H.B. 224

This document includes House Committee Amendments incorporated into the bill on Tue, Feb 4, 2014 at 11:31 AM by lerror. -->              1     

SALES AND USE TAX AMENDMENTS

             2     
2014 GENERAL SESSION

             3     
STATE OF UTAH

             4     
Chief Sponsor: Jim Nielson

             5     
Senate Sponsor: ____________

             6     
             7      LONG TITLE
             8      General Description:
             9          This bill makes amendments related to sales and use taxes.
             10      Highlighted Provisions:
             11          This bill:
             12          .    reduces the state sales and use tax rate if the Supreme Court of the United States
             13      authorizes or Congress permits the state to require certain sellers to collect a sales or
             14      use tax;
             15          .    amends certain study requirements for the Revenue and Taxation Interim
             16      Committee related to an action by the Supreme Court of the United States or
             17      Congress;
             18          .    repeals provisions requiring certain state sales and use tax revenue to be deposited
             19      into the Remote Sales Restricted Account; and
             20          .    makes technical and conforming changes.
             21      Money Appropriated in this Bill:
             22          None
             23      Other Special Clauses:
             24          This bill provides effective dates.
             25      Utah Code Sections Affected:
             26      AMENDS:
             27           59-12-103 (Superseded 07/01/14), as last amended by Laws of Utah 2013, Chapters


             28      150 and 227
             29           59-12-103 (Effective 07/01/14), as last amended by Laws of Utah 2013, Chapters 150
             30      and 227
             31           59-12-103.1 , as last amended by Laws of Utah 2013, Chapter 150
             32           59-12-103.2 , as last amended by Laws of Utah 2013, Chapter 150
             33     
             34      Be it enacted by the Legislature of the state of Utah:
             35          Section 1. Section 59-12-103 (Superseded 07/01/14) is amended to read:
             36           59-12-103 (Superseded 07/01/14). Sales and use tax base -- Rates -- Effective dates
             37      -- Use of sales and use tax revenues.
             38          (1) A tax is imposed on the purchaser as provided in this part for amounts paid or
             39      charged for the following transactions:
             40          (a) retail sales of tangible personal property made within the state;
             41          (b) amounts paid for:
             42          (i) telecommunications service, other than mobile telecommunications service, that
             43      originates and terminates within the boundaries of this state;
             44          (ii) mobile telecommunications service that originates and terminates within the
             45      boundaries of one state only to the extent permitted by the Mobile Telecommunications
             46      Sourcing Act, 4 U.S.C. Sec. 116 et seq.; or
             47          (iii) an ancillary service associated with a:
             48          (A) telecommunications service described in Subsection (1)(b)(i); or
             49          (B) mobile telecommunications service described in Subsection (1)(b)(ii);
             50          (c) sales of the following for commercial use:
             51          (i) gas;
             52          (ii) electricity;
             53          (iii) heat;
             54          (iv) coal;
             55          (v) fuel oil; or
             56          (vi) other fuels;
             57          (d) sales of the following for residential use:
             58          (i) gas;


