax Act; and
             3497          (II) the tax rate the state imposes in accordance with Part 20, Supplemental State Sales
             3498      and Use Tax Act, if the location of the transaction as determined under Sections 59-12-211
             3499      through 59-12-215 is in a city, town, or the unincorporated area of a county in which the state



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             3500
     imposes the tax under Part 20, Supplemental State Sales and Use Tax Act; and
             3501          (ii) a local tax equal to the sum of the tax rates a county, city, or town imposes on the
             3502      transaction under this chapter other than this part.
             3503          (b) Except as provided in Subsection (2)(d) or (e), a state tax and a local tax is imposed
             3504      on a transaction described in Subsection (1)(d) equal to the sum of:
             3505          (i) a state tax imposed on the transaction at a tax rate of 2%; and
             3506          (ii) a local tax equal to the sum of the tax rates a county, city, or town imposes on the
             3507      transaction under this chapter other than this part.
             3508          (c) Except as provided in Subsection (2)(d) or (e), a state tax and a local tax is imposed
             3509      on amounts paid or charged for food and food ingredients equal to the sum of:
             3510          (i) a state tax imposed on the amounts paid or charged for food and food ingredients at
             3511      a tax rate of 1.75%; and
             3512          (ii) a local tax equal to the sum of the tax rates a county, city, or town imposes on the
             3513      amounts paid or charged for food and food ingredients under this chapter other than this part.
             3514          (d) (i) For a bundled transaction that is attributable to food and food ingredients and
             3515      tangible personal property other than food and food ingredients, a state tax and a local tax is
             3516      imposed on the entire bundled transaction equal to the sum of:
             3517          (A) a state tax imposed on the entire bundled transaction equal to the sum of:
             3518          (I) the tax rate described in Subsection (2)(a)(i)(A); and
             3519          (II) (Aa) the tax rate the state imposes in accordance with Part 18, Additional State
             3520      Sales and Use Tax Act, if the location of the transaction as determined under Sections
             3521      59-12-211 through 59-12-215 is in a county in which the state imposes the tax under Part 18,
             3522      Additional State Sales and Use Tax Act; and
             3523          (Bb) the tax rate the state imposes in accordance with Part 20, Supplemental State
             3524      Sales and Use Tax Act, if the location of the transaction as determined under Sections
             3525      59-12-211 through 59-12-215 is in a city, town, or the unincorporated area of a county in which
             3526      the state imposes the tax under Part 20, Supplemental State Sales and Use Tax Act; and
             3527          (B) a local tax imposed on the entire bundled transaction at the sum of the tax rates
             3528      described in Subsection (2)(a)(ii).
             3529          (ii) If an optional computer software maintenance contract is a bundled transaction that
             3530      consists of taxable and nontaxable products that are not separately itemized on an invoice or



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             3531
     similar billing document, the purchase of the optional computer software maintenance contract
             3532      is 40% taxable under this chapter and 60% nontaxable under this chapter.
             3533          (iii) Subject to Subsection (2)(d)(iv), for a bundled transaction other than a bundled
             3534      transaction described in Subsection (2)(d)(i) or (ii):
             3535          (A) if the sales price of the bundled transaction is attributable to tangible personal
             3536      property, a product, or a service that is subject to taxation under this chapter and tangible
             3537      personal property, a product, or service that is not subject to taxation under this chapter, the
             3538      entire bundled transaction is subject to taxation under this chapter unless:
             3539          (I) the seller is able to identify by reasonable and verifiable standards the tangible
             3540      personal property, product, or service that is not subject to taxation under this chapter from the
             3541      books and records the seller keeps in the seller's regular course of business; or
             3542          (II) state or federal law provides otherwise; or
             3543          (B) if the sales price of a bundled transaction is attributable to two or more items of
             3544      tangible personal property, products, or services that are subject to taxation under this chapter
             3545      at different rates, the entire bundled transaction is subject to taxation under this chapter at the
             3546      higher tax rate unless:
             3547          (I) the seller is able to identify by reasonable and verifiable standards the tangible
             3548      personal property, product, or service that is subject to taxation under this chapter at the lower
             3549      tax rate from the books and records the seller keeps in the seller's regular course of business; or
             3550          (II) state or federal law provides otherwise.
             3551          (iv) For purposes of Subsection (2)(d)(iii), books and records that a seller keeps in the
             3552      seller's regular course of business includes books and records the seller keeps in the regular
             3553      course of business for nontax purposes.
             3554          (e) (i) Except as otherwise provided in this chapter and subject to Subsections (2)(e)(ii)
             3555      and (iii), if a transaction consists of the sale, lease, or rental of tangible personal property, a
             3556      product, or a service that is subject to taxation under this chapter, and the sale, lease, or rental
             3557      of tangible personal property, other property, a product, or a service that is not subject to
             3558      taxation under this chapter, the entire transaction is subject to taxation under this chapter unless
             3559      the seller, at the time of the transaction:
             3560          (A) separately states the portion of the transaction that is not subject to taxation under
             3561      this chapter on an invoice, bill of sale, or similar document provided to the purchaser; or



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             3562
         (B) is able to identify by reasonable and verifiable standards, from the books and
             3563      records the seller keeps in the seller's regular course of business, the portion of the transaction
             3564      that is not subject to taxation under this chapter.
             3565          (ii) A purchaser and a seller may correct the taxability of a transaction if:
             3566          (A) after the transaction occurs, the purchaser and the seller discover that the portion of
             3567      the transaction that is not subject to taxation under this chapter was not separately stated on an
             3568      invoice, bill of sale, or similar document provided to the purchaser because of an error or
             3569      ignorance of the law; and
             3570          (B) the seller is able to identify by reasonable and verifiable standards, from the books
             3571      and records the seller keeps in the seller's regular course of business, the portion of the
             3572      transaction that is not subject to taxation under this chapter.
             3573          (iii) For purposes of Subsections (2)(e)(i) and (ii), books and records that a seller keeps
             3574      in the seller's regular course of business includes books and records the seller keeps in the
             3575      regular course of business for nontax purposes.
             3576          (f) (i) If the sales price of a transaction is attributable to two or more items of tangible
             3577      personal property, products, or services that are subject to taxation under this chapter at
             3578      different rates, the entire purchase is subject to taxation under this chapter at the higher tax rate
             3579      unless the seller, at the time of the transaction:
             3580          (A) separately states the items subject to taxation under this chapter at each of the
             3581      different rates on an invoice, bill of sale, or similar document provided to the purchaser; or
             3582          (B) is able to identify by reasonable and verifiable standards the tangible personal
             3583      property, product, or service that is subject to taxation under this chapter at the lower tax rate
             3584      from the books and records the seller keeps in the seller's regular course of business.
             3585          (ii) For purposes of Subsection (2)(f)(i), books and records that a seller keeps in the
             3586      seller's regular course of business includes books and records the seller keeps in the regular
             3587      course of business for nontax purposes.
             3588          (g) Subject to Subsections (2)(h) and (i), a tax rate repeal or tax rate change for a tax
             3589      rate imposed under the following shall take effect on the first day of a calendar quarter:
             3590          (i) Subsection (2)(a)(i)(A);
             3591          (ii) Subsection (2)(b)(i);
             3592          (iii) Subsection (2)(c)(i); or



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             3593
         (iv) Subsection (2)(d)(i)(A)(I).
             3594          (h) (i) A tax rate increase takes effect on the first day of the first billing period that
             3595      begins on or after the effective date of the tax rate increase if the billing period for the
             3596      transaction begins before the effective date of a tax rate increase imposed under:
             3597          (A) Subsection (2)(a)(i)(A);
             3598          (B) Subsection (2)(b)(i);
             3599          (C) Subsection (2)(c)(i); or
             3600          (D) Subsection (2)(d)(i)(A)(I).
             3601          (ii) The repeal of a tax or a tax rate decrease applies to a billing period if the billing
             3602      statement for the billing period is rendered on or after the effective date of the repeal of the tax
             3603      or the tax rate decrease imposed under:
             3604          (A) Subsection (2)(a)(i)(A);
             3605          (B) Subsection (2)(b)(i);
             3606          (C) Subsection (2)(c)(i); or
             3607          (D) Subsection (2)(d)(i)(A)(I).
             3608          (i) (i) For a tax rate described in Subsection (2)(i)(ii), if a tax due on a catalogue sale is
             3609      computed on the basis of sales and use tax rates published in the catalogue, a tax rate repeal or
             3610      change in a tax rate takes effect:
             3611          (A) on the first day of a calendar quarter; and
             3612          (B) beginning 60 days after the effective date of the tax rate repeal or tax rate change.
             3613          (ii) Subsection (2)(i)(i) applies to the tax rates described in the following:
             3614          (A) Subsection (2)(a)(i)(A);
             3615          (B) Subsection (2)(b)(i);
             3616          (C) Subsection (2)(c)(i); or
             3617          (D) Subsection (2)(d)(i)(A)(I).
             3618          (iii) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act,
             3619      the commission may by rule define the term "catalogue sale."
             3620          (3) (a) The following state taxes shall be deposited into the General Fund:
             3621          (i) the tax imposed by Subsection (2)(a)(i)(A);
             3622          (ii) the tax imposed by Subsection (2)(b)(i);
             3623          (iii) the tax imposed by Subsection (2)(c)(i); or



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             3624
         (iv) the tax imposed by Subsection (2)(d)(i)(A)(I).
             3625          (b) The following local taxes shall be distributed to a county, city, or town as provided
             3626      in this chapter:
             3627          (i) the tax imposed by Subsection (2)(a)(ii);
             3628          (ii) the tax imposed by Subsection (2)(b)(ii);
             3629          (iii) the tax imposed by Subsection (2)(c)(ii); and
             3630          (iv) the tax imposed by Subsection (2)(d)(i)(B).
             3631          (4) (a) Notwithstanding Subsection (3)(a), for a fiscal year beginning on or after July 1,
             3632      2003, the lesser of the following amounts shall be used as provided in Subsections (4)(b)
             3633      through (g):
             3634          (i) for taxes listed under Subsection (3)(a), the amount of tax revenue generated:
             3635          (A) by a 1/16% tax rate on the transactions described in Subsection (1); and
             3636          (B) for the fiscal year; or
             3637          (ii) $17,500,000.
             3638          (b) (i) For a fiscal year beginning on or after July 1, 2003, 14% of the amount
             3639      described in Subsection (4)(a) shall be transferred each year as dedicated credits to the
             3640      Department of Natural Resources to:
             3641          (A) implement the measures described in Subsections 79-2-303 (3)(a) through (d) to
             3642      protect sensitive plant and animal species; or
             3643          (B) award grants, up to the amount authorized by the Legislature in an appropriations
             3644      act, to political subdivisions of the state to implement the measures described in Subsections
             3645      79-2-303 (3)(a) through (d) to protect sensitive plant and animal species.
             3646          (ii) Money transferred to the Department of Natural Resources under Subsection
             3647      (4)(b)(i) may not be used to assist the United States Fish and Wildlife Service or any other
             3648      person to list or attempt to have listed a species as threatened or endangered under the
             3649      Endangered Species Act of 1973, 16 U.S.C. Sec. 1531 et seq.
             3650          (iii) At the end of each fiscal year:
             3651          (A) 50% of any unexpended dedicated credits shall lapse to the Water Resources
             3652      Conservation and Development Fund created in Section 73-10-24 ;
             3653          (B) 25% of any unexpended dedicated credits shall lapse to the Utah Wastewater Loan
             3654      Program Subaccount created in Section 73-10c-5 ; and



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             3655
         (C) 25% of any unexpended dedicated credits shall lapse to the Drinking Water Loan
             3656      Program Subaccount created in Section 73-10c-5 .
             3657          (c) For a fiscal year beginning on or after July 1, 2003, 3% of the amount described in
             3658      Subsection (4)(a) shall be deposited each year in the Agriculture Resource Development Fund
             3659      created in Section 4-18-6 .
             3660          (d) (i) For a fiscal year beginning on or after July 1, 2003, 1% of the amount described
             3661      in Subsection (4)(a) shall be transferred each year as dedicated credits to the Division of Water
             3662      Rights to cover the costs incurred in hiring legal and technical staff for the adjudication of
             3663      water rights.
             3664          (ii) At the end of each fiscal year:
             3665          (A) 50% of any unexpended dedicated credits shall lapse to the Water Resources
             3666      Conservation and Development Fund created in Section 73-10-24 ;
             3667          (B) 25% of any unexpended dedicated credits shall lapse to the Utah Wastewater Loan
             3668      Program Subaccount created in Section 73-10c-5 ; and
             3669          (C) 25% of any unexpended dedicated credits shall lapse to the Drinking Water Loan
             3670      Program Subaccount created in Section 73-10c-5 .
             3671          (e) (i) For a fiscal year beginning on or after July 1, 2003, 41% of the amount described
             3672      in Subsection (4)(a) shall be deposited in the Water Resources Conservation and Development
             3673      Fund created in Section 73-10-24 for use by the Division of Water Resources.
             3674          (ii) In addition to the uses allowed of the Water Resources Conservation and
             3675      Development Fund under Section 73-10-24 , the Water Resources Conservation and
             3676      Development Fund may also be used to:
             3677          (A) conduct hydrologic and geotechnical investigations by the Division of Water
             3678      Resources in a cooperative effort with other state, federal, or local entities, for the purpose of
             3679      quantifying surface and ground water resources and describing the hydrologic systems of an
             3680      area in sufficient detail so as to enable local and state resource managers to plan for and
             3681      accommodate growth in water use without jeopardizing the resource;
             3682          (B) fund state required dam safety improvements; and
             3683          (C) protect the state's interest in interstate water compact allocations, including the
             3684      hiring of technical and legal staff.
             3685          (f) For a fiscal year beginning on or after July 1, 2003, 20.5% of the amount described



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             3686
     in Subsection (4)(a) shall be deposited in the Utah Wastewater Loan Program Subaccount
             3687      created in Section 73-10c-5 for use by the Water Quality Board to fund wastewater projects.
             3688          (g) For a fiscal year beginning on or after July 1, 2003, 20.5% of the amount described
             3689      in Subsection (4)(a) shall be deposited in the Drinking Water Loan Program Subaccount
             3690      created in Section 73-10c-5 for use by the Division of Drinking Water to:
             3691          (i) provide for the installation and repair of collection, treatment, storage, and
             3692      distribution facilities for any public water system, as defined in Section 19-4-102 ;
             3693          (ii) develop underground sources of water, including springs and wells; and
             3694          (iii) develop surface water sources.
             3695          (5) (a) Notwithstanding Subsection (3)(a), for a fiscal year beginning on or after July 1,
             3696      2006, the difference between the following amounts shall be expended as provided in this
             3697      Subsection (5), if that difference is greater than $1:
             3698          (i) for taxes listed under Subsection (3)(a), the amount of tax revenue generated for the
             3699      fiscal year by a 1/16% tax rate on the transactions described in Subsection (1); and
             3700          (ii) $17,500,000.
             3701          (b) (i) The first $500,000 of the difference described in Subsection (5)(a) shall be:
             3702          (A) transferred each fiscal year to the Department of Natural Resources as dedicated
             3703      credits; and
             3704          (B) expended by the Department of Natural Resources for watershed rehabilitation or
             3705      restoration.
             3706          (ii) At the end of each fiscal year, 100% of any unexpended dedicated credits described
             3707      in Subsection (5)(b)(i) shall lapse to the Water Resources Conservation and Development Fund
             3708      created in Section 73-10-24 .
             3709          (c) (i) After making the transfer required by Subsection (5)(b)(i), $150,000 of the
             3710      remaining difference described in Subsection (5)(a) shall be:
             3711          (A) transferred each fiscal year to the Division of Water Resources as dedicated
             3712      credits; and
             3713          (B) expended by the Division of Water Resources for cloud-seeding projects
             3714      authorized by Title 73, Chapter 15, Modification of Weather.
             3715          (ii) At the end of each fiscal year, 100% of any unexpended dedicated credits described
             3716      in Subsection (5)(c)(i) shall lapse to the Water Resources Conservation and Development Fund



