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S.B. 154

             1     

SALES AND USE TAXATION OF WATER

             2     
2013 GENERAL SESSION

             3     
STATE OF UTAH

             4     
Chief Sponsor: Scott K. Jenkins

             5     
House Sponsor: ____________

             6     
             7      LONG TITLE
             8      General Description:
             9          This bill makes changes to the sales and use taxation of water.
             10      Highlighted Provisions:
             11          This bill:
             12          .    creates and amends definitions;
             13          .    modifies a sales and use tax exemption for water;
             14          .    adds potable delivered water to the state and local sales and use tax base;
             15          .    allocates state revenues collected from the sales and use tax on potable delivered
             16      water to the Water Resources Conservation and Development Fund;
             17          .    modifies the funding sources for the Water Resources Conservation and
             18      Development Fund to include the sales and use tax allocations; and
             19          .    makes technical and conforming changes.
             20      Money Appropriated in this Bill:
             21          None
             22      Other Special Clauses:
             23          This bill provides an effective date.
             24      Utah Code Sections Affected:
             25      AMENDS:
             26          59-12-102 (Superseded 07/01/14), as last amended by Laws of Utah 2012, Chapters
             27      255, 312, 405, and 410


             28          59-12-102 (Effective 07/01/14), as last amended by Laws of Utah 2012, Chapters 255,
             29      312, 405, 410, and 424
             30          59-12-103 (Superseded 07/01/14), as last amended by Laws of Utah 2012, Chapters
             31      207, 212, 254, and 255
             32          59-12-103 (Effective 07/01/14), as last amended by Laws of Utah 2012, Chapters 207,
             33      212, 254, 255, and 424
             34          59-12-104, as last amended by Laws of Utah 2012, Chapters 255, 399, 405, and 410
             35          59-12-1201, as last amended by Laws of Utah 2012, Chapter 121
             36          73-10-25, as last amended by Laws of Utah 1991, First Special Session, Chapter 4
             37          73-10-31, as enacted by Laws of Utah 1996, Chapter 199
             38     
             39      Be it enacted by the Legislature of the state of Utah:
             40          Section 1. Section 59-12-102 (Superseded 07/01/14) is amended to read:
             41           59-12-102 (Superseded 07/01/14). Definitions.
             42          As used in this chapter:
             43          (1) "800 service" means a telecommunications service that:
             44          (a) allows a caller to dial a toll-free number without incurring a charge for the call; and
             45          (b) is typically marketed:
             46          (i) under the name 800 toll-free calling;
             47          (ii) under the name 855 toll-free calling;
             48          (iii) under the name 866 toll-free calling;
             49          (iv) under the name 877 toll-free calling;
             50          (v) under the name 888 toll-free calling; or
             51          (vi) under a name similar to Subsections (1)(b)(i) through (v) as designated by the
             52      Federal Communications Commission.
             53          (2) (a) "900 service" means an inbound toll telecommunications service that:
             54          (i) a subscriber purchases;
             55          (ii) allows a customer of the subscriber described in Subsection (2)(a)(i) to call in to
             56      the subscriber's:
             57          (A) prerecorded announcement; or
             58          (B) live service; and


             59          (iii) is typically marketed:
             60          (A) under the name 900 service; or
             61          (B) under a name similar to Subsection (2)(a)(iii)(A) as designated by the Federal
             62      Communications Commission.
             63          (b) "900 service" does not include a charge for:
             64          (i) a collection service a seller of a telecommunications service provides to a
             65      subscriber; or
             66          (ii) the following a subscriber sells to the subscriber's customer:
             67          (A) a product; or
             68          (B) a service.
             69          (3) (a) "Admission or user fees" includes season passes.
             70          (b) "Admission or user fees" does not include annual membership dues to private
             71      organizations.
             72          (4) "Agreement" means the Streamlined Sales and Use Tax Agreement adopted on
             73      November 12, 2002, including amendments made to the Streamlined Sales and Use Tax
             74      Agreement after November 12, 2002.
             75          (5) "Agreement combined tax rate" means the sum of the tax rates:
             76          (a) listed under Subsection (6); and
             77          (b) that are imposed within a local taxing jurisdiction.
             78          (6) "Agreement sales and use tax" means a tax imposed under:
             79          (a) Subsection 59-12-103 (2)(a)(i)(A);
             80          (b) Subsection 59-12-103 (2)(b)(i);
             81          (c) Subsection 59-12-103 (2)(c)(i);
             82          (d) Subsection 59-12-103 (2)(d)(i)(A)(I);
             83          (e) Section 59-12-204 ;
             84          (f) Section 59-12-401 ;
             85          (g) Section 59-12-402 ;
             86          (h) Section 59-12-703 ;
             87          (i) Section 59-12-802 ;
             88          (j) Section 59-12-804 ;
             89          (k) Section 59-12-1102 ;


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


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


             152          (b) "Ancillary service" includes:
             153          (i) a conference bridging service;
             154          (ii) a detailed communications billing service;
             155          (iii) directory assistance;
             156          (iv) a vertical service; or
             157          (v) a voice mail service.
             158          (13) "Area agency on aging" is as defined in Section 62A-3-101 .
             159          (14) "Assisted amusement device" means an amusement device, skill device, or ride
             160      device that is started and stopped by an individual:
             161          (a) who is not the purchaser or renter of the right to use or operate the amusement
             162      device, skill device, or ride device; and
             163          (b) at the direction of the seller of the right to use the amusement device, skill device,
             164      or ride device.
             165          (15) "Assisted cleaning or washing of tangible personal property" means cleaning or
             166      washing of tangible personal property if the cleaning or washing labor is primarily performed
             167      by an individual:
             168          (a) who is not the purchaser of the cleaning or washing of the tangible personal
             169      property; and
             170          (b) at the direction of the seller of the cleaning or washing of the tangible personal
             171      property.
             172          (16) "Authorized carrier" means:
             173          (a) in the case of vehicles operated over public highways, the holder of credentials
             174      indicating that the vehicle is or will be operated pursuant to both the International Registration
             175      Plan and the International Fuel Tax Agreement;
             176          (b) in the case of aircraft, the holder of a Federal Aviation Administration operating
             177      certificate or air carrier's operating certificate; or
             178          (c) in the case of locomotives, freight cars, railroad work equipment, or other rolling
             179      stock, the holder of a certificate issued by the United States Surface Transportation Board.
             180          (17) (a) Except as provided in Subsection (17)(b), "biomass energy" means any of the
             181      following that is used as the primary source of energy to produce fuel or electricity:
             182          (i) material from a plant or tree; or


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


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


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


             276          (ii) For purposes of Subsection (18)(b)(vi), a seller:
             277          (A) shall use the seller's purchase price or the seller's sales price to determine if the
             278      purchase price or sales price of the tangible personal property or product subject to taxation
             279      under this chapter is de minimis; and
             280          (B) may not use a combination of the seller's purchase price and the seller's sales price
             281      to determine if the purchase price or sales price of the tangible personal property or product
             282      subject to taxation under this chapter is de minimis.
             283          (iii) For purposes of Subsection (18)(b)(vi), a seller shall use the full term of a service
             284      contract to determine if the sales price of tangible personal property or a product is de minimis.
             285          (f) For purposes of Subsection (18)(b)(vii)(B), a seller may not use a combination of
             286      the seller's purchase price and the seller's sales price to determine if tangible personal property
             287      subject to taxation under this chapter is 50% or less of the seller's total purchase price or sales
             288      price of that retail sale.
             289          (19) "Certified automated system" means software certified by the governing board of
             290      the agreement that:
             291          (a) calculates the agreement sales and use tax imposed within a local taxing
             292      jurisdiction:
             293          (i) on a transaction; and
             294          (ii) in the states that are members of the agreement;
             295          (b) determines the amount of agreement sales and use tax to remit to a state that is a
             296      member of the agreement; and
             297          (c) maintains a record of the transaction described in Subsection (19)(a)(i).
             298          (20) "Certified service provider" means an agent certified:
             299          (a) by the governing board of the agreement; and
             300          (b) to perform all of a seller's sales and use tax functions for an agreement sales and
             301      use tax other than the seller's obligation under Section 59-12-124 to remit a tax on the seller's
             302      own purchases.
             303          (21) (a) Subject to Subsection (21)(b), "clothing" means all human wearing apparel
             304      suitable for general use.
             305          (b) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             306      commission shall make rules:


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


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


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


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


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


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


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


             524          (ii) the judicial branch of the state, including the courts, the Judicial Council, the
             525      Office of the Court Administrator, and similar administrative units in the judicial branch;
             526          (iii) the legislative branch of the state, including the House of Representatives, the
             527      Senate, the Legislative Printing Office, the Office of Legislative Research and General
             528      Counsel, the Office of the Legislative Auditor General, and the Office of the Legislative Fiscal
             529      Analyst;
             530          (iv) the National Guard;
             531          (v) an independent entity as defined in Section 63E-1-102 ; or
             532          (vi) a political subdivision as defined in Section 17B-1-102 .
             533          (b) "Governmental entity" does not include the state systems of public and higher
             534      education, including:
             535          (i) a college campus of the Utah College of Applied Technology;
             536          (ii) a school;
             537          (iii) the State Board of Education;
             538          (iv) the State Board of Regents; or
             539          (v) an institution of higher education.
             540          (50) "Hydroelectric energy" means water used as the sole source of energy to produce
             541      electricity.
             542          (51) "Industrial use" means the use of natural gas, electricity, heat, coal, fuel oil, or
             543      other fuels:
             544          (a) in mining or extraction of minerals;
             545          (b) in agricultural operations to produce an agricultural product up to the time of
             546      harvest or placing the agricultural product into a storage facility, including:
             547          (i) commercial greenhouses;
             548          (ii) irrigation pumps;
             549          (iii) farm machinery;
             550          (iv) implements of husbandry as defined in Subsection 41-1a-102 (23) that are not
             551      registered under Title 41, Chapter 1a, Part 2, Registration; and
             552          (v) other farming activities;
             553          (c) in manufacturing tangible personal property at an establishment described in SIC
             554      Codes 2000 to 3999 of the 1987 Standard Industrial Classification Manual of the federal


             555      Executive Office of the President, Office of Management and Budget;
             556          (d) by a scrap recycler if:
             557          (i) from a fixed location, the scrap recycler utilizes machinery or equipment to process
             558      one or more of the following items into prepared grades of processed materials for use in new
             559      products:
             560          (A) iron;
             561          (B) steel;
             562          (C) nonferrous metal;
             563          (D) paper;
             564          (E) glass;
             565          (F) plastic;
             566          (G) textile; or
             567          (H) rubber; and
             568          (ii) the new products under Subsection (51)(d)(i) would otherwise be made with
             569      nonrecycled materials; or
             570          (e) in producing a form of energy or steam described in Subsection 54-2-1 (2)(a) by a
             571      cogeneration facility as defined in Section 54-2-1 .
             572          (52) (a) Except as provided in Subsection (52)(b), "installation charge" means a charge
             573      for installing:
             574          (i) tangible personal property; or
             575          (ii) a product transferred electronically.
             576          (b) "Installation charge" does not include a charge for:
             577          (i) repairs or renovations of:
             578          (A) tangible personal property; or
             579          (B) a product transferred electronically; or
             580          (ii) attaching tangible personal property or a product transferred electronically:
             581          (A) to other tangible personal property; and
             582          (B) as part of a manufacturing or fabrication process.
             583          (53) "Institution of higher education" means an institution of higher education listed in
             584      Section 53B-2-101 .
             585          (54) (a) "Lease" or "rental" means a transfer of possession or control of tangible


             586      personal property or a product transferred electronically for:
             587          (i) (A) a fixed term; or
             588          (B) an indeterminate term; and
             589          (ii) consideration.
             590          (b) "Lease" or "rental" includes an agreement covering a motor vehicle and trailer if the
             591      amount of consideration may be increased or decreased by reference to the amount realized
             592      upon sale or disposition of the property as defined in Section 7701(h)(1), Internal Revenue
             593      Code.
             594          (c) "Lease" or "rental" does not include:
             595          (i) a transfer of possession or control of property under a security agreement or
             596      deferred payment plan that requires the transfer of title upon completion of the required
             597      payments;
             598          (ii) a transfer of possession or control of property under an agreement that requires the
             599      transfer of title:
             600          (A) upon completion of required payments; and
             601          (B) if the payment of an option price does not exceed the greater of:
             602          (I) $100; or
             603          (II) 1% of the total required payments; or
             604          (iii) providing tangible personal property along with an operator for a fixed period of
             605      time or an indeterminate period of time if the operator is necessary for equipment to perform as
             606      designed.
             607          (d) For purposes of Subsection (54)(c)(iii), an operator is necessary for equipment to
             608      perform as designed if the operator's duties exceed the:
             609          (i) set-up of tangible personal property;
             610          (ii) maintenance of tangible personal property; or
             611          (iii) inspection of tangible personal property.
             612          (55) "Life science establishment" means an establishment in this state that is classified
             613      under the following NAICS codes of the 2007 North American Industry Classification System
             614      of the federal Executive Office of the President, Office of Management and Budget:
             615          (a) NAICS Code 33911, Medical Equipment and Supplies Manufacturing;
             616          (b) NAICS Code 334510, Electromedical and Electrotherapeutic Apparatus


             617      Manufacturing; or
             618          (c) NAICS Code 334517, Irradiation Apparatus Manufacturing.
             619          (56) "Life science research and development facility" means a facility owned, leased,
             620      or rented by a life science establishment if research and development is performed in 51% or
             621      more of the total area of the facility.
             622          (57) "Load and leave" means delivery to a purchaser by use of a tangible storage media
             623      if the tangible storage media is not physically transferred to the purchaser.
             624          (58) "Local taxing jurisdiction" means a:
             625          (a) county that is authorized to impose an agreement sales and use tax;
             626          (b) city that is authorized to impose an agreement sales and use tax; or
             627          (c) town that is authorized to impose an agreement sales and use tax.
             628          (59) "Manufactured home" is as defined in Section 15A-1-302 .
             629          (60) For purposes of Section 59-12-104 , "manufacturing facility" means:
             630          (a) an establishment described in SIC Codes 2000 to 3999 of the 1987 Standard
             631      Industrial Classification Manual of the federal Executive Office of the President, Office of
             632      Management and Budget;
             633          (b) a scrap recycler if:
             634          (i) from a fixed location, the scrap recycler utilizes machinery or equipment to process
             635      one or more of the following items into prepared grades of processed materials for use in new
             636      products:
             637          (A) iron;
             638          (B) steel;
             639          (C) nonferrous metal;
             640          (D) paper;
             641          (E) glass;
             642          (F) plastic;
             643          (G) textile; or
             644          (H) rubber; and
             645          (ii) the new products under Subsection (60)(b)(i) would otherwise be made with
             646      nonrecycled materials; or
             647          (c) a cogeneration facility as defined in Section 54-2-1 .


             648          (61) "Member of the immediate family of the producer" means a person who is related
             649      to a producer described in Subsection 59-12-104 (20)(a) as a:
             650          (a) child or stepchild, regardless of whether the child or stepchild is:
             651          (i) an adopted child or adopted stepchild; or
             652          (ii) a foster child or foster stepchild;
             653          (b) grandchild or stepgrandchild;
             654          (c) grandparent or stepgrandparent;
             655          (d) nephew or stepnephew;
             656          (e) niece or stepniece;
             657          (f) parent or stepparent;
             658          (g) sibling or stepsibling;
             659          (h) spouse;
             660          (i) person who is the spouse of a person described in Subsections (61)(a) through (g);
             661      or
             662          (j) person similar to a person described in Subsections (61)(a) through (i) as
             663      determined by the commission by rule made in accordance with Title 63G, Chapter 3, Utah
             664      Administrative Rulemaking Act.
             665          (62) "Mobile home" is as defined in Section 15A-1-302 .
             666          (63) "Mobile telecommunications service" is as defined in the Mobile
             667      Telecommunications Sourcing Act, 4 U.S.C. Sec. 124.
             668          (64) (a) "Mobile wireless service" means a telecommunications service, regardless of
             669      the technology used, if:
             670          (i) the origination point of the conveyance, routing, or transmission is not fixed;
             671          (ii) the termination point of the conveyance, routing, or transmission is not fixed; or
             672          (iii) the origination point described in Subsection (64)(a)(i) and the termination point
             673      described in Subsection (64)(a)(ii) are not fixed.
             674          (b) "Mobile wireless service" includes a telecommunications service that is provided
             675      by a commercial mobile radio service provider.
             676          (c) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             677      commission may by rule define "commercial mobile radio service provider."
             678          (65) (a) Except as provided in Subsection (65)(c), "mobility enhancing equipment"


             679      means equipment that is:
             680          (i) primarily and customarily used to provide or increase the ability to move from one
             681      place to another;
             682          (ii) appropriate for use in a:
             683          (A) home; or
             684          (B) motor vehicle; and
             685          (iii) not generally used by persons with normal mobility.
             686          (b) "Mobility enhancing equipment" includes parts used in the repair or replacement of
             687      the equipment described in Subsection (65)(a).
             688          (c) Notwithstanding Subsection (65)(a), "mobility enhancing equipment" does not
             689      include:
             690          (i) a motor vehicle;
             691          (ii) equipment on a motor vehicle if that equipment is normally provided by the motor
             692      vehicle manufacturer;
             693          (iii) durable medical equipment; or
             694          (iv) a prosthetic device.
             695          (66) "Model 1 seller" means a seller registered under the agreement that has selected a
             696      certified service provider as the seller's agent to perform all of the seller's sales and use tax
             697      functions for agreement sales and use taxes other than the seller's obligation under Section
             698      59-12-124 to remit a tax on the seller's own purchases.
             699          (67) "Model 2 seller" means a seller registered under the agreement that:
             700          (a) except as provided in Subsection (67)(b), has selected a certified automated system
             701      to perform the seller's sales tax functions for agreement sales and use taxes; and
             702          (b) notwithstanding Subsection (67)(a), retains responsibility for remitting all of the
             703      sales tax:
             704          (i) collected by the seller; and
             705          (ii) to the appropriate local taxing jurisdiction.
             706          (68) (a) Subject to Subsection (68)(b), "model 3 seller" means a seller registered under
             707      the agreement that has:
             708          (i) sales in at least five states that are members of the agreement;
             709          (ii) total annual sales revenues of at least $500,000,000;


             710          (iii) a proprietary system that calculates the amount of tax:
             711          (A) for an agreement sales and use tax; and
             712          (B) due to each local taxing jurisdiction; and
             713          (iv) entered into a performance agreement with the governing board of the agreement.
             714          (b) For purposes of Subsection (68)(a), "model 3 seller" includes an affiliated group of
             715      sellers using the same proprietary system.
             716          (69) "Model 4 seller" means a seller that is registered under the agreement and is not a
             717      model 1 seller, model 2 seller, or model 3 seller.
             718          (70) "Modular home" means a modular unit as defined in Section 15A-1-302 .
             719          (71) "Motor vehicle" is as defined in Section 41-1a-102 .
             720          (72) "Oil sands" means impregnated bituminous sands that:
             721          (a) contain a heavy, thick form of petroleum that is released when heated, mixed with
             722      other hydrocarbons, or otherwise treated;
             723          (b) yield mixtures of liquid hydrocarbon; and
             724          (c) require further processing other than mechanical blending before becoming finished
             725      petroleum products.
             726          (73) "Oil shale" means a group of fine black to dark brown shales containing kerogen
             727      material that yields petroleum upon heating and distillation.
             728          (74) "Optional computer software maintenance contract" means a computer software
             729      maintenance contract that a customer is not obligated to purchase as a condition to the retail
             730      sale of computer software.
             731          (75) (a) "Other fuels" means products that burn independently to produce heat or
             732      energy.
             733          (b) "Other fuels" includes oxygen when it is used in the manufacturing of tangible
             734      personal property.
             735          (76) (a) "Paging service" means a telecommunications service that provides
             736      transmission of a coded radio signal for the purpose of activating a specific pager.
             737          (b) For purposes of Subsection (76)(a), the transmission of a coded radio signal
             738      includes a transmission by message or sound.
             739          (77) "Pawnbroker" is as defined in Section 13-32a-102 .
             740          (78) "Pawn transaction" is as defined in Section 13-32a-102 .


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


             772      made in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act:
             773          (A) a computer;
             774          (B) a telephone;
             775          (C) a television; or
             776          (D) tangible personal property similar to Subsections (79)(c)(iii)(A) through (C) as
             777      determined by the commission by rule made in accordance with Title 63G, Chapter 3, Utah
             778      Administrative Rulemaking Act; or
             779          (iv) an item listed in Subsection [(117)] (119)(c).
             780          (80) "Person" includes any individual, firm, partnership, joint venture, association,
             781      corporation, estate, trust, business trust, receiver, syndicate, this state, any county, city,
             782      municipality, district, or other local governmental entity of the state, or any group or
             783      combination acting as a unit.
             784          (81) "Place of primary use":
             785          (a) for telecommunications service other than mobile telecommunications service,
             786      means the street address representative of where the customer's use of the telecommunications
             787      service primarily occurs, which shall be:
             788          (i) the residential street address of the customer; or
             789          (ii) the primary business street address of the customer; or
             790          (b) for mobile telecommunications service, is as defined in the Mobile
             791      Telecommunications Sourcing Act, 4 U.S.C. Sec. 124.
             792          (82) (a) "Postpaid calling service" means a telecommunications service a person
             793      obtains by making a payment on a call-by-call basis:
             794          (i) through the use of a:
             795          (A) bank card;
             796          (B) credit card;
             797          (C) debit card; or
             798          (D) travel card; or
             799          (ii) by a charge made to a telephone number that is not associated with the origination
             800      or termination of the telecommunications service.
             801          (b) "Postpaid calling service" includes a service, except for a prepaid wireless calling
             802      service, that would be a prepaid wireless calling service if the service were exclusively a


             803      telecommunications service.
             804          (83) "Postproduction" means an activity related to the finishing or duplication of a
             805      medium described in Subsection 59-12-104 (54)(a).
             806          (84) "Potable delivered water" means water that is:
             807          (a) suitable for human consumption; and
             808          (b) delivered through a pipe or similar conduit to the place of retail sale.
             809          [(84)] (85) "Prepaid calling service" means a telecommunications service:
             810          (a) that allows a purchaser access to telecommunications service that is exclusively
             811      telecommunications service;
             812          (b) that:
             813          (i) is paid for in advance; and
             814          (ii) enables the origination of a call using an:
             815          (A) access number; or
             816          (B) authorization code;
             817          (c) that is dialed:
             818          (i) manually; or
             819          (ii) electronically; and
             820          (d) sold in predetermined units or dollars that decline:
             821          (i) by a known amount; and
             822          (ii) with use.
             823          [(85)] (86) "Prepaid wireless calling service" means a telecommunications service:
             824          (a) that provides the right to utilize:
             825          (i) mobile wireless service; and
             826          (ii) other service that is not a telecommunications service, including:
             827          (A) the download of a product transferred electronically;
             828          (B) a content service; or
             829          (C) an ancillary service;
             830          (b) that:
             831          (i) is paid for in advance; and
             832          (ii) enables the origination of a call using an:
             833          (A) access number; or


             834          (B) authorization code;
             835          (c) that is dialed:
             836          (i) manually; or
             837          (ii) electronically; and
             838          (d) sold in predetermined units or dollars that decline:
             839          (i) by a known amount; and
             840          (ii) with use.
             841          [(86)] (87) (a) "Prepared food" means:
             842          (i) food:
             843          (A) sold in a heated state; or
             844          (B) heated by a seller;
             845          (ii) two or more food ingredients mixed or combined by the seller for sale as a single
             846      item; or
             847          (iii) except as provided in Subsection [(86)] (87)(c), food sold with an eating utensil
             848      provided by the seller, including a:
             849          (A) plate;
             850          (B) knife;
             851          (C) fork;
             852          (D) spoon;
             853          (E) glass;
             854          (F) cup;
             855          (G) napkin; or
             856          (H) straw.
             857          (b) "Prepared food" does not include:
             858          (i) food that a seller only:
             859          (A) cuts;
             860          (B) repackages; or
             861          (C) pasteurizes; or
             862          (ii) (A) the following:
             863          (I) raw egg;
             864          (II) raw fish;


             865          (III) raw meat;
             866          (IV) raw poultry; or
             867          (V) a food containing an item described in Subsections [(86)] (87)(b)(ii)(A)(I) through
             868      (IV); and
             869          (B) if the Food and Drug Administration recommends in Chapter 3, Part 401.11 of the
             870      Food and Drug Administration's Food Code that a consumer cook the items described in
             871      Subsection [(86)] (87)(b)(ii)(A) to prevent food borne illness; or
             872          (iii) the following if sold without eating utensils provided by the seller:
             873          (A) food and food ingredients sold by a seller if the seller's proper primary
             874      classification under the 2002 North American Industry Classification System of the federal
             875      Executive Office of the President, Office of Management and Budget, is manufacturing in
             876      Sector 311, Food Manufacturing, except for Subsector 3118, Bakeries and Tortilla
             877      Manufacturing;
             878          (B) food and food ingredients sold in an unheated state:
             879          (I) by weight or volume; and
             880          (II) as a single item; or
             881          (C) a bakery item, including:
             882          (I) a bagel;
             883          (II) a bar;
             884          (III) a biscuit;
             885          (IV) bread;
             886          (V) a bun;
             887          (VI) a cake;
             888          (VII) a cookie;
             889          (VIII) a croissant;
             890          (IX) a danish;
             891          (X) a donut;
             892          (XI) a muffin;
             893          (XII) a pastry;
             894          (XIII) a pie;
             895          (XIV) a roll;


             896          (XV) a tart;
             897          (XVI) a torte; or
             898          (XVII) a tortilla.
             899          (c) Notwithstanding Subsection [(86)] (87)(a)(iii), an eating utensil provided by the
             900      seller does not include the following used to transport the food:
             901          (i) a container; or
             902          (ii) packaging.
             903          [(87)] (88) "Prescription" means an order, formula, or recipe that is issued:
             904          (a) (i) orally;
             905          (ii) in writing;
             906          (iii) electronically; or
             907          (iv) by any other manner of transmission; and
             908          (b) by a licensed practitioner authorized by the laws of a state.
             909          [(88)] (89) (a) Except as provided in Subsection [(88)] (89)(b)(ii) or (iii), "prewritten
             910      computer software" means computer software that is not designed and developed:
             911          (i) by the author or other creator of the computer software; and
             912          (ii) to the specifications of a specific purchaser.
             913          (b) "Prewritten computer software" includes:
             914          (i) a prewritten upgrade to computer software if the prewritten upgrade to the computer
             915      software is not designed and developed:
             916          (A) by the author or other creator of the computer software; and
             917          (B) to the specifications of a specific purchaser;
             918          (ii) notwithstanding Subsection [(88)] (89)(a), computer software designed and
             919      developed by the author or other creator of the computer software to the specifications of a
             920      specific purchaser if the computer software is sold to a person other than the purchaser; or
             921          (iii) notwithstanding Subsection [(88)] (89)(a) and except as provided in Subsection
             922      [(88)] (89)(c), prewritten computer software or a prewritten portion of prewritten computer
             923      software:
             924          (A) that is modified or enhanced to any degree; and
             925          (B) if the modification or enhancement described in Subsection [(88)] (89)(b)(iii)(A) is
             926      designed and developed to the specifications of a specific purchaser.