             59          (ii) electricity;
             60          (iii) heat;
             61          (iv) coal;
             62          (v) fuel oil; or
             63          (vi) other fuels;
             64          (e) sales of prepared food;
             65          (f) except as provided in Section 59-12-104 , amounts paid or charged as admission or
             66      user fees for theaters, movies, operas, museums, planetariums, shows of any type or nature,
             67      exhibitions, concerts, carnivals, amusement parks, amusement rides, circuses, menageries,
             68      fairs, races, contests, sporting events, dances, boxing matches, wrestling matches, closed circuit
             69      television broadcasts, billiard parlors, pool parlors, bowling lanes, golf, miniature golf, golf
             70      driving ranges, batting cages, skating rinks, ski lifts, ski runs, ski trails, snowmobile trails,
             71      tennis courts, swimming pools, water slides, river runs, jeep tours, boat tours, scenic cruises,
             72      horseback rides, sports activities, or any other amusement, entertainment, recreation,
             73      exhibition, cultural, or athletic activity;
             74          (g) amounts paid or charged for services for repairs or renovations of tangible personal
             75      property, unless Section 59-12-104 provides for an exemption from sales and use tax for:
             76          (i) the tangible personal property; and
             77          (ii) parts used in the repairs or renovations of the tangible personal property described
             78      in Subsection (1)(g)(i), whether or not any parts are actually used in the repairs or renovations
             79      of that tangible personal property;
             80          (h) except as provided in Subsection 59-12-104 (7), amounts paid or charged for
             81      assisted cleaning or washing of tangible personal property;
             82          (i) amounts paid or charged for tourist home, hotel, motel, or trailer court
             83      accommodations and services that are regularly rented for less than 30 consecutive days;
             84          (j) amounts paid or charged for laundry or dry cleaning services;
             85          (k) amounts paid or charged for leases or rentals of tangible personal property if within
             86      this state the tangible personal property is:
             87          (i) stored;
             88          (ii) used; or
             89          (iii) otherwise consumed;


             90          (l) amounts paid or charged for tangible personal property if within this state the
             91      tangible personal property is:
             92          (i) stored;
             93          (ii) used; or
             94          (iii) consumed; and
             95          (m) amounts paid or charged for a sale:
             96          (i) (A) of a product transferred electronically; or
             97          (B) of a repair or renovation of a product transferred electronically; and
             98          (ii) regardless of whether the sale provides:
             99          (A) a right of permanent use of the product; or
             100          (B) a right to use the product that is less than a permanent use, including a right:
             101          (I) for a definite or specified length of time; and
             102          (II) that terminates upon the occurrence of a condition.
             103          (2) (a) Except as provided in Subsections (2)(b) through (e), a state tax and a local tax
             104      is imposed on a transaction described in Subsection (1) equal to the sum of:
             105          (i) a state tax imposed on the transaction at a tax rate equal to the sum of:
             106          (A) subject to Section 59-12-103.1 , 4.70%; and
             107          (B) (I) the tax rate the state imposes in accordance with Part 18, Additional State Sales
             108      and Use Tax Act, if the location of the transaction as determined under Sections 59-12-211
             109      through 59-12-215 is in a county in which the state imposes the tax under Part 18, Additional
             110      State Sales and Use Tax Act; and
             111          (II) the tax rate the state imposes in accordance with Part 20, Supplemental State Sales
             112      and Use Tax Act, if the location of the transaction as determined under Sections 59-12-211
             113      through 59-12-215 is in a city, town, or the unincorporated area of a county in which the state
             114      imposes the tax under Part 20, Supplemental State Sales and Use Tax Act; and
             115          (ii) a local tax equal to the sum of the tax rates a county, city, or town imposes on the
             116      transaction under this chapter other than this part.
             117          (b) Except as provided in Subsection (2)(d) or (e), a state tax and a local tax is imposed
             118      on a transaction described in Subsection (1)(d) equal to the sum of:
             119          (i) a state tax imposed on the transaction at a tax rate of 2%; and
             120          (ii) a local tax equal to the sum of the tax rates a county, city, or town imposes on the