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             3717
     created in Section 73-10-24 .
             3718          (d) After making the transfers required by Subsections (5)(b) and (c), 94% of the
             3719      remaining difference described in Subsection (5)(a) shall be deposited into the Water
             3720      Resources Conservation and Development Fund created in Section 73-10-24 for use by the
             3721      Division of Water Resources for:
             3722          (i) preconstruction costs:
             3723          (A) as defined in Subsection 73-26-103 (6) for projects authorized by Title 73, Chapter
             3724      26, Bear River Development Act; and
             3725          (B) as defined in Subsection 73-28-103 (8) for the Lake Powell Pipeline project
             3726      authorized by Title 73, Chapter 28, Lake Powell Pipeline Development Act;
             3727          (ii) the cost of employing a civil engineer to oversee any project authorized by Title 73,
             3728      Chapter 26, Bear River Development Act;
             3729          (iii) the cost of employing a civil engineer to oversee the Lake Powell Pipeline project
             3730      authorized by Title 73, Chapter 28, Lake Powell Pipeline Development Act; and
             3731          (iv) other uses authorized under Sections 73-10-24 , 73-10-25.1 , 73-10-30 , and
             3732      Subsection (4)(e)(ii) after funding the uses specified in Subsections (5)(d)(i) through (iii).
             3733          (e) After making the transfers required by Subsections (5)(b) and (c) and subject to
             3734      Subsection (5)(f), 6% of the remaining difference described in Subsection (5)(a) shall be
             3735      transferred each year as dedicated credits to the Division of Water Rights to cover the costs
             3736      incurred for employing additional technical staff for the administration of water rights.
             3737          (f) At the end of each fiscal year, any unexpended dedicated credits described in
             3738      Subsection (5)(e) over $150,000 lapse to the Water Resources Conservation and Development
             3739      Fund created in Section 73-10-24 .
             3740          (6) Notwithstanding Subsection (3)(a), for a fiscal year beginning on or after July 1,
             3741      2003, and for taxes listed under Subsection (3)(a), the amount of revenue generated by a 1/16%
             3742      tax rate on the transactions described in Subsection (1) for the fiscal year shall be deposited in
             3743      the Transportation Fund created by Section 72-2-102 .
             3744          (7) Notwithstanding Subsection (3)(a), beginning on July 1, 2012, the Division of
             3745      Finance shall deposit into the Transportation Investment Fund of 2005 created in Section
             3746      72-2-124 a portion of the taxes listed under Subsection (3)(a) equal to the revenues generated
             3747      by a 1/64% tax rate on the taxable transactions under Subsection (1).



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             3748
         (8) (a) Notwithstanding Subsection (3)(a), in addition to the amounts deposited in
             3749      Subsection (7), and subject to Subsection (8)(b), for a fiscal year beginning on or after July 1,
             3750      2012, the Division of Finance shall deposit into the Transportation Investment Fund of 2005
             3751      created by Section 72-2-124 :
             3752          (i) a portion of the taxes listed under Subsection (3)(a) in an amount equal to 8.3% of
             3753      the revenues collected from the following taxes, which represents a portion of the
             3754      approximately 17% of sales and use tax revenues generated annually by the sales and use tax
             3755      on vehicles and vehicle-related products:
             3756          (A) the tax imposed by Subsection (2)(a)(i)(A);
             3757          (B) the tax imposed by Subsection (2)(b)(i);
             3758          (C) the tax imposed by Subsection (2)(c)(i); and
             3759          (D) the tax imposed by Subsection (2)(d)(i)(A)(I); plus
             3760          (ii) an amount equal to 30% of the growth in the amount of revenues collected in the
             3761      current fiscal year from the sales and use taxes described in Subsections (8)(a)(i)(A) through
             3762      (D) that exceeds the amount collected from the sales and use taxes described in Subsections
             3763      (8)(a)(i)(A) through (D) in the 2010-11 fiscal year.
             3764          (b) (i) Subject to Subsections (8)(b)(ii) and (iii), in any fiscal year that the portion of
             3765      the sales and use taxes deposited under Subsection (8)(a) represents an amount that is a total
             3766      lower percentage of the sales and use taxes described in Subsections (8)(a)(i)(A) through (D)
             3767      generated in the current fiscal year than the total percentage of sales and use taxes deposited in
             3768      the previous fiscal year, the Division of Finance shall deposit an amount under Subsection
             3769      (8)(a) equal to the product of:
             3770          (A) the total percentage of sales and use taxes deposited under Subsection (8)(a) in the
             3771      previous fiscal year; and
             3772          (B) the total sales and use tax revenue generated by the taxes described in Subsections
             3773      (8)(a)(i)(A) through (D) in the current fiscal year.
             3774          (ii) In any fiscal year in which the portion of the sales and use taxes deposited under
             3775      Subsection (8)(a) would exceed 17% of the revenues collected from the sales and use taxes
             3776      described in Subsections (8)(a)(i)(A) through (D) in the current fiscal year, the Division of
             3777      Finance shall deposit 17% of the revenues collected from the sales and use taxes described in
             3778      Subsections (8)(a)(i)(A) through (D) for the current fiscal year under Subsection (8)(a).



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             3779
         (iii) In all subsequent fiscal years after a year in which 17% of the revenues collected
             3780      from the sales and use taxes described in Subsections (8)(a)(i)(A) through (D) was deposited
             3781      under Subsection (8)(a), the Division of Finance shall annually deposit 17% of the revenues
             3782      collected from the sales and use taxes described in Subsections (8)(a)(i)(A) through (D) in the
             3783      current fiscal year under Subsection (8)(a).
             3784          (9) Notwithstanding Subsection (3)(a), and in addition to the amounts deposited under
             3785      Subsections (7) and (8), for a fiscal year beginning on or after July 1, 2012, the Division of
             3786      Finance shall annually deposit $90,000,000 of the revenues generated by the taxes listed under
             3787      Subsection (3)(a) into the Transportation Investment Fund of 2005 created by Section
             3788      72-2-124 .
             3789          (10) Notwithstanding Subsection (3)(a), for each fiscal year beginning with fiscal year
             3790      2009-10, $533,750 shall be deposited into the Qualified Emergency Food Agencies Fund
             3791      created by Section 35A-8-1009 and expended as provided in Section 35A-8-1009 .
             3792          (11) (a) Notwithstanding Subsection (3)(a), except as provided in Subsection (11)(b),
             3793      and in addition to any amounts deposited under Subsections (7), (8), and (9), beginning on July
             3794      1, 2012, the Division of Finance shall deposit into the Transportation Investment Fund of 2005
             3795      created by Section 72-2-124 the amount of tax revenue generated by a .025% tax rate on the
             3796      transactions described in Subsection (1).
             3797          (b) For purposes of Subsection (11)(a), the Division of Finance may not deposit into
             3798      the Transportation Investment Fund of 2005 any tax revenue generated by amounts paid or
             3799      charged for food and food ingredients, except for tax revenue generated by a bundled
             3800      transaction attributable to food and food ingredients and tangible personal property other than
             3801      food and food ingredients described in Subsection (2)(d).
             3802          (12) (a) Notwithstanding Subsection (3)(a), and except as provided in Subsection
             3803      (12)(b), beginning on January 1, 2009, the Division of Finance shall deposit into the
             3804      Transportation Fund created by Section 72-2-102 the amount of tax revenue generated by a
             3805      .025% tax rate on the transactions described in Subsection (1) to be expended to address
             3806      chokepoints in construction management.
             3807          (b) For purposes of Subsection (12)(a), the Division of Finance may not deposit into
             3808      the Transportation Fund any tax revenue generated by amounts paid or charged for food and
             3809      food ingredients, except for tax revenue generated by a bundled transaction attributable to food



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             3810
     and food ingredients and tangible personal property other than food and food ingredients
             3811      described in Subsection (2)(d).
             3812          Section 5. Section 59-12-104 is amended to read:
             3813           59-12-104. Exemptions.
             3814          The following sales and uses are exempt from the taxes imposed by this chapter:
             3815          (1) sales of aviation fuel, motor fuel, and special fuel subject to a Utah state excise tax
             3816      under Chapter 13, Motor and Special Fuel Tax Act;
             3817          (2) subject to Section 59-12-104.6 , sales to the state, its institutions, and its political
             3818      subdivisions; however, this exemption does not apply to sales of:
             3819          (a) construction materials except:
             3820          (i) construction materials purchased by or on behalf of institutions of the public
             3821      education system as defined in Utah Constitution Article X, Section 2, provided the
             3822      construction materials are clearly identified and segregated and installed or converted to real
             3823      property which is owned by institutions of the public education system; and
             3824          (ii) construction materials purchased by the state, its institutions, or its political
             3825      subdivisions which are installed or converted to real property by employees of the state, its
             3826      institutions, or its political subdivisions; or
             3827          (b) tangible personal property in connection with the construction, operation,
             3828      maintenance, repair, or replacement of a project, as defined in Section 11-13-103 , or facilities
             3829      providing additional project capacity, as defined in Section 11-13-103 ;
             3830          (3) (a) sales of an item described in Subsection (3)(b) from a vending machine if:
             3831          (i) the proceeds of each sale do not exceed $1; and
             3832          (ii) the seller or operator of the vending machine reports an amount equal to 150% of
             3833      the cost of the item described in Subsection (3)(b) as goods consumed; and
             3834          (b) Subsection (3)(a) applies to:
             3835          (i) food and food ingredients; or
             3836          (ii) prepared food;
             3837          (4) (a) sales of the following to a commercial airline carrier for in-flight consumption:
             3838          (i) alcoholic beverages;
             3839          (ii) food and food ingredients; or
             3840          (iii) prepared food;



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             3841
         (b) sales of tangible personal property or a product transferred electronically:
             3842          (i) to a passenger;
             3843          (ii) by a commercial airline carrier; and
             3844          (iii) during a flight for in-flight consumption or in-flight use by the passenger; or
             3845          (c) services related to Subsection (4)(a) or (b);
             3846          (5) (a) (i) beginning on July 1, 2008, and ending on September 30, 2008, sales of parts
             3847      and equipment:
             3848          (A) (I) by an establishment described in NAICS Code 336411 or 336412 of the 2002
             3849      North American Industry Classification System of the federal Executive Office of the
             3850      President, Office of Management and Budget; and
             3851          (II) for:
             3852          (Aa) installation in an aircraft, including services relating to the installation of parts or
             3853      equipment in the aircraft;
             3854          (Bb) renovation of an aircraft; or
             3855          (Cc) repair of an aircraft; or
             3856          (B) for installation in an aircraft operated by a common carrier in interstate or foreign
             3857      commerce; or
             3858          (ii) beginning on October 1, 2008, sales of parts and equipment for installation in an
             3859      aircraft operated by a common carrier in interstate or foreign commerce; and
             3860          (b) notwithstanding the time period of Subsection 59-1-1410 (8) for filing for a refund,
             3861      a person may claim the exemption allowed by Subsection (5)(a)(i)(B) for a sale by filing for a
             3862      refund:
             3863          (i) if the sale is made on or after July 1, 2008, but on or before September 30, 2008;
             3864          (ii) as if Subsection (5)(a)(i)(B) were in effect on the day on which the sale is made;
             3865          (iii) if the person did not claim the exemption allowed by Subsection (5)(a)(i)(B) for
             3866      the sale prior to filing for the refund;
             3867          (iv) for sales and use taxes paid under this chapter on the sale;
             3868          (v) in accordance with Section 59-1-1410 ; and
             3869          (vi) subject to any extension allowed for filing for a refund under Section 59-1-1410 , if
             3870      the person files for the refund on or before September 30, 2011;
             3871          (6) sales of commercials, motion picture films, prerecorded audio program tapes or



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             3872
     records, and prerecorded video tapes by a producer, distributor, or studio to a motion picture
             3873      exhibitor, distributor, or commercial television or radio broadcaster;
             3874          (7) (a) subject to Subsection (7)(b), sales of cleaning or washing of tangible personal
             3875      property if the cleaning or washing of the tangible personal property is not assisted cleaning or
             3876      washing of tangible personal property;
             3877          (b) if a seller that sells at the same business location assisted cleaning or washing of
             3878      tangible personal property and cleaning or washing of tangible personal property that is not
             3879      assisted cleaning or washing of tangible personal property, the exemption described in
             3880      Subsection (7)(a) applies if the seller separately accounts for the sales of the assisted cleaning
             3881      or washing of the tangible personal property; and
             3882          (c) for purposes of Subsection (7)(b) and in accordance with Title 63G, Chapter 3,
             3883      Utah Administrative Rulemaking Act, the commission may make rules:
             3884          (i) governing the circumstances under which sales are at the same business location;
             3885      and
             3886          (ii) establishing the procedures and requirements for a seller to separately account for
             3887      sales of assisted cleaning or washing of tangible personal property;
             3888          (8) sales made to or by religious or charitable institutions in the conduct of their regular
             3889      religious or charitable functions and activities, if the requirements of Section 59-12-104.1 are
             3890      fulfilled;
             3891          (9) sales of a vehicle of a type required to be registered under the motor vehicle laws of
             3892      this state if the vehicle is:
             3893          (a) not registered in this state; and
             3894          (b) (i) not used in this state; or
             3895          (ii) used in this state:
             3896          (A) if the vehicle is not used to conduct business, for a time period that does not
             3897      exceed the longer of:
             3898          (I) 30 days in any calendar year; or
             3899          (II) the time period necessary to transport the vehicle to the borders of this state; or
             3900          (B) if the vehicle is used to conduct business, for the time period necessary to transport
             3901      the vehicle to the borders of this state;
             3902          (10) (a) amounts paid for an item described in Subsection (10)(b) if:



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             3903
         (i) the item is intended for human use; and
             3904          (ii) (A) a prescription was issued for the item; or
             3905          (B) the item was purchased by a hospital or other medical facility; and
             3906          (b) (i) Subsection (10)(a) applies to:
             3907          (A) a drug;
             3908          (B) a syringe; or
             3909          (C) a stoma supply; and
             3910          (ii) in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             3911      commission may by rule define the terms:
             3912          (A) "syringe"; or
             3913          (B) "stoma supply";
             3914          (11) sales or use of property, materials, or services used in the construction of or
             3915      incorporated in pollution control facilities allowed by Sections 19-2-123 through 19-2-127 ;
             3916          (12) (a) sales of an item described in Subsection (12)(c) served by:
             3917          (i) the following if the item described in Subsection (12)(c) is not available to the
             3918      general public:
             3919          (A) a church; or
             3920          (B) a charitable institution;
             3921          (ii) an institution of higher education if:
             3922          (A) the item described in Subsection (12)(c) is not available to the general public; or
             3923          (B) the item described in Subsection (12)(c) is prepaid as part of a student meal plan
             3924      offered by the institution of higher education; or
             3925          (b) sales of an item described in Subsection (12)(c) provided for a patient by:
             3926          (i) a medical facility; or
             3927          (ii) a nursing facility; and
             3928          (c) Subsections (12)(a) and (b) apply to:
             3929          (i) food and food ingredients;
             3930          (ii) prepared food; or
             3931          (iii) alcoholic beverages;
             3932          (13) (a) except as provided in Subsection (13)(b), the sale of tangible personal property
             3933      or a product transferred electronically by a person:



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             3934
         (i) regardless of the number of transactions involving the sale of that tangible personal
             3935      property or product transferred electronically by that person; and
             3936          (ii) not regularly engaged in the business of selling that type of tangible personal
             3937      property or product transferred electronically;
             3938          (b) this Subsection (13) does not apply if:
             3939          (i) the sale is one of a series of sales of a character to indicate that the person is
             3940      regularly engaged in the business of selling that type of tangible personal property or product
             3941      transferred electronically;
             3942          (ii) the person holds that person out as regularly engaged in the business of selling that
             3943      type of tangible personal property or product transferred electronically;
             3944          (iii) the person sells an item of tangible personal property or product transferred
             3945      electronically that the person purchased as a sale that is exempt under Subsection (25); or
             3946          (iv) the sale is of a vehicle or vessel required to be titled or registered under the laws of
             3947      this state in which case the tax is based upon:
             3948          (A) the bill of sale or other written evidence of value of the vehicle or vessel being
             3949      sold; or
             3950          (B) in the absence of a bill of sale or other written evidence of value, the fair market
             3951      value of the vehicle or vessel being sold at the time of the sale as determined by the
             3952      commission; and
             3953          (c) in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             3954      commission shall make rules establishing the circumstances under which:
             3955          (i) a person is regularly engaged in the business of selling a type of tangible personal
             3956      property or product transferred electronically;
             3957          (ii) a sale of tangible personal property or a product transferred electronically is one of
             3958      a series of sales of a character to indicate that a person is regularly engaged in the business of
             3959      selling that type of tangible personal property or product transferred electronically; or
             3960          (iii) a person holds that person out as regularly engaged in the business of selling a type
             3961      of tangible personal property or product transferred electronically;
             3962          (14) (a) except as provided in Subsection (14)(b), amounts paid or charged on or after
             3963      July 1, 2006, for a purchase or lease by a manufacturing facility except for a cogeneration
             3964      facility, of the following:



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             3965
         (i) machinery and equipment that:
             3966          (A) are used:
             3967          (I) for a manufacturing facility except for a manufacturing facility that is a scrap
             3968      recycler described in Subsection 59-12-102 (60)(b):
             3969          (Aa) in the manufacturing process;
             3970          (Bb) to manufacture an item sold as tangible personal property; and
             3971          (Cc) beginning on July 1, 2009, in a manufacturing facility described in this Subsection
             3972      (14)(a)(i)(A)(I) in the state; or
             3973          (II) for a manufacturing facility that is a scrap recycler described in Subsection
             3974      59-12-102 (60)(b):
             3975          (Aa) to process an item sold as tangible personal property; and
             3976          (Bb) beginning on July 1, 2009, in a manufacturing facility described in this Subsection
             3977      (14)(a)(i)(A)(II) in the state; and
             3978          (B) have an economic life of three or more years; and
             3979          (ii) normal operating repair or replacement parts that:
             3980          (A) have an economic life of three or more years; and
             3981          (B) are used:
             3982          (I) for a manufacturing facility except for a manufacturing facility that is a scrap
             3983      recycler described in Subsection 59-12-102 (60)(b):
             3984          (Aa) in the manufacturing process; and
             3985          (Bb) in a manufacturing facility described in this Subsection (14)(a)(ii)(B)(I) in the
             3986      state; or
             3987          (II) for a manufacturing facility that is a scrap recycler described in Subsection
             3988      59-12-102 (60)(b):
             3989          (Aa) to process an item sold as tangible personal property; and
             3990          (Bb) in a manufacturing facility described in this Subsection (14)(a)(ii)(B)(II) in the
             3991      state;
             3992          (b) amounts paid or charged on or after July 1, 2005, for a purchase or lease by a
             3993      manufacturing facility that is a cogeneration facility placed in service on or after May 1, 2006,
             3994      of the following:
             3995          (i) machinery and equipment that:



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             3996
         (A) are used:
             3997          (I) in the manufacturing process;
             3998          (II) to manufacture an item sold as tangible personal property; and
             3999          (III) beginning on July 1, 2009, in a manufacturing facility described in this Subsection
             4000      (14)(b) in the state; and
             4001          (B) have an economic life of three or more years; and
             4002          (ii) normal operating repair or replacement parts that:
             4003          (A) are used:
             4004          (I) in the manufacturing process; and
             4005          (II) in a manufacturing facility described in this Subsection (14)(b) in the state; and
             4006          (B) have an economic life of three or more years;
             4007          (c) amounts paid or charged for a purchase or lease made on or after January 1, 2008,
             4008      by an establishment described in NAICS Subsector 212, Mining (except Oil and Gas), or
             4009      NAICS Code 213113, Support Activities for Coal Mining, 213114, Support Activities for
             4010      Metal Mining, or 213115, Support Activities for Nonmetallic Minerals (except Fuels) Mining,
             4011      of the 2002 North American Industry Classification System of the federal Executive Office of
             4012      the President, Office of Management and Budget, of the following:
             4013          (i) machinery and equipment that:
             4014          (A) are used:
             4015          (I) (Aa) in the production process, other than the production of real property; or
             4016          (Bb) in research and development; and
             4017          (II) beginning on July 1, 2009, in an establishment described in this Subsection (14)(c)
             4018      in the state; and
             4019          (B) have an economic life of three or more years; and
             4020          (ii) normal operating repair or replacement parts that:
             4021          (A) have an economic life of three or more years; and
             4022          (B) are used in:
             4023          (I) (Aa) the production process, except for the production of real property; and
             4024          (Bb) an establishment described in this Subsection (14)(c) in the state; or
             4025          (II) (Aa) research and development; and
             4026          (Bb) in an establishment described in this Subsection (14)(c) in the state;



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             4027
         (d) (i) amounts paid or charged for a purchase or lease made on or after July 1, 2010,
             4028      but on or before June 30, 2014, by an establishment described in NAICS Code 518112, Web
             4029      Search Portals, of the 2002 North American Industry Classification System of the federal
             4030      Executive Office of the President, Office of Management and Budget, of the following:
             4031          (A) machinery and equipment that:
             4032          (I) are used in the operation of the web search portal;
             4033          (II) have an economic life of three or more years; and
             4034          (III) are used in a new or expanding establishment described in this Subsection (14)(d)
             4035      in the state; and
             4036          (B) normal operating repair or replacement parts that:
             4037          (I) are used in the operation of the web search portal;
             4038          (II) have an economic life of three or more years; and
             4039          (III) are used in a new or expanding establishment described in this Subsection (14)(d)
             4040      in the state; or
             4041          (ii) amounts paid or charged for a purchase or lease made on or after July 1, 2014, by
             4042      an establishment described in NAICS Code 518112, Web Search Portals, of the 2002 North
             4043      American Industry Classification System of the federal Executive Office of the President,
             4044      Office of Management and Budget, of the following:
             4045          (A) machinery and equipment that:
             4046          (I) are used in the operation of the web search portal; and
             4047          (II) have an economic life of three or more years; and
             4048          (B) normal operating repair or replacement parts that:
             4049          (I) are used in the operation of the web search portal; and
             4050          (II) have an economic life of three or more years;
             4051          (e) for purposes of this Subsection (14) and in accordance with Title 63G, Chapter 3,
             4052      Utah Administrative Rulemaking Act, the commission:
             4053          (i) shall by rule define the term "establishment"; and
             4054          (ii) may by rule define what constitutes:
             4055          (A) processing an item sold as tangible personal property;
             4056          (B) the production process, except for the production of real property;
             4057          (C) research and development; or



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             4058
         (D) a new or expanding establishment described in Subsection (14)(d) in the state; and
             4059          (f) on or before October 1, 2011, and every five years after October 1, 2011, the
             4060      commission shall:
             4061          (i) review the exemptions described in this Subsection (14) and make
             4062      recommendations to the Revenue and Taxation Interim Committee concerning whether the
             4063      exemptions should be continued, modified, or repealed; and
             4064          (ii) include in its report:
             4065          (A) an estimate of the cost of the exemptions;
             4066          (B) the purpose and effectiveness of the exemptions; and
             4067          (C) the benefits of the exemptions to the state;
             4068          (15) (a) sales of the following if the requirements of Subsection (15)(b) are met:
             4069          (i) tooling;
             4070          (ii) special tooling;
             4071          (iii) support equipment;
             4072          (iv) special test equipment; or
             4073          (v) parts used in the repairs or renovations of tooling or equipment described in
             4074      Subsections (15)(a)(i) through (iv); and
             4075          (b) sales of tooling, equipment, or parts described in Subsection (15)(a) are exempt if:
             4076          (i) the tooling, equipment, or parts are used or consumed exclusively in the
             4077      performance of any aerospace or electronics industry contract with the United States
             4078      government or any subcontract under that contract; and
             4079          (ii) under the terms of the contract or subcontract described in Subsection (15)(b)(i),
             4080      title to the tooling, equipment, or parts is vested in the United States government as evidenced
             4081      by:
             4082          (A) a government identification tag placed on the tooling, equipment, or parts; or
             4083          (B) listing on a government-approved property record if placing a government
             4084      identification tag on the tooling, equipment, or parts is impractical;
             4085          (16) sales of newspapers or newspaper subscriptions;
             4086          (17) (a) except as provided in Subsection (17)(b), tangible personal property or a
             4087      product transferred electronically traded in as full or part payment of the purchase price, except
             4088      that for purposes of calculating sales or use tax upon vehicles not sold by a vehicle dealer,



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             4089
     trade-ins are limited to other vehicles only, and the tax is based upon:
             4090          (i) the bill of sale or other written evidence of value of the vehicle being sold and the
             4091      vehicle being traded in; or
             4092          (ii) in the absence of a bill of sale or other written evidence of value, the then existing
             4093      fair market value of the vehicle being sold and the vehicle being traded in, as determined by the
             4094      commission; and
             4095          (b) notwithstanding Subsection (17)(a), Subsection (17)(a) does not apply to the
             4096      following items of tangible personal property or products transferred electronically traded in as
             4097      full or part payment of the purchase price:
             4098          (i) money;
             4099          (ii) electricity;
             4100          (iii) water;
             4101          (iv) gas; or
             4102          (v) steam;
             4103          (18) (a) (i) except as provided in Subsection (18)(b), sales of tangible personal property
             4104      or a product transferred electronically used or consumed primarily and directly in farming
             4105      operations, regardless of whether the tangible personal property or product transferred
             4106      electronically:
             4107          (A) becomes part of real estate; or
             4108          (B) is installed by a:
             4109          (I) farmer;
             4110          (II) contractor; or
             4111          (III) subcontractor; or
             4112          (ii) sales of parts used in the repairs or renovations of tangible personal property or a
             4113      product transferred electronically if the tangible personal property or product transferred
             4114      electronically is exempt under Subsection (18)(a)(i); and
             4115          (b) notwithstanding Subsection (18)(a), amounts paid or charged for the following are
             4116      subject to the taxes imposed by this chapter:
             4117          (i) (A) subject to Subsection (18)(b)(i)(B), the following if used in a manner that is
             4118      incidental to farming:
             4119          (I) machinery;



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             4120
         (II) equipment;
             4121          (III) materials; or
             4122          (IV) supplies; and
             4123          (B) tangible personal property that is considered to be used in a manner that is
             4124      incidental to farming includes:
             4125          (I) hand tools; or
             4126          (II) maintenance and janitorial equipment and supplies;
             4127          (ii) (A) subject to Subsection (18)(b)(ii)(B), tangible personal property or a product
             4128      transferred electronically if the tangible personal property or product transferred electronically
             4129      is used in an activity other than farming; and
             4130          (B) tangible personal property or a product transferred electronically that is considered
             4131      to be used in an activity other than farming includes:
             4132          (I) office equipment and supplies; or
             4133          (II) equipment and supplies used in:
             4134          (Aa) the sale or distribution of farm products;
             4135          (Bb) research; or
             4136          (Cc) transportation; or
             4137          (iii) a vehicle required to be registered by the laws of this state during the period
             4138      ending two years after the date of the vehicle's purchase;
             4139          (19) sales of hay;
             4140          (20) exclusive sale during the harvest season of seasonal crops, seedling plants, or
             4141      garden, farm, or other agricultural produce if the seasonal crops are, seedling plants are, or
             4142      garden, farm, or other agricultural produce is sold by:
             4143          (a) the producer of the seasonal crops, seedling plants, or garden, farm, or other
             4144      agricultural produce;
             4145          (b) an employee of the producer described in Subsection (20)(a); or
             4146          (c) a member of the immediate family of the producer described in Subsection (20)(a);
             4147          (21) purchases made using a coupon as defined in 7 U.S.C. Sec. 2012 that is issued
             4148      under the Food Stamp Program, 7 U.S.C. Sec. 2011 et seq.;
             4149          (22) sales of nonreturnable containers, nonreturnable labels, nonreturnable bags,
             4150      nonreturnable shipping cases, and nonreturnable casings to a manufacturer, processor,



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             4151
     wholesaler, or retailer for use in packaging tangible personal property to be sold by that
             4152      manufacturer, processor, wholesaler, or retailer;
             4153          (23) a product stored in the state for resale;
             4154          (24) (a) purchases of a product if:
             4155          (i) the product is:
             4156          (A) purchased outside of this state;
             4157          (B) brought into this state:
             4158          (I) at any time after the purchase described in Subsection (24)(a)(i)(A); and
             4159          (II) by a nonresident person who is not living or working in this state at the time of the
             4160      purchase;
             4161          (C) used for the personal use or enjoyment of the nonresident person described in
             4162      Subsection (24)(a)(i)(B)(II) while that nonresident person is within the state; and
             4163          (D) not used in conducting business in this state; and
             4164          (ii) for:
             4165          (A) a product other than a boat described in Subsection (24)(a)(ii)(B), the first use of
             4166      the product for a purpose for which the product is designed occurs outside of this state;
             4167          (B) a boat, the boat is registered outside of this state; or
             4168          (C) a vehicle other than a vehicle sold to an authorized carrier, the vehicle is registered
             4169      outside of this state;
             4170          (b) the exemption provided for in Subsection (24)(a) does not apply to:
             4171          (i) a lease or rental of a product; or
             4172          (ii) a sale of a vehicle exempt under Subsection (33); and
             4173          (c) in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, for
             4174      purposes of Subsection (24)(a), the commission may by rule define what constitutes the
             4175      following:
             4176          (i) conducting business in this state if that phrase has the same meaning in this
             4177      Subsection (24) as in Subsection (63);
             4178          (ii) the first use of a product if that phrase has the same meaning in this Subsection (24)
             4179      as in Subsection (63); or
             4180          (iii) a purpose for which a product is designed if that phrase has the same meaning in
             4181      this Subsection (24) as in Subsection (63);



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             4182
         (25) a product purchased for resale in this state, in the regular course of business, either
             4183      in its original form or as an ingredient or component part of a manufactured or compounded
             4184      product;
             4185          (26) a product upon which a sales or use tax was paid to some other state, or one of its
             4186      subdivisions, except that the state shall be paid any difference between the tax paid and the tax
             4187      imposed by this part and Part 2, Local Sales and Use Tax Act, and no adjustment is allowed if
             4188      the tax paid was greater than the tax imposed by this part and Part 2, Local Sales and Use Tax
             4189      Act;
             4190          (27) any sale of a service described in Subsections 59-12-103 (1)(b), (c), and (d) to a
             4191      person for use in compounding a service taxable under the subsections;
             4192          (28) purchases made in accordance with the special supplemental nutrition program for
             4193      women, infants, and children established in 42 U.S.C. Sec. 1786;
             4194          (29) beginning on July 1, 1999, through June 30, 2014, sales or leases of rolls, rollers,
             4195      refractory brick, electric motors, or other replacement parts used in the furnaces, mills, or ovens
             4196      of a steel mill described in SIC Code 3312 of the 1987 Standard Industrial Classification
             4197      Manual of the federal Executive Office of the President, Office of Management and Budget;
             4198          (30) sales of a boat of a type required to be registered under Title 73, Chapter 18, State
             4199      Boating Act, a boat trailer, or an outboard motor if the boat, boat trailer, or outboard motor is:
             4200          (a) not registered in this state; and
             4201          (b) (i) not used in this state; or
             4202          (ii) used in this state:
             4203          (A) if the boat, boat trailer, or outboard motor is not used to conduct business, for a
             4204      time period that does not exceed the longer of:
             4205          (I) 30 days in any calendar year; or
             4206          (II) the time period necessary to transport the boat, boat trailer, or outboard motor to
             4207      the borders of this state; or
             4208          (B) if the boat, boat trailer, or outboard motor is used to conduct business, for the time
             4209      period necessary to transport the boat, boat trailer, or outboard motor to the borders of this
             4210      state;
             4211          (31) sales of aircraft manufactured in Utah;
             4212          (32) amounts paid for the purchase of telecommunications service for purposes of