             927          (c) Notwithstanding Subsection [(88)] (89)(b)(iii), "prewritten computer software"
             928      does not include a modification or enhancement described in Subsection [(88)] (89)(b)(iii) if
             929      the charges for the modification or enhancement are:
             930          (i) reasonable; and
             931          (ii) separately stated on the invoice or other statement of price provided to the
             932      purchaser.
             933          [(89)] (90) (a) "Private communication service" means a telecommunications service:
             934          (i) that entitles a customer to exclusive or priority use of one or more communications
             935      channels between or among termination points; and
             936          (ii) regardless of the manner in which the one or more communications channels are
             937      connected.
             938          (b) "Private communications service" includes the following provided in connection
             939      with the use of one or more communications channels:
             940          (i) an extension line;
             941          (ii) a station;
             942          (iii) switching capacity; or
             943          (iv) another associated service that is provided in connection with the use of one or
             944      more communications channels as defined in Section 59-12-215 .
             945          [(90)] (91) (a) Except as provided in Subsection [(90)] (91)(b), "product transferred
             946      electronically" means a product transferred electronically that would be subject to a tax under
             947      this chapter if that product was transferred in a manner other than electronically.
             948          (b) "Product transferred electronically" does not include:
             949          (i) an ancillary service;
             950          (ii) computer software; or
             951          (iii) a telecommunications service.
             952          [(91)] (92) (a) "Prosthetic device" means a device that is worn on or in the body to:
             953          (i) artificially replace a missing portion of the body;
             954          (ii) prevent or correct a physical deformity or physical malfunction; or
             955          (iii) support a weak or deformed portion of the body.
             956          (b) "Prosthetic device" includes:
             957          (i) parts used in the repairs or renovation of a prosthetic device;


             958          (ii) replacement parts for a prosthetic device;
             959          (iii) a dental prosthesis; or
             960          (iv) a hearing aid.
             961          (c) "Prosthetic device" does not include:
             962          (i) corrective eyeglasses; or
             963          (ii) contact lenses.
             964          [(92)] (93) (a) "Protective equipment" means an item:
             965          (i) for human wear; and
             966          (ii) that is:
             967          (A) designed as protection:
             968          (I) to the wearer against injury or disease; or
             969          (II) against damage or injury of other persons or property; and
             970          (B) not suitable for general use.
             971          (b) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             972      commission shall make rules:
             973          (i) listing the items that constitute "protective equipment"; and
             974          (ii) that are consistent with the list of items that constitute "protective equipment"
             975      under the agreement.
             976          [(93)] (94) (a) For purposes of Subsection 59-12-104 (41), "publication" means any
             977      written or printed matter, other than a photocopy:
             978          (i) regardless of:
             979          (A) characteristics;
             980          (B) copyright;
             981          (C) form;
             982          (D) format;
             983          (E) method of reproduction; or
             984          (F) source; and
             985          (ii) made available in printed or electronic format.
             986          (b) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             987      commission may by rule define the term "photocopy."
             988          [(94)] (95) (a) "Purchase price" and "sales price" mean the total amount of


             989      consideration:
             990          (i) valued in money; and
             991          (ii) for which tangible personal property, a product transferred electronically, or
             992      services are:
             993          (A) sold;
             994          (B) leased; or
             995          (C) rented.
             996          (b) "Purchase price" and "sales price" include:
             997          (i) the seller's cost of the tangible personal property, a product transferred
             998      electronically, or services sold;
             999          (ii) expenses of the seller, including:
             1000          (A) the cost of materials used;
             1001          (B) a labor cost;
             1002          (C) a service cost;
             1003          (D) interest;
             1004          (E) a loss;
             1005          (F) the cost of transportation to the seller; or
             1006          (G) a tax imposed on the seller;
             1007          (iii) a charge by the seller for any service necessary to complete the sale; or
             1008          (iv) consideration a seller receives from a person other than the purchaser if:
             1009          (A) (I) the seller actually receives consideration from a person other than the purchaser;
             1010      and
             1011          (II) the consideration described in Subsection [(94)] (95)(b)(iv)(A)(I) is directly related
             1012      to a price reduction or discount on the sale;
             1013          (B) the seller has an obligation to pass the price reduction or discount through to the
             1014      purchaser;
             1015          (C) the amount of the consideration attributable to the sale is fixed and determinable by
             1016      the seller at the time of the sale to the purchaser; and
             1017          (D) (I) (Aa) the purchaser presents a certificate, coupon, or other documentation to the
             1018      seller to claim a price reduction or discount; and
             1019          (Bb) a person other than the seller authorizes, distributes, or grants the certificate,


             1020      coupon, or other documentation with the understanding that the person other than the seller
             1021      will reimburse any seller to whom the certificate, coupon, or other documentation is presented;
             1022          (II) the purchaser identifies that purchaser to the seller as a member of a group or
             1023      organization allowed a price reduction or discount, except that a preferred customer card that is
             1024      available to any patron of a seller does not constitute membership in a group or organization
             1025      allowed a price reduction or discount; or
             1026          (III) the price reduction or discount is identified as a third party price reduction or
             1027      discount on the:
             1028          (Aa) invoice the purchaser receives; or
             1029          (Bb) certificate, coupon, or other documentation the purchaser presents.
             1030          (c) "Purchase price" and "sales price" do not include:
             1031          (i) a discount:
             1032          (A) in a form including:
             1033          (I) cash;
             1034          (II) term; or
             1035          (III) coupon;
             1036          (B) that is allowed by a seller;
             1037          (C) taken by a purchaser on a sale; and
             1038          (D) that is not reimbursed by a third party; or
             1039          (ii) the following if separately stated on an invoice, bill of sale, or similar document
             1040      provided to the purchaser:
             1041          (A) the following from credit extended on the sale of tangible personal property or
             1042      services:
             1043          (I) a carrying charge;
             1044          (II) a financing charge; or
             1045          (III) an interest charge;
             1046          (B) a delivery charge;
             1047          (C) an installation charge;
             1048          (D) a manufacturer rebate on a motor vehicle; or
             1049          (E) a tax or fee legally imposed directly on the consumer.
             1050          [(95)] (96) "Purchaser" means a person to whom:


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


             1082      process of preparing those devices, technologies, or applications for marketing.
             1083          [(100)] (101) (a) "Residential telecommunications services" means a
             1084      telecommunications service or an ancillary service that is provided to an individual for personal
             1085      use:
             1086          (i) at a residential address; or
             1087          (ii) at an institution, including a nursing home or a school, if the telecommunications
             1088      service or ancillary service is provided to and paid for by the individual residing at the
             1089      institution rather than the institution.
             1090          (b) For purposes of Subsection [(100)] (101)(a)(i), a residential address includes an:
             1091          (i) apartment; or
             1092          (ii) other individual dwelling unit.
             1093          [(101)] (102) "Residential use" means the use in or around a home, apartment building,
             1094      sleeping quarters, and similar facilities or accommodations.
             1095          [(102)] (103) "Retail sale" or "sale at retail" means a sale, lease, or rental for a purpose
             1096      other than:
             1097          (a) resale;
             1098          (b) sublease; or
             1099          (c) subrent.
             1100          [(103)] (104) (a) "Retailer" means any person engaged in a regularly organized
             1101      business in tangible personal property or any other taxable transaction under Subsection
             1102      59-12-103 (1), and who is selling to the user or consumer and not for resale.
             1103          (b) "Retailer" includes commission merchants, auctioneers, and any person regularly
             1104      engaged in the business of selling to users or consumers within the state.
             1105          [(104)] (105) (a) "Sale" means any transfer of title, exchange, or barter, conditional or
             1106      otherwise, in any manner, of tangible personal property or any other taxable transaction under
             1107      Subsection 59-12-103 (1), for consideration.
             1108          (b) "Sale" includes:
             1109          (i) installment and credit sales;
             1110          (ii) any closed transaction constituting a sale;
             1111          (iii) any sale of electrical energy, gas, services, or entertainment taxable under this
             1112      chapter;


             1113          (iv) any transaction if the possession of property is transferred but the seller retains the
             1114      title as security for the payment of the price; and
             1115          (v) any transaction under which right to possession, operation, or use of any article of
             1116      tangible personal property is granted under a lease or contract and the transfer of possession
             1117      would be taxable if an outright sale were made.
             1118          [(105)] (106) "Sale at retail" is as defined in Subsection [(102)] (103).
             1119          [(106)] (107) "Sale-leaseback transaction" means a transaction by which title to
             1120      tangible personal property or a product transferred electronically that is subject to a tax under
             1121      this chapter is transferred:
             1122          (a) by a purchaser-lessee;
             1123          (b) to a lessor;
             1124          (c) for consideration; and
             1125          (d) if:
             1126          (i) the purchaser-lessee paid sales and use tax on the purchaser-lessee's initial purchase
             1127      of the tangible personal property or product transferred electronically;
             1128          (ii) the sale of the tangible personal property or product transferred electronically to the
             1129      lessor is intended as a form of financing:
             1130          (A) for the tangible personal property or product transferred electronically; and
             1131          (B) to the purchaser-lessee; and
             1132          (iii) in accordance with generally accepted accounting principles, the purchaser-lessee
             1133      is required to:
             1134          (A) capitalize the tangible personal property or product transferred electronically for
             1135      financial reporting purposes; and
             1136          (B) account for the lease payments as payments made under a financing arrangement.
             1137          [(107)] (108) "Sales price" is as defined in Subsection [(94)] (95).
             1138          [(108)] (109) (a) "Sales relating to schools" means the following sales by, amounts
             1139      paid to, or amounts charged by a school:
             1140          (i) sales that are directly related to the school's educational functions or activities
             1141      including:
             1142          (A) the sale of:
             1143          (I) textbooks;


             1144          (II) textbook fees;
             1145          (III) laboratory fees;
             1146          (IV) laboratory supplies; or
             1147          (V) safety equipment;
             1148          (B) the sale of a uniform, protective equipment, or sports or recreational equipment
             1149      that:
             1150          (I) a student is specifically required to wear as a condition of participation in a
             1151      school-related event or school-related activity; and
             1152          (II) is not readily adaptable to general or continued usage to the extent that it takes the
             1153      place of ordinary clothing;
             1154          (C) sales of the following if the net or gross revenues generated by the sales are
             1155      deposited into a school district fund or school fund dedicated to school meals:
             1156          (I) food and food ingredients; or
             1157          (II) prepared food; or
             1158          (D) transportation charges for official school activities; or
             1159          (ii) amounts paid to or amounts charged by a school for admission to a school-related
             1160      event or school-related activity.
             1161          (b) "Sales relating to schools" does not include:
             1162          (i) bookstore sales of items that are not educational materials or supplies;
             1163          (ii) except as provided in Subsection [(108)] (109)(a)(i)(B):
             1164          (A) clothing;
             1165          (B) clothing accessories or equipment;
             1166          (C) protective equipment; or
             1167          (D) sports or recreational equipment; or
             1168          (iii) amounts paid to or amounts charged by a school for admission to a school-related
             1169      event or school-related activity if the amounts paid or charged are passed through to a person:
             1170          (A) other than a:
             1171          (I) school;
             1172          (II) nonprofit organization authorized by a school board or a governing body of a
             1173      private school to organize and direct a competitive secondary school activity; or
             1174          (III) nonprofit association authorized by a school board or a governing body of a


             1175      private school to organize and direct a competitive secondary school activity; and
             1176          (B) that is required to collect sales and use taxes under this chapter.
             1177          (c) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             1178      commission may make rules defining the term "passed through."
             1179          [(109)] (110) For purposes of this section and Section 59-12-104 , "school":
             1180          (a) means:
             1181          (i) an elementary school or a secondary school that:
             1182          (A) is a:
             1183          (I) public school; or
             1184          (II) private school; and
             1185          (B) provides instruction for one or more grades kindergarten through 12; or
             1186          (ii) a public school district; and
             1187          (b) includes the Electronic High School as defined in Section 53A-15-1002 .
             1188          [(110)] (111) "Seller" means a person that makes a sale, lease, or rental of:
             1189          (a) tangible personal property;
             1190          (b) a product transferred electronically; or
             1191          (c) a service.
             1192          [(111)] (112) (a) "Semiconductor fabricating, processing, research, or development
             1193      materials" means tangible personal property or a product transferred electronically if the
             1194      tangible personal property or product transferred electronically is:
             1195          (i) used primarily in the process of:
             1196          (A) (I) manufacturing a semiconductor;
             1197          (II) fabricating a semiconductor; or
             1198          (III) research or development of a:
             1199          (Aa) semiconductor; or
             1200          (Bb) semiconductor manufacturing process; or
             1201          (B) maintaining an environment suitable for a semiconductor; or
             1202          (ii) consumed primarily in the process of:
             1203          (A) (I) manufacturing a semiconductor;
             1204          (II) fabricating a semiconductor; or
             1205          (III) research or development of a:


             1206          (Aa) semiconductor; or
             1207          (Bb) semiconductor manufacturing process; or
             1208          (B) maintaining an environment suitable for a semiconductor.
             1209          (b) "Semiconductor fabricating, processing, research, or development materials"
             1210      includes:
             1211          (i) parts used in the repairs or renovations of tangible personal property or a product
             1212      transferred electronically described in Subsection [(111)] (112)(a); or
             1213          (ii) a chemical, catalyst, or other material used to:
             1214          (A) produce or induce in a semiconductor a:
             1215          (I) chemical change; or
             1216          (II) physical change;
             1217          (B) remove impurities from a semiconductor; or
             1218          (C) improve the marketable condition of a semiconductor.
             1219          [(112)] (113) "Senior citizen center" means a facility having the primary purpose of
             1220      providing services to the aged as defined in Section 62A-3-101 .
             1221          [(113)] (114) "Simplified electronic return" means the electronic return:
             1222          (a) described in Section 318(C) of the agreement; and
             1223          (b) approved by the governing board of the agreement.
             1224          [(114)] (115) "Solar energy" means the sun used as the sole source of energy for
             1225      producing electricity.
             1226          [(115)] (116) (a) "Sports or recreational equipment" means an item:
             1227          (i) designed for human use; and
             1228          (ii) that is:
             1229          (A) worn in conjunction with:
             1230          (I) an athletic activity; or
             1231          (II) a recreational activity; and
             1232          (B) not suitable for general use.
             1233          (b) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             1234      commission shall make rules:
             1235          (i) listing the items that constitute "sports or recreational equipment"; and
             1236          (ii) that are consistent with the list of items that constitute "sports or recreational


             1237      equipment" under the agreement.
             1238          [(116)] (117) "State" means the state of Utah, its departments, and agencies.
             1239          [(117)] (118) "Storage" means any keeping or retention of tangible personal property or
             1240      any other taxable transaction under Subsection 59-12-103 (1), in this state for any purpose
             1241      except sale in the regular course of business.
             1242          [(118)] (119) (a) Except as provided in Subsection [(118)] (119)(d) or (e), "tangible
             1243      personal property" means personal property that:
             1244          (i) may be:
             1245          (A) seen;
             1246          (B) weighed;
             1247          (C) measured;
             1248          (D) felt; or
             1249          (E) touched; or
             1250          (ii) is in any manner perceptible to the senses.
             1251          (b) "Tangible personal property" includes:
             1252          (i) electricity;
             1253          (ii) water;
             1254          (iii) gas;
             1255          (iv) steam; or
             1256          (v) prewritten computer software, regardless of the manner in which the prewritten
             1257      computer software is transferred.
             1258          (c) "Tangible personal property" includes the following regardless of whether the item
             1259      is attached to real property:
             1260          (i) a dishwasher;
             1261          (ii) a dryer;
             1262          (iii) a freezer;
             1263          (iv) a microwave;
             1264          (v) a refrigerator;
             1265          (vi) a stove;
             1266          (vii) a washer; or
             1267          (viii) an item similar to Subsections [(118)] (119)(c)(i) through (vii) as determined by


             1268      the commission by rule made in accordance with Title 63G, Chapter 3, Utah Administrative
             1269      Rulemaking Act.
             1270          (d) "Tangible personal property" does not include a product that is transferred
             1271      electronically.
             1272          (e) "Tangible personal property" does not include the following if attached to real
             1273      property, regardless of whether the attachment to real property is only through a line that
             1274      supplies water, electricity, gas, telephone, cable, or supplies a similar item as determined by the
             1275      commission by rule made in accordance with Title 63G, Chapter 3, Utah Administrative
             1276      Rulemaking Act:
             1277          (i) a hot water heater;
             1278          (ii) a water filtration system; or
             1279          (iii) a water softener system.
             1280          [(119)] (120) (a) "Telecommunications enabling or facilitating equipment, machinery,
             1281      or software" means an item listed in Subsection [(119)] (120)(b) if that item is purchased or
             1282      leased primarily to enable or facilitate one or more of the following to function:
             1283          (i) telecommunications switching or routing equipment, machinery, or software; or
             1284          (ii) telecommunications transmission equipment, machinery, or software.
             1285          (b) The following apply to Subsection [(119)] (120)(a):
             1286          (i) a pole;
             1287          (ii) software;
             1288          (iii) a supplementary power supply;
             1289          (iv) temperature or environmental equipment or machinery;
             1290          (v) test equipment;
             1291          (vi) a tower; or
             1292          (vii) equipment, machinery, or software that functions similarly to an item listed in
             1293      Subsections [(119)] (120)(b)(i) through (vi) as determined by the commission by rule made in
             1294      accordance with Subsection [(119)] (120)(c).
             1295          (c) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             1296      commission may by rule define what constitutes equipment, machinery, or software that
             1297      functions similarly to an item listed in Subsections [(119)] (120)(b)(i) through (vi).
             1298          [(120)] (121) "Telecommunications equipment, machinery, or software required for


             1299      911 service" means equipment, machinery, or software that is required to comply with 47
             1300      C.F.R. Sec. 20.18.
             1301          [(121)] (122) "Telecommunications maintenance or repair equipment, machinery, or
             1302      software" means equipment, machinery, or software purchased or leased primarily to maintain
             1303      or repair one or more of the following, regardless of whether the equipment, machinery, or
             1304      software is purchased or leased as a spare part or as an upgrade or modification to one or more
             1305      of the following:
             1306          (a) telecommunications enabling or facilitating equipment, machinery, or software;
             1307          (b) telecommunications switching or routing equipment, machinery, or software; or
             1308          (c) telecommunications transmission equipment, machinery, or software.
             1309          [(122)] (123) (a) "Telecommunications service" means the electronic conveyance,
             1310      routing, or transmission of audio, data, video, voice, or any other information or signal to a
             1311      point, or among or between points.
             1312          (b) "Telecommunications service" includes:
             1313          (i) an electronic conveyance, routing, or transmission with respect to which a computer
             1314      processing application is used to act:
             1315          (A) on the code, form, or protocol of the content;
             1316          (B) for the purpose of electronic conveyance, routing, or transmission; and
             1317          (C) regardless of whether the service:
             1318          (I) is referred to as voice over Internet protocol service; or
             1319          (II) is classified by the Federal Communications Commission as enhanced or value
             1320      added;
             1321          (ii) an 800 service;
             1322          (iii) a 900 service;
             1323          (iv) a fixed wireless service;
             1324          (v) a mobile wireless service;
             1325          (vi) a postpaid calling service;
             1326          (vii) a prepaid calling service;
             1327          (viii) a prepaid wireless calling service; or
             1328          (ix) a private communications service.
             1329          (c) "Telecommunications service" does not include:


             1330          (i) advertising, including directory advertising;
             1331          (ii) an ancillary service;
             1332          (iii) a billing and collection service provided to a third party;
             1333          (iv) a data processing and information service if:
             1334          (A) the data processing and information service allows data to be:
             1335          (I) (Aa) acquired;
             1336          (Bb) generated;
             1337          (Cc) processed;
             1338          (Dd) retrieved; or
             1339          (Ee) stored; and
             1340          (II) delivered by an electronic transmission to a purchaser; and
             1341          (B) the purchaser's primary purpose for the underlying transaction is the processed data
             1342      or information;
             1343          (v) installation or maintenance of the following on a customer's premises:
             1344          (A) equipment; or
             1345          (B) wiring;
             1346          (vi) Internet access service;
             1347          (vii) a paging service;
             1348          (viii) a product transferred electronically, including:
             1349          (A) music;
             1350          (B) reading material;
             1351          (C) a ring tone;
             1352          (D) software; or
             1353          (E) video;
             1354          (ix) a radio and television audio and video programming service:
             1355          (A) regardless of the medium; and
             1356          (B) including:
             1357          (I) furnishing conveyance, routing, or transmission of a television audio and video
             1358      programming service by a programming service provider;
             1359          (II) cable service as defined in 47 U.S.C. Sec. 522(6); or
             1360          (III) audio and video programming services delivered by a commercial mobile radio


             1361      service provider as defined in 47 C.F.R. Sec. 20.3;
             1362          (x) a value-added nonvoice data service; or
             1363          (xi) tangible personal property.
             1364          [(123)] (124) (a) "Telecommunications service provider" means a person that:
             1365          (i) owns, controls, operates, or manages a telecommunications service; and
             1366          (ii) engages in an activity described in Subsection [(123)] (124)(a)(i) for the shared use
             1367      with or resale to any person of the telecommunications service.
             1368          (b) A person described in Subsection [(123)] (124)(a) is a telecommunications service
             1369      provider whether or not the Public Service Commission of Utah regulates:
             1370          (i) that person; or
             1371          (ii) the telecommunications service that the person owns, controls, operates, or
             1372      manages.
             1373          [(124)] (125) (a) "Telecommunications switching or routing equipment, machinery, or
             1374      software" means an item listed in Subsection [(124)] (125)(b) if that item is purchased or
             1375      leased primarily for switching or routing:
             1376          (i) an ancillary service;
             1377          (ii) data communications;
             1378          (iii) voice communications; or
             1379          (iv) telecommunications service.
             1380          (b) The following apply to Subsection [(124)] (125)(a):
             1381          (i) a bridge;
             1382          (ii) a computer;
             1383          (iii) a cross connect;
             1384          (iv) a modem;
             1385          (v) a multiplexer;
             1386          (vi) plug in circuitry;
             1387          (vii) a router;
             1388          (viii) software;
             1389          (ix) a switch; or
             1390          (x) equipment, machinery, or software that functions similarly to an item listed in
             1391      Subsections [(124)] (125)(b)(i) through (ix) as determined by the commission by rule made in


             1392      accordance with Subsection [(124)] (125)(c).
             1393          (c) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             1394      commission may by rule define what constitutes equipment, machinery, or software that
             1395      functions similarly to an item listed in Subsections [(124)] (125)(b)(i) through (ix).
             1396          [(125)] (126) (a) "Telecommunications transmission equipment, machinery, or
             1397      software" means an item listed in Subsection [(125)] (126)(b) if that item is purchased or
             1398      leased primarily for sending, receiving, or transporting:
             1399          (i) an ancillary service;
             1400          (ii) data communications;
             1401          (iii) voice communications; or
             1402          (iv) telecommunications service.
             1403          (b) The following apply to Subsection [(125)] (126)(a):
             1404          (i) an amplifier;
             1405          (ii) a cable;
             1406          (iii) a closure;
             1407          (iv) a conduit;
             1408          (v) a controller;
             1409          (vi) a duplexer;
             1410          (vii) a filter;
             1411          (viii) an input device;
             1412          (ix) an input/output device;
             1413          (x) an insulator;
             1414          (xi) microwave machinery or equipment;
             1415          (xii) an oscillator;
             1416          (xiii) an output device;
             1417          (xiv) a pedestal;
             1418          (xv) a power converter;
             1419          (xvi) a power supply;
             1420          (xvii) a radio channel;
             1421          (xviii) a radio receiver;
             1422          (xix) a radio transmitter;


             1423          (xx) a repeater;
             1424          (xxi) software;
             1425          (xxii) a terminal;
             1426          (xxiii) a timing unit;
             1427          (xxiv) a transformer;
             1428          (xxv) a wire; or
             1429          (xxvi) equipment, machinery, or software that functions similarly to an item listed in
             1430      Subsections [(125)] (126)(b)(i) through (xxv) as determined by the commission by rule made in
             1431      accordance with Subsection [(125)] (126)(c).
             1432          (c) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             1433      commission may by rule define what constitutes equipment, machinery, or software that
             1434      functions similarly to an item listed in Subsections [(125)] (126)(b)(i) through (xxv).
             1435          [(126)] (127) (a) "Textbook for a higher education course" means a textbook or other
             1436      printed material that is required for a course:
             1437          (i) offered by an institution of higher education; and
             1438          (ii) that the purchaser of the textbook or other printed material attends or will attend.
             1439          (b) "Textbook for a higher education course" includes a textbook in electronic format.
             1440          [(127)] (128) "Tobacco" means:
             1441          (a) a cigarette;
             1442          (b) a cigar;
             1443          (c) chewing tobacco;
             1444          (d) pipe tobacco; or
             1445          (e) any other item that contains tobacco.
             1446          [(128)] (129) "Unassisted amusement device" means an amusement device, skill
             1447      device, or ride device that is started and stopped by the purchaser or renter of the right to use or
             1448      operate the amusement device, skill device, or ride device.
             1449          [(129)] (130) (a) "Use" means the exercise of any right or power over tangible personal
             1450      property, a product transferred electronically, or a service under Subsection 59-12-103 (1),
             1451      incident to the ownership or the leasing of that tangible personal property, product transferred
             1452      electronically, or service.
             1453          (b) "Use" does not include the sale, display, demonstration, or trial of tangible personal


             1454      property, a product transferred electronically, or a service in the regular course of business and
             1455      held for resale.
             1456          [(130)] (131) "Value-added nonvoice data service" means a service:
             1457          (a) that otherwise meets the definition of a telecommunications service except that a
             1458      computer processing application is used to act primarily for a purpose other than conveyance,
             1459      routing, or transmission; and
             1460          (b) with respect to which a computer processing application is used to act on data or
             1461      information:
             1462          (i) code;
             1463          (ii) content;
             1464          (iii) form; or
             1465          (iv) protocol.
             1466          [(131)] (132) (a) Subject to Subsection [(131)] (132)(b), "vehicle" means the following
             1467      that are required to be titled, registered, or titled and registered:
             1468          (i) an aircraft as defined in Section 72-10-102 ;
             1469          (ii) a vehicle as defined in Section 41-1a-102 ;
             1470          (iii) an off-highway vehicle as defined in Section 41-22-2 ; or
             1471          (iv) a vessel as defined in Section 41-1a-102 .
             1472          (b) For purposes of Subsection 59-12-104 (33) only, "vehicle" includes:
             1473          (i) a vehicle described in Subsection [(131)] (132)(a); or
             1474          (ii) (A) a locomotive;
             1475          (B) a freight car;
             1476          (C) railroad work equipment; or
             1477          (D) other railroad rolling stock.
             1478          [(132)] (133) "Vehicle dealer" means a person engaged in the business of buying,
             1479      selling, or exchanging a vehicle as defined in Subsection [(131)] (132).
             1480          [(133)] (134) (a) "Vertical service" means an ancillary service that:
             1481          (i) is offered in connection with one or more telecommunications services; and
             1482          (ii) offers an advanced calling feature that allows a customer to:
             1483          (A) identify a caller; and
             1484          (B) manage multiple calls and call connections.


             1485          (b) "Vertical service" includes an ancillary service that allows a customer to manage a
             1486      conference bridging service.
             1487          [(134)] (135) (a) "Voice mail service" means an ancillary service that enables a
             1488      customer to receive, send, or store a recorded message.
             1489          (b) "Voice mail service" does not include a vertical service that a customer is required
             1490      to have in order to utilize a voice mail service.
             1491          [(135)] (136) (a) Except as provided in Subsection [(135)] (136)(b), "waste energy
             1492      facility" means a facility that generates electricity:
             1493          (i) using as the primary source of energy waste materials that would be placed in a
             1494      landfill or refuse pit if it were not used to generate electricity, including:
             1495          (A) tires;
             1496          (B) waste coal;
             1497          (C) oil shale; or
             1498          (D) municipal solid waste; and
             1499          (ii) in amounts greater than actually required for the operation of the facility.
             1500          (b) "Waste energy facility" does not include a facility that incinerates:
             1501          (i) hospital waste as defined in 40 C.F.R. 60.51c; or
             1502          (ii) medical/infectious waste as defined in 40 C.F.R. 60.51c.
             1503          [(136)] (137) "Watercraft" means a vessel as defined in Section 73-18-2 .
             1504          [(137)] (138) "Wind energy" means wind used as the sole source of energy to produce
             1505      electricity.
             1506          [(138)] (139) "ZIP Code" means a Zoning Improvement Plan Code assigned to a
             1507      geographic location by the United States Postal Service.
             1508          Section 2. Section 59-12-102 (Effective 07/01/14) is amended to read:
             1509           59-12-102 (Effective 07/01/14). Definitions.
             1510          As used in this chapter:
             1511          (1) "800 service" means a telecommunications service that:
             1512          (a) allows a caller to dial a toll-free number without incurring a charge for the call; and
             1513          (b) is typically marketed:
             1514          (i) under the name 800 toll-free calling;
             1515          (ii) under the name 855 toll-free calling;


             1516          (iii) under the name 866 toll-free calling;
             1517          (iv) under the name 877 toll-free calling;
             1518          (v) under the name 888 toll-free calling; or
             1519          (vi) under a name similar to Subsections (1)(b)(i) through (v) as designated by the
             1520      Federal Communications Commission.
             1521          (2) (a) "900 service" means an inbound toll telecommunications service that:
             1522          (i) a subscriber purchases;
             1523          (ii) allows a customer of the subscriber described in Subsection (2)(a)(i) to call in to
             1524      the subscriber's:
             1525          (A) prerecorded announcement; or
             1526          (B) live service; and
             1527          (iii) is typically marketed:
             1528          (A) under the name 900 service; or
             1529          (B) under a name similar to Subsection (2)(a)(iii)(A) as designated by the Federal
             1530      Communications Commission.
             1531          (b) "900 service" does not include a charge for:
             1532          (i) a collection service a seller of a telecommunications service provides to a
             1533      subscriber; or
             1534          (ii) the following a subscriber sells to the subscriber's customer:
             1535          (A) a product; or
             1536          (B) a service.
             1537          (3) (a) "Admission or user fees" includes season passes.
             1538          (b) "Admission or user fees" does not include annual membership dues to private
             1539      organizations.
             1540          (4) "Agreement" means the Streamlined Sales and Use Tax Agreement adopted on
             1541      November 12, 2002, including amendments made to the Streamlined Sales and Use Tax
             1542      Agreement after November 12, 2002.
             1543          (5) "Agreement combined tax rate" means the sum of the tax rates:
             1544          (a) listed under Subsection (6); and
             1545          (b) that are imposed within a local taxing jurisdiction.
             1546          (6) "Agreement sales and use tax" means a tax imposed under:


             1547          (a) Subsection 59-12-103 (2)(a)(i)(A);
             1548          (b) Subsection 59-12-103 (2)(b)(i);
             1549          (c) Subsection 59-12-103 (2)(c)(i);
             1550          (d) Subsection 59-12-103 (2)(d)(i)(A)(I);
             1551          (e) Section 59-12-204 ;
             1552          (f) Section 59-12-401 ;
             1553          (g) Section 59-12-402 ;
             1554          (h) Section 59-12-703 ;
             1555          (i) Section 59-12-802 ;
             1556          (j) Section 59-12-804 ;
             1557          (k) Section 59-12-1102 ;
             1558          (l) Section 59-12-1302 ;
             1559          (m) Section 59-12-1402 ;
             1560          (n) Section 59-12-1802 ;
             1561          (o) Section 59-12-2003 ;
             1562          (p) Section 59-12-2103 ;
             1563          (q) Section 59-12-2213 ;
             1564          (r) Section 59-12-2214 ;
             1565          (s) Section 59-12-2215 ;
             1566          (t) Section 59-12-2216 ;
             1567          (u) Section 59-12-2217 ; or
             1568          (v) Section 59-12-2218 .
             1569          (7) "Aircraft" is as defined in Section 72-10-102 .
             1570          (8) "Aircraft maintenance, repair, and overhaul provider" means a business entity:
             1571          (a) except for:
             1572          (i) an airline as defined in Section 59-2-102 ; or
             1573          (ii) an affiliated group, as defined in Section 59-7-101 , except that "affiliated group"
             1574      includes a corporation that is qualified to do business but is not otherwise doing business in the
             1575      state, of an airline; and
             1576          (b) that has the workers, expertise, and facilities to perform the following, regardless of
             1577      whether the business entity performs the following in this state:


             1578          (i) check, diagnose, overhaul, and repair:
             1579          (A) an onboard system of a fixed wing turbine powered aircraft; and
             1580          (B) the parts that comprise an onboard system of a fixed wing turbine powered aircraft;
             1581          (ii) assemble, change, dismantle, inspect, and test a fixed wing turbine powered aircraft
             1582      engine;
             1583          (iii) perform at least the following maintenance on a fixed wing turbine powered
             1584      aircraft:
             1585          (A) an inspection;
             1586          (B) a repair, including a structural repair or modification;
             1587          (C) changing landing gear; and
             1588          (D) addressing issues related to an aging fixed wing turbine powered aircraft;
             1589          (iv) completely remove the existing paint of a fixed wing turbine powered aircraft and
             1590      completely apply new paint to the fixed wing turbine powered aircraft; and
             1591          (v) refurbish the interior of a fixed wing turbine powered aircraft in a manner that
             1592      results in a change in the fixed wing turbine powered aircraft's certification requirements by the
             1593      authority that certifies the fixed wing turbine powered aircraft.
             1594          (9) "Alcoholic beverage" means a beverage that:
             1595          (a) is suitable for human consumption; and
             1596          (b) contains .5% or more alcohol by volume.
             1597          (10) "Alternative energy" means:
             1598          (a) biomass energy;
             1599          (b) geothermal energy;
             1600          (c) hydroelectric energy;
             1601          (d) solar energy;
             1602          (e) wind energy; or
             1603          (f) energy that is derived from:
             1604          (i) coal-to-liquids;
             1605          (ii) nuclear fuel;
             1606          (iii) oil-impregnated diatomaceous earth;
             1607          (iv) oil sands;
             1608          (v) oil shale; or


             1609          (vi) petroleum coke.
             1610          (11) (a) Subject to Subsection (11)(b), "alternative energy electricity production
             1611      facility" means a facility that:
             1612          (i) uses alternative energy to produce electricity; and
             1613          (ii) has a production capacity of [2] two megawatts or greater.
             1614          (b) A facility is an alternative energy electricity production facility regardless of
             1615      whether the facility is:
             1616          (i) connected to an electric grid; or
             1617          (ii) located on the premises of an electricity consumer.
             1618          (12) (a) "Ancillary service" means a service associated with, or incidental to, the
             1619      provision of telecommunications service.
             1620          (b) "Ancillary service" includes:
             1621          (i) a conference bridging service;
             1622          (ii) a detailed communications billing service;
             1623          (iii) directory assistance;
             1624          (iv) a vertical service; or
             1625          (v) a voice mail service.
             1626          (13) "Area agency on aging" is as defined in Section 62A-3-101 .
             1627          (14) "Assisted amusement device" means an amusement device, skill device, or ride
             1628      device that is started and stopped by an individual:
             1629          (a) who is not the purchaser or renter of the right to use or operate the amusement
             1630      device, skill device, or ride device; and
             1631          (b) at the direction of the seller of the right to use the amusement device, skill device,
             1632      or ride device.
             1633          (15) "Assisted cleaning or washing of tangible personal property" means cleaning or
             1634      washing of tangible personal property if the cleaning or washing labor is primarily performed
             1635      by an individual:
             1636          (a) who is not the purchaser of the cleaning or washing of the tangible personal
             1637      property; and
             1638          (b) at the direction of the seller of the cleaning or washing of the tangible personal
             1639      property.