             121      transaction under this chapter other than this part.
             122          (c) Except as provided in Subsection (2)(d) or (e), a state tax and a local tax is imposed
             123      on amounts paid or charged for food and food ingredients equal to the sum of:
             124          (i) a state tax imposed on the amounts paid or charged for food and food ingredients at
             125      a tax rate of 1.75%; and
             126          (ii) a local tax equal to the sum of the tax rates a county, city, or town imposes on the
             127      amounts paid or charged for food and food ingredients under this chapter other than this part.
             128          (d) (i) For a bundled transaction that is attributable to food and food ingredients and
             129      tangible personal property other than food and food ingredients, a state tax and a local tax is
             130      imposed on the entire bundled transaction equal to the sum of:
             131          (A) a state tax imposed on the entire bundled transaction equal to the sum of:
             132          (I) the tax rate described in Subsection (2)(a)(i)(A); and
             133          (II) (Aa) the tax rate the state imposes in accordance with Part 18, Additional State
             134      Sales and Use Tax Act, if the location of the transaction as determined under Sections
             135      59-12-211 through 59-12-215 is in a county in which the state imposes the tax under Part 18,
             136      Additional State Sales and Use Tax Act; and
             137          (Bb) the tax rate the state imposes in accordance with Part 20, Supplemental State
             138      Sales and Use Tax Act, if the location of the transaction as determined under Sections
             139      59-12-211 through 59-12-215 is in a city, town, or the unincorporated area of a county in which
             140      the state imposes the tax under Part 20, Supplemental State Sales and Use Tax Act; and
             141          (B) a local tax imposed on the entire bundled transaction at the sum of the tax rates
             142      described in Subsection (2)(a)(ii).
             143          (ii) If an optional computer software maintenance contract is a bundled transaction that
             144      consists of taxable and nontaxable products that are not separately itemized on an invoice or
             145      similar billing document, the purchase of the optional computer software maintenance contract
             146      is 40% taxable under this chapter and 60% nontaxable under this chapter.
             147          (iii) Subject to Subsection (2)(d)(iv), for a bundled transaction other than a bundled
             148      transaction described in Subsection (2)(d)(i) or (ii):
             149          (A) if the sales price of the bundled transaction is attributable to tangible personal
             150      property, a product, or a service that is subject to taxation under this chapter and tangible
             151      personal property, a product, or service that is not subject to taxation under this chapter, the


             152      entire bundled transaction is subject to taxation under this chapter unless:
             153          (I) the seller is able to identify by reasonable and verifiable standards the tangible
             154      personal property, product, or service that is not subject to taxation under this chapter from the
             155      books and records the seller keeps in the seller's regular course of business; or
             156          (II) state or federal law provides otherwise; or
             157          (B) if the sales price of a bundled transaction is attributable to two or more items of
             158      tangible personal property, products, or services that are subject to taxation under this chapter
             159      at different rates, the entire bundled transaction is subject to taxation under this chapter at the
             160      higher tax rate unless:
             161          (I) the seller is able to identify by reasonable and verifiable standards the tangible
             162      personal property, product, or service that is subject to taxation under this chapter at the lower
             163      tax rate from the books and records the seller keeps in the seller's regular course of business; or
             164          (II) state or federal law provides otherwise.
             165          (iv) For purposes of Subsection (2)(d)(iii), books and records that a seller keeps in the
             166      seller's regular course of business includes books and records the seller keeps in the regular
             167      course of business for nontax purposes.
             168          (e) Subject to Subsections (2)(f) and (g), a tax rate repeal or tax rate change for a tax
             169      rate imposed under the following shall take effect on the first day of a calendar quarter:
             170          (i) Subsection (2)(a)(i)(A);
             171          (ii) Subsection (2)(b)(i);
             172          (iii) Subsection (2)(c)(i); or
             173          (iv) Subsection (2)(d)(i)(A)(I).
             174          (f) (i) A tax rate increase takes effect on the first day of the first billing period that
             175      begins on or after the effective date of the tax rate increase if the billing period for the
             176      transaction begins before the effective date of a tax rate increase imposed under:
             177          (A) Subsection (2)(a)(i)(A);
             178          (B) Subsection (2)(b)(i);
             179          (C) Subsection (2)(c)(i); or
             180          (D) Subsection (2)(d)(i)(A)(I).
             181          (ii) The repeal of a tax or a tax rate decrease applies to a billing period if the billing
             182      statement for the billing period is rendered on or after the effective date of the repeal of the tax