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             4213
     providing telecommunications service;
             4214          (33) sales, leases, or uses of the following:
             4215          (a) a vehicle by an authorized carrier; or
             4216          (b) tangible personal property that is installed on a vehicle:
             4217          (i) sold or leased to or used by an authorized carrier; and
             4218          (ii) before the vehicle is placed in service for the first time;
             4219          (34) (a) 45% of the sales price of any new manufactured home; and
             4220          (b) 100% of the sales price of any used manufactured home;
             4221          (35) sales relating to schools and fundraising sales;
             4222          (36) sales or rentals of durable medical equipment if:
             4223          (a) a person presents a prescription for the durable medical equipment; and
             4224          (b) the durable medical equipment is used for home use only;
             4225          (37) (a) sales to a ski resort of electricity to operate a passenger ropeway as defined in
             4226      Section 72-11-102 ; and
             4227          (b) the commission shall by rule determine the method for calculating sales exempt
             4228      under Subsection (37)(a) that are not separately metered and accounted for in utility billings;
             4229          (38) sales to a ski resort of:
             4230          (a) snowmaking equipment;
             4231          (b) ski slope grooming equipment;
             4232          (c) passenger ropeways as defined in Section 72-11-102 ; or
             4233          (d) parts used in the repairs or renovations of equipment or passenger ropeways
             4234      described in Subsections (38)(a) through (c);
             4235          (39) sales of natural gas, electricity, heat, coal, fuel oil, or other fuels for industrial use;
             4236          (40) (a) subject to Subsection (40)(b), sales or rentals of the right to use or operate for
             4237      amusement, entertainment, or recreation an unassisted amusement device as defined in Section
             4238      59-12-102 ;
             4239          (b) if a seller that sells or rents at the same business location the right to use or operate
             4240      for amusement, entertainment, or recreation one or more unassisted amusement devices and
             4241      one or more assisted amusement devices, the exemption described in Subsection (40)(a)
             4242      applies if the seller separately accounts for the sales or rentals of the right to use or operate for
             4243      amusement, entertainment, or recreation for the assisted amusement devices; and



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             4244
         (c) for purposes of Subsection (40)(b) and in accordance with Title 63G, Chapter 3,
             4245      Utah Administrative Rulemaking Act, the commission may make rules:
             4246          (i) governing the circumstances under which sales are at the same business location;
             4247      and
             4248          (ii) establishing the procedures and requirements for a seller to separately account for
             4249      the sales or rentals of the right to use or operate for amusement, entertainment, or recreation for
             4250      assisted amusement devices;
             4251          (41) (a) sales of photocopies by:
             4252          (i) a governmental entity; or
             4253          (ii) an entity within the state system of public education, including:
             4254          (A) a school; or
             4255          (B) the State Board of Education; or
             4256          (b) sales of publications by a governmental entity;
             4257          (42) amounts paid for admission to an athletic event at an institution of higher
             4258      education that is subject to the provisions of Title IX of the Education Amendments of 1972,
             4259      20 U.S.C. Sec. 1681 et seq.;
             4260          (43) (a) sales made to or by:
             4261          (i) an area agency on aging; or
             4262          (ii) a senior citizen center owned by a county, city, or town; or
             4263          (b) sales made by a senior citizen center that contracts with an area agency on aging;
             4264          (44) sales or leases of semiconductor fabricating, processing, research, or development
             4265      materials regardless of whether the semiconductor fabricating, processing, research, or
             4266      development materials:
             4267          (a) actually come into contact with a semiconductor; or
             4268          (b) ultimately become incorporated into real property;
             4269          (45) [an amount paid by or charged to a purchaser for accommodations and services
             4270      described in Subsection 59-12-103 (1)(i) to the extent the amount is] short-term lodging exempt
             4271      under Section 59-12-104.2 ;
             4272          (46) beginning on September 1, 2001, the lease or use of a vehicle issued a temporary
             4273      sports event registration certificate in accordance with Section 41-3-306 for the event period
             4274      specified on the temporary sports event registration certificate;



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             4275
         (47) (a) sales or uses of electricity, if the sales or uses are made under a tariff adopted
             4276      by the Public Service Commission of Utah only for purchase of electricity produced from a
             4277      new alternative energy source, as designated in the tariff by the Public Service Commission of
             4278      Utah; and
             4279          (b) the exemption under Subsection (47)(a) applies to the portion of the tariff rate a
             4280      customer pays under the tariff described in Subsection (47)(a) that exceeds the tariff rate under
             4281      the tariff described in Subsection (47)(a) that the customer would have paid absent the tariff;
             4282          (48) sales or rentals of mobility enhancing equipment if a person presents a
             4283      prescription for the mobility enhancing equipment;
             4284          (49) sales of water in a:
             4285          (a) pipe;
             4286          (b) conduit;
             4287          (c) ditch; or
             4288          (d) reservoir;
             4289          (50) sales of currency or coins that constitute legal tender of a state, the United States,
             4290      or a foreign nation;
             4291          (51) (a) sales of an item described in Subsection (51)(b) if the item:
             4292          (i) does not constitute legal tender of a state, the United States, or a foreign nation; and
             4293          (ii) has a gold, silver, or platinum content of 50% or more; and
             4294          (b) Subsection (51)(a) applies to a gold, silver, or platinum:
             4295          (i) ingot;
             4296          (ii) bar;
             4297          (iii) medallion; or
             4298          (iv) decorative coin;
             4299          (52) amounts paid on a sale-leaseback transaction;
             4300          (53) sales of a prosthetic device:
             4301          (a) for use on or in a human; and
             4302          (b) (i) for which a prescription is required; or
             4303          (ii) if the prosthetic device is purchased by a hospital or other medical facility;
             4304          (54) (a) except as provided in Subsection (54)(b), purchases, leases, or rentals of
             4305      machinery or equipment by an establishment described in Subsection (54)(c) if the machinery



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             4306
     or equipment is primarily used in the production or postproduction of the following media for
             4307      commercial distribution:
             4308          (i) a motion picture;
             4309          (ii) a television program;
             4310          (iii) a movie made for television;
             4311          (iv) a music video;
             4312          (v) a commercial;
             4313          (vi) a documentary; or
             4314          (vii) a medium similar to Subsections (54)(a)(i) through (vi) as determined by the
             4315      commission by administrative rule made in accordance with Subsection (54)(d); or
             4316          (b) notwithstanding Subsection (54)(a), purchases, leases, or rentals of machinery or
             4317      equipment by an establishment described in Subsection (54)(c) that is used for the production
             4318      or postproduction of the following are subject to the taxes imposed by this chapter:
             4319          (i) a live musical performance;
             4320          (ii) a live news program; or
             4321          (iii) a live sporting event;
             4322          (c) the following establishments listed in the 1997 North American Industry
             4323      Classification System of the federal Executive Office of the President, Office of Management
             4324      and Budget, apply to Subsections (54)(a) and (b):
             4325          (i) NAICS Code 512110; or
             4326          (ii) NAICS Code 51219; and
             4327          (d) in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             4328      commission may by rule:
             4329          (i) prescribe what constitutes a medium similar to Subsections (54)(a)(i) through (vi);
             4330      or
             4331          (ii) define:
             4332          (A) "commercial distribution";
             4333          (B) "live musical performance";
             4334          (C) "live news program"; or
             4335          (D) "live sporting event";
             4336          (55) (a) leases of seven or more years or purchases made on or after July 1, 2004, but



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             4337
     on or before June 30, 2027, of tangible personal property that:
             4338          (i) is leased or purchased for or by a facility that:
             4339          (A) is an alternative energy electricity production facility;
             4340          (B) is located in the state; and
             4341          (C) (I) becomes operational on or after July 1, 2004; or
             4342          (II) has its generation capacity increased by one or more megawatts on or after July 1,
             4343      2004, as a result of the use of the tangible personal property;
             4344          (ii) has an economic life of five or more years; and
             4345          (iii) is used to make the facility or the increase in capacity of the facility described in
             4346      Subsection (55)(a)(i) operational up to the point of interconnection with an existing
             4347      transmission grid including:
             4348          (A) a wind turbine;
             4349          (B) generating equipment;
             4350          (C) a control and monitoring system;
             4351          (D) a power line;
             4352          (E) substation equipment;
             4353          (F) lighting;
             4354          (G) fencing;
             4355          (H) pipes; or
             4356          (I) other equipment used for locating a power line or pole; and
             4357          (b) this Subsection (55) does not apply to:
             4358          (i) tangible personal property used in construction of:
             4359          (A) a new alternative energy electricity production facility; or
             4360          (B) the increase in the capacity of an alternative energy electricity production facility;
             4361          (ii) contracted services required for construction and routine maintenance activities;
             4362      and
             4363          (iii) unless the tangible personal property is used or acquired for an increase in capacity
             4364      of the facility described in Subsection (55)(a)(i)(C)(II), tangible personal property used or
             4365      acquired after:
             4366          (A) the alternative energy electricity production facility described in Subsection
             4367      (55)(a)(i) is operational as described in Subsection (55)(a)(iii); or



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             4368
         (B) the increased capacity described in Subsection (55)(a)(i) is operational as described
             4369      in Subsection (55)(a)(iii);
             4370          (56) (a) leases of seven or more years or purchases made on or after July 1, 2004, but
             4371      on or before June 30, 2027, of tangible personal property that:
             4372          (i) is leased or purchased for or by a facility that:
             4373          (A) is a waste energy production facility;
             4374          (B) is located in the state; and
             4375          (C) (I) becomes operational on or after July 1, 2004; or
             4376          (II) has its generation capacity increased by one or more megawatts on or after July 1,
             4377      2004, as a result of the use of the tangible personal property;
             4378          (ii) has an economic life of five or more years; and
             4379          (iii) is used to make the facility or the increase in capacity of the facility described in
             4380      Subsection (56)(a)(i) operational up to the point of interconnection with an existing
             4381      transmission grid including:
             4382          (A) generating equipment;
             4383          (B) a control and monitoring system;
             4384          (C) a power line;
             4385          (D) substation equipment;
             4386          (E) lighting;
             4387          (F) fencing;
             4388          (G) pipes; or
             4389          (H) other equipment used for locating a power line or pole; and
             4390          (b) this Subsection (56) does not apply to:
             4391          (i) tangible personal property used in construction of:
             4392          (A) a new waste energy facility; or
             4393          (B) the increase in the capacity of a waste energy facility;
             4394          (ii) contracted services required for construction and routine maintenance activities;
             4395      and
             4396          (iii) unless the tangible personal property is used or acquired for an increase in capacity
             4397      described in Subsection (56)(a)(i)(C)(II), tangible personal property used or acquired after:
             4398          (A) the waste energy facility described in Subsection (56)(a)(i) is operational as



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             4399
     described in Subsection (56)(a)(iii); or
             4400          (B) the increased capacity described in Subsection (56)(a)(i) is operational as described
             4401      in Subsection (56)(a)(iii);
             4402          (57) (a) leases of five or more years or purchases made on or after July 1, 2004 but on
             4403      or before June 30, 2027, of tangible personal property that:
             4404          (i) is leased or purchased for or by a facility that:
             4405          (A) is located in the state;
             4406          (B) produces fuel from alternative energy, including:
             4407          (I) methanol; or
             4408          (II) ethanol; and
             4409          (C) (I) becomes operational on or after July 1, 2004; or
             4410          (II) has its capacity to produce fuel increase by 25% or more on or after July 1, 2004, as
             4411      a result of the installation of the tangible personal property;
             4412          (ii) has an economic life of five or more years; and
             4413          (iii) is installed on the facility described in Subsection (57)(a)(i);
             4414          (b) this Subsection (57) does not apply to:
             4415          (i) tangible personal property used in construction of:
             4416          (A) a new facility described in Subsection (57)(a)(i); or
             4417          (B) the increase in capacity of the facility described in Subsection (57)(a)(i); or
             4418          (ii) contracted services required for construction and routine maintenance activities;
             4419      and
             4420          (iii) unless the tangible personal property is used or acquired for an increase in capacity
             4421      described in Subsection (57)(a)(i)(C)(II), tangible personal property used or acquired after:
             4422          (A) the facility described in Subsection (57)(a)(i) is operational; or
             4423          (B) the increased capacity described in Subsection (57)(a)(i) is operational;
             4424          (58) (a) subject to Subsection (58)(b) or (c), sales of tangible personal property or a
             4425      product transferred electronically to a person within this state if that tangible personal property
             4426      or product transferred electronically is subsequently shipped outside the state and incorporated
             4427      pursuant to contract into and becomes a part of real property located outside of this state;
             4428          (b) the exemption under Subsection (58)(a) is not allowed to the extent that the other
             4429      state or political entity to which the tangible personal property is shipped imposes a sales, use,



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             4430
     gross receipts, or other similar transaction excise tax on the transaction against which the other
             4431      state or political entity allows a credit for sales and use taxes imposed by this chapter; and
             4432          (c) notwithstanding the time period of Subsection 59-1-1410 (8) for filing for a refund,
             4433      a person may claim the exemption allowed by this Subsection (58) for a sale by filing for a
             4434      refund:
             4435          (i) if the sale is made on or after July 1, 2004, but on or before June 30, 2008;
             4436          (ii) as if this Subsection (58) as in effect on July 1, 2008, were in effect on the day on
             4437      which the sale is made;
             4438          (iii) if the person did not claim the exemption allowed by this Subsection (58) for the
             4439      sale prior to filing for the refund;
             4440          (iv) for sales and use taxes paid under this chapter on the sale;
             4441          (v) in accordance with Section 59-1-1410 ; and
             4442          (vi) subject to any extension allowed for filing for a refund under Section 59-1-1410 , if
             4443      the person files for the refund on or before June 30, 2011;
             4444          (59) purchases:
             4445          (a) of one or more of the following items in printed or electronic format:
             4446          (i) a list containing information that includes one or more:
             4447          (A) names; or
             4448          (B) addresses; or
             4449          (ii) a database containing information that includes one or more:
             4450          (A) names; or
             4451          (B) addresses; and
             4452          (b) used to send direct mail;
             4453          (60) redemptions or repurchases of a product by a person if that product was:
             4454          (a) delivered to a pawnbroker as part of a pawn transaction; and
             4455          (b) redeemed or repurchased within the time period established in a written agreement
             4456      between the person and the pawnbroker for redeeming or repurchasing the product;
             4457          (61) (a) purchases or leases of an item described in Subsection (61)(b) if the item:
             4458          (i) is purchased or leased by, or on behalf of, a telecommunications service provider;
             4459      and
             4460          (ii) has a useful economic life of one or more years; and