             1640          (16) "Authorized carrier" means:
             1641          (a) in the case of vehicles operated over public highways, the holder of credentials
             1642      indicating that the vehicle is or will be operated pursuant to both the International Registration
             1643      Plan and the International Fuel Tax Agreement;
             1644          (b) in the case of aircraft, the holder of a Federal Aviation Administration operating
             1645      certificate or air carrier's operating certificate; or
             1646          (c) in the case of locomotives, freight cars, railroad work equipment, or other rolling
             1647      stock, the holder of a certificate issued by the United States Surface Transportation Board.
             1648          (17) (a) Except as provided in Subsection (17)(b), "biomass energy" means any of the
             1649      following that is used as the primary source of energy to produce fuel or electricity:
             1650          (i) material from a plant or tree; or
             1651          (ii) other organic matter that is available on a renewable basis, including:
             1652          (A) slash and brush from forests and woodlands;
             1653          (B) animal waste;
             1654          (C) methane produced:
             1655          (I) at landfills; or
             1656          (II) as a byproduct of the treatment of wastewater residuals;
             1657          (D) aquatic plants; and
             1658          (E) agricultural products.
             1659          (b) "Biomass energy" does not include:
             1660          (i) black liquor;
             1661          (ii) treated woods; or
             1662          (iii) biomass from municipal solid waste other than methane produced:
             1663          (A) at landfills; or
             1664          (B) as a byproduct of the treatment of wastewater residuals.
             1665          (18) (a) "Bundled transaction" means the sale of two or more items of tangible personal
             1666      property, products, or services if the tangible personal property, products, or services are:
             1667          (i) distinct and identifiable; and
             1668          (ii) sold for one nonitemized price.
             1669          (b) "Bundled transaction" does not include:
             1670          (i) the sale of tangible personal property if the sales price varies, or is negotiable, on


             1671      the basis of the selection by the purchaser of the items of tangible personal property included in
             1672      the transaction;
             1673          (ii) the sale of real property;
             1674          (iii) the sale of services to real property;
             1675          (iv) the retail sale of tangible personal property and a service if:
             1676          (A) the tangible personal property:
             1677          (I) is essential to the use of the service; and
             1678          (II) is provided exclusively in connection with the service; and
             1679          (B) the service is the true object of the transaction;
             1680          (v) the retail sale of two services if:
             1681          (A) one service is provided that is essential to the use or receipt of a second service;
             1682          (B) the first service is provided exclusively in connection with the second service; and
             1683          (C) the second service is the true object of the transaction;
             1684          (vi) a transaction that includes tangible personal property or a product subject to
             1685      taxation under this chapter and tangible personal property or a product that is not subject to
             1686      taxation under this chapter if the:
             1687          (A) seller's purchase price of the tangible personal property or product subject to
             1688      taxation under this chapter is de minimis; or
             1689          (B) seller's sales price of the tangible personal property or product subject to taxation
             1690      under this chapter is de minimis; and
             1691          (vii) the retail sale of tangible personal property that is not subject to taxation under
             1692      this chapter and tangible personal property that is subject to taxation under this chapter if:
             1693          (A) that retail sale includes:
             1694          (I) food and food ingredients;
             1695          (II) a drug;
             1696          (III) durable medical equipment;
             1697          (IV) mobility enhancing equipment;
             1698          (V) an over-the-counter drug;
             1699          (VI) a prosthetic device; or
             1700          (VII) a medical supply; and
             1701          (B) subject to Subsection (18)(f):


             1702          (I) the seller's purchase price of the tangible personal property subject to taxation under
             1703      this chapter is 50% or less of the seller's total purchase price of that retail sale; or
             1704          (II) the seller's sales price of the tangible personal property subject to taxation under
             1705      this chapter is 50% or less of the seller's total sales price of that retail sale.
             1706          (c) (i) For purposes of Subsection (18)(a)(i), tangible personal property, a product, or a
             1707      service that is distinct and identifiable does not include:
             1708          (A) packaging that:
             1709          (I) accompanies the sale of the tangible personal property, product, or service; and
             1710          (II) is incidental or immaterial to the sale of the tangible personal property, product, or
             1711      service;
             1712          (B) tangible personal property, a product, or a service provided free of charge with the
             1713      purchase of another item of tangible personal property, a product, or a service; or
             1714          (C) an item of tangible personal property, a product, or a service included in the
             1715      definition of "purchase price."
             1716          (ii) For purposes of Subsection (18)(c)(i)(B), an item of tangible personal property, a
             1717      product, or a service is provided free of charge with the purchase of another item of tangible
             1718      personal property, a product, or a service if the sales price of the purchased item of tangible
             1719      personal property, product, or service does not vary depending on the inclusion of the tangible
             1720      personal property, product, or service provided free of charge.
             1721          (d) (i) For purposes of Subsection (18)(a)(ii), property sold for one nonitemized price
             1722      does not include a price that is separately identified by tangible personal property, product, or
             1723      service on the following, regardless of whether the following is in paper format or electronic
             1724      format:
             1725          (A) a binding sales document; or
             1726          (B) another supporting sales-related document that is available to a purchaser.
             1727          (ii) For purposes of Subsection (18)(d)(i), a binding sales document or another
             1728      supporting sales-related document that is available to a purchaser includes:
             1729          (A) a bill of sale;
             1730          (B) a contract;
             1731          (C) an invoice;
             1732          (D) a lease agreement;


             1733          (E) a periodic notice of rates and services;
             1734          (F) a price list;
             1735          (G) a rate card;
             1736          (H) a receipt; or
             1737          (I) a service agreement.
             1738          (e) (i) For purposes of Subsection (18)(b)(vi), the sales price of tangible personal
             1739      property or a product subject to taxation under this chapter is de minimis if:
             1740          (A) the seller's purchase price of the tangible personal property or product is 10% or
             1741      less of the seller's total purchase price of the bundled transaction; or
             1742          (B) the seller's sales price of the tangible personal property or product is 10% or less of
             1743      the seller's total sales price of the bundled transaction.
             1744          (ii) For purposes of Subsection (18)(b)(vi), a seller:
             1745          (A) shall use the seller's purchase price or the seller's sales price to determine if the
             1746      purchase price or sales price of the tangible personal property or product subject to taxation
             1747      under this chapter is de minimis; and
             1748          (B) may not use a combination of the seller's purchase price and the seller's sales price
             1749      to determine if the purchase price or sales price of the tangible personal property or product
             1750      subject to taxation under this chapter is de minimis.
             1751          (iii) For purposes of Subsection (18)(b)(vi), a seller shall use the full term of a service
             1752      contract to determine if the sales price of tangible personal property or a product is de minimis.
             1753          (f) For purposes of Subsection (18)(b)(vii)(B), a seller may not use a combination of
             1754      the seller's purchase price and the seller's sales price to determine if tangible personal property
             1755      subject to taxation under this chapter is 50% or less of the seller's total purchase price or sales
             1756      price of that retail sale.
             1757          (19) "Certified automated system" means software certified by the governing board of
             1758      the agreement that:
             1759          (a) calculates the agreement sales and use tax imposed within a local taxing
             1760      jurisdiction:
             1761          (i) on a transaction; and
             1762          (ii) in the states that are members of the agreement;
             1763          (b) determines the amount of agreement sales and use tax to remit to a state that is a


             1764      member of the agreement; and
             1765          (c) maintains a record of the transaction described in Subsection (19)(a)(i).
             1766          (20) "Certified service provider" means an agent certified:
             1767          (a) by the governing board of the agreement; and
             1768          (b) to perform all of a seller's sales and use tax functions for an agreement sales and
             1769      use tax other than the seller's obligation under Section 59-12-124 to remit a tax on the seller's
             1770      own purchases.
             1771          (21) (a) Subject to Subsection (21)(b), "clothing" means all human wearing apparel
             1772      suitable for general use.
             1773          (b) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             1774      commission shall make rules:
             1775          (i) listing the items that constitute "clothing"; and
             1776          (ii) that are consistent with the list of items that constitute "clothing" under the
             1777      agreement.
             1778          (22) "Coal-to-liquid" means the process of converting coal into a liquid synthetic fuel.
             1779          (23) "Commercial use" means the use of gas, electricity, heat, coal, fuel oil, or other
             1780      fuels that does not constitute industrial use under Subsection (51) or residential use under
             1781      Subsection (101).
             1782          (24) (a) "Common carrier" means a person engaged in or transacting the business of
             1783      transporting passengers, freight, merchandise, or other property for hire within this state.
             1784          (b) (i) "Common carrier" does not include a person who, at the time the person is
             1785      traveling to or from that person's place of employment, transports a passenger to or from the
             1786      passenger's place of employment.
             1787          (ii) For purposes of Subsection (24)(b)(i), in accordance with Title 63G, Chapter 3,
             1788      Utah Administrative Rulemaking Act, the commission may make rules defining what
             1789      constitutes a person's place of employment.
             1790          (25) "Component part" includes:
             1791          (a) poultry, dairy, and other livestock feed, and their components;
             1792          (b) baling ties and twine used in the baling of hay and straw;
             1793          (c) fuel used for providing temperature control of orchards and commercial
             1794      greenhouses doing a majority of their business in wholesale sales, and for providing power for


             1795      off-highway type farm machinery; and
             1796          (d) feed, seeds, and seedlings.
             1797          (26) "Computer" means an electronic device that accepts information:
             1798          (a) (i) in digital form; or
             1799          (ii) in a form similar to digital form; and
             1800          (b) manipulates that information for a result based on a sequence of instructions.
             1801          (27) "Computer software" means a set of coded instructions designed to cause:
             1802          (a) a computer to perform a task; or
             1803          (b) automatic data processing equipment to perform a task.
             1804          (28) "Computer software maintenance contract" means a contract that obligates a seller
             1805      of computer software to provide a customer with:
             1806          (a) future updates or upgrades to computer software;
             1807          (b) support services with respect to computer software; or
             1808          (c) a combination of Subsections (28)(a) and (b).
             1809          (29) (a) "Conference bridging service" means an ancillary service that links two or
             1810      more participants of an audio conference call or video conference call.
             1811          (b) "Conference bridging service" may include providing a telephone number as part of
             1812      the ancillary service described in Subsection (29)(a).
             1813          (c) "Conference bridging service" does not include a telecommunications service used
             1814      to reach the ancillary service described in Subsection (29)(a).
             1815          (30) "Construction materials" means any tangible personal property that will be
             1816      converted into real property.
             1817          (31) "Delivered electronically" means delivered to a purchaser by means other than
             1818      tangible storage media.
             1819          (32) (a) "Delivery charge" means a charge:
             1820          (i) by a seller of:
             1821          (A) tangible personal property;
             1822          (B) a product transferred electronically; or
             1823          (C) services; and
             1824          (ii) for preparation and delivery of the tangible personal property, product transferred
             1825      electronically, or services described in Subsection (32)(a)(i) to a location designated by the


             1826      purchaser.
             1827          (b) "Delivery charge" includes a charge for the following:
             1828          (i) transportation;
             1829          (ii) shipping;
             1830          (iii) postage;
             1831          (iv) handling;
             1832          (v) crating; or
             1833          (vi) packing.
             1834          (33) "Detailed telecommunications billing service" means an ancillary service of
             1835      separately stating information pertaining to individual calls on a customer's billing statement.
             1836          (34) "Dietary supplement" means a product, other than tobacco, that:
             1837          (a) is intended to supplement the diet;
             1838          (b) contains one or more of the following dietary ingredients:
             1839          (i) a vitamin;
             1840          (ii) a mineral;
             1841          (iii) an herb or other botanical;
             1842          (iv) an amino acid;
             1843          (v) a dietary substance for use by humans to supplement the diet by increasing the total
             1844      dietary intake; or
             1845          (vi) a concentrate, metabolite, constituent, extract, or combination of any ingredient
             1846      described in Subsections (34)(b)(i) through (v);
             1847          (c) (i) except as provided in Subsection (34)(c)(ii), is intended for ingestion in:
             1848          (A) tablet form;
             1849          (B) capsule form;
             1850          (C) powder form;
             1851          (D) softgel form;
             1852          (E) gelcap form; or
             1853          (F) liquid form; or
             1854          (ii) notwithstanding Subsection (34)(c)(i), if the product is not intended for ingestion in
             1855      a form described in Subsections (34)(c)(i)(A) through (F), is not represented:
             1856          (A) as conventional food; and


             1857          (B) for use as a sole item of:
             1858          (I) a meal; or
             1859          (II) the diet; and
             1860          (d) is required to be labeled as a dietary supplement:
             1861          (i) identifiable by the "Supplemental Facts" box found on the label; and
             1862          (ii) as required by 21 C.F.R. Sec. 101.36.
             1863          (35) (a) "Direct mail" means printed material delivered or distributed by United States
             1864      mail or other delivery service:
             1865          (i) to:
             1866          (A) a mass audience; or
             1867          (B) addressees on a mailing list provided:
             1868          (I) by a purchaser of the mailing list; or
             1869          (II) at the discretion of the purchaser of the mailing list; and
             1870          (ii) if the cost of the printed material is not billed directly to the recipients.
             1871          (b) "Direct mail" includes tangible personal property supplied directly or indirectly by a
             1872      purchaser to a seller of direct mail for inclusion in a package containing the printed material.
             1873          (c) "Direct mail" does not include multiple items of printed material delivered to a
             1874      single address.
             1875          (36) "Directory assistance" means an ancillary service of providing:
             1876          (a) address information; or
             1877          (b) telephone number information.
             1878          (37) (a) "Disposable home medical equipment or supplies" means medical equipment
             1879      or supplies that:
             1880          (i) cannot withstand repeated use; and
             1881          (ii) are purchased by, for, or on behalf of a person other than:
             1882          (A) a health care facility as defined in Section 26-21-2 ;
             1883          (B) a health care provider as defined in Section 78B-3-403 ;
             1884          (C) an office of a health care provider described in Subsection (37)(a)(ii)(B); or
             1885          (D) a person similar to a person described in Subsections (37)(a)(ii)(A) through (C).
             1886          (b) "Disposable home medical equipment or supplies" does not include:
             1887          (i) a drug;


             1888          (ii) durable medical equipment;
             1889          (iii) a hearing aid;
             1890          (iv) a hearing aid accessory;
             1891          (v) mobility enhancing equipment; or
             1892          (vi) tangible personal property used to correct impaired vision, including:
             1893          (A) eyeglasses; or
             1894          (B) contact lenses.
             1895          (c) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             1896      commission may by rule define what constitutes medical equipment or supplies.
             1897          (38) (a) "Drug" means a compound, substance, or preparation, or a component of a
             1898      compound, substance, or preparation that is:
             1899          (i) recognized in:
             1900          (A) the official United States Pharmacopoeia;
             1901          (B) the official Homeopathic Pharmacopoeia of the United States;
             1902          (C) the official National Formulary; or
             1903          (D) a supplement to a publication listed in Subsections (38)(a)(i)(A) through (C);
             1904          (ii) intended for use in the:
             1905          (A) diagnosis of disease;
             1906          (B) cure of disease;
             1907          (C) mitigation of disease;
             1908          (D) treatment of disease; or
             1909          (E) prevention of disease; or
             1910          (iii) intended to affect:
             1911          (A) the structure of the body; or
             1912          (B) any function of the body.
             1913          (b) "Drug" does not include:
             1914          (i) food and food ingredients;
             1915          (ii) a dietary supplement;
             1916          (iii) an alcoholic beverage; or
             1917          (iv) a prosthetic device.
             1918          (39) (a) Except as provided in Subsection (39)(c), "durable medical equipment" means


             1919      equipment that:
             1920          (i) can withstand repeated use;
             1921          (ii) is primarily and customarily used to serve a medical purpose;
             1922          (iii) generally is not useful to a person in the absence of illness or injury; and
             1923          (iv) is not worn in or on the body.
             1924          (b) "Durable medical equipment" includes parts used in the repair or replacement of the
             1925      equipment described in Subsection (39)(a).
             1926          (c) Notwithstanding Subsection (39)(a), "durable medical equipment" does not include
             1927      mobility enhancing equipment.
             1928          (40) "Electronic" means:
             1929          (a) relating to technology; and
             1930          (b) having:
             1931          (i) electrical capabilities;
             1932          (ii) digital capabilities;
             1933          (iii) magnetic capabilities;
             1934          (iv) wireless capabilities;
             1935          (v) optical capabilities;
             1936          (vi) electromagnetic capabilities; or
             1937          (vii) capabilities similar to Subsections (40)(b)(i) through (vi).
             1938          (41) "Employee" is as defined in Section 59-10-401 .
             1939          (42) "Fixed guideway" means a public transit facility that uses and occupies:
             1940          (a) rail for the use of public transit; or
             1941          (b) a separate right-of-way for the use of public transit.
             1942          (43) "Fixed wing turbine powered aircraft" means an aircraft that:
             1943          (a) is powered by turbine engines;
             1944          (b) operates on jet fuel; and
             1945          (c) has wings that are permanently attached to the fuselage of the aircraft.
             1946          (44) "Fixed wireless service" means a telecommunications service that provides radio
             1947      communication between fixed points.
             1948          (45) (a) "Food and food ingredients" means substances:
             1949          (i) regardless of whether the substances are in:


             1950          (A) liquid form;
             1951          (B) concentrated form;
             1952          (C) solid form;
             1953          (D) frozen form;
             1954          (E) dried form; or
             1955          (F) dehydrated form; and
             1956          (ii) that are:
             1957          (A) sold for:
             1958          (I) ingestion by humans; or
             1959          (II) chewing by humans; and
             1960          (B) consumed for the substance's:
             1961          (I) taste; or
             1962          (II) nutritional value.
             1963          (b) "Food and food ingredients" includes an item described in Subsection [(86)]
             1964      (87)(b)(iii).
             1965          (c) "Food and food ingredients" does not include:
             1966          (i) an alcoholic beverage;
             1967          (ii) tobacco; or
             1968          (iii) prepared food.
             1969          (46) (a) "Fundraising sales" means sales:
             1970          (i) (A) made by a school; or
             1971          (B) made by a school student;
             1972          (ii) that are for the purpose of raising funds for the school to purchase equipment,
             1973      materials, or provide transportation; and
             1974          (iii) that are part of an officially sanctioned school activity.
             1975          (b) For purposes of Subsection (46)(a)(iii), "officially sanctioned school activity"
             1976      means a school activity:
             1977          (i) that is conducted in accordance with a formal policy adopted by the school or school
             1978      district governing the authorization and supervision of fundraising activities;
             1979          (ii) that does not directly or indirectly compensate an individual teacher or other
             1980      educational personnel by direct payment, commissions, or payment in kind; and


             1981          (iii) the net or gross revenues from which are deposited in a dedicated account
             1982      controlled by the school or school district.
             1983          (47) "Geothermal energy" means energy contained in heat that continuously flows
             1984      outward from the earth that is used as the sole source of energy to produce electricity.
             1985          (48) "Governing board of the agreement" means the governing board of the agreement
             1986      that is:
             1987          (a) authorized to administer the agreement; and
             1988          (b) established in accordance with the agreement.
             1989          (49) (a) For purposes of Subsection 59-12-104 (41), "governmental entity" means:
             1990          (i) the executive branch of the state, including all departments, institutions, boards,
             1991      divisions, bureaus, offices, commissions, and committees;
             1992          (ii) the judicial branch of the state, including the courts, the Judicial Council, the
             1993      Office of the Court Administrator, and similar administrative units in the judicial branch;
             1994          (iii) the legislative branch of the state, including the House of Representatives, the
             1995      Senate, the Legislative Printing Office, the Office of Legislative Research and General
             1996      Counsel, the Office of the Legislative Auditor General, and the Office of the Legislative Fiscal
             1997      Analyst;
             1998          (iv) the National Guard;
             1999          (v) an independent entity as defined in Section 63E-1-102 ; or
             2000          (vi) a political subdivision as defined in Section 17B-1-102 .
             2001          (b) "Governmental entity" does not include the state systems of public and higher
             2002      education, including:
             2003          (i) a college campus of the Utah College of Applied Technology;
             2004          (ii) a school;
             2005          (iii) the State Board of Education;
             2006          (iv) the State Board of Regents; or
             2007          (v) an institution of higher education.
             2008          (50) "Hydroelectric energy" means water used as the sole source of energy to produce
             2009      electricity.
             2010          (51) "Industrial use" means the use of natural gas, electricity, heat, coal, fuel oil, or
             2011      other fuels:


             2012          (a) in mining or extraction of minerals;
             2013          (b) in agricultural operations to produce an agricultural product up to the time of
             2014      harvest or placing the agricultural product into a storage facility, including:
             2015          (i) commercial greenhouses;
             2016          (ii) irrigation pumps;
             2017          (iii) farm machinery;
             2018          (iv) implements of husbandry as defined in Subsection 41-1a-102 (23) that are not
             2019      registered under Title 41, Chapter 1a, Part 2, Registration; and
             2020          (v) other farming activities;
             2021          (c) in manufacturing tangible personal property at an establishment described in SIC
             2022      Codes 2000 to 3999 of the 1987 Standard Industrial Classification Manual of the federal
             2023      Executive Office of the President, Office of Management and Budget;
             2024          (d) by a scrap recycler if:
             2025          (i) from a fixed location, the scrap recycler utilizes machinery or equipment to process
             2026      one or more of the following items into prepared grades of processed materials for use in new
             2027      products:
             2028          (A) iron;
             2029          (B) steel;
             2030          (C) nonferrous metal;
             2031          (D) paper;
             2032          (E) glass;
             2033          (F) plastic;
             2034          (G) textile; or
             2035          (H) rubber; and
             2036          (ii) the new products under Subsection (51)(d)(i) would otherwise be made with
             2037      nonrecycled materials; or
             2038          (e) in producing a form of energy or steam described in Subsection 54-2-1 (2)(a) by a
             2039      cogeneration facility as defined in Section 54-2-1 .
             2040          (52) (a) Except as provided in Subsection (52)(b), "installation charge" means a charge
             2041      for installing:
             2042          (i) tangible personal property; or


             2043          (ii) a product transferred electronically.
             2044          (b) "Installation charge" does not include a charge for:
             2045          (i) repairs or renovations of:
             2046          (A) tangible personal property; or
             2047          (B) a product transferred electronically; or
             2048          (ii) attaching tangible personal property or a product transferred electronically:
             2049          (A) to other tangible personal property; and
             2050          (B) as part of a manufacturing or fabrication process.
             2051          (53) "Institution of higher education" means an institution of higher education listed in
             2052      Section 53B-2-101 .
             2053          (54) (a) "Lease" or "rental" means a transfer of possession or control of tangible
             2054      personal property or a product transferred electronically for:
             2055          (i) (A) a fixed term; or
             2056          (B) an indeterminate term; and
             2057          (ii) consideration.
             2058          (b) "Lease" or "rental" includes an agreement covering a motor vehicle and trailer if the
             2059      amount of consideration may be increased or decreased by reference to the amount realized
             2060      upon sale or disposition of the property as defined in Section 7701(h)(1), Internal Revenue
             2061      Code.
             2062          (c) "Lease" or "rental" does not include:
             2063          (i) a transfer of possession or control of property under a security agreement or
             2064      deferred payment plan that requires the transfer of title upon completion of the required
             2065      payments;
             2066          (ii) a transfer of possession or control of property under an agreement that requires the
             2067      transfer of title:
             2068          (A) upon completion of required payments; and
             2069          (B) if the payment of an option price does not exceed the greater of:
             2070          (I) $100; or
             2071          (II) 1% of the total required payments; or
             2072          (iii) providing tangible personal property along with an operator for a fixed period of
             2073      time or an indeterminate period of time if the operator is necessary for equipment to perform as


             2074      designed.
             2075          (d) For purposes of Subsection (54)(c)(iii), an operator is necessary for equipment to
             2076      perform as designed if the operator's duties exceed the:
             2077          (i) set-up of tangible personal property;
             2078          (ii) maintenance of tangible personal property; or
             2079          (iii) inspection of tangible personal property.
             2080          (55) "Life science establishment" means an establishment in this state that is classified
             2081      under the following NAICS codes of the 2007 North American Industry Classification System
             2082      of the federal Executive Office of the President, Office of Management and Budget:
             2083          (a) NAICS Code 33911, Medical Equipment and Supplies Manufacturing;
             2084          (b) NAICS Code 334510, Electromedical and Electrotherapeutic Apparatus
             2085      Manufacturing; or
             2086          (c) NAICS Code 334517, Irradiation Apparatus Manufacturing.
             2087          (56) "Life science research and development facility" means a facility owned, leased,
             2088      or rented by a life science establishment if research and development is performed in 51% or
             2089      more of the total area of the facility.
             2090          (57) "Load and leave" means delivery to a purchaser by use of a tangible storage media
             2091      if the tangible storage media is not physically transferred to the purchaser.
             2092          (58) "Local taxing jurisdiction" means a:
             2093          (a) county that is authorized to impose an agreement sales and use tax;
             2094          (b) city that is authorized to impose an agreement sales and use tax; or
             2095          (c) town that is authorized to impose an agreement sales and use tax.
             2096          (59) "Manufactured home" is as defined in Section 15A-1-302 .
             2097          (60) For purposes of Section 59-12-104 , "manufacturing facility" means:
             2098          (a) an establishment described in SIC Codes 2000 to 3999 of the 1987 Standard
             2099      Industrial Classification Manual of the federal Executive Office of the President, Office of
             2100      Management and Budget;
             2101          (b) a scrap recycler if:
             2102          (i) from a fixed location, the scrap recycler utilizes machinery or equipment to process
             2103      one or more of the following items into prepared grades of processed materials for use in new
             2104      products:


             2105          (A) iron;
             2106          (B) steel;
             2107          (C) nonferrous metal;
             2108          (D) paper;
             2109          (E) glass;
             2110          (F) plastic;
             2111          (G) textile; or
             2112          (H) rubber; and
             2113          (ii) the new products under Subsection (60)(b)(i) would otherwise be made with
             2114      nonrecycled materials; or
             2115          (c) a cogeneration facility as defined in Section 54-2-1 .
             2116          (61) "Member of the immediate family of the producer" means a person who is related
             2117      to a producer described in Subsection 59-12-104 (20)(a) as a:
             2118          (a) child or stepchild, regardless of whether the child or stepchild is:
             2119          (i) an adopted child or adopted stepchild; or
             2120          (ii) a foster child or foster stepchild;
             2121          (b) grandchild or stepgrandchild;
             2122          (c) grandparent or stepgrandparent;
             2123          (d) nephew or stepnephew;
             2124          (e) niece or stepniece;
             2125          (f) parent or stepparent;
             2126          (g) sibling or stepsibling;
             2127          (h) spouse;
             2128          (i) person who is the spouse of a person described in Subsections (61)(a) through (g);
             2129      or
             2130          (j) person similar to a person described in Subsections (61)(a) through (i) as
             2131      determined by the commission by rule made in accordance with Title 63G, Chapter 3, Utah
             2132      Administrative Rulemaking Act.
             2133          (62) "Mobile home" is as defined in Section 15A-1-302 .
             2134          (63) "Mobile telecommunications service" is as defined in the Mobile
             2135      Telecommunications Sourcing Act, 4 U.S.C. Sec. 124.