             183      or the tax rate decrease imposed under:
             184          (A) Subsection (2)(a)(i)(A);
             185          (B) Subsection (2)(b)(i);
             186          (C) Subsection (2)(c)(i); or
             187          (D) Subsection (2)(d)(i)(A)(I).
             188          (g) (i) For a tax rate described in Subsection (2)(g)(ii), if a tax due on a catalogue sale
             189      is computed on the basis of sales and use tax rates published in the catalogue, a tax rate repeal
             190      or change in a tax rate takes effect:
             191          (A) on the first day of a calendar quarter; and
             192          (B) beginning 60 days after the effective date of the tax rate repeal or tax rate change.
             193          (ii) Subsection (2)(g)(i) applies to the tax rates described in the following:
             194          (A) Subsection (2)(a)(i)(A);
             195          (B) Subsection (2)(b)(i);
             196          (C) Subsection (2)(c)(i); or
             197          (D) Subsection (2)(d)(i)(A)(I).
             198          (iii) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act,
             199      the commission may by rule define the term "catalogue sale."
             200          (3) (a) The following state taxes shall be deposited into the General Fund:
             201          (i) the tax imposed by Subsection (2)(a)(i)(A);
             202          (ii) the tax imposed by Subsection (2)(b)(i);
             203          (iii) the tax imposed by Subsection (2)(c)(i); or
             204          (iv) the tax imposed by Subsection (2)(d)(i)(A)(I).
             205          (b) The following local taxes shall be distributed to a county, city, or town as provided
             206      in this chapter:
             207          (i) the tax imposed by Subsection (2)(a)(ii);
             208          (ii) the tax imposed by Subsection (2)(b)(ii);
             209          (iii) the tax imposed by Subsection (2)(c)(ii); and
             210          (iv) the tax imposed by Subsection (2)(d)(i)(B).
             211          (4) (a) Notwithstanding Subsection (3)(a), for a fiscal year beginning on or after July 1,
             212      2003, the lesser of the following amounts shall be expended as provided in Subsections (4)(b)
             213      through (g):


             214          (i) for taxes listed under Subsection (3)(a), the amount of tax revenue generated:
             215          (A) by a 1/16% tax rate on the transactions described in Subsection (1); and
             216          (B) for the fiscal year; or
             217          (ii) $17,500,000.
             218          (b) (i) For a fiscal year beginning on or after July 1, 2003, 14% of the amount
             219      described in Subsection (4)(a) shall be transferred each year as dedicated credits to the
             220      Department of Natural Resources to:
             221          (A) implement the measures described in Subsections 79-2-303 (3)(a) through (d) to
             222      protect sensitive plant and animal species; or
             223          (B) award grants, up to the amount authorized by the Legislature in an appropriations
             224      act, to political subdivisions of the state to implement the measures described in Subsections
             225      79-2-303 (3)(a) through (d) to protect sensitive plant and animal species.
             226          (ii) Money transferred to the Department of Natural Resources under Subsection
             227      (4)(b)(i) may not be used to assist the United States Fish and Wildlife Service or any other
             228      person to list or attempt to have listed a species as threatened or endangered under the
             229      Endangered Species Act of 1973, 16 U.S.C. Sec. 1531 et seq.
             230          (iii) At the end of each fiscal year:
             231          (A) 50% of any unexpended dedicated credits shall lapse to the Water Resources
             232      Conservation and Development Fund created in Section 73-10-24 ;
             233          (B) 25% of any unexpended dedicated credits shall lapse to the Utah Wastewater Loan
             234      Program Subaccount created in Section 73-10c-5 ; and
             235          (C) 25% of any unexpended dedicated credits shall lapse to the Drinking Water Loan
             236      Program Subaccount created in Section 73-10c-5 .
             237          (c) For a fiscal year beginning on or after July 1, 2003, 3% of the amount described in
             238      Subsection (4)(a) shall be deposited each year in the Agriculture Resource Development Fund
             239      created in Section 4-18-106 .
             240          (d) (i) For a fiscal year beginning on or after July 1, 2003, 1% of the amount described
             241      in Subsection (4)(a) shall be transferred each year as dedicated credits to the Division of Water
             242      Rights to cover the costs incurred in hiring legal and technical staff for the adjudication of
             243      water rights.
             244          (ii) At the end of each fiscal year:


             245          (A) 50% of any unexpended dedicated credits shall lapse to the Water Resources
             246      Conservation and Development Fund created in Section 73-10-24 ;
             247          (B) 25% of any unexpended dedicated credits shall lapse to the Utah Wastewater Loan
             248      Program Subaccount created in Section 73-10c-5 ; and
             249          (C) 25% of any unexpended dedicated credits shall lapse to the Drinking Water Loan
             250      Program Subaccount created in Section 73-10c-5 .
             251          (e) (i) For a fiscal year beginning on or after July 1, 2003, 41% of the amount described
             252      in Subsection (4)(a) shall be deposited in the Water Resources Conservation and Development
             253      Fund created in Section 73-10-24 for use by the Division of Water Resources.
             254          (ii) In addition to the uses allowed of the Water Resources Conservation and
             255      Development Fund under Section 73-10-24 , the Water Resources Conservation and
             256      Development Fund may also be used to:
             257          (A) conduct hydrologic and geotechnical investigations by the Division of Water
             258      Resources in a cooperative effort with other state, federal, or local entities, for the purpose of
             259      quantifying surface and ground water resources and describing the hydrologic systems of an
             260      area in sufficient detail so as to enable local and state resource managers to plan for and
             261      accommodate growth in water use without jeopardizing the resource;
             262          (B) fund state required dam safety improvements; and
             263          (C) protect the state's interest in interstate water compact allocations, including the
             264      hiring of technical and legal staff.
             265          (f) For a fiscal year beginning on or after July 1, 2003, 20.5% of the amount described
             266      in Subsection (4)(a) shall be deposited in the Utah Wastewater Loan Program Subaccount
             267      created in Section 73-10c-5 for use by the Water Quality Board to fund wastewater projects.
             268          (g) For a fiscal year beginning on or after July 1, 2003, 20.5% of the amount described
             269      in Subsection (4)(a) shall be deposited in the Drinking Water Loan Program Subaccount
             270      created in Section 73-10c-5 for use by the Division of Drinking Water to:
             271          (i) provide for the installation and repair of collection, treatment, storage, and
             272      distribution facilities for any public water system, as defined in Section 19-4-102 ;
             273          (ii) develop underground sources of water, including springs and wells; and
             274          (iii) develop surface water sources.
             275          (5) (a) Notwithstanding Subsection (3)(a), for a fiscal year beginning on or after July 1,


             276      2006, the difference between the following amounts shall be expended as provided in this
             277      Subsection (5), if that difference is greater than $1:
             278          (i) for taxes listed under Subsection (3)(a), the amount of tax revenue generated for the
             279      fiscal year by a 1/16% tax rate on the transactions described in Subsection (1); and
             280          (ii) $17,500,000.
             281          (b) (i) The first $500,000 of the difference described in Subsection (5)(a) shall be:
             282          (A) transferred each fiscal year to the Department of Natural Resources as dedicated
             283      credits; and
             284          (B) expended by the Department of Natural Resources for watershed rehabilitation or
             285      restoration.
             286          (ii) At the end of each fiscal year, 100% of any unexpended dedicated credits described
             287      in Subsection (5)(b)(i) shall lapse to the Water Resources Conservation and Development Fund
             288      created in Section 73-10-24 .
             289          (c) (i) After making the transfer required by Subsection (5)(b)(i), $150,000 of the
             290      remaining difference described in Subsection (5)(a) shall be:
             291          (A) transferred each fiscal year to the Division of Water Resources as dedicated
             292      credits; and
             293          (B) expended by the Division of Water Resources for cloud-seeding projects
             294      authorized by Title 73, Chapter 15, Modification of Weather.
             295          (ii) At the end of each fiscal year, 100% of any unexpended dedicated credits described
             296      in Subsection (5)(c)(i) shall lapse to the Water Resources Conservation and Development Fund
             297      created in Section 73-10-24 .
             298          (d) After making the transfers required by Subsections (5)(b) and (c), 94% of the
             299      remaining difference described in Subsection (5)(a) shall be deposited into the Water
             300      Resources Conservation and Development Fund created in Section 73-10-24 for use by the
             301      Division of Water Resources for:
             302          (i) preconstruction costs:
             303          (A) as defined in Subsection 73-26-103 (6) for projects authorized by Title 73, Chapter
             304      26, Bear River Development Act; and
             305          (B) as defined in Subsection 73-28-103 (8) for the Lake Powell Pipeline project
             306      authorized by Title 73, Chapter 28, Lake Powell Pipeline Development Act;