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             4461
         (b) the following apply to Subsection (61)(a):
             4462          (i) telecommunications enabling or facilitating equipment, machinery, or software;
             4463          (ii) telecommunications equipment, machinery, or software required for 911 service;
             4464          (iii) telecommunications maintenance or repair equipment, machinery, or software;
             4465          (iv) telecommunications switching or routing equipment, machinery, or software; or
             4466          (v) telecommunications transmission equipment, machinery, or software;
             4467          (62) (a) beginning on July 1, 2006, and ending on June 30, 2027, purchases of tangible
             4468      personal property or a product transferred electronically that are used in the research and
             4469      development of alternative energy technology; and
             4470          (b) in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             4471      commission may, for purposes of Subsection (62)(a), make rules defining what constitutes
             4472      purchases of tangible personal property or a product transferred electronically that are used in
             4473      the research and development of alternative energy technology;
             4474          (63) (a) purchases of tangible personal property or a product transferred electronically
             4475      if:
             4476          (i) the tangible personal property or product transferred electronically is:
             4477          (A) purchased outside of this state;
             4478          (B) brought into this state at any time after the purchase described in Subsection
             4479      (63)(a)(i)(A); and
             4480          (C) used in conducting business in this state; and
             4481          (ii) for:
             4482          (A) tangible personal property or a product transferred electronically other than the
             4483      tangible personal property described in Subsection (63)(a)(ii)(B), the first use of the property
             4484      for a purpose for which the property is designed occurs outside of this state; or
             4485          (B) a vehicle other than a vehicle sold to an authorized carrier, the vehicle is registered
             4486      outside of this state;
             4487          (b) the exemption provided for in Subsection (63)(a) does not apply to:
             4488          (i) a lease or rental of tangible personal property or a product transferred electronically;
             4489      or
             4490          (ii) a sale of a vehicle exempt under Subsection (33); and
             4491          (c) in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, for



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             4492
     purposes of Subsection (63)(a), the commission may by rule define what constitutes the
             4493      following:
             4494          (i) conducting business in this state if that phrase has the same meaning in this
             4495      Subsection (63) as in Subsection (24);
             4496          (ii) the first use of tangible personal property or a product transferred electronically if
             4497      that phrase has the same meaning in this Subsection (63) as in Subsection (24); or
             4498          (iii) a purpose for which tangible personal property or a product transferred
             4499      electronically is designed if that phrase has the same meaning in this Subsection (63) as in
             4500      Subsection (24);
             4501          (64) sales of disposable home medical equipment or supplies if:
             4502          (a) a person presents a prescription for the disposable home medical equipment or
             4503      supplies;
             4504          (b) the disposable home medical equipment or supplies are used exclusively by the
             4505      person to whom the prescription described in Subsection (64)(a) is issued; and
             4506          (c) the disposable home medical equipment and supplies are listed as eligible for
             4507      payment under:
             4508          (i) Title XVIII, federal Social Security Act; or
             4509          (ii) the state plan for medical assistance under Title XIX, federal Social Security Act;
             4510          (65) sales:
             4511          (a) to a public transit district under Title 17B, Chapter 2a, Part 8, Public Transit
             4512      District Act; or
             4513          (b) of tangible personal property to a subcontractor of a public transit district, if the
             4514      tangible personal property is:
             4515          (i) clearly identified; and
             4516          (ii) installed or converted to real property owned by the public transit district;
             4517          (66) sales of construction materials:
             4518          (a) purchased on or after July 1, 2010;
             4519          (b) purchased by, on behalf of, or for the benefit of an international airport:
             4520          (i) located within a county of the first class; and
             4521          (ii) that has a United States customs office on its premises; and
             4522          (c) if the construction materials are:



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             4523
         (i) clearly identified;
             4524          (ii) segregated; and
             4525          (iii) installed or converted to real property:
             4526          (A) owned or operated by the international airport described in Subsection (66)(b); and
             4527          (B) located at the international airport described in Subsection (66)(b);
             4528          (67) sales of construction materials:
             4529          (a) purchased on or after July 1, 2008;
             4530          (b) purchased by, on behalf of, or for the benefit of a new airport:
             4531          (i) located within a county of the second class; and
             4532          (ii) that is owned or operated by a city in which an airline as defined in Section
             4533      59-2-102 is headquartered; and
             4534          (c) if the construction materials are:
             4535          (i) clearly identified;
             4536          (ii) segregated; and
             4537          (iii) installed or converted to real property:
             4538          (A) owned or operated by the new airport described in Subsection (67)(b);
             4539          (B) located at the new airport described in Subsection (67)(b); and
             4540          (C) as part of the construction of the new airport described in Subsection (67)(b);
             4541          (68) sales of fuel to a common carrier that is a railroad for use in a locomotive engine;
             4542          (69) purchases and sales described in Section 63H-4-111 ;
             4543          (70) (a) sales of tangible personal property to an aircraft maintenance, repair, and
             4544      overhaul provider for use in the maintenance, repair, overhaul, or refurbishment in this state of
             4545      a fixed wing turbine powered aircraft if that fixed wing turbine powered aircraft's registration
             4546      lists a state or country other than this state as the location of registry of the fixed wing turbine
             4547      powered aircraft; or
             4548          (b) sales of tangible personal property by an aircraft maintenance, repair, and overhaul
             4549      provider in connection with the maintenance, repair, overhaul, or refurbishment in this state of
             4550      a fixed wing turbine powered aircraft if that fixed wing turbine powered aircraft's registration
             4551      lists a state or country other than this state as the location of registry of the fixed wing turbine
             4552      powered aircraft;
             4553          (71) subject to Section 59-12-104.4 , sales of a textbook for a higher education course:



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             4554
         (a) to a person admitted to an institution of higher education; and
             4555          (b) by a seller, other than a bookstore owned by an institution of higher education, if
             4556      51% or more of that seller's sales revenue for the previous calendar quarter are sales of a
             4557      textbook for a higher education course;
             4558          (72) a license fee or tax a municipality imposes in accordance with Subsection
             4559      10-1-203 (5) on a purchaser from a business for which the municipality provides an enhanced
             4560      level of municipal services;
             4561          (73) amounts paid or charged for construction materials used in the construction of a
             4562      new or expanding life science research and development facility in the state, if the construction
             4563      materials are:
             4564          (a) clearly identified;
             4565          (b) segregated; and
             4566          (c) installed or converted to real property; and
             4567          (74) amounts paid or charged for:
             4568          (a) a purchase or lease of machinery and equipment that:
             4569          (i) are used in performing qualified research:
             4570          (A) as defined in Section 59-7-612 ;
             4571          (B) in the state; and
             4572          (C) with respect to which the purchaser pays or incurs a qualified research expense as
             4573      defined in Section 59-7-612 ; and
             4574          (ii) have an economic life of three or more years; and
             4575          (b) normal operating repair or replacement parts:
             4576          (i) for the machinery and equipment described in Subsection (74)(a); and
             4577          (ii) that have an economic life of three or more years.
             4578          Section 6. Section 59-12-104.2 is amended to read:
             4579           59-12-104.2. Exemption for accommodations and services taxed by the Navajo
             4580      Nation.
             4581          (1) As used in this section "tribal taxing area" means the geographical area that:
             4582          (a) is subject to the taxing authority of the Navajo Nation; and
             4583          (b) consists of:
             4584          (i) notwithstanding the issuance of a patent, all land:



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             4585
         (A) within the limits of an Indian reservation under the jurisdiction of the federal
             4586      government; and
             4587          (B) including any rights-of-way running through the reservation; and
             4588          (ii) all Indian allotments the Indian titles to which have not been extinguished,
             4589      including any rights-of-way running through an Indian allotment.
             4590          (2) (a) Beginning July 1, 2001, amounts [paid by or charged to a purchaser for
             4591      accommodations and services described in] subject to taxation as short-term lodging under
             4592      Subsection 59-12-103 (1)(i) are exempt from the tax imposed by Subsection
             4593      59-12-103 (2)(a)(i)(A) or (2)(d)(i)(A)(I) to the extent permitted under Subsection (2)(b) if:
             4594          (i) the [accommodations and services described in Subsection 59-12-103 (1)(i) are]
             4595      short-term lodging is provided within:
             4596          (A) the state; and
             4597          (B) a tribal taxing area;
             4598          (ii) the Navajo Nation imposes and collects a tax on the amounts paid by or charged to
             4599      the purchaser for the [accommodations and services described in Subsection 59-12-103 (1)(i)]
             4600      short-term lodging;
             4601          (iii) the Navajo Nation imposes the tax described in Subsection (2)(a)(ii) without
             4602      regard to whether or not the purchaser that pays or is charged for the [accommodations and
             4603      services] short-term lodging is an enrolled member of the Navajo Nation; and
             4604          (iv) the requirements of Subsection (4) are met.
             4605          (b) If but for Subsection (2)(a) the amounts paid by or charged to a purchaser for
             4606      [accommodations and services] short-term lodging described in Subsection (2)(a) are subject to
             4607      a tax imposed by Subsection 59-12-103 (2)(a)(i)(A) or (2)(d)(i)(A)(I):
             4608          (i) the seller shall collect and pay to the state the difference described in Subsection (3)
             4609      if that difference is greater than $0; and
             4610          (ii) a person may not require the state to provide a refund, a credit, or similar tax relief
             4611      if the difference described in Subsection (3) is equal to or less than $0.
             4612          (3) The difference described in Subsection (2)(b) is equal to the difference between:
             4613          (a) the amount of tax imposed by Subsection 59-12-103 (2)(a)(i)(A) or (2)(d)(i)(A)(I)
             4614      on the amounts [paid by or charged to a purchaser for accommodations and services described
             4615      in] subject to taxation as short-term lodging under Subsection 59-12-103 (1)(i); [less] and



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             4616
         (b) the tax imposed and collected by the Navajo Nation on the amounts paid by or
             4617      charged to a purchaser for the [accommodations and services described in Subsection
             4618      59-12-103 (1)(i)] short-term lodging.
             4619          (4) (a) If, on or after July 1, 2001, the Navajo Nation changes the tax rate of a tax
             4620      imposed on amounts paid by or charged to a purchaser for [accommodations and services
             4621      described in Subsection 59-12-103 (1)(i)] short-term lodging, any change in the amount of the
             4622      exemption under Subsection (2) as a result of the change in the tax rate is not effective until the
             4623      first day of the calendar quarter after a 90-day period beginning on the date the commission
             4624      receives notice meeting the requirements of Subsection (4)(b) from the Navajo Nation.
             4625          (b) The notice described in Subsection (4)(a) shall state:
             4626          (i) that the Navajo Nation has changed or will change the tax rate of a tax imposed on
             4627      amounts paid by or charged to a purchaser for [accommodations and services described in
             4628      Subsection 59-12-103 (1)(i)] short-term lodging;
             4629          (ii) the effective date of the rate change on the tax described in Subsection (4)(b)(i);
             4630      and
             4631          (iii) the new rate of the tax described in Subsection (4)(b)(i).
             4632          (5) Beginning with the 2006 interim, the Revenue and Taxation Interim Committee:
             4633          (a) shall review the exemption provided for in this section one or more times every five
             4634      years;
             4635          (b) shall determine on or before the November interim meeting of the year in which the
             4636      Revenue and Taxation Interim Committee reviews the exemption provided for in this section
             4637      whether the exemption should be:
             4638          (i) continued;
             4639          (ii) modified; or
             4640          (iii) repealed; and
             4641          (c) may review any other issue related to the exemption provided for in this section as
             4642      determined by the Revenue and Taxation Interim Committee.
             4643          Section 7. Section 59-12-104.6 is amended to read:
             4644           59-12-104.6. Procedure for claiming a sales and use tax exemption for certain
             4645      lodging related purchases -- Rulemaking authority -- Applicability of section.
             4646          (1) As used in this section:



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             4647
         (a) "Designated establishment within the lodging industry" means an establishment
             4648      described in NAICS Code 721110 or 721191 of the 2007 North American Industry
             4649      Classification System of the federal Executive Office of the President, Office of Management
             4650      and Budget.
             4651          (b) "Exempt purchaser" means a person that:
             4652          (i) makes a lodging related purchase; and
             4653          (ii) may claim an exemption from a tax under this chapter for the purchase.
             4654          (c) "Lodging related purchase" means the purchase of the following from a seller that is
             4655      a designated establishment within the lodging industry:
             4656          (i) [accommodations and services described in Subsection 59-12-103 (1)(i)] short-term
             4657      lodging; or
             4658          (ii) any other tangible personal property, product, or service that is:
             4659          (A) purchased as part of a transaction that includes the purchase of [accommodations
             4660      and services described in Subsection (1)(c)(i)] short-term lodging; and
             4661          (B) included on the invoice, bill of sale, or similar document provided to the purchaser
             4662      of the [accommodations and services described in Subsection (1)(c)(i)] short-term lodging.
             4663          (2) Except as provided in Subsection (3), an exempt purchaser that makes a lodging
             4664      related purchase:
             4665          (a) shall pay a tax that would otherwise be imposed under this chapter on the lodging
             4666      related purchase but for the purchaser being allowed to claim an exemption from a tax under
             4667      this chapter for the purchase; and
             4668          (b) may apply to the commission for a refund of the tax described in Subsection (2)(a)
             4669      that the purchaser pays.
             4670          (3) An exempt purchaser that makes a lodging related purchase may claim an
             4671      exemption from a tax under this chapter at the point of sale if the exempt purchaser:
             4672          (a) is an agency or instrumentality of the United States;
             4673          (b) is exempt from a tax under this chapter on a lodging related purchase as authorized
             4674      by a diplomatic tax exemption card issued by the United States; or
             4675          (c) may claim the exemption at the point of sale in accordance with Section
             4676      59-12-104.1 .
             4677          (4) An exempt purchaser that applies to the commission for a refund may not make an



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             4678
     application to the commission for a refund more frequently than monthly.
             4679          (5) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             4680      commission may make rules providing:
             4681          (a) procedures for applying for a refund under this section;
             4682          (b) standards for determining and verifying the amount of a lodging related purchase by
             4683      an exempt purchaser; and
             4684          (c) procedures for claiming a refund on a monthly basis.
             4685          (6) This section does not apply to amounts taxed by the Navajo Nation that are exempt
             4686      from sales and use taxes in accordance with Section 59-12-104.2 .
             4687          Section 8. Section 59-12-107 is amended to read:
             4688           59-12-107. Definitions -- Collection, remittance, and payment of tax by sellers or
             4689      other persons -- Returns -- Reports -- Direct payment by purchaser of vehicle -- Other
             4690      liability for collection -- Rulemaking authority -- Credits -- Treatment of bad debt --
             4691      Penalties and interest.
             4692          (1) As used in this section:
             4693          (a) "Ownership" means direct ownership or indirect ownership through a parent,
             4694      subsidiary, or affiliate.
             4695          (b) "Related seller" means a seller that:
             4696          (i) meets one or more of the criteria described in Subsection (2)(a)(i); and
             4697          (ii) delivers tangible personal property, a service, or a product transferred electronically
             4698      that is sold:
             4699          (A) by a seller that does not meet one or more of the criteria described in Subsection
             4700      (2)(a)(i); and
             4701          (B) to a purchaser in the state.
             4702          (c) "Substantial ownership interest" means an ownership interest in a business entity if
             4703      that ownership interest is greater than the degree of ownership of equity interest specified in 15
             4704      U.S.C. Sec. 78p, with respect to a person other than a director or an officer.
             4705          (2) (a) Except as provided in Subsection (2)(e), Section 59-12-107.1 , or Section
             4706      59-12-123 , and subject to Subsection (2)(f), each seller shall pay or collect and remit the sales
             4707      and use taxes imposed by this chapter if within this state the seller:
             4708          (i) has or utilizes:



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             4709
         (A) an office;
             4710          (B) a distribution house;
             4711          (C) a sales house;
             4712          (D) a warehouse;
             4713          (E) a service enterprise; or
             4714          (F) a place of business similar to Subsections (2)(a)(i)(A) through (E);
             4715          (ii) maintains a stock of goods;
             4716          (iii) regularly solicits orders, regardless of whether or not the orders are accepted in the
             4717      state, unless the seller's only activity in the state is:
             4718          (A) advertising; or
             4719          (B) solicitation by:
             4720          (I) direct mail;
             4721          (II) electronic mail;
             4722          (III) the Internet;
             4723          (IV) telecommunications service; or
             4724          (V) a means similar to Subsection (2)(a)(iii)(A) or (B);
             4725          (iv) regularly engages in the delivery of property in the state other than by:
             4726          (A) common carrier; or
             4727          (B) United States mail; or
             4728          (v) regularly engages in an activity directly related to the leasing or servicing of
             4729      property located within the state.
             4730          (b) A seller is considered to be engaged in the business of selling tangible personal
             4731      property, a service, or a product transferred electronically for use in the state, and shall pay or
             4732      collect and remit the sales and use taxes imposed by this chapter if:
             4733          (i) the seller holds a substantial ownership interest in, or is owned in whole or in
             4734      substantial part by, a related seller; and
             4735          (ii) (A) the seller sells the same or a substantially similar line of products as the related
             4736      seller and does so under the same or a substantially similar business name; or
             4737          (B) the place of business described in Subsection (2)(a)(i) of the related seller or an in
             4738      state employee of the related seller is used to advertise, promote, or facilitate sales by the seller
             4739      to a purchaser.