             2136          (64) (a) "Mobile wireless service" means a telecommunications service, regardless of
             2137      the technology used, if:
             2138          (i) the origination point of the conveyance, routing, or transmission is not fixed;
             2139          (ii) the termination point of the conveyance, routing, or transmission is not fixed; or
             2140          (iii) the origination point described in Subsection (64)(a)(i) and the termination point
             2141      described in Subsection (64)(a)(ii) are not fixed.
             2142          (b) "Mobile wireless service" includes a telecommunications service that is provided
             2143      by a commercial mobile radio service provider.
             2144          (c) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             2145      commission may by rule define "commercial mobile radio service provider."
             2146          (65) (a) Except as provided in Subsection (65)(c), "mobility enhancing equipment"
             2147      means equipment that is:
             2148          (i) primarily and customarily used to provide or increase the ability to move from one
             2149      place to another;
             2150          (ii) appropriate for use in a:
             2151          (A) home; or
             2152          (B) motor vehicle; and
             2153          (iii) not generally used by persons with normal mobility.
             2154          (b) "Mobility enhancing equipment" includes parts used in the repair or replacement of
             2155      the equipment described in Subsection (65)(a).
             2156          (c) Notwithstanding Subsection (65)(a), "mobility enhancing equipment" does not
             2157      include:
             2158          (i) a motor vehicle;
             2159          (ii) equipment on a motor vehicle if that equipment is normally provided by the motor
             2160      vehicle manufacturer;
             2161          (iii) durable medical equipment; or
             2162          (iv) a prosthetic device.
             2163          (66) "Model 1 seller" means a seller registered under the agreement that has selected a
             2164      certified service provider as the seller's agent to perform all of the seller's sales and use tax
             2165      functions for agreement sales and use taxes other than the seller's obligation under Section
             2166      59-12-124 to remit a tax on the seller's own purchases.


             2167          (67) "Model 2 seller" means a seller registered under the agreement that:
             2168          (a) except as provided in Subsection (67)(b), has selected a certified automated system
             2169      to perform the seller's sales tax functions for agreement sales and use taxes; and
             2170          (b) notwithstanding Subsection (67)(a), retains responsibility for remitting all of the
             2171      sales tax:
             2172          (i) collected by the seller; and
             2173          (ii) to the appropriate local taxing jurisdiction.
             2174          (68) (a) Subject to Subsection (68)(b), "model 3 seller" means a seller registered under
             2175      the agreement that has:
             2176          (i) sales in at least five states that are members of the agreement;
             2177          (ii) total annual sales revenues of at least $500,000,000;
             2178          (iii) a proprietary system that calculates the amount of tax:
             2179          (A) for an agreement sales and use tax; and
             2180          (B) due to each local taxing jurisdiction; and
             2181          (iv) entered into a performance agreement with the governing board of the agreement.
             2182          (b) For purposes of Subsection (68)(a), "model 3 seller" includes an affiliated group of
             2183      sellers using the same proprietary system.
             2184          (69) "Model 4 seller" means a seller that is registered under the agreement and is not a
             2185      model 1 seller, model 2 seller, or model 3 seller.
             2186          (70) "Modular home" means a modular unit as defined in Section 15A-1-302 .
             2187          (71) "Motor vehicle" is as defined in Section 41-1a-102 .
             2188          (72) "Oil sands" means impregnated bituminous sands that:
             2189          (a) contain a heavy, thick form of petroleum that is released when heated, mixed with
             2190      other hydrocarbons, or otherwise treated;
             2191          (b) yield mixtures of liquid hydrocarbon; and
             2192          (c) require further processing other than mechanical blending before becoming finished
             2193      petroleum products.
             2194          (73) "Oil shale" means a group of fine black to dark brown shales containing kerogen
             2195      material that yields petroleum upon heating and distillation.
             2196          (74) "Optional computer software maintenance contract" means a computer software
             2197      maintenance contract that a customer is not obligated to purchase as a condition to the retail


             2198      sale of computer software.
             2199          (75) (a) "Other fuels" means products that burn independently to produce heat or
             2200      energy.
             2201          (b) "Other fuels" includes oxygen when it is used in the manufacturing of tangible
             2202      personal property.
             2203          (76) (a) "Paging service" means a telecommunications service that provides
             2204      transmission of a coded radio signal for the purpose of activating a specific pager.
             2205          (b) For purposes of Subsection (76)(a), the transmission of a coded radio signal
             2206      includes a transmission by message or sound.
             2207          (77) "Pawnbroker" is as defined in Section 13-32a-102 .
             2208          (78) "Pawn transaction" is as defined in Section 13-32a-102 .
             2209          (79) (a) "Permanently attached to real property" means that for tangible personal
             2210      property attached to real property:
             2211          (i) the attachment of the tangible personal property to the real property:
             2212          (A) is essential to the use of the tangible personal property; and
             2213          (B) suggests that the tangible personal property will remain attached to the real
             2214      property in the same place over the useful life of the tangible personal property; or
             2215          (ii) if the tangible personal property is detached from the real property, the detachment
             2216      would:
             2217          (A) cause substantial damage to the tangible personal property; or
             2218          (B) require substantial alteration or repair of the real property to which the tangible
             2219      personal property is attached.
             2220          (b) "Permanently attached to real property" includes:
             2221          (i) the attachment of an accessory to the tangible personal property if the accessory is:
             2222          (A) essential to the operation of the tangible personal property; and
             2223          (B) attached only to facilitate the operation of the tangible personal property;
             2224          (ii) a temporary detachment of tangible personal property from real property for a
             2225      repair or renovation if the repair or renovation is performed where the tangible personal
             2226      property and real property are located; or
             2227          (iii) property attached to oil, gas, or water pipelines, except for the property listed in
             2228      Subsection (79)(c)(iii) or (iv).


             2229          (c) "Permanently attached to real property" does not include:
             2230          (i) the attachment of portable or movable tangible personal property to real property if
             2231      that portable or movable tangible personal property is attached to real property only for:
             2232          (A) convenience;
             2233          (B) stability; or
             2234          (C) for an obvious temporary purpose;
             2235          (ii) the detachment of tangible personal property from real property except for the
             2236      detachment described in Subsection (79)(b)(ii);
             2237          (iii) an attachment of the following tangible personal property to real property if the
             2238      attachment to real property is only through a line that supplies water, electricity, gas,
             2239      telecommunications, cable, or supplies a similar item as determined by the commission by rule
             2240      made in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act:
             2241          (A) a computer;
             2242          (B) a telephone;
             2243          (C) a television; or
             2244          (D) tangible personal property similar to Subsections (79)(c)(iii)(A) through (C) as
             2245      determined by the commission by rule made in accordance with Title 63G, Chapter 3, Utah
             2246      Administrative Rulemaking Act; or
             2247          (iv) an item listed in Subsection [(117)] (119)(c).
             2248          (80) "Person" includes any individual, firm, partnership, joint venture, association,
             2249      corporation, estate, trust, business trust, receiver, syndicate, this state, any county, city,
             2250      municipality, district, or other local governmental entity of the state, or any group or
             2251      combination acting as a unit.
             2252          (81) "Place of primary use":
             2253          (a) for telecommunications service other than mobile telecommunications service,
             2254      means the street address representative of where the customer's use of the telecommunications
             2255      service primarily occurs, which shall be:
             2256          (i) the residential street address of the customer; or
             2257          (ii) the primary business street address of the customer; or
             2258          (b) for mobile telecommunications service, is as defined in the Mobile
             2259      Telecommunications Sourcing Act, 4 U.S.C. Sec. 124.


             2260          (82) (a) "Postpaid calling service" means a telecommunications service a person
             2261      obtains by making a payment on a call-by-call basis:
             2262          (i) through the use of a:
             2263          (A) bank card;
             2264          (B) credit card;
             2265          (C) debit card; or
             2266          (D) travel card; or
             2267          (ii) by a charge made to a telephone number that is not associated with the origination
             2268      or termination of the telecommunications service.
             2269          (b) "Postpaid calling service" includes a service, except for a prepaid wireless calling
             2270      service, that would be a prepaid wireless calling service if the service were exclusively a
             2271      telecommunications service.
             2272          (83) "Postproduction" means an activity related to the finishing or duplication of a
             2273      medium described in Subsection 59-12-104 (54)(a).
             2274          (84) "Potable delivered water" means water that is:
             2275          (a) suitable for human consumption; and
             2276          (b) delivered through a pipe or similar conduit to the place of retail sale.
             2277          [(84)] (85) "Prepaid calling service" means a telecommunications service:
             2278          (a) that allows a purchaser access to telecommunications service that is exclusively
             2279      telecommunications service;
             2280          (b) that:
             2281          (i) is paid for in advance; and
             2282          (ii) enables the origination of a call using an:
             2283          (A) access number; or
             2284          (B) authorization code;
             2285          (c) that is dialed:
             2286          (i) manually; or
             2287          (ii) electronically; and
             2288          (d) sold in predetermined units or dollars that decline:
             2289          (i) by a known amount; and
             2290          (ii) with use.


             2291          [(85)] (86) "Prepaid wireless calling service" means a telecommunications service:
             2292          (a) that provides the right to utilize:
             2293          (i) mobile wireless service; and
             2294          (ii) other service that is not a telecommunications service, including:
             2295          (A) the download of a product transferred electronically;
             2296          (B) a content service; or
             2297          (C) an ancillary service;
             2298          (b) that:
             2299          (i) is paid for in advance; and
             2300          (ii) enables the origination of a call using an:
             2301          (A) access number; or
             2302          (B) authorization code;
             2303          (c) that is dialed:
             2304          (i) manually; or
             2305          (ii) electronically; and
             2306          (d) sold in predetermined units or dollars that decline:
             2307          (i) by a known amount; and
             2308          (ii) with use.
             2309          [(86)] (87) (a) "Prepared food" means:
             2310          (i) food:
             2311          (A) sold in a heated state; or
             2312          (B) heated by a seller;
             2313          (ii) two or more food ingredients mixed or combined by the seller for sale as a single
             2314      item; or
             2315          (iii) except as provided in Subsection [(86)] (87)(c), food sold with an eating utensil
             2316      provided by the seller, including a:
             2317          (A) plate;
             2318          (B) knife;
             2319          (C) fork;
             2320          (D) spoon;
             2321          (E) glass;


             2322          (F) cup;
             2323          (G) napkin; or
             2324          (H) straw.
             2325          (b) "Prepared food" does not include:
             2326          (i) food that a seller only:
             2327          (A) cuts;
             2328          (B) repackages; or
             2329          (C) pasteurizes; or
             2330          (ii) (A) the following:
             2331          (I) raw egg;
             2332          (II) raw fish;
             2333          (III) raw meat;
             2334          (IV) raw poultry; or
             2335          (V) a food containing an item described in Subsections [(86)] (87)(b)(ii)(A)(I) through
             2336      (IV); and
             2337          (B) if the Food and Drug Administration recommends in Chapter 3, Part 401.11 of the
             2338      Food and Drug Administration's Food Code that a consumer cook the items described in
             2339      Subsection [(86)] (87)(b)(ii)(A) to prevent food borne illness; or
             2340          (iii) the following if sold without eating utensils provided by the seller:
             2341          (A) food and food ingredients sold by a seller if the seller's proper primary
             2342      classification under the 2002 North American Industry Classification System of the federal
             2343      Executive Office of the President, Office of Management and Budget, is manufacturing in
             2344      Sector 311, Food Manufacturing, except for Subsector 3118, Bakeries and Tortilla
             2345      Manufacturing;
             2346          (B) food and food ingredients sold in an unheated state:
             2347          (I) by weight or volume; and
             2348          (II) as a single item; or
             2349          (C) a bakery item, including:
             2350          (I) a bagel;
             2351          (II) a bar;
             2352          (III) a biscuit;


             2353          (IV) bread;
             2354          (V) a bun;
             2355          (VI) a cake;
             2356          (VII) a cookie;
             2357          (VIII) a croissant;
             2358          (IX) a danish;
             2359          (X) a donut;
             2360          (XI) a muffin;
             2361          (XII) a pastry;
             2362          (XIII) a pie;
             2363          (XIV) a roll;
             2364          (XV) a tart;
             2365          (XVI) a torte; or
             2366          (XVII) a tortilla.
             2367          (c) Notwithstanding Subsection [(86)] (87)(a)(iii), an eating utensil provided by the
             2368      seller does not include the following used to transport the food:
             2369          (i) a container; or
             2370          (ii) packaging.
             2371          [(87)] (88) "Prescription" means an order, formula, or recipe that is issued:
             2372          (a) (i) orally;
             2373          (ii) in writing;
             2374          (iii) electronically; or
             2375          (iv) by any other manner of transmission; and
             2376          (b) by a licensed practitioner authorized by the laws of a state.
             2377          [(88)] (89) (a) Except as provided in Subsection [(88)] (89)(b)(ii) or (iii), "prewritten
             2378      computer software" means computer software that is not designed and developed:
             2379          (i) by the author or other creator of the computer software; and
             2380          (ii) to the specifications of a specific purchaser.
             2381          (b) "Prewritten computer software" includes:
             2382          (i) a prewritten upgrade to computer software if the prewritten upgrade to the computer
             2383      software is not designed and developed:


             2384          (A) by the author or other creator of the computer software; and
             2385          (B) to the specifications of a specific purchaser;
             2386          (ii) notwithstanding Subsection [(88)] (89)(a), computer software designed and
             2387      developed by the author or other creator of the computer software to the specifications of a
             2388      specific purchaser if the computer software is sold to a person other than the purchaser; or
             2389          (iii) notwithstanding Subsection [(88)] (89)(a) and except as provided in Subsection
             2390      [(88)] (89)(c), prewritten computer software or a prewritten portion of prewritten computer
             2391      software:
             2392          (A) that is modified or enhanced to any degree; and
             2393          (B) if the modification or enhancement described in Subsection [(88)] (89)(b)(iii)(A) is
             2394      designed and developed to the specifications of a specific purchaser.
             2395          (c) Notwithstanding Subsection [(88)] (89)(b)(iii), "prewritten computer software"
             2396      does not include a modification or enhancement described in Subsection [(88)] (89)(b)(iii) if
             2397      the charges for the modification or enhancement are:
             2398          (i) reasonable; and
             2399          (ii) subject to Subsections 59-12-103 (2)(e)(ii) and (2)(f)(i), separately stated on the
             2400      invoice or other statement of price provided to the purchaser at the time of sale or later, as
             2401      demonstrated by:
             2402          (A) the books and records the seller keeps at the time of the transaction in the regular
             2403      course of business, including books and records the seller keeps at the time of the transaction in
             2404      the regular course of business for nontax purposes;
             2405          (B) a preponderance of the facts and circumstances at the time of the transaction; and
             2406          (C) the understanding of all of the parties to the transaction.
             2407          [(89)] (90) (a) "Private communication service" means a telecommunications service:
             2408          (i) that entitles a customer to exclusive or priority use of one or more communications
             2409      channels between or among termination points; and
             2410          (ii) regardless of the manner in which the one or more communications channels are
             2411      connected.
             2412          (b) "Private communications service" includes the following provided in connection
             2413      with the use of one or more communications channels:
             2414          (i) an extension line;


             2415          (ii) a station;
             2416          (iii) switching capacity; or
             2417          (iv) another associated service that is provided in connection with the use of one or
             2418      more communications channels as defined in Section 59-12-215 .
             2419          [(90)] (91) (a) Except as provided in Subsection [(90)] (91)(b), "product transferred
             2420      electronically" means a product transferred electronically that would be subject to a tax under
             2421      this chapter if that product was transferred in a manner other than electronically.
             2422          (b) "Product transferred electronically" does not include:
             2423          (i) an ancillary service;
             2424          (ii) computer software; or
             2425          (iii) a telecommunications service.
             2426          [(91)] (92) (a) "Prosthetic device" means a device that is worn on or in the body to:
             2427          (i) artificially replace a missing portion of the body;
             2428          (ii) prevent or correct a physical deformity or physical malfunction; or
             2429          (iii) support a weak or deformed portion of the body.
             2430          (b) "Prosthetic device" includes:
             2431          (i) parts used in the repairs or renovation of a prosthetic device;
             2432          (ii) replacement parts for a prosthetic device;
             2433          (iii) a dental prosthesis; or
             2434          (iv) a hearing aid.
             2435          (c) "Prosthetic device" does not include:
             2436          (i) corrective eyeglasses; or
             2437          (ii) contact lenses.
             2438          [(92)] (93) (a) "Protective equipment" means an item:
             2439          (i) for human wear; and
             2440          (ii) that is:
             2441          (A) designed as protection:
             2442          (I) to the wearer against injury or disease; or
             2443          (II) against damage or injury of other persons or property; and
             2444          (B) not suitable for general use.
             2445          (b) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the


             2446      commission shall make rules:
             2447          (i) listing the items that constitute "protective equipment"; and
             2448          (ii) that are consistent with the list of items that constitute "protective equipment"
             2449      under the agreement.
             2450          [(93)] (94) (a) For purposes of Subsection 59-12-104 (41), "publication" means any
             2451      written or printed matter, other than a photocopy:
             2452          (i) regardless of:
             2453          (A) characteristics;
             2454          (B) copyright;
             2455          (C) form;
             2456          (D) format;
             2457          (E) method of reproduction; or
             2458          (F) source; and
             2459          (ii) made available in printed or electronic format.
             2460          (b) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             2461      commission may by rule define the term "photocopy."
             2462          [(94)] (95) (a) "Purchase price" and "sales price" mean the total amount of
             2463      consideration:
             2464          (i) valued in money; and
             2465          (ii) for which tangible personal property, a product transferred electronically, or
             2466      services are:
             2467          (A) sold;
             2468          (B) leased; or
             2469          (C) rented.
             2470          (b) "Purchase price" and "sales price" include:
             2471          (i) the seller's cost of the tangible personal property, a product transferred
             2472      electronically, or services sold;
             2473          (ii) expenses of the seller, including:
             2474          (A) the cost of materials used;
             2475          (B) a labor cost;
             2476          (C) a service cost;


             2477          (D) interest;
             2478          (E) a loss;
             2479          (F) the cost of transportation to the seller; or
             2480          (G) a tax imposed on the seller;
             2481          (iii) a charge by the seller for any service necessary to complete the sale; or
             2482          (iv) consideration a seller receives from a person other than the purchaser if:
             2483          (A) (I) the seller actually receives consideration from a person other than the purchaser;
             2484      and
             2485          (II) the consideration described in Subsection [(94)] (95)(b)(iv)(A)(I) is directly related
             2486      to a price reduction or discount on the sale;
             2487          (B) the seller has an obligation to pass the price reduction or discount through to the
             2488      purchaser;
             2489          (C) the amount of the consideration attributable to the sale is fixed and determinable by
             2490      the seller at the time of the sale to the purchaser; and
             2491          (D) (I) (Aa) the purchaser presents a certificate, coupon, or other documentation to the
             2492      seller to claim a price reduction or discount; and
             2493          (Bb) a person other than the seller authorizes, distributes, or grants the certificate,
             2494      coupon, or other documentation with the understanding that the person other than the seller
             2495      will reimburse any seller to whom the certificate, coupon, or other documentation is presented;
             2496          (II) the purchaser identifies that purchaser to the seller as a member of a group or
             2497      organization allowed a price reduction or discount, except that a preferred customer card that is
             2498      available to any patron of a seller does not constitute membership in a group or organization
             2499      allowed a price reduction or discount; or
             2500          (III) the price reduction or discount is identified as a third party price reduction or
             2501      discount on the:
             2502          (Aa) invoice the purchaser receives; or
             2503          (Bb) certificate, coupon, or other documentation the purchaser presents.
             2504          (c) "Purchase price" and "sales price" do not include:
             2505          (i) a discount:
             2506          (A) in a form including:
             2507          (I) cash;


             2508          (II) term; or
             2509          (III) coupon;
             2510          (B) that is allowed by a seller;
             2511          (C) taken by a purchaser on a sale; and
             2512          (D) that is not reimbursed by a third party; or
             2513          (ii) subject to Subsections 59-12-103 (2)(e)(ii) and (2)(f)(i), the following if separately
             2514      stated on an invoice, bill of sale, or similar document provided to the purchaser at the time of
             2515      sale or later, as demonstrated by the books and records the seller keeps at the time of the
             2516      transaction in the regular course of business, including books and records the seller keeps at the
             2517      time of the transaction in the regular course of business for nontax purposes, by a
             2518      preponderance of the facts and circumstances at the time of the transaction, and by the
             2519      understanding of all of the parties to the transaction:
             2520          (A) the following from credit extended on the sale of tangible personal property or
             2521      services:
             2522          (I) a carrying charge;
             2523          (II) a financing charge; or
             2524          (III) an interest charge;
             2525          (B) a delivery charge;
             2526          (C) an installation charge;
             2527          (D) a manufacturer rebate on a motor vehicle; or
             2528          (E) a tax or fee legally imposed directly on the consumer.
             2529          [(95)] (96) "Purchaser" means a person to whom:
             2530          (a) a sale of tangible personal property is made;
             2531          (b) a product is transferred electronically; or
             2532          (c) a service is furnished.
             2533          [(96)] (97) "Regularly rented" means:
             2534          (a) rented to a guest for value three or more times during a calendar year; or
             2535          (b) advertised or held out to the public as a place that is regularly rented to guests for
             2536      value.
             2537          [(97)] (98) "Rental" is as defined in Subsection (54).
             2538          [(98)] (99) (a) Except as provided in Subsection [(98)] (99)(b), "repairs or renovations


             2539      of tangible personal property" means:
             2540          (i) a repair or renovation of tangible personal property that is not permanently attached
             2541      to real property; or
             2542          (ii) attaching tangible personal property or a product transferred electronically to other
             2543      tangible personal property or detaching tangible personal property or a product transferred
             2544      electronically from other tangible personal property if:
             2545          (A) the other tangible personal property to which the tangible personal property or
             2546      product transferred electronically is attached or from which the tangible personal property or
             2547      product transferred electronically is detached is not permanently attached to real property; and
             2548          (B) the attachment of tangible personal property or a product transferred electronically
             2549      to other tangible personal property or detachment of tangible personal property or a product
             2550      transferred electronically from other tangible personal property is made in conjunction with a
             2551      repair or replacement of tangible personal property or a product transferred electronically.
             2552          (b) "Repairs or renovations of tangible personal property" does not include:
             2553          (i) attaching prewritten computer software to other tangible personal property if the
             2554      other tangible personal property to which the prewritten computer software is attached is not
             2555      permanently attached to real property; or
             2556          (ii) detaching prewritten computer software from other tangible personal property if the
             2557      other tangible personal property from which the prewritten computer software is detached is
             2558      not permanently attached to real property.
             2559          [(99)] (100) "Research and development" means the process of inquiry or
             2560      experimentation aimed at the discovery of facts, devices, technologies, or applications and the
             2561      process of preparing those devices, technologies, or applications for marketing.
             2562          [(100)] (101) (a) "Residential telecommunications services" means a
             2563      telecommunications service or an ancillary service that is provided to an individual for personal
             2564      use:
             2565          (i) at a residential address; or
             2566          (ii) at an institution, including a nursing home or a school, if the telecommunications
             2567      service or ancillary service is provided to and paid for by the individual residing at the
             2568      institution rather than the institution.
             2569          (b) For purposes of Subsection [(100)] (101)(a)(i), a residential address includes an:


             2570          (i) apartment; or
             2571          (ii) other individual dwelling unit.
             2572          [(101)] (102) "Residential use" means the use in or around a home, apartment building,
             2573      sleeping quarters, and similar facilities or accommodations.
             2574          [(102)] (103) "Retail sale" or "sale at retail" means a sale, lease, or rental for a purpose
             2575      other than:
             2576          (a) resale;
             2577          (b) sublease; or
             2578          (c) subrent.
             2579          [(103)] (104) (a) "Retailer" means any person engaged in a regularly organized
             2580      business in tangible personal property or any other taxable transaction under Subsection
             2581      59-12-103 (1), and who is selling to the user or consumer and not for resale.
             2582          (b) "Retailer" includes commission merchants, auctioneers, and any person regularly
             2583      engaged in the business of selling to users or consumers within the state.
             2584          [(104)] (105) (a) "Sale" means any transfer of title, exchange, or barter, conditional or
             2585      otherwise, in any manner, of tangible personal property or any other taxable transaction under
             2586      Subsection 59-12-103 (1), for consideration.
             2587          (b) "Sale" includes:
             2588          (i) installment and credit sales;
             2589          (ii) any closed transaction constituting a sale;
             2590          (iii) any sale of electrical energy, gas, services, or entertainment taxable under this
             2591      chapter;
             2592          (iv) any transaction if the possession of property is transferred but the seller retains the
             2593      title as security for the payment of the price; and
             2594          (v) any transaction under which right to possession, operation, or use of any article of
             2595      tangible personal property is granted under a lease or contract and the transfer of possession
             2596      would be taxable if an outright sale were made.
             2597          [(105)] (106) "Sale at retail" is as defined in Subsection [(102)] (103).
             2598          [(106)] (107) "Sale-leaseback transaction" means a transaction by which title to
             2599      tangible personal property or a product transferred electronically that is subject to a tax under
             2600      this chapter is transferred:


             2601          (a) by a purchaser-lessee;
             2602          (b) to a lessor;
             2603          (c) for consideration; and
             2604          (d) if:
             2605          (i) the purchaser-lessee paid sales and use tax on the purchaser-lessee's initial purchase
             2606      of the tangible personal property or product transferred electronically;
             2607          (ii) the sale of the tangible personal property or product transferred electronically to the
             2608      lessor is intended as a form of financing:
             2609          (A) for the tangible personal property or product transferred electronically; and
             2610          (B) to the purchaser-lessee; and
             2611          (iii) in accordance with generally accepted accounting principles, the purchaser-lessee
             2612      is required to:
             2613          (A) capitalize the tangible personal property or product transferred electronically for
             2614      financial reporting purposes; and
             2615          (B) account for the lease payments as payments made under a financing arrangement.
             2616          [(107)] (108) "Sales price" is as defined in Subsection [(94)] (95).
             2617          [(108)] (109) (a) "Sales relating to schools" means the following sales by, amounts
             2618      paid to, or amounts charged by a school:
             2619          (i) sales that are directly related to the school's educational functions or activities
             2620      including:
             2621          (A) the sale of:
             2622          (I) textbooks;
             2623          (II) textbook fees;
             2624          (III) laboratory fees;
             2625          (IV) laboratory supplies; or
             2626          (V) safety equipment;
             2627          (B) the sale of a uniform, protective equipment, or sports or recreational equipment
             2628      that:
             2629          (I) a student is specifically required to wear as a condition of participation in a
             2630      school-related event or school-related activity; and
             2631          (II) is not readily adaptable to general or continued usage to the extent that it takes the


             2632      place of ordinary clothing;
             2633          (C) sales of the following if the net or gross revenues generated by the sales are
             2634      deposited into a school district fund or school fund dedicated to school meals:
             2635          (I) food and food ingredients; or
             2636          (II) prepared food; or
             2637          (D) transportation charges for official school activities; or
             2638          (ii) amounts paid to or amounts charged by a school for admission to a school-related
             2639      event or school-related activity.
             2640          (b) "Sales relating to schools" does not include:
             2641          (i) bookstore sales of items that are not educational materials or supplies;
             2642          (ii) except as provided in Subsection [(108)] (109)(a)(i)(B):
             2643          (A) clothing;
             2644          (B) clothing accessories or equipment;
             2645          (C) protective equipment; or
             2646          (D) sports or recreational equipment; or
             2647          (iii) amounts paid to or amounts charged by a school for admission to a school-related
             2648      event or school-related activity if the amounts paid or charged are passed through to a person:
             2649          (A) other than a:
             2650          (I) school;
             2651          (II) nonprofit organization authorized by a school board or a governing body of a
             2652      private school to organize and direct a competitive secondary school activity; or
             2653          (III) nonprofit association authorized by a school board or a governing body of a
             2654      private school to organize and direct a competitive secondary school activity; and
             2655          (B) that is required to collect sales and use taxes under this chapter.
             2656          (c) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             2657      commission may make rules defining the term "passed through."
             2658          [(109)] (110) For purposes of this section and Section 59-12-104 , "school":
             2659          (a) means:
             2660          (i) an elementary school or a secondary school that:
             2661          (A) is a:
             2662          (I) public school; or


             2663          (II) private school; and
             2664          (B) provides instruction for one or more grades kindergarten through 12; or
             2665          (ii) a public school district; and
             2666          (b) includes the Electronic High School as defined in Section 53A-15-1002 .
             2667          [(110)] (111) "Seller" means a person that makes a sale, lease, or rental of:
             2668          (a) tangible personal property;
             2669          (b) a product transferred electronically; or
             2670          (c) a service.
             2671          [(111)] (112) (a) "Semiconductor fabricating, processing, research, or development
             2672      materials" means tangible personal property or a product transferred electronically if the
             2673      tangible personal property or product transferred electronically is:
             2674          (i) used primarily in the process of:
             2675          (A) (I) manufacturing a semiconductor;
             2676          (II) fabricating a semiconductor; or
             2677          (III) research or development of a:
             2678          (Aa) semiconductor; or
             2679          (Bb) semiconductor manufacturing process; or
             2680          (B) maintaining an environment suitable for a semiconductor; or
             2681          (ii) consumed primarily in the process of:
             2682          (A) (I) manufacturing a semiconductor;
             2683          (II) fabricating a semiconductor; or
             2684          (III) research or development of a:
             2685          (Aa) semiconductor; or
             2686          (Bb) semiconductor manufacturing process; or
             2687          (B) maintaining an environment suitable for a semiconductor.
             2688          (b) "Semiconductor fabricating, processing, research, or development materials"
             2689      includes:
             2690          (i) parts used in the repairs or renovations of tangible personal property or a product
             2691      transferred electronically described in Subsection [(111)] (112)(a); or
             2692          (ii) a chemical, catalyst, or other material used to:
             2693          (A) produce or induce in a semiconductor a:


             2694          (I) chemical change; or
             2695          (II) physical change;
             2696          (B) remove impurities from a semiconductor; or
             2697          (C) improve the marketable condition of a semiconductor.
             2698          [(112)] (113) "Senior citizen center" means a facility having the primary purpose of
             2699      providing services to the aged as defined in Section 62A-3-101 .
             2700          [(113)] (114) "Simplified electronic return" means the electronic return:
             2701          (a) described in Section 318(C) of the agreement; and
             2702          (b) approved by the governing board of the agreement.
             2703          [(114)] (115) "Solar energy" means the sun used as the sole source of energy for
             2704      producing electricity.
             2705          [(115)] (116) (a) "Sports or recreational equipment" means an item:
             2706          (i) designed for human use; and
             2707          (ii) that is:
             2708          (A) worn in conjunction with:
             2709          (I) an athletic activity; or
             2710          (II) a recreational activity; and
             2711          (B) not suitable for general use.
             2712          (b) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             2713      commission shall make rules:
             2714          (i) listing the items that constitute "sports or recreational equipment"; and
             2715          (ii) that are consistent with the list of items that constitute "sports or recreational
             2716      equipment" under the agreement.
             2717          [(116)] (117) "State" means the state of Utah, its departments, and agencies.
             2718          [(117)] (118) "Storage" means any keeping or retention of tangible personal property or
             2719      any other taxable transaction under Subsection 59-12-103 (1), in this state for any purpose
             2720      except sale in the regular course of business.
             2721          [(118)] (119) (a) Except as provided in Subsection [(118)] (119)(d) or (e), "tangible
             2722      personal property" means personal property that:
             2723          (i) may be:
             2724          (A) seen;


             2725          (B) weighed;
             2726          (C) measured;
             2727          (D) felt; or
             2728          (E) touched; or
             2729          (ii) is in any manner perceptible to the senses.
             2730          (b) "Tangible personal property" includes:
             2731          (i) electricity;
             2732          (ii) water;
             2733          (iii) gas;
             2734          (iv) steam; or
             2735          (v) prewritten computer software, regardless of the manner in which the prewritten
             2736      computer software is transferred.
             2737          (c) "Tangible personal property" includes the following regardless of whether the item
             2738      is attached to real property:
             2739          (i) a dishwasher;
             2740          (ii) a dryer;
             2741          (iii) a freezer;
             2742          (iv) a microwave;
             2743          (v) a refrigerator;
             2744          (vi) a stove;
             2745          (vii) a washer; or
             2746          (viii) an item similar to Subsections [(118)] (119)(c)(i) through (vii) as determined by
             2747      the commission by rule made in accordance with Title 63G, Chapter 3, Utah Administrative
             2748      Rulemaking Act.
             2749          (d) "Tangible personal property" does not include a product that is transferred
             2750      electronically.
             2751          (e) "Tangible personal property" does not include the following if attached to real
             2752      property, regardless of whether the attachment to real property is only through a line that
             2753      supplies water, electricity, gas, telephone, cable, or supplies a similar item as determined by the
             2754      commission by rule made in accordance with Title 63G, Chapter 3, Utah Administrative
             2755      Rulemaking Act:


             2756          (i) a hot water heater;
             2757          (ii) a water filtration system; or
             2758          (iii) a water softener system.
             2759          [(119)] (120) (a) "Telecommunications enabling or facilitating equipment, machinery,
             2760      or software" means an item listed in Subsection [(119)] (120)(b) if that item is purchased or
             2761      leased primarily to enable or facilitate one or more of the following to function:
             2762          (i) telecommunications switching or routing equipment, machinery, or software; or
             2763          (ii) telecommunications transmission equipment, machinery, or software.
             2764          (b) The following apply to Subsection [(119)] (120)(a):
             2765          (i) a pole;
             2766          (ii) software;
             2767          (iii) a supplementary power supply;
             2768          (iv) temperature or environmental equipment or machinery;
             2769          (v) test equipment;
             2770          (vi) a tower; or
             2771          (vii) equipment, machinery, or software that functions similarly to an item listed in
             2772      Subsections [(119)] (120)(b)(i) through (vi) as determined by the commission by rule made in
             2773      accordance with Subsection [(119)] (120)(c).
             2774          (c) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             2775      commission may by rule define what constitutes equipment, machinery, or software that
             2776      functions similarly to an item listed in Subsections [(119)] (120)(b)(i) through (vi).
             2777          [(120)] (121) "Telecommunications equipment, machinery, or software required for
             2778      911 service" means equipment, machinery, or software that is required to comply with 47
             2779      C.F.R. Sec. 20.18.
             2780          [(121)] (122) "Telecommunications maintenance or repair equipment, machinery, or
             2781      software" means equipment, machinery, or software purchased or leased primarily to maintain
             2782      or repair one or more of the following, regardless of whether the equipment, machinery, or
             2783      software is purchased or leased as a spare part or as an upgrade or modification to one or more
             2784      of the following:
             2785          (a) telecommunications enabling or facilitating equipment, machinery, or software;
             2786          (b) telecommunications switching or routing equipment, machinery, or software; or


             2787          (c) telecommunications transmission equipment, machinery, or software.
             2788          [(122)] (123) (a) "Telecommunications service" means the electronic conveyance,
             2789      routing, or transmission of audio, data, video, voice, or any other information or signal to a
             2790      point, or among or between points.
             2791          (b) "Telecommunications service" includes:
             2792          (i) an electronic conveyance, routing, or transmission with respect to which a computer
             2793      processing application is used to act:
             2794          (A) on the code, form, or protocol of the content;
             2795          (B) for the purpose of electronic conveyance, routing, or transmission; and
             2796          (C) regardless of whether the service:
             2797          (I) is referred to as voice over Internet protocol service; or
             2798          (II) is classified by the Federal Communications Commission as enhanced or value
             2799      added;
             2800          (ii) an 800 service;
             2801          (iii) a 900 service;
             2802          (iv) a fixed wireless service;
             2803          (v) a mobile wireless service;
             2804          (vi) a postpaid calling service;
             2805          (vii) a prepaid calling service;
             2806          (viii) a prepaid wireless calling service; or
             2807          (ix) a private communications service.
             2808          (c) "Telecommunications service" does not include:
             2809          (i) advertising, including directory advertising;
             2810          (ii) an ancillary service;
             2811          (iii) a billing and collection service provided to a third party;
             2812          (iv) a data processing and information service if:
             2813          (A) the data processing and information service allows data to be:
             2814          (I) (Aa) acquired;
             2815          (Bb) generated;
             2816          (Cc) processed;
             2817          (Dd) retrieved; or


             2818          (Ee) stored; and
             2819          (II) delivered by an electronic transmission to a purchaser; and
             2820          (B) the purchaser's primary purpose for the underlying transaction is the processed data
             2821      or information;
             2822          (v) installation or maintenance of the following on a customer's premises:
             2823          (A) equipment; or
             2824          (B) wiring;
             2825          (vi) Internet access service;
             2826          (vii) a paging service;
             2827          (viii) a product transferred electronically, including:
             2828          (A) music;
             2829          (B) reading material;
             2830          (C) a ring tone;
             2831          (D) software; or
             2832          (E) video;
             2833          (ix) a radio and television audio and video programming service:
             2834          (A) regardless of the medium; and
             2835          (B) including:
             2836          (I) furnishing conveyance, routing, or transmission of a television audio and video
             2837      programming service by a programming service provider;
             2838          (II) cable service as defined in 47 U.S.C. Sec. 522(6); or
             2839          (III) audio and video programming services delivered by a commercial mobile radio
             2840      service provider as defined in 47 C.F.R. Sec. 20.3;
             2841          (x) a value-added nonvoice data service; or
             2842          (xi) tangible personal property.
             2843          [(123)] (124) (a) "Telecommunications service provider" means a person that:
             2844          (i) owns, controls, operates, or manages a telecommunications service; and
             2845          (ii) engages in an activity described in Subsection [(123)] (124)(a)(i) for the shared use
             2846      with or resale to any person of the telecommunications service.
             2847          (b) A person described in Subsection [(123)] (124)(a) is a telecommunications service
             2848      provider whether or not the Public Service Commission of Utah regulates:


             2849          (i) that person; or
             2850          (ii) the telecommunications service that the person owns, controls, operates, or
             2851      manages.
             2852          [(124)] (125) (a) "Telecommunications switching or routing equipment, machinery, or
             2853      software" means an item listed in Subsection [(124)] (125)(b) if that item is purchased or
             2854      leased primarily for switching or routing:
             2855          (i) an ancillary service;
             2856          (ii) data communications;
             2857          (iii) voice communications; or
             2858          (iv) telecommunications service.
             2859          (b) The following apply to Subsection [(124)] (125)(a):
             2860          (i) a bridge;
             2861          (ii) a computer;
             2862          (iii) a cross connect;
             2863          (iv) a modem;
             2864          (v) a multiplexer;
             2865          (vi) plug in circuitry;
             2866          (vii) a router;
             2867          (viii) software;
             2868          (ix) a switch; or
             2869          (x) equipment, machinery, or software that functions similarly to an item listed in
             2870      Subsections [(124)] (125)(b)(i) through (ix) as determined by the commission by rule made in
             2871      accordance with Subsection [(124)] (125)(c).
             2872          (c) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             2873      commission may by rule define what constitutes equipment, machinery, or software that
             2874      functions similarly to an item listed in Subsections [(124)] (125)(b)(i) through (ix).
             2875          [(125)] (126) (a) "Telecommunications transmission equipment, machinery, or
             2876      software" means an item listed in Subsection [(125)] (126)(b) if that item is purchased or
             2877      leased primarily for sending, receiving, or transporting:
             2878          (i) an ancillary service;
             2879          (ii) data communications;


             2880          (iii) voice communications; or
             2881          (iv) telecommunications service.
             2882          (b) The following apply to Subsection [(125)] (126)(a):
             2883          (i) an amplifier;
             2884          (ii) a cable;
             2885          (iii) a closure;
             2886          (iv) a conduit;
             2887          (v) a controller;
             2888          (vi) a duplexer;
             2889          (vii) a filter;
             2890          (viii) an input device;
             2891          (ix) an input/output device;
             2892          (x) an insulator;
             2893          (xi) microwave machinery or equipment;
             2894          (xii) an oscillator;
             2895          (xiii) an output device;
             2896          (xiv) a pedestal;
             2897          (xv) a power converter;
             2898          (xvi) a power supply;
             2899          (xvii) a radio channel;
             2900          (xviii) a radio receiver;
             2901          (xix) a radio transmitter;
             2902          (xx) a repeater;
             2903          (xxi) software;
             2904          (xxii) a terminal;
             2905          (xxiii) a timing unit;
             2906          (xxiv) a transformer;
             2907          (xxv) a wire; or
             2908          (xxvi) equipment, machinery, or software that functions similarly to an item listed in
             2909      Subsections [(125)] (126)(b)(i) through (xxv) as determined by the commission by rule made in
             2910      accordance with Subsection [(125)] (126)(c).


             2911          (c) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             2912      commission may by rule define what constitutes equipment, machinery, or software that
             2913      functions similarly to an item listed in Subsections [(125)] (126)(b)(i) through (xxv).
             2914          [(126)] (127) (a) "Textbook for a higher education course" means a textbook or other
             2915      printed material that is required for a course:
             2916          (i) offered by an institution of higher education; and
             2917          (ii) that the purchaser of the textbook or other printed material attends or will attend.
             2918          (b) "Textbook for a higher education course" includes a textbook in electronic format.
             2919          [(127)] (128) "Tobacco" means:
             2920          (a) a cigarette;
             2921          (b) a cigar;
             2922          (c) chewing tobacco;
             2923          (d) pipe tobacco; or
             2924          (e) any other item that contains tobacco.
             2925          [(128)] (129) "Unassisted amusement device" means an amusement device, skill
             2926      device, or ride device that is started and stopped by the purchaser or renter of the right to use or
             2927      operate the amusement device, skill device, or ride device.
             2928          [(129)] (130) (a) "Use" means the exercise of any right or power over tangible personal
             2929      property, a product transferred electronically, or a service under Subsection 59-12-103 (1),
             2930      incident to the ownership or the leasing of that tangible personal property, product transferred
             2931      electronically, or service.
             2932          (b) "Use" does not include the sale, display, demonstration, or trial of tangible personal
             2933      property, a product transferred electronically, or a service in the regular course of business and
             2934      held for resale.
             2935          [(130)] (131) "Value-added nonvoice data service" means a service:
             2936          (a) that otherwise meets the definition of a telecommunications service except that a
             2937      computer processing application is used to act primarily for a purpose other than conveyance,
             2938      routing, or transmission; and
             2939          (b) with respect to which a computer processing application is used to act on data or
             2940      information:
             2941          (i) code;


             2942          (ii) content;
             2943          (iii) form; or
             2944          (iv) protocol.
             2945          [(131)] (132) (a) Subject to Subsection [(131)] (132)(b), "vehicle" means the following
             2946      that are required to be titled, registered, or titled and registered:
             2947          (i) an aircraft as defined in Section 72-10-102 ;
             2948          (ii) a vehicle as defined in Section 41-1a-102 ;
             2949          (iii) an off-highway vehicle as defined in Section 41-22-2 ; or
             2950          (iv) a vessel as defined in Section 41-1a-102 .
             2951          (b) For purposes of Subsection 59-12-104 (33) only, "vehicle" includes:
             2952          (i) a vehicle described in Subsection [(131)] (132)(a); or
             2953          (ii) (A) a locomotive;
             2954          (B) a freight car;
             2955          (C) railroad work equipment; or
             2956          (D) other railroad rolling stock.
             2957          [(132)] (133) "Vehicle dealer" means a person engaged in the business of buying,
             2958      selling, or exchanging a vehicle as defined in Subsection [(131)] (132).
             2959          [(133)] (134) (a) "Vertical service" means an ancillary service that:
             2960          (i) is offered in connection with one or more telecommunications services; and
             2961          (ii) offers an advanced calling feature that allows a customer to:
             2962          (A) identify a caller; and
             2963          (B) manage multiple calls and call connections.
             2964          (b) "Vertical service" includes an ancillary service that allows a customer to manage a
             2965      conference bridging service.
             2966          [(134)] (135) (a) "Voice mail service" means an ancillary service that enables a
             2967      customer to receive, send, or store a recorded message.
             2968          (b) "Voice mail service" does not include a vertical service that a customer is required
             2969      to have in order to utilize a voice mail service.
             2970          [(135)] (136) (a) Except as provided in Subsection [(135)] (136)(b), "waste energy
             2971      facility" means a facility that generates electricity:
             2972          (i) using as the primary source of energy waste materials that would be placed in a


             2973      landfill or refuse pit if it were not used to generate electricity, including:
             2974          (A) tires;
             2975          (B) waste coal;
             2976          (C) oil shale; or
             2977          (D) municipal solid waste; and
             2978          (ii) in amounts greater than actually required for the operation of the facility.
             2979          (b) "Waste energy facility" does not include a facility that incinerates:
             2980          (i) hospital waste as defined in 40 C.F.R. 60.51c; or
             2981          (ii) medical/infectious waste as defined in 40 C.F.R. 60.51c.
             2982          [(136)] (137) "Watercraft" means a vessel as defined in Section 73-18-2 .
             2983          [(137)] (138) "Wind energy" means wind used as the sole source of energy to produce
             2984      electricity.
             2985          [(138)] (139) "ZIP Code" means a Zoning Improvement Plan Code assigned to a
             2986      geographic location by the United States Postal Service.
             2987          Section 3. Section 59-12-103 (Superseded 07/01/14) is amended to read:
             2988           59-12-103 (Superseded 07/01/14). Sales and use tax base -- Rates -- Effective dates
             2989      -- Use of sales and use tax revenues.
             2990          (1) A tax is imposed on the purchaser as provided in this part for amounts paid or
             2991      charged for the following transactions:
             2992          (a) retail sales of tangible personal property made within the state;
             2993          (b) amounts paid for:
             2994          (i) telecommunications service, other than mobile telecommunications service, that
             2995      originates and terminates within the boundaries of this state;
             2996          (ii) mobile telecommunications service that originates and terminates within the
             2997      boundaries of one state only to the extent permitted by the Mobile Telecommunications
             2998      Sourcing Act, 4 U.S.C. Sec. 116 et seq.; or
             2999          (iii) an ancillary service associated with a:
             3000          (A) telecommunications service described in Subsection (1)(b)(i); or
             3001          (B) mobile telecommunications service described in Subsection (1)(b)(ii);
             3002          (c) sales of the following for commercial use:
             3003          (i) gas;


             3004          (ii) electricity;
             3005          (iii) heat;
             3006          (iv) coal;
             3007          (v) fuel oil; or
             3008          (vi) other fuels;
             3009          (d) sales of the following for residential use:
             3010          (i) gas;
             3011          (ii) electricity;
             3012          (iii) heat;
             3013          (iv) coal;
             3014          (v) fuel oil; or
             3015          (vi) other fuels;
             3016          (e) sales of prepared food;
             3017          (f) except as provided in Section 59-12-104 , amounts paid or charged as admission or
             3018      user fees for theaters, movies, operas, museums, planetariums, shows of any type or nature,
             3019      exhibitions, concerts, carnivals, amusement parks, amusement rides, circuses, menageries,
             3020      fairs, races, contests, sporting events, dances, boxing matches, wrestling matches, closed circuit
             3021      television broadcasts, billiard parlors, pool parlors, bowling lanes, golf, miniature golf, golf
             3022      driving ranges, batting cages, skating rinks, ski lifts, ski runs, ski trails, snowmobile trails,
             3023      tennis courts, swimming pools, water slides, river runs, jeep tours, boat tours, scenic cruises,
             3024      horseback rides, sports activities, or any other amusement, entertainment, recreation,
             3025      exhibition, cultural, or athletic activity;
             3026          (g) amounts paid or charged for services for repairs or renovations of tangible personal
             3027      property, unless Section 59-12-104 provides for an exemption from sales and use tax for:
             3028          (i) the tangible personal property; and
             3029          (ii) parts used in the repairs or renovations of the tangible personal property described
             3030      in Subsection (1)(g)(i), whether or not any parts are actually used in the repairs or renovations
             3031      of that tangible personal property;
             3032          (h) except as provided in Subsection 59-12-104 (7), amounts paid or charged for
             3033      assisted cleaning or washing of tangible personal property;
             3034          (i) amounts paid or charged for tourist home, hotel, motel, or trailer court


             3035      accommodations and services that are regularly rented for less than 30 consecutive days;
             3036          (j) amounts paid or charged for laundry or dry cleaning services;
             3037          (k) amounts paid or charged for leases or rentals of tangible personal property if within
             3038      this state the tangible personal property is:
             3039          (i) stored;
             3040          (ii) used; or
             3041          (iii) otherwise consumed;
             3042          (l) amounts paid or charged for tangible personal property if within this state the
             3043      tangible personal property is:
             3044          (i) stored;
             3045          (ii) used; or
             3046          (iii) consumed; [and]
             3047          (m) amounts paid or charged for a sale:
             3048          (i) (A) of a product transferred electronically; or
             3049          (B) of a repair or renovation of a product transferred electronically; and
             3050          (ii) regardless of whether the sale provides:
             3051          (A) a right of permanent use of the product; or
             3052          (B) a right to use the product that is less than a permanent use, including a right:
             3053          (I) for a definite or specified length of time; and
             3054          (II) that terminates upon the occurrence of a condition[.]; and
             3055          (n) amounts paid or charged for the retail sale of potable delivered water.
             3056          (2) (a) Except as provided in Subsections (2)(b) through (e), a state tax and a local tax
             3057      is imposed on a transaction described in Subsection (1), including Subsection (1)(n), equal to
             3058      the sum of:
             3059          (i) a state tax imposed on the transaction at a tax rate equal to the sum of:
             3060          (A) 4.70%; and
             3061          (B) (I) the tax rate the state imposes in accordance with Part 18, Additional State Sales
             3062      and Use Tax Act, if the location of the transaction as determined under Sections 59-12-211
             3063      through 59-12-215 is in a county in which the state imposes the tax under Part 18, Additional
             3064      State Sales and Use Tax Act; and
             3065          (II) the tax rate the state imposes in accordance with Part 20, Supplemental State Sales


             3066      and Use Tax Act, if the location of the transaction as determined under Sections 59-12-211
             3067      through 59-12-215 is in a city, town, or the unincorporated area of a county in which the state
             3068      imposes the tax under Part 20, Supplemental State Sales and Use Tax Act; and
             3069          (ii) a local tax equal to the sum of the tax rates a county, city, or town imposes on the
             3070      transaction under this chapter other than this part.
             3071          (b) Except as provided in Subsection (2)(d) or (e), a state tax and a local tax is imposed
             3072      on a transaction described in Subsection (1)(d) equal to the sum of:
             3073          (i) a state tax imposed on the transaction at a tax rate of 2%; and
             3074          (ii) a local tax equal to the sum of the tax rates a county, city, or town imposes on the
             3075      transaction under this chapter other than this part.
             3076          (c) Except as provided in Subsection (2)(d) or (e), a state tax and a local tax is imposed
             3077      on amounts paid or charged for food and food ingredients equal to the sum of:
             3078          (i) a state tax imposed on the amounts paid or charged for food and food ingredients at
             3079      a tax rate of 1.75%; and
             3080          (ii) a local tax equal to the sum of the tax rates a county, city, or town imposes on the
             3081      amounts paid or charged for food and food ingredients under this chapter other than this part.
             3082          (d) (i) For a bundled transaction that is attributable to food and food ingredients and
             3083      tangible personal property other than food and food ingredients, a state tax and a local tax is
             3084      imposed on the entire bundled transaction equal to the sum of:
             3085          (A) a state tax imposed on the entire bundled transaction equal to the sum of:
             3086          (I) the tax rate described in Subsection (2)(a)(i)(A); and
             3087          (II) (Aa) the tax rate the state imposes in accordance with Part 18, Additional State
             3088      Sales and Use Tax Act, if the location of the transaction as determined under Sections
             3089      59-12-211 through 59-12-215 is in a county in which the state imposes the tax under Part 18,
             3090      Additional State Sales and Use Tax Act; and
             3091          (Bb) the tax rate the state imposes in accordance with Part 20, Supplemental State
             3092      Sales and Use Tax Act, if the location of the transaction as determined under Sections
             3093      59-12-211 through 59-12-215 is in a city, town, or the unincorporated area of a county in which
             3094      the state imposes the tax under Part 20, Supplemental State Sales and Use Tax Act; and
             3095          (B) a local tax imposed on the entire bundled transaction at the sum of the tax rates
             3096      described in Subsection (2)(a)(ii).


             3097          (ii) If an optional computer software maintenance contract is a bundled transaction that
             3098      consists of taxable and nontaxable products that are not separately itemized on an invoice or
             3099      similar billing document, the purchase of the optional computer software maintenance contract
             3100      is 40% taxable under this chapter and 60% nontaxable under this chapter.
             3101          (iii) Subject to Subsection (2)(d)(iv), for a bundled transaction other than a bundled
             3102      transaction described in Subsection (2)(d)(i) or (ii):
             3103          (A) if the sales price of the bundled transaction is attributable to tangible personal
             3104      property, a product, or a service that is subject to taxation under this chapter and tangible
             3105      personal property, a product, or service that is not subject to taxation under this chapter, the
             3106      entire bundled transaction is subject to taxation under this chapter unless:
             3107          (I) the seller is able to identify by reasonable and verifiable standards the tangible
             3108      personal property, product, or service that is not subject to taxation under this chapter from the
             3109      books and records the seller keeps in the seller's regular course of business; or
             3110          (II) state or federal law provides otherwise; or
             3111          (B) if the sales price of a bundled transaction is attributable to two or more items of
             3112      tangible personal property, products, or services that are subject to taxation under this chapter
             3113      at different rates, the entire bundled transaction is subject to taxation under this chapter at the
             3114      higher tax rate unless:
             3115          (I) the seller is able to identify by reasonable and verifiable standards the tangible
             3116      personal property, product, or service that is subject to taxation under this chapter at the lower
             3117      tax rate from the books and records the seller keeps in the seller's regular course of business; or
             3118          (II) state or federal law provides otherwise.
             3119          (iv) For purposes of Subsection (2)(d)(iii), books and records that a seller keeps in the
             3120      seller's regular course of business includes books and records the seller keeps in the regular
             3121      course of business for nontax purposes.
             3122          (e) Subject to Subsections (2)(f) and (g), a tax rate repeal or tax rate change for a tax
             3123      rate imposed under the following shall take effect on the first day of a calendar quarter:
             3124          (i) Subsection (2)(a)(i)(A);
             3125          (ii) Subsection (2)(b)(i);
             3126          (iii) Subsection (2)(c)(i); or
             3127          (iv) Subsection (2)(d)(i)(A)(I).


             3128          (f) (i) A tax rate increase takes effect on the first day of the first billing period that
             3129      begins on or after the effective date of the tax rate increase if the billing period for the
             3130      transaction begins before the effective date of a tax rate increase imposed under:
             3131          (A) Subsection (2)(a)(i)(A);
             3132          (B) Subsection (2)(b)(i);
             3133          (C) Subsection (2)(c)(i); or
             3134          (D) Subsection (2)(d)(i)(A)(I).
             3135          (ii) The repeal of a tax or a tax rate decrease applies to a billing period if the billing
             3136      statement for the billing period is rendered on or after the effective date of the repeal of the tax
             3137      or the tax rate decrease imposed under:
             3138          (A) Subsection (2)(a)(i)(A);
             3139          (B) Subsection (2)(b)(i);
             3140          (C) Subsection (2)(c)(i); or
             3141          (D) Subsection (2)(d)(i)(A)(I).
             3142          (g) (i) For a tax rate described in Subsection (2)(g)(ii), if a tax due on a catalogue sale
             3143      is computed on the basis of sales and use tax rates published in the catalogue, a tax rate repeal
             3144      or change in a tax rate takes effect:
             3145          (A) on the first day of a calendar quarter; and
             3146          (B) beginning 60 days after the effective date of the tax rate repeal or tax rate change.
             3147          (ii) Subsection (2)(g)(i) applies to the tax rates described in the following:
             3148          (A) Subsection (2)(a)(i)(A);
             3149          (B) Subsection (2)(b)(i);
             3150          (C) Subsection (2)(c)(i); or
             3151          (D) Subsection (2)(d)(i)(A)(I).
             3152          (iii) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act,
             3153      the commission may by rule define the term "catalogue sale."
             3154          (3) (a) The following state taxes shall be deposited into the General Fund:
             3155          (i) the tax imposed by Subsection (2)(a)(i)(A);
             3156          (ii) the tax imposed by Subsection (2)(b)(i);
             3157          (iii) the tax imposed by Subsection (2)(c)(i); or
             3158          (iv) the tax imposed by Subsection (2)(d)(i)(A)(I).