             307          (ii) the cost of employing a civil engineer to oversee any project authorized by Title 73,
             308      Chapter 26, Bear River Development Act;
             309          (iii) the cost of employing a civil engineer to oversee the Lake Powell Pipeline project
             310      authorized by Title 73, Chapter 28, Lake Powell Pipeline Development Act; and
             311          (iv) other uses authorized under Sections 73-10-24 , 73-10-25.1 , 73-10-30 , and
             312      Subsection (4)(e)(ii) after funding the uses specified in Subsections (5)(d)(i) through (iii).
             313          (e) After making the transfers required by Subsections (5)(b) and (c) and subject to
             314      Subsection (5)(f), 6% of the remaining difference described in Subsection (5)(a) shall be
             315      transferred each year as dedicated credits to the Division of Water Rights to cover the costs
             316      incurred for employing additional technical staff for the administration of water rights.
             317          (f) At the end of each fiscal year, any unexpended dedicated credits described in
             318      Subsection (5)(e) over $150,000 lapse to the Water Resources Conservation and Development
             319      Fund created in Section 73-10-24 .
             320          (6) Notwithstanding Subsection (3)(a), for a fiscal year beginning on or after July 1,
             321      2003, and for taxes listed under Subsection (3)(a), the amount of revenue generated by a 1/16%
             322      tax rate on the transactions described in Subsection (1) for the fiscal year shall be deposited in
             323      the Transportation Fund created by Section 72-2-102 .
             324          (7) Notwithstanding Subsection (3)(a), beginning on July 1, 2012, the Division of
             325      Finance shall deposit into the Transportation Investment Fund of 2005 created in Section
             326      72-2-124 a portion of the taxes listed under Subsection (3)(a) equal to the revenues generated
             327      by a 1/64% tax rate on the taxable transactions under Subsection (1).
             328          (8) (a) Notwithstanding Subsection (3)(a), in addition to the amounts deposited in
             329      Subsection (7), and subject to Subsection (8)(b), for a fiscal year beginning on or after July 1,
             330      2012, the Division of Finance shall deposit into the Transportation Investment Fund of 2005
             331      created by Section 72-2-124 :
             332          (i) a portion of the taxes listed under Subsection (3)(a) in an amount equal to 8.3% of
             333      the revenues collected from the following taxes, which represents a portion of the
             334      approximately 17% of sales and use tax revenues generated annually by the sales and use tax
             335      on vehicles and vehicle-related products:
             336          (A) the tax imposed by Subsection (2)(a)(i)(A);
             337          (B) the tax imposed by Subsection (2)(b)(i);