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             4740
         (c) A seller that does not meet one or more of the criteria provided for in Subsection
             4741      (2)(a) or is not a seller required to pay or collect and remit sales and use taxes under Subsection
             4742      (2)(b):
             4743          (i) except as provided in Subsection (2)(c)(ii), may voluntarily:
             4744          (A) collect a tax on a transaction described in Subsection 59-12-103 (1); and
             4745          (B) remit the tax to the commission as provided in this part; or
             4746          (ii) notwithstanding Subsection (2)(c)(i), shall collect a tax on a transaction described
             4747      in Subsection 59-12-103 (1) if Section 59-12-103.1 requires the seller to collect the tax.
             4748          (d) The collection and remittance of a tax under this chapter by a seller that is
             4749      registered under the agreement may not be used as a factor in determining whether that seller is
             4750      required by Subsection (2) to:
             4751          (i) pay a tax, fee, or charge under:
             4752          (A) Title 10, Chapter 1, Part 3, Municipal Energy Sales and Use Tax Act;
             4753          (B) Title 10, Chapter 1, Part 4, Municipal Telecommunications License Tax Act;
             4754          (C) Section 19-6-714 ;
             4755          (D) Section 19-6-805 ;
             4756          (E) Section 69-2-5 ;
             4757          (F) Section 69-2-5.5 ;
             4758          (G) Section 69-2-5.6 ; or
             4759          (H) this title; or
             4760          (ii) collect and remit a tax, fee, or charge under:
             4761          (A) Title 10, Chapter 1, Part 3, Municipal Energy Sales and Use Tax Act;
             4762          (B) Title 10, Chapter 1, Part 4, Municipal Telecommunications License Tax Act;
             4763          (C) Section 19-6-714 ;
             4764          (D) Section 19-6-805 ;
             4765          (E) Section 69-2-5 ;
             4766          (F) Section 69-2-5.5 ;
             4767          (G) Section 69-2-5.6 ; or
             4768          (H) this title.
             4769          (e) A person shall pay a use tax imposed by this chapter on a transaction described in
             4770      Subsection 59-12-103 (1) if:



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             4771
         (i) the seller did not collect a tax imposed by this chapter on the transaction; and
             4772          (ii) the person:
             4773          (A) stores the tangible personal property or product transferred electronically in the
             4774      state;
             4775          (B) uses the tangible personal property or product transferred electronically in the state;
             4776      or
             4777          (C) consumes the tangible personal property or product transferred electronically in the
             4778      state.
             4779          (f) The ownership of property that is located at the premises of a printer's facility with
             4780      which the retailer has contracted for printing and that consists of the final printed product,
             4781      property that becomes a part of the final printed product, or copy from which the printed
             4782      product is produced, shall not result in the retailer being considered to have or maintain an
             4783      office, distribution house, sales house, warehouse, service enterprise, or other place of
             4784      business, or to maintain a stock of goods, within this state.
             4785          (3) (a) Except as provided in Section 59-12-107.1 , a tax under this chapter shall be
             4786      collected from a purchaser.
             4787          (b) A seller may not collect as tax an amount, without regard to fractional parts of one
             4788      cent, in excess of the tax computed at the rates prescribed by this chapter.
             4789          (c) (i) Each seller shall:
             4790          (A) give the purchaser a receipt for the tax collected; or
             4791          (B) bill the tax as a separate item and declare the name of this state and the seller's
             4792      sales and use tax license number on the invoice for the sale.
             4793          (ii) The receipt or invoice is prima facie evidence that the seller has collected the tax
             4794      and relieves the purchaser of the liability for reporting the tax to the commission as a
             4795      consumer.
             4796          (d) A seller is not required to maintain a separate account for the tax collected, but is
             4797      considered to be a person charged with receipt, safekeeping, and transfer of public money.
             4798          (e) Taxes collected by a seller pursuant to this chapter shall be held in trust for the
             4799      benefit of the state and for payment to the commission in the manner and at the time provided
             4800      for in this chapter.
             4801          (f) If any seller, during any reporting period, collects as a tax an amount in excess of



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             4802
     the lawful state and local percentage of total taxable sales allowed under this chapter, the seller
             4803      shall remit to the commission the full amount of the tax imposed under this chapter, plus any
             4804      excess.
             4805          (g) If the accounting methods regularly employed by the seller in the transaction of the
             4806      seller's business are such that reports of sales made during a calendar month or quarterly period
             4807      will impose unnecessary hardships, the commission may accept reports at intervals that will, in
             4808      the commission's opinion, better suit the convenience of the taxpayer or seller and will not
             4809      jeopardize collection of the tax.
             4810          (h) (i) For a purchase paid with specie legal tender as defined in Section 59-1-1501.1 ,
             4811      and until such time as the commission accepts specie legal tender for the payment of a tax
             4812      under this chapter, if the commission requires a seller to remit a tax under this chapter in legal
             4813      tender other than specie legal tender, the seller shall state on the seller's books and records and
             4814      on an invoice, bill of sale, or similar document provided to the purchaser:
             4815          (A) the purchase price in specie legal tender and in the legal tender the seller is
             4816      required to remit to the commission;
             4817          (B) subject to Subsection (3)(h)(ii), the amount of tax due under this chapter in specie
             4818      legal tender and in the legal tender the seller is required to remit to the commission;
             4819          (C) the tax rate under this chapter applicable to the purchase; and
             4820          (D) the date of the purchase.
             4821          (ii) (A) Subject to Subsection (3)(h)(ii)(B), for purposes of determining the amount of
             4822      tax due under Subsection (3)(h)(i), a seller shall use the most recent London fixing price for the
             4823      specie legal tender the purchaser paid.
             4824          (B) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             4825      commission may make rules for determining the amount of tax due under Subsection (3)(h)(i)
             4826      if the London fixing price is not available for a particular day.
             4827          (i) For purposes of a sale of short-term lodging that involves a short-term lodging
             4828      intermediary:
             4829          (i) the short-term lodging intermediary shall:
             4830          (A) collect a tax under this chapter on the short-term lodging charge that is charged to
             4831      the purchaser;
             4832          (B) separately state the tax described in Subsection (3)(i)(i)(A) on an invoice, a bill of



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Senate Committee Amendments 3-5-2013 cm/rlr
             4833
     sale, or similar document provided to the purchaser prior to the purchaser's completion of the
             4834      possession, use, or occupancy of the short-term lodging;
             4835          (C) remit to the commission S. , by electronic means in a manner prescribed by the
             4835a      commission, .S the tax S. [ described in Subsection (3)(i)(i)(A) ] due .S on the
             4836      short-term lodging intermediary charge; and
             4837          (D) remit to the short-term lodging operator the tax due on the short-term lodging
             4838      operator charge;
             4839          (ii) the short-term lodging operator shall S. , by electronic means in a manner
             4839a      prescribed by the commission, .S remit to the commission the tax due on the
             4840      short-term lodging operator charge;
             4841          (iii) the commission may not require:
             4842          (A) a short-term lodging operator to remit a tax on a short-term lodging intermediary
             4843      charge that was not remitted to the S. [ short-term lodging operator ] commission .S by the
             4843a      short-term lodging
             4844      intermediary; or
             4845          (B) a short-term lodging intermediary to remit a tax on a short-term lodging operator
             4846      charge that was remitted to the short-term lodging operator by the short-term lodging
             4847      intermediary; and
             4848          (iv) for purposes of determining a tax due under this chapter on a short-term lodging
             4849      charge, a short-term lodging intermediary shall determine the amount of a short-term lodging
             4850      charge that is part of a travel package by reasonable and verifiable standards from the books
             4851      and records the short-term lodging intermediary keeps in the regular course of business,
             4852      including books and records kept for nontax purposes.
             4853          (4) (a) Except as provided in Subsections (5) through (7) and Section 59-12-108 , the
             4854      sales or use tax imposed by this chapter is due and payable to the commission quarterly on or
             4855      before the last day of the month next succeeding each calendar quarterly period.
             4856          (b) (i) Each seller shall, on or before the last day of the month next succeeding each
             4857      calendar quarterly period, file with the commission a return for the preceding quarterly period.
             4858          (ii) The seller shall remit with the return under Subsection (4)(b)(i) the amount of the
             4859      tax required under this chapter to be collected or paid for the period covered by the return.
             4860          (c) Except as provided in Subsection (5)(c), a return shall contain information and be in
             4861      a form the commission prescribes by rule.
             4862          (d) (i) Subject to Subsection (4)(d)(ii), the sales tax as computed in the return shall be
             4863      based on the total nonexempt sales made during the period for which the return is filed,




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             4864
     including both cash and charge sales.
             4865          (ii) For a sale that includes the delivery or installation of tangible personal property at a
             4866      location other than a seller's place of business described in Subsection (2)(a)(i), if the delivery
             4867      or installation is separately stated on an invoice or receipt, a seller may compute the tax due on
             4868      the sale for purposes of Subsection (4)(d)(i) based on the amount the seller receives for that
             4869      sale during each period for which the seller receives payment for the sale.
             4870          (e) (i) The use tax as computed in the return shall be based on the total amount of
             4871      purchases for storage, use, or other consumption in this state made during the period for which
             4872      the return is filed, including both cash and charge purchases.
             4873          (ii) (A) As used in this Subsection (4)(e)(ii), "qualifying purchaser" means a purchaser
             4874      who is required to remit taxes under this chapter, but is not required to remit taxes monthly in
             4875      accordance with Section 59-12-108 , and who converts tangible personal property into real
             4876      property.
             4877          (B) Subject to Subsections (4)(e)(ii)(C) and (D), a qualifying purchaser may remit the
             4878      taxes due under this chapter on tangible personal property for which the qualifying purchaser
             4879      claims an exemption as allowed under Subsection 59-12-104 (23) or (25) based on the period in
             4880      which the qualifying purchaser receives payment, in accordance with Subsection (4)(e)(ii)(C),
             4881      for the conversion of the tangible personal property into real property.
             4882          (C) A qualifying purchaser remitting taxes due under this chapter in accordance with
             4883      Subsection (4)(e)(ii)(B) shall remit an amount equal to the total amount of tax due on the
             4884      qualifying purchaser's purchase of the tangible personal property that was converted into real
             4885      property multiplied by a fraction, the numerator of which is the payment received in the period
             4886      for the qualifying purchaser's sale of the tangible personal property that was converted into real
             4887      property and the denominator of which is the entire sales price for the qualifying purchaser's
             4888      sale of the tangible personal property that was converted into real property.
             4889          (D) A qualifying purchaser may remit taxes due under this chapter in accordance with
             4890      this Subsection (4)(e)(ii) only if the books and records that the qualifying purchaser keeps in
             4891      the qualifying purchaser's regular course of business identify by reasonable and verifiable
             4892      standards that the tangible personal property was converted into real property.
             4893          (f) (i) Subject to Subsection (4)(f)(ii) and in accordance with Title 63G, Chapter 3,
             4894      Utah Administrative Rulemaking Act, the commission may by rule extend the time for making



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             4895
     returns and paying the taxes.
             4896          (ii) An extension under Subsection (4)(f)(i) may not be for more than 90 days.
             4897          (g) The commission may require returns and payment of the tax to be made for other
             4898      than quarterly periods if the commission considers it necessary in order to ensure the payment
             4899      of the tax imposed by this chapter.
             4900          (h) (i) The commission may require a seller that files a simplified electronic return with
             4901      the commission to file an additional electronic report with the commission.
             4902          (ii) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             4903      commission may make rules providing:
             4904          (A) the information required to be included in the additional electronic report described
             4905      in Subsection (4)(h)(i); and
             4906          (B) one or more due dates for filing the additional electronic report described in
             4907      Subsection (4)(h)(i).
             4908          (5) (a) As used in this Subsection (5) and Subsection (6)(b), "remote seller" means a
             4909      seller that is:
             4910          (i) registered under the agreement;
             4911          (ii) described in Subsection (2)(c); and
             4912          (iii) not a:
             4913          (A) model 1 seller;
             4914          (B) model 2 seller; or
             4915          (C) model 3 seller.
             4916          (b) (i) Except as provided in Subsection (5)(b)(ii), a tax a remote seller collects in
             4917      accordance with Subsection (2)(c) is due and payable:
             4918          (A) to the commission;
             4919          (B) annually; and
             4920          (C) on or before the last day of the month immediately following the last day of each
             4921      calendar year.
             4922          (ii) The commission may require that a tax a remote seller collects in accordance with
             4923      Subsection (2)(c) be due and payable:
             4924          (A) to the commission; and
             4925          (B) on the last day of the month immediately following any month in which the seller



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             4926
     accumulates a total of at least $1,000 in agreement sales and use tax.
             4927          (c) (i) If a remote seller remits a tax to the commission in accordance with Subsection
             4928      (5)(b), the remote seller shall file a return:
             4929          (A) with the commission;
             4930          (B) with respect to the tax;
             4931          (C) containing information prescribed by the commission; and
             4932          (D) on a form prescribed by the commission.
             4933          (ii) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             4934      commission shall make rules prescribing:
             4935          (A) the information required to be contained in a return described in Subsection
             4936      (5)(c)(i); and
             4937          (B) the form described in Subsection (5)(c)(i)(D).
             4938          (d) A tax a remote seller collects in accordance with this Subsection (5) shall be
             4939      calculated on the basis of the total amount of taxable transactions under Subsection
             4940      59-12-103 (1) the remote seller completes, including:
             4941          (i) a cash transaction; and
             4942          (ii) a charge transaction.
             4943          (6) (a) Except as provided in Subsection (6)(b), a tax a seller that files a simplified
             4944      electronic return collects in accordance with this chapter is due and payable:
             4945          (i) monthly on or before the last day of the month immediately following the month for
             4946      which the seller collects a tax under this chapter; and
             4947          (ii) for the month for which the seller collects a tax under this chapter.
             4948          (b) A tax a remote seller that files a simplified electronic return collects in accordance
             4949      with this chapter is due and payable as provided in Subsection (5).
             4950          (7) (a) On each vehicle sale made by other than a regular licensed vehicle dealer, the
             4951      purchaser shall pay the sales or use tax directly to the commission if the vehicle is subject to
             4952      titling or registration under the laws of this state.
             4953          (b) The commission shall collect the tax described in Subsection (7)(a) when the
             4954      vehicle is titled or registered.
             4955          (8) If any sale of tangible personal property or any other taxable transaction under
             4956      Subsection 59-12-103 (1), is made by a wholesaler to a retailer, the wholesaler is not



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             4957
     responsible for the collection or payment of the tax imposed on the sale and the retailer is
             4958      responsible for the collection or payment of the tax imposed on the sale if:
             4959          (a) the retailer represents that the personal property is purchased by the retailer for
             4960      resale; and
             4961          (b) the personal property is not subsequently resold.
             4962          (9) If any sale of property or service subject to the tax is made to a person prepaying
             4963      sales or use tax in accordance with Title 63M, Chapter 5, Resource Development Act, or to a
             4964      contractor or subcontractor of that person, the person to whom such payment or consideration
             4965      is payable is not responsible for the collection or payment of the sales or use tax and the person
             4966      prepaying the sales or use tax is responsible for the collection or payment of the sales or use tax
             4967      if the person prepaying the sales or use tax represents that the amount prepaid as sales or use
             4968      tax has not been fully credited against sales or use tax due and payable under the rules
             4969      promulgated by the commission.
             4970          (10) (a) For purposes of this Subsection (10):
             4971          (i) Except as provided in Subsection (10)(a)(ii), "bad debt" is as defined in Section
             4972      166, Internal Revenue Code.
             4973          (ii) Notwithstanding Subsection (10)(a)(i), "bad debt" does not include:
             4974          (A) an amount included in the purchase price of tangible personal property, a product
             4975      transferred electronically, or a service that is:
             4976          (I) not a transaction described in Subsection 59-12-103 (1); or
             4977          (II) exempt under Section 59-12-104 ;
             4978          (B) a financing charge;
             4979          (C) interest;
             4980          (D) a tax imposed under this chapter on the purchase price of tangible personal
             4981      property, a product transferred electronically, or a service;
             4982          (E) an uncollectible amount on tangible personal property or a product transferred
             4983      electronically that:
             4984          (I) is subject to a tax under this chapter; and
             4985          (II) remains in the possession of a seller until the full purchase price is paid;
             4986          (F) an expense incurred in attempting to collect any debt; or
             4987          (G) an amount that a seller does not collect on repossessed property.