             3159          (b) The following local taxes shall be distributed to a county, city, or town as provided
             3160      in this chapter:
             3161          (i) the tax imposed by Subsection (2)(a)(ii);
             3162          (ii) the tax imposed by Subsection (2)(b)(ii);
             3163          (iii) the tax imposed by Subsection (2)(c)(ii); and
             3164          (iv) the tax imposed by Subsection (2)(d)(i)(B).
             3165          (4) (a) Notwithstanding Subsection (3)(a), for a fiscal year beginning on or after July 1,
             3166      2003, the lesser of the following amounts shall be used as provided in Subsections (4)(b)
             3167      through (g):
             3168          (i) for taxes listed under Subsection (3)(a), the amount of tax revenue generated:
             3169          (A) by a 1/16% tax rate on the transactions described in Subsection (1); and
             3170          (B) for the fiscal year; or
             3171          (ii) $17,500,000.
             3172          (b) (i) For a fiscal year beginning on or after July 1, 2003, 14% of the amount
             3173      described in Subsection (4)(a) shall be transferred each year as dedicated credits to the
             3174      Department of Natural Resources to:
             3175          (A) implement the measures described in Subsections 79-2-303 (3)(a) through (d) to
             3176      protect sensitive plant and animal species; or
             3177          (B) award grants, up to the amount authorized by the Legislature in an appropriations
             3178      act, to political subdivisions of the state to implement the measures described in Subsections
             3179      79-2-303 (3)(a) through (d) to protect sensitive plant and animal species.
             3180          (ii) Money transferred to the Department of Natural Resources under Subsection
             3181      (4)(b)(i) may not be used to assist the United States Fish and Wildlife Service or any other
             3182      person to list or attempt to have listed a species as threatened or endangered under the
             3183      Endangered Species Act of 1973, 16 U.S.C. Sec. 1531 et seq.
             3184          (iii) At the end of each fiscal year:
             3185          (A) 50% of any unexpended dedicated credits shall lapse to the Water Resources
             3186      Conservation and Development Fund created in Section 73-10-24 ;
             3187          (B) 25% of any unexpended dedicated credits shall lapse to the Utah Wastewater Loan
             3188      Program Subaccount created in Section 73-10c-5 ; and
             3189          (C) 25% of any unexpended dedicated credits shall lapse to the Drinking Water Loan


             3190      Program Subaccount created in Section 73-10c-5 .
             3191          (c) For a fiscal year beginning on or after July 1, 2003, 3% of the amount described in
             3192      Subsection (4)(a) shall be deposited each year in the Agriculture Resource Development Fund
             3193      created in Section 4-18-6 .
             3194          (d) (i) For a fiscal year beginning on or after July 1, 2003, 1% of the amount described
             3195      in Subsection (4)(a) shall be transferred each year as dedicated credits to the Division of Water
             3196      Rights to cover the costs incurred in hiring legal and technical staff for the adjudication of
             3197      water rights.
             3198          (ii) At the end of each fiscal year:
             3199          (A) 50% of any unexpended dedicated credits shall lapse to the Water Resources
             3200      Conservation and Development Fund created in Section 73-10-24 ;
             3201          (B) 25% of any unexpended dedicated credits shall lapse to the Utah Wastewater Loan
             3202      Program Subaccount created in Section 73-10c-5 ; and
             3203          (C) 25% of any unexpended dedicated credits shall lapse to the Drinking Water Loan
             3204      Program Subaccount created in Section 73-10c-5 .
             3205          (e) (i) For a fiscal year beginning on or after July 1, 2003, 41% of the amount described
             3206      in Subsection (4)(a) shall be deposited in the Water Resources Conservation and Development
             3207      Fund created in Section 73-10-24 for use by the Division of Water Resources.
             3208          (ii) In addition to the uses allowed of the Water Resources Conservation and
             3209      Development Fund under Section 73-10-24 , the Water Resources Conservation and
             3210      Development Fund may also be used to:
             3211          (A) conduct hydrologic and geotechnical investigations by the Division of Water
             3212      Resources in a cooperative effort with other state, federal, or local entities, for the purpose of
             3213      quantifying surface and ground water resources and describing the hydrologic systems of an
             3214      area in sufficient detail so as to enable local and state resource managers to plan for and
             3215      accommodate growth in water use without jeopardizing the resource;
             3216          (B) fund state required dam safety improvements; and
             3217          (C) protect the state's interest in interstate water compact allocations, including the
             3218      hiring of technical and legal staff.
             3219          (f) For a fiscal year beginning on or after July 1, 2003, 20.5% of the amount described
             3220      in Subsection (4)(a) shall be deposited in the Utah Wastewater Loan Program Subaccount


             3221      created in Section 73-10c-5 for use by the Water Quality Board to fund wastewater projects.
             3222          (g) For a fiscal year beginning on or after July 1, 2003, 20.5% of the amount described
             3223      in Subsection (4)(a) shall be deposited in the Drinking Water Loan Program Subaccount
             3224      created in Section 73-10c-5 for use by the Division of Drinking Water to:
             3225          (i) provide for the installation and repair of collection, treatment, storage, and
             3226      distribution facilities for any public water system, as defined in Section 19-4-102 ;
             3227          (ii) develop underground sources of water, including springs and wells; and
             3228          (iii) develop surface water sources.
             3229          (5) (a) Notwithstanding Subsection (3)(a), for a fiscal year beginning on or after July 1,
             3230      2006, the difference between the following amounts shall be expended as provided in this
             3231      Subsection (5), if that difference is greater than $1:
             3232          (i) for taxes listed under Subsection (3)(a), the amount of tax revenue generated for the
             3233      fiscal year by a 1/16% tax rate on the transactions described in Subsection (1); and
             3234          (ii) $17,500,000.
             3235          (b) (i) The first $500,000 of the difference described in Subsection (5)(a) shall be:
             3236          (A) transferred each fiscal year to the Department of Natural Resources as dedicated
             3237      credits; and
             3238          (B) expended by the Department of Natural Resources for watershed rehabilitation or
             3239      restoration.
             3240          (ii) At the end of each fiscal year, 100% of any unexpended dedicated credits described
             3241      in Subsection (5)(b)(i) shall lapse to the Water Resources Conservation and Development Fund
             3242      created in Section 73-10-24 .
             3243          (c) (i) After making the transfer required by Subsection (5)(b)(i), $150,000 of the
             3244      remaining difference described in Subsection (5)(a) shall be:
             3245          (A) transferred each fiscal year to the Division of Water Resources as dedicated
             3246      credits; and
             3247          (B) expended by the Division of Water Resources for cloud-seeding projects
             3248      authorized by Title 73, Chapter 15, Modification of Weather.
             3249          (ii) At the end of each fiscal year, 100% of any unexpended dedicated credits described
             3250      in Subsection (5)(c)(i) shall lapse to the Water Resources Conservation and Development Fund
             3251      created in Section 73-10-24 .


             3252          (d) After making the transfers required by Subsections (5)(b) and (c), 94% of the
             3253      remaining difference described in Subsection (5)(a) shall be deposited into the Water
             3254      Resources Conservation and Development Fund created in Section 73-10-24 for use by the
             3255      Division of Water Resources for:
             3256          (i) preconstruction costs:
             3257          (A) as defined in Subsection 73-26-103 (6) for projects authorized by Title 73, Chapter
             3258      26, Bear River Development Act; and
             3259          (B) as defined in Subsection 73-28-103 (8) for the Lake Powell Pipeline project
             3260      authorized by Title 73, Chapter 28, Lake Powell Pipeline Development Act;
             3261          (ii) the cost of employing a civil engineer to oversee any project authorized by Title 73,
             3262      Chapter 26, Bear River Development Act;
             3263          (iii) the cost of employing a civil engineer to oversee the Lake Powell Pipeline project
             3264      authorized by Title 73, Chapter 28, Lake Powell Pipeline Development Act; and
             3265          (iv) other uses authorized under Sections 73-10-24 , 73-10-25.1 , 73-10-30 , and
             3266      Subsection (4)(e)(ii) after funding the uses specified in Subsections (5)(d)(i) through (iii).
             3267          (e) After making the transfers required by Subsections (5)(b) and (c) and subject to
             3268      Subsection (5)(f), 6% of the remaining difference described in Subsection (5)(a) shall be
             3269      transferred each year as dedicated credits to the Division of Water Rights to cover the costs
             3270      incurred for employing additional technical staff for the administration of water rights.
             3271          (f) At the end of each fiscal year, any unexpended dedicated credits described in
             3272      Subsection (5)(e) over $150,000 lapse to the Water Resources Conservation and Development
             3273      Fund created in Section 73-10-24 .
             3274          (6) Notwithstanding Subsection (3)(a), for a fiscal year beginning on or after July 1,
             3275      2003, and for taxes listed under Subsection (3)(a), the amount of revenue generated by a 1/16%
             3276      tax rate on the transactions described in Subsection (1) for the fiscal year shall be deposited in
             3277      the Transportation Fund created by Section 72-2-102 .
             3278          (7) Notwithstanding Subsection (3)(a), beginning on July 1, 2012, the Division of
             3279      Finance shall deposit into the Transportation Investment Fund of 2005 created in Section
             3280      72-2-124 a portion of the taxes listed under Subsection (3)(a) equal to the revenues generated
             3281      by a 1/64% tax rate on the taxable transactions under Subsection (1).
             3282          (8) (a) Notwithstanding Subsection (3)(a), in addition to the amounts deposited in


             3283      Subsection (7), and subject to Subsection (8)(b), for a fiscal year beginning on or after July 1,
             3284      2012, the Division of Finance shall deposit into the Transportation Investment Fund of 2005
             3285      created by Section 72-2-124 :
             3286          (i) a portion of the taxes listed under Subsection (3)(a) in an amount equal to 8.3% of
             3287      the revenues collected from the following taxes, which represents a portion of the
             3288      approximately 17% of sales and use tax revenues generated annually by the sales and use tax
             3289      on vehicles and vehicle-related products:
             3290          (A) the tax imposed by Subsection (2)(a)(i)(A);
             3291          (B) the tax imposed by Subsection (2)(b)(i);
             3292          (C) the tax imposed by Subsection (2)(c)(i); and
             3293          (D) the tax imposed by Subsection (2)(d)(i)(A)(I); plus
             3294          (ii) an amount equal to 30% of the growth in the amount of revenues collected in the
             3295      current fiscal year from the sales and use taxes described in Subsections (8)(a)(i)(A) through
             3296      (D) that exceeds the amount collected from the sales and use taxes described in Subsections
             3297      (8)(a)(i)(A) through (D) in the 2010-11 fiscal year.
             3298          (b) (i) Subject to Subsections (8)(b)(ii) and (iii), in any fiscal year that the portion of
             3299      the sales and use taxes deposited under Subsection (8)(a) represents an amount that is a total
             3300      lower percentage of the sales and use taxes described in Subsections (8)(a)(i)(A) through (D)
             3301      generated in the current fiscal year than the total percentage of sales and use taxes deposited in
             3302      the previous fiscal year, the Division of Finance shall deposit an amount under Subsection
             3303      (8)(a) equal to the product of:
             3304          (A) the total percentage of sales and use taxes deposited under Subsection (8)(a) in the
             3305      previous fiscal year; and
             3306          (B) the total sales and use tax revenue generated by the taxes described in Subsections
             3307      (8)(a)(i)(A) through (D) in the current fiscal year.
             3308          (ii) In any fiscal year in which the portion of the sales and use taxes deposited under
             3309      Subsection (8)(a) would exceed 17% of the revenues collected from the sales and use taxes
             3310      described in Subsections (8)(a)(i)(A) through (D) in the current fiscal year, the Division of
             3311      Finance shall deposit 17% of the revenues collected from the sales and use taxes described in
             3312      Subsections (8)(a)(i)(A) through (D) for the current fiscal year under Subsection (8)(a).
             3313          (iii) In all subsequent fiscal years after a year in which 17% of the revenues collected


             3314      from the sales and use taxes described in Subsections (8)(a)(i)(A) through (D) was deposited
             3315      under Subsection (8)(a), the Division of Finance shall annually deposit 17% of the revenues
             3316      collected from the sales and use taxes described in Subsections (8)(a)(i)(A) through (D) in the
             3317      current fiscal year under Subsection (8)(a).
             3318          (9) Notwithstanding Subsection (3)(a), and in addition to the amounts deposited under
             3319      Subsections (7) and (8), for a fiscal year beginning on or after July 1, 2012, the Division of
             3320      Finance shall annually deposit $90,000,000 of the revenues generated by the taxes listed under
             3321      Subsection (3)(a) into the Transportation Investment Fund of 2005 created by Section
             3322      72-2-124 .
             3323          (10) Notwithstanding Subsection (3)(a), for each fiscal year beginning with fiscal year
             3324      2009-10, $533,750 shall be deposited into the Qualified Emergency Food Agencies Fund
             3325      created by Section 35A-8-1009 and expended as provided in Section 35A-8-1009 .
             3326          (11) (a) Notwithstanding Subsection (3)(a), except as provided in Subsection (11)(b),
             3327      and in addition to any amounts deposited under Subsections (7), (8), and (9), beginning on July
             3328      1, 2012, the Division of Finance shall deposit into the Transportation Investment Fund of 2005
             3329      created by Section 72-2-124 the amount of tax revenue generated by a .025% tax rate on the
             3330      transactions described in Subsection (1).
             3331          (b) For purposes of Subsection (11)(a), the Division of Finance may not deposit into
             3332      the Transportation Investment Fund of 2005 any tax revenue generated by amounts paid or
             3333      charged for food and food ingredients, except for tax revenue generated by a bundled
             3334      transaction attributable to food and food ingredients and tangible personal property other than
             3335      food and food ingredients described in Subsection (2)(d).
             3336          (12) (a) Notwithstanding Subsection (3)(a), and except as provided in Subsection
             3337      (12)(b), beginning on January 1, 2009, the Division of Finance shall deposit into the
             3338      Transportation Fund created by Section 72-2-102 the amount of tax revenue generated by a
             3339      .025% tax rate on the transactions described in Subsection (1) to be expended to address
             3340      chokepoints in construction management.
             3341          (b) For purposes of Subsection (12)(a), the Division of Finance may not deposit into
             3342      the Transportation Fund any tax revenue generated by amounts paid or charged for food and
             3343      food ingredients, except for tax revenue generated by a bundled transaction attributable to food
             3344      and food ingredients and tangible personal property other than food and food ingredients


             3345      described in Subsection (2)(d).
             3346          (13) The Division of Finance shall annually deposit into the Water Resources
             3347      Conservation and Development Fund created in Section 73-10-24 an amount equal to the
             3348      amount of state sales and use tax revenues collected under this section on amounts paid or
             3349      charged under Subsection (1)(n).
             3350          Section 4. Section 59-12-103 (Effective 07/01/14) is amended to read:
             3351           59-12-103 (Effective 07/01/14). Sales and use tax base -- Rates -- Effective dates --
             3352      Use of sales and use tax revenues.
             3353          (1) A tax is imposed on the purchaser as provided in this part for amounts paid or
             3354      charged for the following transactions:
             3355          (a) retail sales of tangible personal property made within the state;
             3356          (b) amounts paid for:
             3357          (i) telecommunications service, other than mobile telecommunications service, that
             3358      originates and terminates within the boundaries of this state;
             3359          (ii) mobile telecommunications service that originates and terminates within the
             3360      boundaries of one state only to the extent permitted by the Mobile Telecommunications
             3361      Sourcing Act, 4 U.S.C. Sec. 116 et seq.; or
             3362          (iii) an ancillary service associated with a:
             3363          (A) telecommunications service described in Subsection (1)(b)(i); or
             3364          (B) mobile telecommunications service described in Subsection (1)(b)(ii);
             3365          (c) sales of the following for commercial use:
             3366          (i) gas;
             3367          (ii) electricity;
             3368          (iii) heat;
             3369          (iv) coal;
             3370          (v) fuel oil; or
             3371          (vi) other fuels;
             3372          (d) sales of the following for residential use:
             3373          (i) gas;
             3374          (ii) electricity;
             3375          (iii) heat;


             3376          (iv) coal;
             3377          (v) fuel oil; or
             3378          (vi) other fuels;
             3379          (e) sales of prepared food;
             3380          (f) except as provided in Section 59-12-104 , amounts paid or charged as admission or
             3381      user fees for theaters, movies, operas, museums, planetariums, shows of any type or nature,
             3382      exhibitions, concerts, carnivals, amusement parks, amusement rides, circuses, menageries,
             3383      fairs, races, contests, sporting events, dances, boxing matches, wrestling matches, closed circuit
             3384      television broadcasts, billiard parlors, pool parlors, bowling lanes, golf, miniature golf, golf
             3385      driving ranges, batting cages, skating rinks, ski lifts, ski runs, ski trails, snowmobile trails,
             3386      tennis courts, swimming pools, water slides, river runs, jeep tours, boat tours, scenic cruises,
             3387      horseback rides, sports activities, or any other amusement, entertainment, recreation,
             3388      exhibition, cultural, or athletic activity;
             3389          (g) amounts paid or charged for services for repairs or renovations of tangible personal
             3390      property, unless Section 59-12-104 provides for an exemption from sales and use tax for:
             3391          (i) the tangible personal property; and
             3392          (ii) parts used in the repairs or renovations of the tangible personal property described
             3393      in Subsection (1)(g)(i), whether or not any parts are actually used in the repairs or renovations
             3394      of that tangible personal property;
             3395          (h) except as provided in Subsection 59-12-104 (7), amounts paid or charged for
             3396      assisted cleaning or washing of tangible personal property;
             3397          (i) amounts paid or charged for tourist home, hotel, motel, or trailer court
             3398      accommodations and services that are regularly rented for less than 30 consecutive days;
             3399          (j) amounts paid or charged for laundry or dry cleaning services;
             3400          (k) amounts paid or charged for leases or rentals of tangible personal property if within
             3401      this state the tangible personal property is:
             3402          (i) stored;
             3403          (ii) used; or
             3404          (iii) otherwise consumed;
             3405          (l) amounts paid or charged for tangible personal property if within this state the
             3406      tangible personal property is:


             3407          (i) stored;
             3408          (ii) used; or
             3409          (iii) consumed; [and]
             3410          (m) amounts paid or charged for a sale:
             3411          (i) (A) of a product transferred electronically; or
             3412          (B) of a repair or renovation of a product transferred electronically; and
             3413          (ii) regardless of whether the sale provides:
             3414          (A) a right of permanent use of the product; or
             3415          (B) a right to use the product that is less than a permanent use, including a right:
             3416          (I) for a definite or specified length of time; and
             3417          (II) that terminates upon the occurrence of a condition[.]; and
             3418          (n) amounts paid or charged for the retail sale of potable delivered water.
             3419          (2) (a) Except as provided in Subsections (2)(b) through (e), a state tax and a local tax
             3420      is imposed on a transaction described in Subsection (1), including Subsection (1)(n), equal to
             3421      the sum of:
             3422          (i) a state tax imposed on the transaction at a tax rate equal to the sum of:
             3423          (A) 4.70%; and
             3424          (B) (I) the tax rate the state imposes in accordance with Part 18, Additional State Sales
             3425      and Use Tax Act, if the location of the transaction as determined under Sections 59-12-211
             3426      through 59-12-215 is in a county in which the state imposes the tax under Part 18, Additional
             3427      State Sales and Use Tax Act; and
             3428          (II) the tax rate the state imposes in accordance with Part 20, Supplemental State Sales
             3429      and Use Tax Act, if the location of the transaction as determined under Sections 59-12-211
             3430      through 59-12-215 is in a city, town, or the unincorporated area of a county in which the state
             3431      imposes the tax under Part 20, Supplemental State Sales and Use Tax Act; and
             3432          (ii) a local tax equal to the sum of the tax rates a county, city, or town imposes on the
             3433      transaction under this chapter other than this part.
             3434          (b) Except as provided in Subsection (2)(d) or (e), a state tax and a local tax is imposed
             3435      on a transaction described in Subsection (1)(d) equal to the sum of:
             3436          (i) a state tax imposed on the transaction at a tax rate of 2%; and
             3437          (ii) a local tax equal to the sum of the tax rates a county, city, or town imposes on the


             3438      transaction under this chapter other than this part.
             3439          (c) Except as provided in Subsection (2)(d) or (e), a state tax and a local tax is imposed
             3440      on amounts paid or charged for food and food ingredients equal to the sum of:
             3441          (i) a state tax imposed on the amounts paid or charged for food and food ingredients at
             3442      a tax rate of 1.75%; and
             3443          (ii) a local tax equal to the sum of the tax rates a county, city, or town imposes on the
             3444      amounts paid or charged for food and food ingredients under this chapter other than this part.
             3445          (d) (i) For a bundled transaction that is attributable to food and food ingredients and
             3446      tangible personal property other than food and food ingredients, a state tax and a local tax is
             3447      imposed on the entire bundled transaction equal to the sum of:
             3448          (A) a state tax imposed on the entire bundled transaction equal to the sum of:
             3449          (I) the tax rate described in Subsection (2)(a)(i)(A); and
             3450          (II) (Aa) the tax rate the state imposes in accordance with Part 18, Additional State
             3451      Sales and Use Tax Act, if the location of the transaction as determined under Sections
             3452      59-12-211 through 59-12-215 is in a county in which the state imposes the tax under Part 18,
             3453      Additional State Sales and Use Tax Act; and
             3454          (Bb) the tax rate the state imposes in accordance with Part 20, Supplemental State
             3455      Sales and Use Tax Act, if the location of the transaction as determined under Sections
             3456      59-12-211 through 59-12-215 is in a city, town, or the unincorporated area of a county in which
             3457      the state imposes the tax under Part 20, Supplemental State Sales and Use Tax Act; and
             3458          (B) a local tax imposed on the entire bundled transaction at the sum of the tax rates
             3459      described in Subsection (2)(a)(ii).
             3460          (ii) If an optional computer software maintenance contract is a bundled transaction that
             3461      consists of taxable and nontaxable products that are not separately itemized on an invoice or
             3462      similar billing document, the purchase of the optional computer software maintenance contract
             3463      is 40% taxable under this chapter and 60% nontaxable under this chapter.
             3464          (iii) Subject to Subsection (2)(d)(iv), for a bundled transaction other than a bundled
             3465      transaction described in Subsection (2)(d)(i) or (ii):
             3466          (A) if the sales price of the bundled transaction is attributable to tangible personal
             3467      property, a product, or a service that is subject to taxation under this chapter and tangible
             3468      personal property, a product, or service that is not subject to taxation under this chapter, the


             3469      entire bundled transaction is subject to taxation under this chapter unless:
             3470          (I) the seller is able to identify by reasonable and verifiable standards the tangible
             3471      personal property, product, or service that is not subject to taxation under this chapter from the
             3472      books and records the seller keeps in the seller's regular course of business; or
             3473          (II) state or federal law provides otherwise; or
             3474          (B) if the sales price of a bundled transaction is attributable to two or more items of
             3475      tangible personal property, products, or services that are subject to taxation under this chapter
             3476      at different rates, the entire bundled transaction is subject to taxation under this chapter at the
             3477      higher tax rate unless:
             3478          (I) the seller is able to identify by reasonable and verifiable standards the tangible
             3479      personal property, product, or service that is subject to taxation under this chapter at the lower
             3480      tax rate from the books and records the seller keeps in the seller's regular course of business; or
             3481          (II) state or federal law provides otherwise.
             3482          (iv) For purposes of Subsection (2)(d)(iii), books and records that a seller keeps in the
             3483      seller's regular course of business includes books and records the seller keeps in the regular
             3484      course of business for nontax purposes.
             3485          (e) (i) Except as otherwise provided in this chapter and subject to Subsections (2)(e)(ii)
             3486      and (iii), if a transaction consists of the sale, lease, or rental of tangible personal property, a
             3487      product, or a service that is subject to taxation under this chapter, and the sale, lease, or rental
             3488      of tangible personal property, other property, a product, or a service that is not subject to
             3489      taxation under this chapter, the entire transaction is subject to taxation under this chapter unless
             3490      the seller, at the time of the transaction:
             3491          (A) separately states the portion of the transaction that is not subject to taxation under
             3492      this chapter on an invoice, bill of sale, or similar document provided to the purchaser; or
             3493          (B) is able to identify by reasonable and verifiable standards, from the books and
             3494      records the seller keeps in the seller's regular course of business, the portion of the transaction
             3495      that is not subject to taxation under this chapter.
             3496          (ii) A purchaser and a seller may correct the taxability of a transaction if:
             3497          (A) after the transaction occurs, the purchaser and the seller discover that the portion of
             3498      the transaction that is not subject to taxation under this chapter was not separately stated on an
             3499      invoice, bill of sale, or similar document provided to the purchaser because of an error or


             3500      ignorance of the law; and
             3501          (B) the seller is able to identify by reasonable and verifiable standards, from the books
             3502      and records the seller keeps in the seller's regular course of business, the portion of the
             3503      transaction that is not subject to taxation under this chapter.
             3504          (iii) For purposes of Subsections (2)(e)(i) and (ii), books and records that a seller keeps
             3505      in the seller's regular course of business includes books and records the seller keeps in the
             3506      regular course of business for nontax purposes.
             3507          (f) (i) If the sales price of a transaction is attributable to two or more items of tangible
             3508      personal property, products, or services that are subject to taxation under this chapter at
             3509      different rates, the entire purchase is subject to taxation under this chapter at the higher tax rate
             3510      unless the seller, at the time of the transaction:
             3511          (A) separately states the items subject to taxation under this chapter at each of the
             3512      different rates on an invoice, bill of sale, or similar document provided to the purchaser; or
             3513          (B) is able to identify by reasonable and verifiable standards the tangible personal
             3514      property, product, or service that is subject to taxation under this chapter at the lower tax rate
             3515      from the books and records the seller keeps in the seller's regular course of business.
             3516          (ii) For purposes of Subsection (2)(f)(i), books and records that a seller keeps in the
             3517      seller's regular course of business includes books and records the seller keeps in the regular
             3518      course of business for nontax purposes.
             3519          (g) Subject to Subsections (2)(h) and (i), a tax rate repeal or tax rate change for a tax
             3520      rate imposed under the following shall take effect on the first day of a calendar quarter:
             3521          (i) Subsection (2)(a)(i)(A);
             3522          (ii) Subsection (2)(b)(i);
             3523          (iii) Subsection (2)(c)(i); or
             3524          (iv) Subsection (2)(d)(i)(A)(I).
             3525          (h) (i) A tax rate increase takes effect on the first day of the first billing period that
             3526      begins on or after the effective date of the tax rate increase if the billing period for the
             3527      transaction begins before the effective date of a tax rate increase imposed under:
             3528          (A) Subsection (2)(a)(i)(A);
             3529          (B) Subsection (2)(b)(i);
             3530          (C) Subsection (2)(c)(i); or


             3531          (D) Subsection (2)(d)(i)(A)(I).
             3532          (ii) The repeal of a tax or a tax rate decrease applies to a billing period if the billing
             3533      statement for the billing period is rendered on or after the effective date of the repeal of the tax
             3534      or the tax rate decrease imposed under:
             3535          (A) Subsection (2)(a)(i)(A);
             3536          (B) Subsection (2)(b)(i);
             3537          (C) Subsection (2)(c)(i); or
             3538          (D) Subsection (2)(d)(i)(A)(I).
             3539          (i) (i) For a tax rate described in Subsection (2)(i)(ii), if a tax due on a catalogue sale is
             3540      computed on the basis of sales and use tax rates published in the catalogue, a tax rate repeal or
             3541      change in a tax rate takes effect:
             3542          (A) on the first day of a calendar quarter; and
             3543          (B) beginning 60 days after the effective date of the tax rate repeal or tax rate change.
             3544          (ii) Subsection (2)(i)(i) applies to the tax rates described in the following:
             3545          (A) Subsection (2)(a)(i)(A);
             3546          (B) Subsection (2)(b)(i);
             3547          (C) Subsection (2)(c)(i); or
             3548          (D) Subsection (2)(d)(i)(A)(I).
             3549          (iii) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act,
             3550      the commission may by rule define the term "catalogue sale."
             3551          (3) (a) The following state taxes shall be deposited into the General Fund:
             3552          (i) the tax imposed by Subsection (2)(a)(i)(A);
             3553          (ii) the tax imposed by Subsection (2)(b)(i);
             3554          (iii) the tax imposed by Subsection (2)(c)(i); or
             3555          (iv) the tax imposed by Subsection (2)(d)(i)(A)(I).
             3556          (b) The following local taxes shall be distributed to a county, city, or town as provided
             3557      in this chapter:
             3558          (i) the tax imposed by Subsection (2)(a)(ii);
             3559          (ii) the tax imposed by Subsection (2)(b)(ii);
             3560          (iii) the tax imposed by Subsection (2)(c)(ii); and
             3561          (iv) the tax imposed by Subsection (2)(d)(i)(B).