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             4988
         (b) (i) To the extent an amount remitted in accordance with Subsection (4)(d) later
             4989      becomes bad debt, a seller may deduct the bad debt from the total amount from which a tax
             4990      under this chapter is calculated on a return.
             4991          (ii) A qualifying purchaser, as defined in Subsection (4)(e)(ii)(A), may deduct from the
             4992      total amount of taxes due under this chapter the amount of tax the qualifying purchaser paid on
             4993      the qualifying purchaser's purchase of tangible personal property converted into real property to
             4994      the extent that:
             4995          (A) tax was remitted in accordance with Subsection (4)(e) on that tangible personal
             4996      property converted into real property;
             4997          (B) the qualifying purchaser's sale of that tangible personal property converted into real
             4998      property later becomes bad debt; and
             4999          (C) the books and records that the qualifying purchaser keeps in the qualifying
             5000      purchaser's regular course of business identify by reasonable and verifiable standards that the
             5001      tangible personal property was converted into real property.
             5002          (c) A seller may file a refund claim with the commission if:
             5003          (i) the amount of bad debt for the time period described in Subsection (10)(e) exceeds
             5004      the amount of the seller's sales that are subject to a tax under this chapter for that same time
             5005      period; and
             5006          (ii) as provided in Section 59-1-1410 .
             5007          (d) A bad debt deduction under this section may not include interest.
             5008          (e) A bad debt may be deducted under this Subsection (10) on a return for the time
             5009      period during which the bad debt:
             5010          (i) is written off as uncollectible in the seller's books and records; and
             5011          (ii) would be eligible for a bad debt deduction:
             5012          (A) for federal income tax purposes; and
             5013          (B) if the seller were required to file a federal income tax return.
             5014          (f) If a seller recovers any portion of bad debt for which the seller makes a deduction or
             5015      claims a refund under this Subsection (10), the seller shall report and remit a tax under this
             5016      chapter:
             5017          (i) on the portion of the bad debt the seller recovers; and
             5018          (ii) on a return filed for the time period for which the portion of the bad debt is



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             5019
     recovered.
             5020          (g) For purposes of reporting a recovery of a portion of bad debt under Subsection
             5021      (10)(f), a seller shall apply amounts received on the bad debt in the following order:
             5022          (i) in a proportional amount:
             5023          (A) to the purchase price of the tangible personal property, product transferred
             5024      electronically, or service; and
             5025          (B) to the tax due under this chapter on the tangible personal property, product
             5026      transferred electronically, or service; and
             5027          (ii) to:
             5028          (A) interest charges;
             5029          (B) service charges; and
             5030          (C) other charges.
             5031          (h) A seller's certified service provider may make a deduction or claim a refund for bad
             5032      debt on behalf of the seller:
             5033          (i) in accordance with this Subsection (10); and
             5034          (ii) if the certified service provider credits or refunds the entire amount of the bad debt
             5035      deduction or refund to the seller.
             5036          (i) A seller may allocate bad debt among the states that are members of the agreement
             5037      if the seller's books and records support that allocation.
             5038          (11) (a) A seller may not, with intent to evade any tax, fail to timely remit the full
             5039      amount of tax required by this chapter.
             5040          (b) A violation of this section is punishable as provided in Section 59-1-401 .
             5041          (c) Each person who fails to pay any tax to the state or any amount of tax required to be
             5042      paid to the state, except amounts determined to be due by the commission under Chapter 1,
             5043      Part 14, Assessment, Collections, and Refunds Act, or Section 59-12-111 , within the time
             5044      required by this chapter, or who fails to file any return as required by this chapter, shall pay, in
             5045      addition to the tax, penalties and interest as provided in Sections 59-1-401 and 59-1-402 .
             5046          (d) For purposes of prosecution under this section, each quarterly tax period in which a
             5047      seller, with intent to evade any tax, collects a tax and fails to timely remit the full amount of the
             5048      tax required to be remitted, constitutes a separate offense.
             5049          Section 9. Section 59-12-107.1 is amended to read:



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             5050
          59-12-107.1. Direct payment permit.
             5051          (1) The commission may issue a direct payment permit to a seller that:
             5052          (a) obtains a license under Section 59-12-106 ;
             5053          (b) makes aggregate purchases of at least $1,500,000 for each of the three years prior to
             5054      the year in which the commission issues the direct payment permit to the seller;
             5055          (c) has a record of timely payment of taxes under this chapter as determined by the
             5056      commission; and
             5057          (d) demonstrates to the commission that the seller has the ability to determine the
             5058      appropriate location of a transaction:
             5059          (i) under:
             5060          (A) Section 59-12-211 ;
             5061          (B) Section 59-12-212 ; or
             5062          (C) Section 59-12-213 ; and
             5063          (ii) for each transaction for which the seller makes a purchase using the direct payment
             5064      permit.
             5065          (2) The commission shall within 120 days after the date a seller applies for a direct
             5066      payment permit notify the seller of the commission's decision to issue or deny the issuance of
             5067      the direct payment permit.
             5068          (3) A direct payment permit may not be used in connection with the following
             5069      transactions:
             5070          (a) a purchase of the following purchased in the same transaction:
             5071          (i) prepared food; and
             5072          (ii) food and food ingredients;
             5073          (b) amounts paid or charged for [accommodations and services described in Subsection
             5074      59-12-103 (1)(i)] short-term lodging;
             5075          (c) amounts paid or charged for admission or user fees under Subsection
             5076      59-12-103 (1)(f);
             5077          (d) a purchase of:
             5078          (i) a motor vehicle;
             5079          (ii) an aircraft;
             5080          (iii) a watercraft;



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             5081
         (iv) a modular home;
             5082          (v) a manufactured home; or
             5083          (vi) a mobile home;
             5084          (e) amounts paid under Subsection 59-12-103 (1)(b); or
             5085          (f) sales under Subsection 59-12-103 (1)(c).
             5086          (4) The holder of a direct payment permit shall:
             5087          (a) present evidence of the direct payment permit to a seller at the time the holder of
             5088      the direct payment permit makes a purchase using the direct payment permit;
             5089          (b) determine the appropriate location of a transaction under:
             5090          (i) (A) Section 59-12-211 ;
             5091          (B) Section 59-12-212 ; or
             5092          (C) Section 59-12-213 ; and
             5093          (ii) for each transaction for which the holder of the direct payment permit makes a
             5094      purchase using the direct payment permit;
             5095          (c) notwithstanding Section 59-12-107 , determine the amount of any sales and use tax
             5096      due on each transaction for which the holder of the direct payment permit uses the direct
             5097      payment permit;
             5098          (d) report and remit to the commission the sales and use tax described in Subsection
             5099      (4)(c) at the same time and in the same manner as the holder of the direct payment permit
             5100      reports and remits a tax under this chapter; and
             5101          (e) maintain records:
             5102          (i) that indicate the appropriate location of a transaction under:
             5103          (A) (I) Section 59-12-211 ;
             5104          (II) Section 59-12-212 ; or
             5105          (III) Section 59-12-213 ; and
             5106          (B) for each transaction for which a purchase is made using the direct payment permit;
             5107      and
             5108          (ii) necessary to determine the amount described in Subsection (4)(c) for each
             5109      transaction for which the holder of the direct payment permit uses the direct payment permit.
             5110          (5) A seller that is presented evidence of a direct payment permit at the time of a
             5111      transaction:



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             5112
         (a) notwithstanding Section 59-12-107 , may not collect sales and use tax on the
             5113      transaction;
             5114          (b) shall, for a period of three years from the date the seller files a return with the
             5115      commission reporting the transaction, retain records to verify that the transaction was made
             5116      using a direct payment permit; and
             5117          (c) notwithstanding Section 59-12-107 , is not liable for sales and use tax on the
             5118      transaction.
             5119          (6) The holder of a direct payment permit may calculate the amount the holder of the
             5120      direct payment permit may retain under Section 59-12-108 on the amount described in
             5121      Subsection (4)(c):
             5122          (a) for each transaction for which the holder of the direct payment permit uses the
             5123      direct payment permit; and
             5124          (b) that the holder of the direct payment permit remits to the commission under this
             5125      section.
             5126          (7) The commission may revoke a direct payment permit issued under this section at
             5127      any time if the holder of the direct payment permit fails to comply with any provision of this
             5128      chapter.
             5129          (8) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             5130      commission may make rules to administer this section.
             5131          Section 10. Section 59-12-301 is amended to read:
             5132           59-12-301. Transient room tax -- Rate -- Expenditure of revenues -- Enactment or
             5133      repeal of tax -- Tax rate change -- Effective date -- Notice requirements.
             5134          (1) (a) A county legislative body may impose a tax on [charges for the
             5135      accommodations and services described in] amounts subject to taxation as short-term lodging
             5136      under Subsection 59-12-103 (1)(i) at a rate of not to exceed 4.25% beginning on or after
             5137      October 1, 2006.
             5138          (b) Subject to Subsection (2), the revenues raised from the tax imposed under
             5139      Subsection (1)(a) shall be used for the purposes listed in Section 17-31-2 .
             5140          (c) The tax imposed under Subsection (1)(a) shall be in addition to the tax imposed
             5141      under Part 6, Tourism, Recreation, Cultural, Convention, and Airport Facilities Tax.
             5142          (2) If a county legislative body of a county of the first class imposes a tax under this



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             5143
     section, beginning on July 1, 2007, and ending on June 30, 2027, each year the first 15% of the
             5144      revenues collected from the tax authorized by Subsection (1)(a) within that county shall be:
             5145          (a) deposited into the Transient Room Tax Fund created by Section 63M-1-2203 ; and
             5146          (b) expended as provided in Section 63M-1-2203 .
             5147          (3) Subject to Subsection (4), a county legislative body:
             5148          (a) may increase or decrease the tax authorized under this part; and
             5149          (b) shall regulate the tax authorized under this part by ordinance.
             5150          (4) (a) For purposes of this Subsection (4):
             5151          (i) "Annexation" means an annexation to a county under Title 17, Chapter 2, County
             5152      Consolidations and Annexations.
             5153          (ii) "Annexing area" means an area that is annexed into a county.
             5154          (b) (i) Except as provided in Subsection (4)(c), if, on or after July 1, 2004, a county
             5155      enacts or repeals a tax or changes the rate of a tax under this part, the enactment, repeal, or
             5156      change shall take effect:
             5157          (A) on the first day of a calendar quarter; and
             5158          (B) after a 90-day period beginning on the date the commission receives notice meeting
             5159      the requirements of Subsection (4)(b)(ii) from the county.
             5160          (ii) The notice described in Subsection (4)(b)(i)(B) shall state:
             5161          (A) that the county will enact or repeal a tax or change the rate of a tax under this part;
             5162          (B) the statutory authority for the tax described in Subsection (4)(b)(ii)(A);
             5163          (C) the effective date of the tax described in Subsection (4)(b)(ii)(A); and
             5164          (D) if the county enacts the tax or changes the rate of the tax described in Subsection
             5165      (4)(b)(ii)(A), the rate of the tax.
             5166          (c) (i) Notwithstanding Subsection (4)(b)(i), for a transaction described in Subsection
             5167      (4)(c)(iii), the enactment of a tax or a tax rate increase shall take effect on the first day of the
             5168      first billing period:
             5169          (A) that begins after the effective date of the enactment of the tax or the tax rate
             5170      increase; and
             5171          (B) if the billing period for the transaction begins before the effective date of the
             5172      enactment of the tax or the tax rate increase imposed under this section.
             5173          (ii) Notwithstanding Subsection (4)(b)(i), for a transaction described in Subsection



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             5174
     (4)(c)(iii), the repeal of a tax or a tax rate decrease shall take effect on the first day of the last
             5175      billing period:
             5176          (A) that began before the effective date of the repeal of the tax or the tax rate decrease;
             5177      and
             5178          (B) if the billing period for the transaction begins before the effective date of the repeal
             5179      of the tax or the tax rate decrease imposed under this section.
             5180          (iii) Subsections (4)(c)(i) and (ii) apply to transactions subject to a tax under
             5181      Subsection 59-12-103 (1)(i).
             5182          (d) (i) Except as provided in Subsection (4)(e), if, for an annexation that occurs on or
             5183      after July 1, 2004, the annexation will result in the enactment, repeal, or a change in the rate of
             5184      a tax under this part for an annexing area, the enactment, repeal, or change shall take effect:
             5185          (A) on the first day of a calendar quarter; and
             5186          (B) after a 90-day period beginning on the date the commission receives notice meeting
             5187      the requirements of Subsection (4)(d)(ii) from the county that annexes the annexing area.
             5188          (ii) The notice described in Subsection (4)(d)(i)(B) shall state:
             5189          (A) that the annexation described in Subsection (4)(d)(i) will result in an enactment,
             5190      repeal, or change in the rate of a tax under this part for the annexing area;
             5191          (B) the statutory authority for the tax described in Subsection (4)(d)(ii)(A);
             5192          (C) the effective date of the tax described in Subsection (4)(d)(ii)(A); and
             5193          (D) if the county enacts the tax or changes the rate of the tax described in Subsection
             5194      (4)(d)(ii)(A), the rate of the tax.
             5195          (e) (i) Notwithstanding Subsection (4)(d)(i), for a transaction described in Subsection
             5196      (4)(e)(iii), the enactment of a tax or a tax rate increase shall take effect on the first day of the
             5197      first billing period:
             5198          (A) that begins after the effective date of the enactment of the tax or the tax rate
             5199      increase; and
             5200          (B) if the billing period for the transaction begins before the effective date of the
             5201      enactment of the tax or the tax rate increase imposed under this section.
             5202          (ii) Notwithstanding Subsection (4)(d)(i), for a transaction described in Subsection
             5203      (4)(e)(iii), the repeal of a tax or a tax rate decrease shall take effect on the first day of the last
             5204      billing period:



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             5205
         (A) that began before the effective date of the repeal of the tax or the tax rate decrease;
             5206      and
             5207          (B) if the billing period for the transaction begins before the effective date of the repeal
             5208      of the tax or the tax rate decrease imposed under this section.
             5209          (iii) Subsections (4)(e)(i) and (ii) apply to transactions subject to a tax under
             5210      Subsection 59-12-103 (1)(i).
             5211          Section 11. Section 59-12-352 is amended to read:
             5212           59-12-352. Transient room tax authority for municipalities and military
             5213      installation development authority -- Purposes for which revenues may be used.
             5214          (1) (a) Except as provided in Subsection (5), the governing body of a municipality may
             5215      impose a tax of not to exceed 1% on [charges for the accommodations and services described
             5216      in] amounts subject to taxation as short-term lodging under Subsection 59-12-103 (1)(i).
             5217          (b) Subject to Section 63H-1-203 , the military installation development authority
             5218      created in Section 63H-1-201 may impose a tax under this section [for accommodations and
             5219      services described in] on amounts subject to taxation as short-term lodging under Subsection
             5220      59-12-103 (1)(i) within a project area described in a project area plan adopted by the authority
             5221      under Title 63H, Chapter 1, Military Installation Development Authority Act, as though the
             5222      authority were a municipality.
             5223          (2) Subject to the limitations of Subsection (1), a governing body of a municipality
             5224      may, by ordinance, increase or decrease the tax under this part.
             5225          (3) A governing body of a municipality shall regulate the tax under this part by
             5226      ordinance.
             5227          (4) A municipality may use revenues generated by the tax under this part for general
             5228      fund purposes.
             5229          (5) (a) A municipality may not impose a tax under this section [for accommodations
             5230      and services described in Subsection 59-12-103 (1)(i)] on short-term lodging within a project
             5231      area described in a project area plan adopted by the authority under Title 63H, Chapter 1,
             5232      Military Installation Development Authority Act.
             5233          (b) Subsection (5)(a) does not apply to the military installation development authority's
             5234      imposition of a tax under this section.
             5235          Section 12. Section 59-12-353 is amended to read:



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             5236
          59-12-353. Additional municipal transient room tax to repay bonded or other
             5237      indebtedness.
             5238          (1) Subject to the limitations of Subsection (2), the governing body of a municipality
             5239      may, in addition to the tax authorized under Section 59-12-352 , impose a tax of not to exceed
             5240      .5% on [charges for the accommodations and services described in] amounts subject to taxation
             5241      as short-term lodging under Subsection 59-12-103 (1)(i) if the governing body of the
             5242      municipality:
             5243          (a) before January 1, 1996, levied and collected a license fee or tax under Section
             5244      10-1-203 ; and
             5245          (b) before January 1, 1997, took official action to obligate the municipality in reliance
             5246      on the license fees or taxes under Subsection (1)(a)(i) to the payment of debt service on bonds
             5247      or other indebtedness, including lease payments under a lease purchase agreement.
             5248          (2) The governing body of a municipality may impose the tax under this section until
             5249      the sooner of:
             5250          (a) the day on which the following have been paid in full:
             5251          (i) the debt service on bonds or other indebtedness, including lease payments under a
             5252      lease purchase agreement described in Subsection (1) (b); and
             5253          (ii) refunding obligations that the municipality incurred as a result of the debt service
             5254      on bonds or other indebtedness, including lease payments under a lease purchase agreement
             5255      described in Subsection (1) (b); or
             5256          (b) 25 years from the day on which the municipality levied the tax under this section.
             5257          Section 13. Section 59-12-603 is amended to read:
             5258           59-12-603. County tax -- Bases -- Rates -- Use of revenues -- Adoption of
             5259      ordinance required -- Advisory board -- Administration -- Collection -- Administrative
             5260      charge -- Distribution -- Enactment or repeal of tax or tax rate change -- Effective date --
             5261      Notice requirements.
             5262          (1) (a) In addition to any other taxes, a county legislative body may, as provided in this
             5263      part, impose a tax as follows:
             5264          (i) (A) a county legislative body of any county may impose a tax of not to exceed 3%
             5265      on all short-term leases and rentals of motor vehicles not exceeding 30 days, except for leases
             5266      and rentals of motor vehicles made for the purpose of temporarily replacing a person's motor



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             5267
     vehicle that is being repaired pursuant to a repair or an insurance agreement; and
             5268          (B) beginning on or after January 1, 1999, a county legislative body of any county
             5269      imposing a tax under Subsection (1)(a)(i)(A) may, in addition to imposing the tax under
             5270      Subsection (1)(a)(i)(A), impose a tax of not to exceed 4% on all short-term leases and rentals
             5271      of motor vehicles not exceeding 30 days, except for leases and rentals of motor vehicles made
             5272      for the purpose of temporarily replacing a person's motor vehicle that is being repaired pursuant
             5273      to a repair or an insurance agreement;
             5274          (ii) a county legislative body of any county may impose a tax of not to exceed 1% of all
             5275      sales of the following that are sold by a restaurant:
             5276          (A) alcoholic beverages;
             5277          (B) food and food ingredients; or
             5278          (C) prepared food; and
             5279          (iii) a county legislative body of a county of the first class may impose a tax of not to
             5280      exceed .5% on [charges for the accommodations and services described in] amounts subject to
             5281      taxation as short-term lodging under Subsection 59-12-103 (1)(i).
             5282          (b) A tax imposed under Subsection (1)(a) is subject to the audit provisions of Section
             5283      17-31-5.5 .
             5284          (2) (a) Subject to Subsection (2)(b), revenue from the imposition of the taxes provided
             5285      for in Subsections (1)(a)(i) through (iii) may be used for:
             5286          (i) financing tourism promotion; and
             5287          (ii) the development, operation, and maintenance of:
             5288          (A) an airport facility;
             5289          (B) a convention facility;
             5290          (C) a cultural facility;
             5291          (D) a recreation facility; or
             5292          (E) a tourist facility.
             5293          (b) A county of the first class shall expend at least $450,000 each year of the revenues
             5294      from the imposition of a tax authorized by Subsection (1)(a)(iii) within the county to fund a
             5295      marketing and ticketing system designed to:
             5296          (i) promote tourism in ski areas within the county by persons that do not reside within
             5297      the state; and



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             5298
         (ii) combine the sale of:
             5299          (A) ski lift tickets; and
             5300          (B) [accommodations and services described in Subsection 59-12-103 (1)(i)] short-term
             5301      lodging.
             5302          (3) A tax imposed under this part may be pledged as security for bonds, notes, or other
             5303      evidences of indebtedness incurred by a county, city, or town under Title 11, Chapter 14, Local
             5304      Government Bonding Act, or a community development and renewal agency under Title 17C,
             5305      Chapter 1, Part 5, Agency Bonds, to finance:
             5306          (a) an airport facility;
             5307          (b) a convention facility;
             5308          (c) a cultural facility;
             5309          (d) a recreation facility; or
             5310          (e) a tourist facility.
             5311          (4) (a) In order to impose the tax under Subsection (1), each county legislative body
             5312      shall adopt an ordinance imposing the tax.
             5313          (b) The ordinance under Subsection (4)(a) shall include provisions substantially the
             5314      same as those contained in Part 1, Tax Collection, except that the tax shall be imposed only on
             5315      those items and sales described in Subsection (1).
             5316          (c) The name of the county as the taxing agency shall be substituted for that of the state
             5317      where necessary, and an additional license is not required if one has been or is issued under
             5318      Section 59-12-106 .
             5319          (5) In order to maintain in effect its tax ordinance adopted under this part, each county
             5320      legislative body shall, within 30 days of any amendment of any applicable provisions of Part 1,
             5321      Tax Collection, adopt amendments to its tax ordinance to conform with the applicable
             5322      amendments to Part 1, Tax Collection.
             5323          (6) (a) Regardless of whether a county of the first class creates a tourism tax advisory
             5324      board in accordance with Section 17-31-8 , the county legislative body of the county of the first
             5325      class shall create a tax advisory board in accordance with this Subsection (6).
             5326          (b) The tax advisory board shall be composed of nine members appointed as follows:
             5327          (i) four members shall be appointed by the county legislative body of the county of the
             5328      first class as follows:



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             5329
         (A) one member shall be a resident of the unincorporated area of the county;
             5330          (B) two members shall be residents of the incorporated area of the county; and
             5331          (C) one member shall be a resident of the unincorporated or incorporated area of the
             5332      county; and
             5333          (ii) subject to Subsections (6)(c) and (d), five members shall be mayors of cities or
             5334      towns within the county of the first class appointed by an organization representing all mayors
             5335      of cities and towns within the county of the first class.
             5336          (c) Five members of the tax advisory board constitute a quorum.
             5337          (d) The county legislative body of the county of the first class shall determine:
             5338          (i) terms of the members of the tax advisory board;
             5339          (ii) procedures and requirements for removing a member of the tax advisory board;
             5340          (iii) voting requirements, except that action of the tax advisory board shall be by at
             5341      least a majority vote of a quorum of the tax advisory board;
             5342          (iv) chairs or other officers of the tax advisory board;
             5343          (v) how meetings are to be called and the frequency of meetings; and
             5344          (vi) the compensation, if any, of members of the tax advisory board.
             5345          (e) The tax advisory board under this Subsection (6) shall advise the county legislative
             5346      body of the county of the first class on the expenditure of revenues collected within the county
             5347      of the first class from the taxes described in Subsection (1)(a).
             5348          (7) (a) (i) Except as provided in Subsection (7)(a)(ii), a tax authorized under this part
             5349      shall be administered, collected, and enforced in accordance with:
             5350          (A) the same procedures used to administer, collect, and enforce the tax under:
             5351          (I) Part 1, Tax Collection; or
             5352          (II) Part 2, Local Sales and Use Tax Act; and
             5353          (B) Chapter 1, General Taxation Policies.
             5354          (ii) A tax under this part is not subject to Section 59-12-107.1 or 59-12-123 or
             5355      Subsections 59-12-205 (2) through (6).
             5356          (b) Except as provided in Subsection (7)(c):
             5357          (i) for a tax under this part other than the tax under Subsection (1)(a)(i)(B), the
             5358      commission shall distribute the revenues to the county imposing the tax; and
             5359          (ii) for a tax under Subsection (1)(a)(i)(B), the commission shall distribute the revenues



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             5360
     according to the distribution formula provided in Subsection (8).
             5361          (c) The commission shall retain and deposit an administrative charge in accordance
             5362      with Section 59-1-306 from the revenues the commission collects from a tax under this part.
             5363          (8) The commission shall distribute the revenues generated by the tax under Subsection
             5364      (1)(a)(i)(B) to each county collecting a tax under Subsection (1)(a)(i)(B) according to the
             5365      following formula:
             5366          (a) the commission shall distribute 70% of the revenues based on the percentages
             5367      generated by dividing the revenues collected by each county under Subsection (1)(a)(i)(B) by
             5368      the total revenues collected by all counties under Subsection (1)(a)(i)(B); and
             5369          (b) the commission shall distribute 30% of the revenues based on the percentages
             5370      generated by dividing the population of each county collecting a tax under Subsection
             5371      (1)(a)(i)(B) by the total population of all counties collecting a tax under Subsection (1)(a)(i)(B).
             5372          (9) (a) For purposes of this Subsection (9):
             5373          (i) "Annexation" means an annexation to a county under Title 17, Chapter 2, Part 2,
             5374      County Annexation.
             5375          (ii) "Annexing area" means an area that is annexed into a county.
             5376          (b) (i) Except as provided in Subsection (9)(c), if, on or after July 1, 2004, a county
             5377      enacts or repeals a tax or changes the rate of a tax under this part, the enactment, repeal, or
             5378      change shall take effect:
             5379          (A) on the first day of a calendar quarter; and
             5380          (B) after a 90-day period beginning on the date the commission receives notice meeting
             5381      the requirements of Subsection (9)(b)(ii) from the county.
             5382          (ii) The notice described in Subsection (9)(b)(i)(B) shall state:
             5383          (A) that the county will enact or repeal a tax or change the rate of a tax under this part;
             5384          (B) the statutory authority for the tax described in Subsection (9)(b)(ii)(A);
             5385          (C) the effective date of the tax described in Subsection (9)(b)(ii)(A); and
             5386          (D) if the county enacts the tax or changes the rate of the tax described in Subsection
             5387      (9)(b)(ii)(A), the rate of the tax.
             5388          (c) (i) The enactment of a tax or a tax rate increase shall take effect on the first day of
             5389      the first billing period:
             5390          (A) that begins after the effective date of the enactment of the tax or the tax rate



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             5391
     increase; and
             5392          (B) if the billing period for the transaction begins before the effective date of the
             5393      enactment of the tax or the tax rate increase imposed under Subsection (1).
             5394          (ii) The repeal of a tax or a tax rate decrease shall take effect on the first day of the last
             5395      billing period:
             5396          (A) that began before the effective date of the repeal of the tax or the tax rate decrease;
             5397      and
             5398          (B) if the billing period for the transaction begins before the effective date of the repeal
             5399      of the tax or the tax rate decrease imposed under Subsection (1).
             5400          (d) (i) Except as provided in Subsection (9)(e), if, for an annexation that occurs on or
             5401      after July 1, 2004, the annexation will result in the enactment, repeal, or change in the rate of a
             5402      tax under this part for an annexing area, the enactment, repeal, or change shall take effect:
             5403          (A) on the first day of a calendar quarter; and
             5404          (B) after a 90-day period beginning on the date the commission receives notice meeting
             5405      the requirements of Subsection (9)(d)(ii) from the county that annexes the annexing area.
             5406          (ii) The notice described in Subsection (9)(d)(i)(B) shall state:
             5407          (A) that the annexation described in Subsection (9)(d)(i) will result in an enactment,
             5408      repeal, or change in the rate of a tax under this part for the annexing area;
             5409          (B) the statutory authority for the tax described in Subsection (9)(d)(ii)(A);
             5410          (C) the effective date of the tax described in Subsection (9)(d)(ii)(A); and
             5411          (D) if the county enacts the tax or changes the rate of the tax described in Subsection
             5412      (9)(d)(ii)(A), the rate of the tax.
             5413          (e) (i) The enactment of a tax or a tax rate increase shall take effect on the first day of
             5414      the first billing period:
             5415          (A) that begins after the effective date of the enactment of the tax or the tax rate
             5416      increase; and
             5417          (B) if the billing period for the transaction begins before the effective date of the
             5418      enactment of the tax or the tax rate increase imposed under Subsection (1).
             5419          (ii) The repeal of a tax or a tax rate decrease shall take effect on the first day of the last
             5420      billing period:
             5421          (A) that began before the effective date of the repeal of the tax or the tax rate decrease;



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             5422
     and
             5423          (B) if the billing period for the transaction begins before the effective date of the repeal
             5424      of the tax or the tax rate decrease imposed under Subsection (1).
             5425          Section 14. Effective date.
             5426          (1) Except as provided in Subsection (2), this bill takes effect on July 1, 2013.
             5427          (2) The actions affecting Sections 59-12-102 (Effective 07/01/14) and 59-12-103
             5428      (Effective 07/01/14) take effect on July 1, 2014.





Legislative Review Note
    as of 2-21-13 2:48 PM


Office of Legislative Research and General Counsel


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