             3562          (4) (a) Notwithstanding Subsection (3)(a), for a fiscal year beginning on or after July 1,
             3563      2003, the lesser of the following amounts shall be used as provided in Subsections (4)(b)
             3564      through (g):
             3565          (i) for taxes listed under Subsection (3)(a), the amount of tax revenue generated:
             3566          (A) by a 1/16% tax rate on the transactions described in Subsection (1); and
             3567          (B) for the fiscal year; or
             3568          (ii) $17,500,000.
             3569          (b) (i) For a fiscal year beginning on or after July 1, 2003, 14% of the amount
             3570      described in Subsection (4)(a) shall be transferred each year as dedicated credits to the
             3571      Department of Natural Resources to:
             3572          (A) implement the measures described in Subsections 79-2-303 (3)(a) through (d) to
             3573      protect sensitive plant and animal species; or
             3574          (B) award grants, up to the amount authorized by the Legislature in an appropriations
             3575      act, to political subdivisions of the state to implement the measures described in Subsections
             3576      79-2-303 (3)(a) through (d) to protect sensitive plant and animal species.
             3577          (ii) Money transferred to the Department of Natural Resources under Subsection
             3578      (4)(b)(i) may not be used to assist the United States Fish and Wildlife Service or any other
             3579      person to list or attempt to have listed a species as threatened or endangered under the
             3580      Endangered Species Act of 1973, 16 U.S.C. Sec. 1531 et seq.
             3581          (iii) At the end of each fiscal year:
             3582          (A) 50% of any unexpended dedicated credits shall lapse to the Water Resources
             3583      Conservation and Development Fund created in Section 73-10-24 ;
             3584          (B) 25% of any unexpended dedicated credits shall lapse to the Utah Wastewater Loan
             3585      Program Subaccount created in Section 73-10c-5 ; and
             3586          (C) 25% of any unexpended dedicated credits shall lapse to the Drinking Water Loan
             3587      Program Subaccount created in Section 73-10c-5 .
             3588          (c) For a fiscal year beginning on or after July 1, 2003, 3% of the amount described in
             3589      Subsection (4)(a) shall be deposited each year in the Agriculture Resource Development Fund
             3590      created in Section 4-18-6 .
             3591          (d) (i) For a fiscal year beginning on or after July 1, 2003, 1% of the amount described
             3592      in Subsection (4)(a) shall be transferred each year as dedicated credits to the Division of Water


             3593      Rights to cover the costs incurred in hiring legal and technical staff for the adjudication of
             3594      water rights.
             3595          (ii) At the end of each fiscal year:
             3596          (A) 50% of any unexpended dedicated credits shall lapse to the Water Resources
             3597      Conservation and Development Fund created in Section 73-10-24 ;
             3598          (B) 25% of any unexpended dedicated credits shall lapse to the Utah Wastewater Loan
             3599      Program Subaccount created in Section 73-10c-5 ; and
             3600          (C) 25% of any unexpended dedicated credits shall lapse to the Drinking Water Loan
             3601      Program Subaccount created in Section 73-10c-5 .
             3602          (e) (i) For a fiscal year beginning on or after July 1, 2003, 41% of the amount described
             3603      in Subsection (4)(a) shall be deposited in the Water Resources Conservation and Development
             3604      Fund created in Section 73-10-24 for use by the Division of Water Resources.
             3605          (ii) In addition to the uses allowed of the Water Resources Conservation and
             3606      Development Fund under Section 73-10-24 , the Water Resources Conservation and
             3607      Development Fund may also be used to:
             3608          (A) conduct hydrologic and geotechnical investigations by the Division of Water
             3609      Resources in a cooperative effort with other state, federal, or local entities, for the purpose of
             3610      quantifying surface and ground water resources and describing the hydrologic systems of an
             3611      area in sufficient detail so as to enable local and state resource managers to plan for and
             3612      accommodate growth in water use without jeopardizing the resource;
             3613          (B) fund state required dam safety improvements; and
             3614          (C) protect the state's interest in interstate water compact allocations, including the
             3615      hiring of technical and legal staff.
             3616          (f) For a fiscal year beginning on or after July 1, 2003, 20.5% of the amount described
             3617      in Subsection (4)(a) shall be deposited in the Utah Wastewater Loan Program Subaccount
             3618      created in Section 73-10c-5 for use by the Water Quality Board to fund wastewater projects.
             3619          (g) For a fiscal year beginning on or after July 1, 2003, 20.5% of the amount described
             3620      in Subsection (4)(a) shall be deposited in the Drinking Water Loan Program Subaccount
             3621      created in Section 73-10c-5 for use by the Division of Drinking Water to:
             3622          (i) provide for the installation and repair of collection, treatment, storage, and
             3623      distribution facilities for any public water system, as defined in Section 19-4-102 ;


             3624          (ii) develop underground sources of water, including springs and wells; and
             3625          (iii) develop surface water sources.
             3626          (5) (a) Notwithstanding Subsection (3)(a), for a fiscal year beginning on or after July 1,
             3627      2006, the difference between the following amounts shall be expended as provided in this
             3628      Subsection (5), if that difference is greater than $1:
             3629          (i) for taxes listed under Subsection (3)(a), the amount of tax revenue generated for the
             3630      fiscal year by a 1/16% tax rate on the transactions described in Subsection (1); and
             3631          (ii) $17,500,000.
             3632          (b) (i) The first $500,000 of the difference described in Subsection (5)(a) shall be:
             3633          (A) transferred each fiscal year to the Department of Natural Resources as dedicated
             3634      credits; and
             3635          (B) expended by the Department of Natural Resources for watershed rehabilitation or
             3636      restoration.
             3637          (ii) At the end of each fiscal year, 100% of any unexpended dedicated credits described
             3638      in Subsection (5)(b)(i) shall lapse to the Water Resources Conservation and Development Fund
             3639      created in Section 73-10-24 .
             3640          (c) (i) After making the transfer required by Subsection (5)(b)(i), $150,000 of the
             3641      remaining difference described in Subsection (5)(a) shall be:
             3642          (A) transferred each fiscal year to the Division of Water Resources as dedicated
             3643      credits; and
             3644          (B) expended by the Division of Water Resources for cloud-seeding projects
             3645      authorized by Title 73, Chapter 15, Modification of Weather.
             3646          (ii) At the end of each fiscal year, 100% of any unexpended dedicated credits described
             3647      in Subsection (5)(c)(i) shall lapse to the Water Resources Conservation and Development Fund
             3648      created in Section 73-10-24 .
             3649          (d) After making the transfers required by Subsections (5)(b) and (c), 94% of the
             3650      remaining difference described in Subsection (5)(a) shall be deposited into the Water
             3651      Resources Conservation and Development Fund created in Section 73-10-24 for use by the
             3652      Division of Water Resources for:
             3653          (i) preconstruction costs:
             3654          (A) as defined in Subsection 73-26-103 (6) for projects authorized by Title 73, Chapter


             3655      26, Bear River Development Act; and
             3656          (B) as defined in Subsection 73-28-103 (8) for the Lake Powell Pipeline project
             3657      authorized by Title 73, Chapter 28, Lake Powell Pipeline Development Act;
             3658          (ii) the cost of employing a civil engineer to oversee any project authorized by Title 73,
             3659      Chapter 26, Bear River Development Act;
             3660          (iii) the cost of employing a civil engineer to oversee the Lake Powell Pipeline project
             3661      authorized by Title 73, Chapter 28, Lake Powell Pipeline Development Act; and
             3662          (iv) other uses authorized under Sections 73-10-24 , 73-10-25.1 , 73-10-30 , and
             3663      Subsection (4)(e)(ii) after funding the uses specified in Subsections (5)(d)(i) through (iii).
             3664          (e) After making the transfers required by Subsections (5)(b) and (c) and subject to
             3665      Subsection (5)(f), 6% of the remaining difference described in Subsection (5)(a) shall be
             3666      transferred each year as dedicated credits to the Division of Water Rights to cover the costs
             3667      incurred for employing additional technical staff for the administration of water rights.
             3668          (f) At the end of each fiscal year, any unexpended dedicated credits described in
             3669      Subsection (5)(e) over $150,000 lapse to the Water Resources Conservation and Development
             3670      Fund created in Section 73-10-24 .
             3671          (6) Notwithstanding Subsection (3)(a), for a fiscal year beginning on or after July 1,
             3672      2003, and for taxes listed under Subsection (3)(a), the amount of revenue generated by a 1/16%
             3673      tax rate on the transactions described in Subsection (1) for the fiscal year shall be deposited in
             3674      the Transportation Fund created by Section 72-2-102 .
             3675          (7) Notwithstanding Subsection (3)(a), beginning on July 1, 2012, the Division of
             3676      Finance shall deposit into the Transportation Investment Fund of 2005 created in Section
             3677      72-2-124 a portion of the taxes listed under Subsection (3)(a) equal to the revenues generated
             3678      by a 1/64% tax rate on the taxable transactions under Subsection (1).
             3679          (8) (a) Notwithstanding Subsection (3)(a), in addition to the amounts deposited in
             3680      Subsection (7), and subject to Subsection (8)(b), for a fiscal year beginning on or after July 1,
             3681      2012, the Division of Finance shall deposit into the Transportation Investment Fund of 2005
             3682      created by Section 72-2-124 :
             3683          (i) a portion of the taxes listed under Subsection (3)(a) in an amount equal to 8.3% of
             3684      the revenues collected from the following taxes, which represents a portion of the
             3685      approximately 17% of sales and use tax revenues generated annually by the sales and use tax


             3686      on vehicles and vehicle-related products:
             3687          (A) the tax imposed by Subsection (2)(a)(i)(A);
             3688          (B) the tax imposed by Subsection (2)(b)(i);
             3689          (C) the tax imposed by Subsection (2)(c)(i); and
             3690          (D) the tax imposed by Subsection (2)(d)(i)(A)(I); plus
             3691          (ii) an amount equal to 30% of the growth in the amount of revenues collected in the
             3692      current fiscal year from the sales and use taxes described in Subsections (8)(a)(i)(A) through
             3693      (D) that exceeds the amount collected from the sales and use taxes described in Subsections
             3694      (8)(a)(i)(A) through (D) in the 2010-11 fiscal year.
             3695          (b) (i) Subject to Subsections (8)(b)(ii) and (iii), in any fiscal year that the portion of
             3696      the sales and use taxes deposited under Subsection (8)(a) represents an amount that is a total
             3697      lower percentage of the sales and use taxes described in Subsections (8)(a)(i)(A) through (D)
             3698      generated in the current fiscal year than the total percentage of sales and use taxes deposited in
             3699      the previous fiscal year, the Division of Finance shall deposit an amount under Subsection
             3700      (8)(a) equal to the product of:
             3701          (A) the total percentage of sales and use taxes deposited under Subsection (8)(a) in the
             3702      previous fiscal year; and
             3703          (B) the total sales and use tax revenue generated by the taxes described in Subsections
             3704      (8)(a)(i)(A) through (D) in the current fiscal year.
             3705          (ii) In any fiscal year in which the portion of the sales and use taxes deposited under
             3706      Subsection (8)(a) would exceed 17% of the revenues collected from the sales and use taxes
             3707      described in Subsections (8)(a)(i)(A) through (D) in the current fiscal year, the Division of
             3708      Finance shall deposit 17% of the revenues collected from the sales and use taxes described in
             3709      Subsections (8)(a)(i)(A) through (D) for the current fiscal year under Subsection (8)(a).
             3710          (iii) In all subsequent fiscal years after a year in which 17% of the revenues collected
             3711      from the sales and use taxes described in Subsections (8)(a)(i)(A) through (D) was deposited
             3712      under Subsection (8)(a), the Division of Finance shall annually deposit 17% of the revenues
             3713      collected from the sales and use taxes described in Subsections (8)(a)(i)(A) through (D) in the
             3714      current fiscal year under Subsection (8)(a).
             3715          (9) Notwithstanding Subsection (3)(a), and in addition to the amounts deposited under
             3716      Subsections (7) and (8), for a fiscal year beginning on or after July 1, 2012, the Division of


             3717      Finance shall annually deposit $90,000,000 of the revenues generated by the taxes listed under
             3718      Subsection (3)(a) into the Transportation Investment Fund of 2005 created by Section
             3719      72-2-124 .
             3720          (10) Notwithstanding Subsection (3)(a), for each fiscal year beginning with fiscal year
             3721      2009-10, $533,750 shall be deposited into the Qualified Emergency Food Agencies Fund
             3722      created by Section 35A-8-1009 and expended as provided in Section 35A-8-1009 .
             3723          (11) (a) Notwithstanding Subsection (3)(a), except as provided in Subsection (11)(b),
             3724      and in addition to any amounts deposited under Subsections (7), (8), and (9), beginning on July
             3725      1, 2012, the Division of Finance shall deposit into the Transportation Investment Fund of 2005
             3726      created by Section 72-2-124 the amount of tax revenue generated by a .025% tax rate on the
             3727      transactions described in Subsection (1).
             3728          (b) For purposes of Subsection (11)(a), the Division of Finance may not deposit into
             3729      the Transportation Investment Fund of 2005 any tax revenue generated by amounts paid or
             3730      charged for food and food ingredients, except for tax revenue generated by a bundled
             3731      transaction attributable to food and food ingredients and tangible personal property other than
             3732      food and food ingredients described in Subsection (2)(d).
             3733          (12) (a) Notwithstanding Subsection (3)(a), and except as provided in Subsection
             3734      (12)(b), beginning on January 1, 2009, the Division of Finance shall deposit into the
             3735      Transportation Fund created by Section 72-2-102 the amount of tax revenue generated by a
             3736      .025% tax rate on the transactions described in Subsection (1) to be expended to address
             3737      chokepoints in construction management.
             3738          (b) For purposes of Subsection (12)(a), the Division of Finance may not deposit into
             3739      the Transportation Fund any tax revenue generated by amounts paid or charged for food and
             3740      food ingredients, except for tax revenue generated by a bundled transaction attributable to food
             3741      and food ingredients and tangible personal property other than food and food ingredients
             3742      described in Subsection (2)(d).
             3743          (13) The Division of Finance shall annually deposit into the Water Resources
             3744      Conservation and Development Fund created in Section 73-10-24 an amount equal to the
             3745      amount of state sales and use tax revenues collected under this section on amounts paid or
             3746      charged under Subsection (1)(n).
             3747          Section 5. Section 59-12-104 is amended to read:


             3748           59-12-104. Exemptions.
             3749          The following sales and uses are exempt from the taxes imposed by this chapter:
             3750          (1) sales of aviation fuel, motor fuel, and special fuel subject to a Utah state excise tax
             3751      under Chapter 13, Motor and Special Fuel Tax Act;
             3752          (2) subject to Section 59-12-104.6 , sales to the state, its institutions, and its political
             3753      subdivisions; however, this exemption does not apply to sales of:
             3754          (a) construction materials except:
             3755          (i) construction materials purchased by or on behalf of institutions of the public
             3756      education system as defined in Utah Constitution Article X, Section 2, provided the
             3757      construction materials are clearly identified and segregated and installed or converted to real
             3758      property which is owned by institutions of the public education system; and
             3759          (ii) construction materials purchased by the state, its institutions, or its political
             3760      subdivisions which are installed or converted to real property by employees of the state, its
             3761      institutions, or its political subdivisions; or
             3762          (b) tangible personal property in connection with the construction, operation,
             3763      maintenance, repair, or replacement of a project, as defined in Section 11-13-103 , or facilities
             3764      providing additional project capacity, as defined in Section 11-13-103 ;
             3765          (3) (a) sales of an item described in Subsection (3)(b) from a vending machine if:
             3766          (i) the proceeds of each sale do not exceed $1; and
             3767          (ii) the seller or operator of the vending machine reports an amount equal to 150% of
             3768      the cost of the item described in Subsection (3)(b) as goods consumed; and
             3769          (b) Subsection (3)(a) applies to:
             3770          (i) food and food ingredients; or
             3771          (ii) prepared food;
             3772          (4) (a) sales of the following to a commercial airline carrier for in-flight consumption:
             3773          (i) alcoholic beverages;
             3774          (ii) food and food ingredients; or
             3775          (iii) prepared food;
             3776          (b) sales of tangible personal property or a product transferred electronically:
             3777          (i) to a passenger;
             3778          (ii) by a commercial airline carrier; and


             3779          (iii) during a flight for in-flight consumption or in-flight use by the passenger; or
             3780          (c) services related to Subsection (4)(a) or (b);
             3781          (5) (a) (i) beginning on July 1, 2008, and ending on September 30, 2008, sales of parts
             3782      and equipment:
             3783          (A) (I) by an establishment described in NAICS Code 336411 or 336412 of the 2002
             3784      North American Industry Classification System of the federal Executive Office of the
             3785      President, Office of Management and Budget; and
             3786          (II) for:
             3787          (Aa) installation in an aircraft, including services relating to the installation of parts or
             3788      equipment in the aircraft;
             3789          (Bb) renovation of an aircraft; or
             3790          (Cc) repair of an aircraft; or
             3791          (B) for installation in an aircraft operated by a common carrier in interstate or foreign
             3792      commerce; or
             3793          (ii) beginning on October 1, 2008, sales of parts and equipment for installation in an
             3794      aircraft operated by a common carrier in interstate or foreign commerce; and
             3795          (b) notwithstanding the time period of Subsection 59-1-1410 (8) for filing for a refund,
             3796      a person may claim the exemption allowed by Subsection (5)(a)(i)(B) for a sale by filing for a
             3797      refund:
             3798          (i) if the sale is made on or after July 1, 2008, but on or before September 30, 2008;
             3799          (ii) as if Subsection (5)(a)(i)(B) were in effect on the day on which the sale is made;
             3800          (iii) if the person did not claim the exemption allowed by Subsection (5)(a)(i)(B) for
             3801      the sale prior to filing for the refund;
             3802          (iv) for sales and use taxes paid under this chapter on the sale;
             3803          (v) in accordance with Section 59-1-1410 ; and
             3804          (vi) subject to any extension allowed for filing for a refund under Section 59-1-1410 , if
             3805      the person files for the refund on or before September 30, 2011;
             3806          (6) sales of commercials, motion picture films, prerecorded audio program tapes or
             3807      records, and prerecorded video tapes by a producer, distributor, or studio to a motion picture
             3808      exhibitor, distributor, or commercial television or radio broadcaster;
             3809          (7) (a) subject to Subsection (7)(b), sales of cleaning or washing of tangible personal


             3810      property if the cleaning or washing of the tangible personal property is not assisted cleaning or
             3811      washing of tangible personal property;
             3812          (b) if a seller that sells at the same business location assisted cleaning or washing of
             3813      tangible personal property and cleaning or washing of tangible personal property that is not
             3814      assisted cleaning or washing of tangible personal property, the exemption described in
             3815      Subsection (7)(a) applies if the seller separately accounts for the sales of the assisted cleaning
             3816      or washing of the tangible personal property; and
             3817          (c) for purposes of Subsection (7)(b) and in accordance with Title 63G, Chapter 3,
             3818      Utah Administrative Rulemaking Act, the commission may make rules:
             3819          (i) governing the circumstances under which sales are at the same business location;
             3820      and
             3821          (ii) establishing the procedures and requirements for a seller to separately account for
             3822      sales of assisted cleaning or washing of tangible personal property;
             3823          (8) sales made to or by religious or charitable institutions in the conduct of their regular
             3824      religious or charitable functions and activities, if the requirements of Section 59-12-104.1 are
             3825      fulfilled;
             3826          (9) sales of a vehicle of a type required to be registered under the motor vehicle laws of
             3827      this state if the vehicle is:
             3828          (a) not registered in this state; and
             3829          (b) (i) not used in this state; or
             3830          (ii) used in this state:
             3831          (A) if the vehicle is not used to conduct business, for a time period that does not
             3832      exceed the longer of:
             3833          (I) 30 days in any calendar year; or
             3834          (II) the time period necessary to transport the vehicle to the borders of this state; or
             3835          (B) if the vehicle is used to conduct business, for the time period necessary to transport
             3836      the vehicle to the borders of this state;
             3837          (10) (a) amounts paid for an item described in Subsection (10)(b) if:
             3838          (i) the item is intended for human use; and
             3839          (ii) (A) a prescription was issued for the item; or
             3840          (B) the item was purchased by a hospital or other medical facility; and


             3841          (b) (i) Subsection (10)(a) applies to:
             3842          (A) a drug;
             3843          (B) a syringe; or
             3844          (C) a stoma supply; and
             3845          (ii) in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             3846      commission may by rule define the terms:
             3847          (A) "syringe"; or
             3848          (B) "stoma supply";
             3849          (11) sales or use of property, materials, or services used in the construction of or
             3850      incorporated in pollution control facilities allowed by Sections 19-2-123 through 19-2-127 ;
             3851          (12) (a) sales of an item described in Subsection (12)(c) served by:
             3852          (i) the following if the item described in Subsection (12)(c) is not available to the
             3853      general public:
             3854          (A) a church; or
             3855          (B) a charitable institution;
             3856          (ii) an institution of higher education if:
             3857          (A) the item described in Subsection (12)(c) is not available to the general public; or
             3858          (B) the item described in Subsection (12)(c) is prepaid as part of a student meal plan
             3859      offered by the institution of higher education; or
             3860          (b) sales of an item described in Subsection (12)(c) provided for a patient by:
             3861          (i) a medical facility; or
             3862          (ii) a nursing facility; and
             3863          (c) Subsections (12)(a) and (b) apply to:
             3864          (i) food and food ingredients;
             3865          (ii) prepared food; or
             3866          (iii) alcoholic beverages;
             3867          (13) (a) except as provided in Subsection (13)(b), the sale of tangible personal property
             3868      or a product transferred electronically by a person:
             3869          (i) regardless of the number of transactions involving the sale of that tangible personal
             3870      property or product transferred electronically by that person; and
             3871          (ii) not regularly engaged in the business of selling that type of tangible personal


             3872      property or product transferred electronically;
             3873          (b) this Subsection (13) does not apply if:
             3874          (i) the sale is one of a series of sales of a character to indicate that the person is
             3875      regularly engaged in the business of selling that type of tangible personal property or product
             3876      transferred electronically;
             3877          (ii) the person holds that person out as regularly engaged in the business of selling that
             3878      type of tangible personal property or product transferred electronically;
             3879          (iii) the person sells an item of tangible personal property or product transferred
             3880      electronically that the person purchased as a sale that is exempt under Subsection (25); or
             3881          (iv) the sale is of a vehicle or vessel required to be titled or registered under the laws of
             3882      this state in which case the tax is based upon:
             3883          (A) the bill of sale or other written evidence of value of the vehicle or vessel being
             3884      sold; or
             3885          (B) in the absence of a bill of sale or other written evidence of value, the fair market
             3886      value of the vehicle or vessel being sold at the time of the sale as determined by the
             3887      commission; and
             3888          (c) in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             3889      commission shall make rules establishing the circumstances under which:
             3890          (i) a person is regularly engaged in the business of selling a type of tangible personal
             3891      property or product transferred electronically;
             3892          (ii) a sale of tangible personal property or a product transferred electronically is one of
             3893      a series of sales of a character to indicate that a person is regularly engaged in the business of
             3894      selling that type of tangible personal property or product transferred electronically; or
             3895          (iii) a person holds that person out as regularly engaged in the business of selling a type
             3896      of tangible personal property or product transferred electronically;
             3897          (14) (a) except as provided in Subsection (14)(b), amounts paid or charged on or after
             3898      July 1, 2006, for a purchase or lease by a manufacturing facility except for a cogeneration
             3899      facility, of the following:
             3900          (i) machinery and equipment that:
             3901          (A) are used:
             3902          (I) for a manufacturing facility except for a manufacturing facility that is a scrap


             3903      recycler described in Subsection 59-12-102 (60)(b):
             3904          (Aa) in the manufacturing process;
             3905          (Bb) to manufacture an item sold as tangible personal property; and
             3906          (Cc) beginning on July 1, 2009, in a manufacturing facility described in this Subsection
             3907      (14)(a)(i)(A)(I) in the state; or
             3908          (II) for a manufacturing facility that is a scrap recycler described in Subsection
             3909      59-12-102 (60)(b):
             3910          (Aa) to process an item sold as tangible personal property; and
             3911          (Bb) beginning on July 1, 2009, in a manufacturing facility described in this Subsection
             3912      (14)(a)(i)(A)(II) in the state; and
             3913          (B) have an economic life of three or more years; and
             3914          (ii) normal operating repair or replacement parts that:
             3915          (A) have an economic life of three or more years; and
             3916          (B) are used:
             3917          (I) for a manufacturing facility except for a manufacturing facility that is a scrap
             3918      recycler described in Subsection 59-12-102 (60)(b):
             3919          (Aa) in the manufacturing process; and
             3920          (Bb) in a manufacturing facility described in this Subsection (14)(a)(ii)(B)(I) in the
             3921      state; or
             3922          (II) for a manufacturing facility that is a scrap recycler described in Subsection
             3923      59-12-102 (60)(b):
             3924          (Aa) to process an item sold as tangible personal property; and
             3925          (Bb) in a manufacturing facility described in this Subsection (14)(a)(ii)(B)(II) in the
             3926      state;
             3927          (b) amounts paid or charged on or after July 1, 2005, for a purchase or lease by a
             3928      manufacturing facility that is a cogeneration facility placed in service on or after May 1, 2006,
             3929      of the following:
             3930          (i) machinery and equipment that:
             3931          (A) are used:
             3932          (I) in the manufacturing process;
             3933          (II) to manufacture an item sold as tangible personal property; and


             3934          (III) beginning on July 1, 2009, in a manufacturing facility described in this Subsection
             3935      (14)(b) in the state; and
             3936          (B) have an economic life of three or more years; and
             3937          (ii) normal operating repair or replacement parts that:
             3938          (A) are used:
             3939          (I) in the manufacturing process; and
             3940          (II) in a manufacturing facility described in this Subsection (14)(b) in the state; and
             3941          (B) have an economic life of three or more years;
             3942          (c) amounts paid or charged for a purchase or lease made on or after January 1, 2008,
             3943      by an establishment described in NAICS Subsector 212, Mining (except Oil and Gas), or
             3944      NAICS Code 213113, Support Activities for Coal Mining, 213114, Support Activities for
             3945      Metal Mining, or 213115, Support Activities for Nonmetallic Minerals (except Fuels) Mining,
             3946      of the 2002 North American Industry Classification System of the federal Executive Office of
             3947      the President, Office of Management and Budget, of the following:
             3948          (i) machinery and equipment that:
             3949          (A) are used:
             3950          (I) (Aa) in the production process, other than the production of real property; or
             3951          (Bb) in research and development; and
             3952          (II) beginning on July 1, 2009, in an establishment described in this Subsection (14)(c)
             3953      in the state; and
             3954          (B) have an economic life of three or more years; and
             3955          (ii) normal operating repair or replacement parts that:
             3956          (A) have an economic life of three or more years; and
             3957          (B) are used in:
             3958          (I) (Aa) the production process, except for the production of real property; and
             3959          (Bb) an establishment described in this Subsection (14)(c) in the state; or
             3960          (II) (Aa) research and development; and
             3961          (Bb) in an establishment described in this Subsection (14)(c) in the state;
             3962          (d) (i) amounts paid or charged for a purchase or lease made on or after July 1, 2010,
             3963      but on or before June 30, 2014, by an establishment described in NAICS Code 518112, Web
             3964      Search Portals, of the 2002 North American Industry Classification System of the federal


             3965      Executive Office of the President, Office of Management and Budget, of the following:
             3966          (A) machinery and equipment that:
             3967          (I) are used in the operation of the web search portal;
             3968          (II) have an economic life of three or more years; and
             3969          (III) are used in a new or expanding establishment described in this Subsection (14)(d)
             3970      in the state; and
             3971          (B) normal operating repair or replacement parts that:
             3972          (I) are used in the operation of the web search portal;
             3973          (II) have an economic life of three or more years; and
             3974          (III) are used in a new or expanding establishment described in this Subsection (14)(d)
             3975      in the state; or
             3976          (ii) amounts paid or charged for a purchase or lease made on or after July 1, 2014, by
             3977      an establishment described in NAICS Code 518112, Web Search Portals, of the 2002 North
             3978      American Industry Classification System of the federal Executive Office of the President,
             3979      Office of Management and Budget, of the following:
             3980          (A) machinery and equipment that:
             3981          (I) are used in the operation of the web search portal; and
             3982          (II) have an economic life of three or more years; and
             3983          (B) normal operating repair or replacement parts that:
             3984          (I) are used in the operation of the web search portal; and
             3985          (II) have an economic life of three or more years;
             3986          (e) for purposes of this Subsection (14) and in accordance with Title 63G, Chapter 3,
             3987      Utah Administrative Rulemaking Act, the commission:
             3988          (i) shall by rule define the term "establishment"; and
             3989          (ii) may by rule define what constitutes:
             3990          (A) processing an item sold as tangible personal property;
             3991          (B) the production process, except for the production of real property;
             3992          (C) research and development; or
             3993          (D) a new or expanding establishment described in Subsection (14)(d) in the state; and
             3994          (f) on or before October 1, 2011, and every five years after October 1, 2011, the
             3995      commission shall:


             3996          (i) review the exemptions described in this Subsection (14) and make
             3997      recommendations to the Revenue and Taxation Interim Committee concerning whether the
             3998      exemptions should be continued, modified, or repealed; and
             3999          (ii) include in its report:
             4000          (A) an estimate of the cost of the exemptions;
             4001          (B) the purpose and effectiveness of the exemptions; and
             4002          (C) the benefits of the exemptions to the state;
             4003          (15) (a) sales of the following if the requirements of Subsection (15)(b) are met:
             4004          (i) tooling;
             4005          (ii) special tooling;
             4006          (iii) support equipment;
             4007          (iv) special test equipment; or
             4008          (v) parts used in the repairs or renovations of tooling or equipment described in
             4009      Subsections (15)(a)(i) through (iv); and
             4010          (b) sales of tooling, equipment, or parts described in Subsection (15)(a) are exempt if:
             4011          (i) the tooling, equipment, or parts are used or consumed exclusively in the
             4012      performance of any aerospace or electronics industry contract with the United States
             4013      government or any subcontract under that contract; and
             4014          (ii) under the terms of the contract or subcontract described in Subsection (15)(b)(i),
             4015      title to the tooling, equipment, or parts is vested in the United States government as evidenced
             4016      by:
             4017          (A) a government identification tag placed on the tooling, equipment, or parts; or
             4018          (B) listing on a government-approved property record if placing a government
             4019      identification tag on the tooling, equipment, or parts is impractical;
             4020          (16) sales of newspapers or newspaper subscriptions;
             4021          (17) (a) except as provided in Subsection (17)(b), tangible personal property or a
             4022      product transferred electronically traded in as full or part payment of the purchase price, except
             4023      that for purposes of calculating sales or use tax upon vehicles not sold by a vehicle dealer,
             4024      trade-ins are limited to other vehicles only, and the tax is based upon:
             4025          (i) the bill of sale or other written evidence of value of the vehicle being sold and the
             4026      vehicle being traded in; or


             4027          (ii) in the absence of a bill of sale or other written evidence of value, the then existing
             4028      fair market value of the vehicle being sold and the vehicle being traded in, as determined by the
             4029      commission; and
             4030          (b) notwithstanding Subsection (17)(a), Subsection (17)(a) does not apply to the
             4031      following items of tangible personal property or products transferred electronically traded in as
             4032      full or part payment of the purchase price:
             4033          (i) money;
             4034          (ii) electricity;
             4035          (iii) water;
             4036          (iv) gas; or
             4037          (v) steam;
             4038          (18) (a) (i) except as provided in Subsection (18)(b), sales of tangible personal property
             4039      or a product transferred electronically used or consumed primarily and directly in farming
             4040      operations, regardless of whether the tangible personal property or product transferred
             4041      electronically:
             4042          (A) becomes part of real estate; or
             4043          (B) is installed by a:
             4044          (I) farmer;
             4045          (II) contractor; or
             4046          (III) subcontractor; or
             4047          (ii) sales of parts used in the repairs or renovations of tangible personal property or a
             4048      product transferred electronically if the tangible personal property or product transferred
             4049      electronically is exempt under Subsection (18)(a)(i); and
             4050          (b) notwithstanding Subsection (18)(a), amounts paid or charged for the following are
             4051      subject to the taxes imposed by this chapter:
             4052          (i) (A) subject to Subsection (18)(b)(i)(B), the following if used in a manner that is
             4053      incidental to farming:
             4054          (I) machinery;
             4055          (II) equipment;
             4056          (III) materials; or
             4057          (IV) supplies; and


             4058          (B) tangible personal property that is considered to be used in a manner that is
             4059      incidental to farming includes:
             4060          (I) hand tools; or
             4061          (II) maintenance and janitorial equipment and supplies;
             4062          (ii) (A) subject to Subsection (18)(b)(ii)(B), tangible personal property or a product
             4063      transferred electronically if the tangible personal property or product transferred electronically
             4064      is used in an activity other than farming; and
             4065          (B) tangible personal property or a product transferred electronically that is considered
             4066      to be used in an activity other than farming includes:
             4067          (I) office equipment and supplies; or
             4068          (II) equipment and supplies used in:
             4069          (Aa) the sale or distribution of farm products;
             4070          (Bb) research; or
             4071          (Cc) transportation; or
             4072          (iii) a vehicle required to be registered by the laws of this state during the period
             4073      ending two years after the date of the vehicle's purchase;
             4074          (19) sales of hay;
             4075          (20) exclusive sale during the harvest season of seasonal crops, seedling plants, or
             4076      garden, farm, or other agricultural produce if the seasonal crops are, seedling plants are, or
             4077      garden, farm, or other agricultural produce is sold by:
             4078          (a) the producer of the seasonal crops, seedling plants, or garden, farm, or other
             4079      agricultural produce;
             4080          (b) an employee of the producer described in Subsection (20)(a); or
             4081          (c) a member of the immediate family of the producer described in Subsection (20)(a);
             4082          (21) purchases made using a coupon as defined in 7 U.S.C. Sec. 2012 that is issued
             4083      under the Food Stamp Program, 7 U.S.C. Sec. 2011 et seq.;
             4084          (22) sales of nonreturnable containers, nonreturnable labels, nonreturnable bags,
             4085      nonreturnable shipping cases, and nonreturnable casings to a manufacturer, processor,
             4086      wholesaler, or retailer for use in packaging tangible personal property to be sold by that
             4087      manufacturer, processor, wholesaler, or retailer;
             4088          (23) a product stored in the state for resale;


             4089          (24) (a) purchases of a product if:
             4090          (i) the product is:
             4091          (A) purchased outside of this state;
             4092          (B) brought into this state:
             4093          (I) at any time after the purchase described in Subsection (24)(a)(i)(A); and
             4094          (II) by a nonresident person who is not living or working in this state at the time of the
             4095      purchase;
             4096          (C) used for the personal use or enjoyment of the nonresident person described in
             4097      Subsection (24)(a)(i)(B)(II) while that nonresident person is within the state; and
             4098          (D) not used in conducting business in this state; and
             4099          (ii) for:
             4100          (A) a product other than a boat described in Subsection (24)(a)(ii)(B), the first use of
             4101      the product for a purpose for which the product is designed occurs outside of this state;
             4102          (B) a boat, the boat is registered outside of this state; or
             4103          (C) a vehicle other than a vehicle sold to an authorized carrier, the vehicle is registered
             4104      outside of this state;
             4105          (b) the exemption provided for in Subsection (24)(a) does not apply to:
             4106          (i) a lease or rental of a product; or
             4107          (ii) a sale of a vehicle exempt under Subsection (33); and
             4108          (c) in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, for
             4109      purposes of Subsection (24)(a), the commission may by rule define what constitutes the
             4110      following:
             4111          (i) conducting business in this state if that phrase has the same meaning in this
             4112      Subsection (24) as in Subsection (63);
             4113          (ii) the first use of a product if that phrase has the same meaning in this Subsection (24)
             4114      as in Subsection (63); or
             4115          (iii) a purpose for which a product is designed if that phrase has the same meaning in
             4116      this Subsection (24) as in Subsection (63);
             4117          (25) a product purchased for resale in this state, in the regular course of business, either
             4118      in its original form or as an ingredient or component part of a manufactured or compounded
             4119      product;


             4120          (26) a product upon which a sales or use tax was paid to some other state, or one of its
             4121      subdivisions, except that the state shall be paid any difference between the tax paid and the tax
             4122      imposed by this part and Part 2, Local Sales and Use Tax Act, and no adjustment is allowed if
             4123      the tax paid was greater than the tax imposed by this part and Part 2, Local Sales and Use Tax
             4124      Act;
             4125          (27) any sale of a service described in Subsections 59-12-103 (1)(b), (c), and (d) to a
             4126      person for use in compounding a service taxable under the subsections;
             4127          (28) purchases made in accordance with the special supplemental nutrition program for
             4128      women, infants, and children established in 42 U.S.C. Sec. 1786;
             4129          (29) beginning on July 1, 1999, through June 30, 2014, sales or leases of rolls, rollers,
             4130      refractory brick, electric motors, or other replacement parts used in the furnaces, mills, or ovens
             4131      of a steel mill described in SIC Code 3312 of the 1987 Standard Industrial Classification
             4132      Manual of the federal Executive Office of the President, Office of Management and Budget;
             4133          (30) sales of a boat of a type required to be registered under Title 73, Chapter 18, State
             4134      Boating Act, a boat trailer, or an outboard motor if the boat, boat trailer, or outboard motor is:
             4135          (a) not registered in this state; and
             4136          (b) (i) not used in this state; or
             4137          (ii) used in this state:
             4138          (A) if the boat, boat trailer, or outboard motor is not used to conduct business, for a
             4139      time period that does not exceed the longer of:
             4140          (I) 30 days in any calendar year; or
             4141          (II) the time period necessary to transport the boat, boat trailer, or outboard motor to
             4142      the borders of this state; or
             4143          (B) if the boat, boat trailer, or outboard motor is used to conduct business, for the time
             4144      period necessary to transport the boat, boat trailer, or outboard motor to the borders of this
             4145      state;
             4146          (31) sales of aircraft manufactured in Utah;
             4147          (32) amounts paid for the purchase of telecommunications service for purposes of
             4148      providing telecommunications service;
             4149          (33) sales, leases, or uses of the following:
             4150          (a) a vehicle by an authorized carrier; or


             4151          (b) tangible personal property that is installed on a vehicle:
             4152          (i) sold or leased to or used by an authorized carrier; and
             4153          (ii) before the vehicle is placed in service for the first time;
             4154          (34) (a) 45% of the sales price of any new manufactured home; and
             4155          (b) 100% of the sales price of any used manufactured home;
             4156          (35) sales relating to schools and fundraising sales;
             4157          (36) sales or rentals of durable medical equipment if:
             4158          (a) a person presents a prescription for the durable medical equipment; and
             4159          (b) the durable medical equipment is used for home use only;
             4160          (37) (a) sales to a ski resort of electricity to operate a passenger ropeway as defined in
             4161      Section 72-11-102 ; and
             4162          (b) the commission shall by rule determine the method for calculating sales exempt
             4163      under Subsection (37)(a) that are not separately metered and accounted for in utility billings;
             4164          (38) sales to a ski resort of:
             4165          (a) snowmaking equipment;
             4166          (b) ski slope grooming equipment;
             4167          (c) passenger ropeways as defined in Section 72-11-102 ; or
             4168          (d) parts used in the repairs or renovations of equipment or passenger ropeways
             4169      described in Subsections (38)(a) through (c);
             4170          (39) sales of natural gas, electricity, heat, coal, fuel oil, or other fuels for industrial use;
             4171          (40) (a) subject to Subsection (40)(b), sales or rentals of the right to use or operate for
             4172      amusement, entertainment, or recreation an unassisted amusement device as defined in Section
             4173      59-12-102 ;
             4174          (b) if a seller that sells or rents at the same business location the right to use or operate
             4175      for amusement, entertainment, or recreation one or more unassisted amusement devices and
             4176      one or more assisted amusement devices, the exemption described in Subsection (40)(a)
             4177      applies if the seller separately accounts for the sales or rentals of the right to use or operate for
             4178      amusement, entertainment, or recreation for the assisted amusement devices; and
             4179          (c) for purposes of Subsection (40)(b) and in accordance with Title 63G, Chapter 3,
             4180      Utah Administrative Rulemaking Act, the commission may make rules:
             4181          (i) governing the circumstances under which sales are at the same business location;


             4182      and
             4183          (ii) establishing the procedures and requirements for a seller to separately account for
             4184      the sales or rentals of the right to use or operate for amusement, entertainment, or recreation for
             4185      assisted amusement devices;
             4186          (41) (a) sales of photocopies by:
             4187          (i) a governmental entity; or
             4188          (ii) an entity within the state system of public education, including:
             4189          (A) a school; or
             4190          (B) the State Board of Education; or
             4191          (b) sales of publications by a governmental entity;
             4192          (42) amounts paid for admission to an athletic event at an institution of higher
             4193      education that is subject to the provisions of Title IX of the Education Amendments of 1972,
             4194      20 U.S.C. Sec. 1681 et seq.;
             4195          (43) (a) sales made to or by:
             4196          (i) an area agency on aging; or
             4197          (ii) a senior citizen center owned by a county, city, or town; or
             4198          (b) sales made by a senior citizen center that contracts with an area agency on aging;
             4199          (44) sales or leases of semiconductor fabricating, processing, research, or development
             4200      materials regardless of whether the semiconductor fabricating, processing, research, or
             4201      development materials:
             4202          (a) actually come into contact with a semiconductor; or
             4203          (b) ultimately become incorporated into real property;
             4204          (45) an amount paid by or charged to a purchaser for accommodations and services
             4205      described in Subsection 59-12-103 (1)(i) to the extent the amount is exempt under Section
             4206      59-12-104.2 ;
             4207          (46) beginning on September 1, 2001, the lease or use of a vehicle issued a temporary
             4208      sports event registration certificate in accordance with Section 41-3-306 for the event period
             4209      specified on the temporary sports event registration certificate;
             4210          (47) (a) sales or uses of electricity, if the sales or uses are made under a tariff adopted
             4211      by the Public Service Commission of Utah only for purchase of electricity produced from a
             4212      new alternative energy source, as designated in the tariff by the Public Service Commission of


             4213      Utah; and
             4214          (b) the exemption under Subsection (47)(a) applies to the portion of the tariff rate a
             4215      customer pays under the tariff described in Subsection (47)(a) that exceeds the tariff rate under
             4216      the tariff described in Subsection (47)(a) that the customer would have paid absent the tariff;
             4217          (48) sales or rentals of mobility enhancing equipment if a person presents a
             4218      prescription for the mobility enhancing equipment;
             4219          (49) sales of water, except for potable delivered water sold at retail, in a:
             4220          (a) pipe;
             4221          (b) conduit;
             4222          (c) ditch; or
             4223          (d) reservoir;
             4224          (50) sales of currency or coins that constitute legal tender of a state, the United States,
             4225      or a foreign nation;
             4226          (51) (a) sales of an item described in Subsection (51)(b) if the item:
             4227          (i) does not constitute legal tender of a state, the United States, or a foreign nation; and
             4228          (ii) has a gold, silver, or platinum content of 50% or more; and
             4229          (b) Subsection (51)(a) applies to a gold, silver, or platinum:
             4230          (i) ingot;
             4231          (ii) bar;
             4232          (iii) medallion; or
             4233          (iv) decorative coin;
             4234          (52) amounts paid on a sale-leaseback transaction;
             4235          (53) sales of a prosthetic device:
             4236          (a) for use on or in a human; and
             4237          (b) (i) for which a prescription is required; or
             4238          (ii) if the prosthetic device is purchased by a hospital or other medical facility;
             4239          (54) (a) except as provided in Subsection (54)(b), purchases, leases, or rentals of
             4240      machinery or equipment by an establishment described in Subsection (54)(c) if the machinery
             4241      or equipment is primarily used in the production or postproduction of the following media for
             4242      commercial distribution:
             4243          (i) a motion picture;


             4244          (ii) a television program;
             4245          (iii) a movie made for television;
             4246          (iv) a music video;
             4247          (v) a commercial;
             4248          (vi) a documentary; or
             4249          (vii) a medium similar to Subsections (54)(a)(i) through (vi) as determined by the
             4250      commission by administrative rule made in accordance with Subsection (54)(d); or
             4251          (b) notwithstanding Subsection (54)(a), purchases, leases, or rentals of machinery or
             4252      equipment by an establishment described in Subsection (54)(c) that is used for the production
             4253      or postproduction of the following are subject to the taxes imposed by this chapter:
             4254          (i) a live musical performance;
             4255          (ii) a live news program; or
             4256          (iii) a live sporting event;
             4257          (c) the following establishments listed in the 1997 North American Industry
             4258      Classification System of the federal Executive Office of the President, Office of Management
             4259      and Budget, apply to Subsections (54)(a) and (b):
             4260          (i) NAICS Code 512110; or
             4261          (ii) NAICS Code 51219; and
             4262          (d) in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             4263      commission may by rule:
             4264          (i) prescribe what constitutes a medium similar to Subsections (54)(a)(i) through (vi);
             4265      or
             4266          (ii) define:
             4267          (A) "commercial distribution";
             4268          (B) "live musical performance";
             4269          (C) "live news program"; or
             4270          (D) "live sporting event";
             4271          (55) (a) leases of seven or more years or purchases made on or after July 1, 2004, but
             4272      on or before June 30, 2027, of tangible personal property that:
             4273          (i) is leased or purchased for or by a facility that:
             4274          (A) is an alternative energy electricity production facility;


             4275          (B) is located in the state; and
             4276          (C) (I) becomes operational on or after July 1, 2004; or
             4277          (II) has its generation capacity increased by one or more megawatts on or after July 1,
             4278      2004, as a result of the use of the tangible personal property;
             4279          (ii) has an economic life of five or more years; and
             4280          (iii) is used to make the facility or the increase in capacity of the facility described in
             4281      Subsection (55)(a)(i) operational up to the point of interconnection with an existing
             4282      transmission grid including:
             4283          (A) a wind turbine;
             4284          (B) generating equipment;
             4285          (C) a control and monitoring system;
             4286          (D) a power line;
             4287          (E) substation equipment;
             4288          (F) lighting;
             4289          (G) fencing;
             4290          (H) pipes; or
             4291          (I) other equipment used for locating a power line or pole; and
             4292          (b) this Subsection (55) does not apply to:
             4293          (i) tangible personal property used in construction of:
             4294          (A) a new alternative energy electricity production facility; or
             4295          (B) the increase in the capacity of an alternative energy electricity production facility;
             4296          (ii) contracted services required for construction and routine maintenance activities;
             4297      and
             4298          (iii) unless the tangible personal property is used or acquired for an increase in capacity
             4299      of the facility described in Subsection (55)(a)(i)(C)(II), tangible personal property used or
             4300      acquired after:
             4301          (A) the alternative energy electricity production facility described in Subsection
             4302      (55)(a)(i) is operational as described in Subsection (55)(a)(iii); or
             4303          (B) the increased capacity described in Subsection (55)(a)(i) is operational as described
             4304      in Subsection (55)(a)(iii);
             4305          (56) (a) leases of seven or more years or purchases made on or after July 1, 2004, but


             4306      on or before June 30, 2027, of tangible personal property that:
             4307          (i) is leased or purchased for or by a facility that:
             4308          (A) is a waste energy production facility;
             4309          (B) is located in the state; and
             4310          (C) (I) becomes operational on or after July 1, 2004; or
             4311          (II) has its generation capacity increased by one or more megawatts on or after July 1,
             4312      2004, as a result of the use of the tangible personal property;
             4313          (ii) has an economic life of five or more years; and
             4314          (iii) is used to make the facility or the increase in capacity of the facility described in
             4315      Subsection (56)(a)(i) operational up to the point of interconnection with an existing
             4316      transmission grid including:
             4317          (A) generating equipment;
             4318          (B) a control and monitoring system;
             4319          (C) a power line;
             4320          (D) substation equipment;
             4321          (E) lighting;
             4322          (F) fencing;
             4323          (G) pipes; or
             4324          (H) other equipment used for locating a power line or pole; and
             4325          (b) this Subsection (56) does not apply to:
             4326          (i) tangible personal property used in construction of:
             4327          (A) a new waste energy facility; or
             4328          (B) the increase in the capacity of a waste energy facility;
             4329          (ii) contracted services required for construction and routine maintenance activities;
             4330      and
             4331          (iii) unless the tangible personal property is used or acquired for an increase in capacity
             4332      described in Subsection (56)(a)(i)(C)(II), tangible personal property used or acquired after:
             4333          (A) the waste energy facility described in Subsection (56)(a)(i) is operational as
             4334      described in Subsection (56)(a)(iii); or
             4335          (B) the increased capacity described in Subsection (56)(a)(i) is operational as described
             4336      in Subsection (56)(a)(iii);


             4337          (57) (a) leases of five or more years or purchases made on or after July 1, 2004 but on
             4338      or before June 30, 2027, of tangible personal property that:
             4339          (i) is leased or purchased for or by a facility that:
             4340          (A) is located in the state;
             4341          (B) produces fuel from alternative energy, including:
             4342          (I) methanol; or
             4343          (II) ethanol; and
             4344          (C) (I) becomes operational on or after July 1, 2004; or
             4345          (II) has its capacity to produce fuel increase by 25% or more on or after July 1, 2004, as
             4346      a result of the installation of the tangible personal property;
             4347          (ii) has an economic life of five or more years; and
             4348          (iii) is installed on the facility described in Subsection (57)(a)(i);
             4349          (b) this Subsection (57) does not apply to:
             4350          (i) tangible personal property used in construction of:
             4351          (A) a new facility described in Subsection (57)(a)(i); or
             4352          (B) the increase in capacity of the facility described in Subsection (57)(a)(i); or
             4353          (ii) contracted services required for construction and routine maintenance activities;
             4354      and
             4355          (iii) unless the tangible personal property is used or acquired for an increase in capacity
             4356      described in Subsection (57)(a)(i)(C)(II), tangible personal property used or acquired after:
             4357          (A) the facility described in Subsection (57)(a)(i) is operational; or
             4358          (B) the increased capacity described in Subsection (57)(a)(i) is operational;
             4359          (58) (a) subject to Subsection (58)(b) or (c), sales of tangible personal property or a
             4360      product transferred electronically to a person within this state if that tangible personal property
             4361      or product transferred electronically is subsequently shipped outside the state and incorporated
             4362      pursuant to contract into and becomes a part of real property located outside of this state;
             4363          (b) the exemption under Subsection (58)(a) is not allowed to the extent that the other
             4364      state or political entity to which the tangible personal property is shipped imposes a sales, use,
             4365      gross receipts, or other similar transaction excise tax on the transaction against which the other
             4366      state or political entity allows a credit for sales and use taxes imposed by this chapter; and
             4367          (c) notwithstanding the time period of Subsection 59-1-1410 (8) for filing for a refund,


             4368      a person may claim the exemption allowed by this Subsection (58) for a sale by filing for a
             4369      refund:
             4370          (i) if the sale is made on or after July 1, 2004, but on or before June 30, 2008;
             4371          (ii) as if this Subsection (58) as in effect on July 1, 2008, were in effect on the day on
             4372      which the sale is made;
             4373          (iii) if the person did not claim the exemption allowed by this Subsection (58) for the
             4374      sale prior to filing for the refund;
             4375          (iv) for sales and use taxes paid under this chapter on the sale;
             4376          (v) in accordance with Section 59-1-1410 ; and
             4377          (vi) subject to any extension allowed for filing for a refund under Section 59-1-1410 , if
             4378      the person files for the refund on or before June 30, 2011;
             4379          (59) purchases:
             4380          (a) of one or more of the following items in printed or electronic format:
             4381          (i) a list containing information that includes one or more:
             4382          (A) names; or
             4383          (B) addresses; or
             4384          (ii) a database containing information that includes one or more:
             4385          (A) names; or
             4386          (B) addresses; and
             4387          (b) used to send direct mail;
             4388          (60) redemptions or repurchases of a product by a person if that product was:
             4389          (a) delivered to a pawnbroker as part of a pawn transaction; and
             4390          (b) redeemed or repurchased within the time period established in a written agreement
             4391      between the person and the pawnbroker for redeeming or repurchasing the product;
             4392          (61) (a) purchases or leases of an item described in Subsection (61)(b) if the item:
             4393          (i) is purchased or leased by, or on behalf of, a telecommunications service provider;
             4394      and
             4395          (ii) has a useful economic life of one or more years; and
             4396          (b) the following apply to Subsection (61)(a):
             4397          (i) telecommunications enabling or facilitating equipment, machinery, or software;
             4398          (ii) telecommunications equipment, machinery, or software required for 911 service;


             4399          (iii) telecommunications maintenance or repair equipment, machinery, or software;
             4400          (iv) telecommunications switching or routing equipment, machinery, or software; or
             4401          (v) telecommunications transmission equipment, machinery, or software;
             4402          (62) (a) beginning on July 1, 2006, and ending on June 30, 2027, purchases of tangible
             4403      personal property or a product transferred electronically that are used in the research and
             4404      development of alternative energy technology; and
             4405          (b) in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             4406      commission may, for purposes of Subsection (62)(a), make rules defining what constitutes
             4407      purchases of tangible personal property or a product transferred electronically that are used in
             4408      the research and development of alternative energy technology;
             4409          (63) (a) purchases of tangible personal property or a product transferred electronically
             4410      if:
             4411          (i) the tangible personal property or product transferred electronically is:
             4412          (A) purchased outside of this state;
             4413          (B) brought into this state at any time after the purchase described in Subsection
             4414      (63)(a)(i)(A); and
             4415          (C) used in conducting business in this state; and
             4416          (ii) for:
             4417          (A) tangible personal property or a product transferred electronically other than the
             4418      tangible personal property described in Subsection (63)(a)(ii)(B), the first use of the property
             4419      for a purpose for which the property is designed occurs outside of this state; or
             4420          (B) a vehicle other than a vehicle sold to an authorized carrier, the vehicle is registered
             4421      outside of this state;
             4422          (b) the exemption provided for in Subsection (63)(a) does not apply to:
             4423          (i) a lease or rental of tangible personal property or a product transferred electronically;
             4424      or
             4425          (ii) a sale of a vehicle exempt under Subsection (33); and
             4426          (c) in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, for
             4427      purposes of Subsection (63)(a), the commission may by rule define what constitutes the
             4428      following:
             4429          (i) conducting business in this state if that phrase has the same meaning in this


             4430      Subsection (63) as in Subsection (24);
             4431          (ii) the first use of tangible personal property or a product transferred electronically if
             4432      that phrase has the same meaning in this Subsection (63) as in Subsection (24); or
             4433          (iii) a purpose for which tangible personal property or a product transferred
             4434      electronically is designed if that phrase has the same meaning in this Subsection (63) as in
             4435      Subsection (24);
             4436          (64) sales of disposable home medical equipment or supplies if:
             4437          (a) a person presents a prescription for the disposable home medical equipment or
             4438      supplies;
             4439          (b) the disposable home medical equipment or supplies are used exclusively by the
             4440      person to whom the prescription described in Subsection (64)(a) is issued; and
             4441          (c) the disposable home medical equipment and supplies are listed as eligible for
             4442      payment under:
             4443          (i) Title XVIII, federal Social Security Act; or
             4444          (ii) the state plan for medical assistance under Title XIX, federal Social Security Act;
             4445          (65) sales:
             4446          (a) to a public transit district under Title 17B, Chapter 2a, Part 8, Public Transit
             4447      District Act; or
             4448          (b) of tangible personal property to a subcontractor of a public transit district, if the
             4449      tangible personal property is:
             4450          (i) clearly identified; and
             4451          (ii) installed or converted to real property owned by the public transit district;
             4452          (66) sales of construction materials:
             4453          (a) purchased on or after July 1, 2010;
             4454          (b) purchased by, on behalf of, or for the benefit of an international airport:
             4455          (i) located within a county of the first class; and
             4456          (ii) that has a United States customs office on its premises; and
             4457          (c) if the construction materials are:
             4458          (i) clearly identified;
             4459          (ii) segregated; and
             4460          (iii) installed or converted to real property:


             4461          (A) owned or operated by the international airport described in Subsection (66)(b); and
             4462          (B) located at the international airport described in Subsection (66)(b);
             4463          (67) sales of construction materials:
             4464          (a) purchased on or after July 1, 2008;
             4465          (b) purchased by, on behalf of, or for the benefit of a new airport:
             4466          (i) located within a county of the second class; and
             4467          (ii) that is owned or operated by a city in which an airline as defined in Section
             4468      59-2-102 is headquartered; and
             4469          (c) if the construction materials are:
             4470          (i) clearly identified;
             4471          (ii) segregated; and
             4472          (iii) installed or converted to real property:
             4473          (A) owned or operated by the new airport described in Subsection (67)(b);
             4474          (B) located at the new airport described in Subsection (67)(b); and
             4475          (C) as part of the construction of the new airport described in Subsection (67)(b);
             4476          (68) sales of fuel to a common carrier that is a railroad for use in a locomotive engine;
             4477          (69) purchases and sales described in Section 63H-4-111 ;
             4478          (70) (a) sales of tangible personal property to an aircraft maintenance, repair, and
             4479      overhaul provider for use in the maintenance, repair, overhaul, or refurbishment in this state of
             4480      a fixed wing turbine powered aircraft if that fixed wing turbine powered aircraft's registration
             4481      lists a state or country other than this state as the location of registry of the fixed wing turbine
             4482      powered aircraft; or
             4483          (b) sales of tangible personal property by an aircraft maintenance, repair, and overhaul
             4484      provider in connection with the maintenance, repair, overhaul, or refurbishment in this state of
             4485      a fixed wing turbine powered aircraft if that fixed wing turbine powered aircraft's registration
             4486      lists a state or country other than this state as the location of registry of the fixed wing turbine
             4487      powered aircraft;
             4488          (71) subject to Section 59-12-104.4 , sales of a textbook for a higher education course:
             4489          (a) to a person admitted to an institution of higher education; and
             4490          (b) by a seller, other than a bookstore owned by an institution of higher education, if
             4491      51% or more of that seller's sales revenue for the previous calendar quarter are sales of a


             4492      textbook for a higher education course;
             4493          (72) a license fee or tax a municipality imposes in accordance with Subsection
             4494      10-1-203 (5) on a purchaser from a business for which the municipality provides an enhanced
             4495      level of municipal services;
             4496          (73) amounts paid or charged for construction materials used in the construction of a
             4497      new or expanding life science research and development facility in the state, if the construction
             4498      materials are:
             4499          (a) clearly identified;
             4500          (b) segregated; and
             4501          (c) installed or converted to real property; and
             4502          (74) amounts paid or charged for:
             4503          (a) a purchase or lease of machinery and equipment that:
             4504          (i) are used in performing qualified research:
             4505          (A) as defined in Section 59-7-612 ;
             4506          (B) in the state; and
             4507          (C) with respect to which the purchaser pays or incurs a qualified research expense as
             4508      defined in Section 59-7-612 ; and
             4509          (ii) have an economic life of three or more years; and
             4510          (b) normal operating repair or replacement parts:
             4511          (i) for the machinery and equipment described in Subsection (74)(a); and
             4512          (ii) that have an economic life of three or more years.
             4513          Section 6. Section 59-12-1201 is amended to read:
             4514           59-12-1201. Motor vehicle rental tax -- Rate -- Exemptions -- Administration,
             4515      collection, and enforcement of tax -- Administrative charge -- Deposits.
             4516          (1) (a) Except as provided in Subsection (3), there is imposed a tax of 2.5% on all
             4517      short-term leases and rentals of motor vehicles not exceeding 30 days.
             4518          (b) The tax imposed in this section is in addition to all other state, county, or municipal
             4519      fees and taxes imposed on rentals of motor vehicles.
             4520          (2) (a) Subject to Subsection (2)(b), a tax rate repeal or tax rate change for the tax
             4521      imposed under Subsection (1) shall take effect on the first day of a calendar quarter.
             4522          (b) (i) For a transaction subject to a tax under Subsection (1), a tax rate increase shall


             4523      take effect on the first day of the first billing period:
             4524          (A) that begins after the effective date of the tax rate increase; and
             4525          (B) if the billing period for the transaction begins before the effective date of a tax rate
             4526      increase imposed under Subsection (1).
             4527          (ii) For a transaction subject to a tax under Subsection (1), the repeal of a tax or a tax
             4528      rate decrease shall take effect on the first day of the last billing period:
             4529          (A) that began before the effective date of the repeal of the tax or the tax rate decrease;
             4530      and
             4531          (B) if the billing period for the transaction begins before the effective date of the repeal
             4532      of the tax or the tax rate decrease imposed under Subsection (1).
             4533          (3) A motor vehicle is exempt from the tax imposed under Subsection (1) if:
             4534          (a) the motor vehicle is registered for a gross laden weight of 12,001 or more pounds;
             4535          (b) the motor vehicle is rented as a personal household goods moving van; or
             4536          (c) the lease or rental of the motor vehicle is made for the purpose of temporarily
             4537      replacing a person's motor vehicle that is being repaired pursuant to a repair agreement or an
             4538      insurance agreement.
             4539          (4) (a) (i) The tax authorized under this section shall be administered, collected, and
             4540      enforced in accordance with:
             4541          (A) the same procedures used to administer, collect, and enforce the tax under Part 1,
             4542      Tax Collection; and
             4543          (B) Chapter 1, General Taxation Policies.
             4544          (ii) Notwithstanding Subsection (4)(a)(i), a tax under this part is not subject to
             4545      Subsections 59-12-103 (4) through [(12)] (13) or Section 59-12-107.1 or 59-12-123 .
             4546          (b) The commission shall retain and deposit an administrative charge in accordance
             4547      with Section 59-1-306 from the revenues the commission collects from a tax under this part.
             4548          (c) Except as provided under Subsection (4)(b), all revenue received by the
             4549      commission under this section shall be deposited daily with the state treasurer and credited
             4550      monthly to the Marda Dillree Corridor Preservation Fund under Section 72-2-117 .
             4551          Section 7. Section 73-10-25 is amended to read:
             4552           73-10-25. Contents of fund -- Investment -- Contributions.
             4553          (1) The Water Resources Conservation and Development Fund consists of:


             4554          (a) money appropriated to it by the Legislature;
             4555          (b) money deposited in accordance with Section 59-12-103 ;
             4556          [(b)] (c) money received from the sale of project water and power, less operating and
             4557      maintenance costs;
             4558          [(c)] (d) annual payments on contracts for projects constructed under Section 73-10-24
             4559      or the State Water Conservation Program; and
             4560          [(d)] (e) other money or tax revenues designated by the Legislature to be credited to the
             4561      Water Resources Conservation and Development Fund.
             4562          (2) All money deposited into the Water Resources Conservation and Development
             4563      Fund shall be invested by the state treasurer with interest accruing to the Water Resources
             4564      Conservation and Development Fund, except for payments, if any, necessary to comply with
             4565      Section 148(f), Internal Revenue Code of 1986.
             4566          (3) Contributions of money, property, or equipment may be received from any political
             4567      subdivision of the state, federal agency, water users' association, person, or corporation for use
             4568      in carrying out the purposes of Section 73-10-24 .
             4569          Section 8. Section 73-10-31 is amended to read:
             4570           73-10-31. Allocation of funds for credit enhancement and interest buy-down
             4571      agreements.
             4572          (1) Of the combined expenditures from the Water Resources Cities Water Loan Fund
             4573      and Water Resources Conservation and Development Fund authorized by the Board of Water
             4574      Resources each year, at least 10% shall be allocated for credit enhancement and interest
             4575      buy-down agreements.
             4576          (2) The requirement specified in Subsection (1) shall apply only so long as sales and
             4577      use tax [is] revenues are transferred to the Water Resources Conservation and Development
             4578      Fund as provided in [Section] Subsections 59-12-103 (4) and (5).
             4579          Section 9. Effective date.
             4580          (1) Except as provided in Subsection (2), this bill takes effect on July 1, 2013.
             4581          (2) The following sections take effect on July 1, 2014:
             4582          (a) Section 59-12-102 (Effective 07/01/14); and
             4583          (b) Section 59-12-103 (Effective 07/01/14).





Legislative Review Note
    as of 1-15-13 2:11 PM


Office of Legislative Research and General Counsel


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