             338          (C) the tax imposed by Subsection (2)(c)(i); and
             339          (D) the tax imposed by Subsection (2)(d)(i)(A)(I); plus
             340          (ii) an amount equal to 30% of the growth in the amount of revenues collected in the
             341      current fiscal year from the sales and use taxes described in Subsections (8)(a)(i)(A) through
             342      (D) that exceeds the amount collected from the sales and use taxes described in Subsections
             343      (8)(a)(i)(A) through (D) in the 2010-11 fiscal year.
             344          (b) (i) Subject to Subsections (8)(b)(ii) and (iii), in any fiscal year that the portion of
             345      the sales and use taxes deposited under Subsection (8)(a) represents an amount that is a total
             346      lower percentage of the sales and use taxes described in Subsections (8)(a)(i)(A) through (D)
             347      generated in the current fiscal year than the total percentage of sales and use taxes deposited in
             348      the previous fiscal year, the Division of Finance shall deposit an amount under Subsection
             349      (8)(a) equal to the product of:
             350          (A) the total percentage of sales and use taxes deposited under Subsection (8)(a) in the
             351      previous fiscal year; and
             352          (B) the total sales and use tax revenue generated by the taxes described in Subsections
             353      (8)(a)(i)(A) through (D) in the current fiscal year.
             354          (ii) In any fiscal year in which the portion of the sales and use taxes deposited under
             355      Subsection (8)(a) would exceed 17% of the revenues collected from the sales and use taxes
             356      described in Subsections (8)(a)(i)(A) through (D) in the current fiscal year, the Division of
             357      Finance shall deposit 17% of the revenues collected from the sales and use taxes described in
             358      Subsections (8)(a)(i)(A) through (D) for the current fiscal year under Subsection (8)(a).
             359          (iii) In all subsequent fiscal years after a year in which 17% of the revenues collected
             360      from the sales and use taxes described in Subsections (8)(a)(i)(A) through (D) was deposited
             361      under Subsection (8)(a), the Division of Finance shall annually deposit 17% of the revenues
             362      collected from the sales and use taxes described in Subsections (8)(a)(i)(A) through (D) in the
             363      current fiscal year under Subsection (8)(a).
             364          (9) Notwithstanding Subsection (3)(a), and in addition to the amounts deposited under
             365      Subsections (7) and (8), for a fiscal year beginning on or after July 1, 2012, the Division of
             366      Finance shall annually deposit $90,000,000 of the revenues generated by the taxes listed under
             367      Subsection (3)(a) into the Transportation Investment Fund of 2005 created by Section
             368      72-2-124 .


             369          (10) Notwithstanding Subsection (3)(a), for each fiscal year beginning with fiscal year
             370      2009-10, $533,750 shall be deposited into the Qualified Emergency Food Agencies Fund
             371      created by Section 35A-8-1009 and expended as provided in Section 35A-8-1009 .
             372          (11) (a) Notwithstanding Subsection (3)(a), except as provided in Subsection (11)(b),
             373      and in addition to any amounts deposited under Subsections (7), (8), and (9), beginning on July
             374      1, 2012, the Division of Finance shall deposit into the Transportation Investment Fund of 2005
             375      created by Section 72-2-124 the amount of tax revenue generated by a .025% tax rate on the
             376      transactions described in Subsection (1).
             377          (b) For purposes of Subsection (11)(a), the Division of Finance may not deposit into
             378      the Transportation Investment Fund of 2005 any tax revenue generated by amounts paid or
             379      charged for food and food ingredients, except for tax revenue generated by a bundled
             380      transaction attributable to food and food ingredients and tangible personal property other than
             381      food and food ingredients described in Subsection (2)(d).
             382          (12) (a) Notwithstanding Subsection (3)(a), and except as provided in Subsection
             383      (12)(b), beginning on January 1, 2009, the Division of Finance shall deposit into the
             384      Transportation Fund created by Section 72-2-102 the amount of tax revenue generated by a
             385      .025% tax rate on the transactions described in Subsection (1) to be expended to address
             386      chokepoints in construction management.
             387          (b) For purposes of Subsection (12)(a), the Division of Finance may not deposit into
             388      the Transportation Fund any tax revenue generated by amounts paid or charged for food and
             389      food ingredients, except for tax revenue generated by a bundled transaction attributable to food
             390      and food ingredients and tangible personal property other than food and food ingredients
             391      described in Subsection (2)(d).
             392          (13) Notwithstanding Subsections (4) through (12), an amount required to be expended
             393      or deposited in accordance with Subsections (4) through (12) may not include an amount the
             394      Division of Finance deposits in accordance with Section 59-12-103.2 .
             395          Section 2. Section 59-12-103 (Effective 07/01/14) is amended to read:
             396           59-12-103 (Effective 07/01/14). Sales and use tax base -- Rates -- Effective dates --
             397      Use of sales and use tax revenues.
             398          (1) A tax is imposed on the purchaser as provided in this part for amounts paid or
             399      charged for the following transactions:


             400          (a) retail sales of tangible personal property made within the state;
             401          (b) amounts paid for:
             402          (i) telecommunications service, other than mobile telecommunications service, that
             403      originates and terminates within the boundaries of this state;
             404          (ii) mobile telecommunications service that originates and terminates within the
             405      boundaries of one state only to the extent permitted by the Mobile Telecommunications
             406      Sourcing Act, 4 U.S.C. Sec. 116 et seq.; or
             407          (iii) an ancillary service associated with a:
             408          (A) telecommunications service described in Subsection (1)(b)(i); or
             409          (B) mobile telecommunications service described in Subsection (1)(b)(ii);
             410          (c) sales of the following for commercial use:
             411          (i) gas;
             412          (ii) electricity;
             413          (iii) heat;
             414          (iv) coal;
             415          (v) fuel oil; or
             416          (vi) other fuels;
             417          (d) sales of the following for residential use:
             418          (i) gas;
             419          (ii) electricity;
             420          (iii) heat;
             421          (iv) coal;
             422          (v) fuel oil; or
             423          (vi) other fuels;
             424          (e) sales of prepared food;
             425          (f) except as provided in Section 59-12-104 , amounts paid or charged as admission or
             426      user fees for theaters, movies, operas, museums, planetariums, shows of any type or nature,
             427      exhibitions, concerts, carnivals, amusement parks, amusement rides, circuses, menageries,
             428      fairs, races, contests, sporting events, dances, boxing matches, wrestling matches, closed circuit
             429      television broadcasts, billiard parlors, pool parlors, bowling lanes, golf, miniature golf, golf
             430      driving ranges, batting cages, skating rinks, ski lifts, ski runs, ski trails, snowmobile trails,


             431      tennis courts, swimming pools, water slides, river runs, jeep tours, boat tours, scenic cruises,
             432      horseback rides, sports activities, or any other amusement, entertainment, recreation,
             433      exhibition, cultural, or athletic activity;
             434          (g) amounts paid or charged for services for repairs or renovations of tangible personal
             435      property, unless Section 59-12-104 provides for an exemption from sales and use tax for:
             436          (i) the tangible personal property; and
             437          (ii) parts used in the repairs or renovations of the tangible personal property described
             438      in Subsection (1)(g)(i), whether or not any parts are actually used in the repairs or renovations
             439      of that tangible personal property;
             440          (h) except as provided in Subsection 59-12-104 (7), amounts paid or charged for
             441      assisted cleaning or washing of tangible personal property;
             442          (i) amounts paid or charged for tourist home, hotel, motel, or trailer court
             443      accommodations and services that are regularly rented for less than 30 consecutive days;
             444          (j) amounts paid or charged for laundry or dry cleaning services;
             445          (k) amounts paid or charged for leases or rentals of tangible personal property if within
             446      this state the tangible personal property is:
             447          (i) stored;
             448          (ii) used; or
             449          (iii) otherwise consumed;
             450          (l) amounts paid or charged for tangible personal property if within this state the
             451      tangible personal property is:
             452          (i) stored;
             453          (ii) used; or
             454          (iii) consumed; and
             455          (m) amounts paid or charged for a sale:
             456          (i) (A) of a product transferred electronically; or
             457          (B) of a repair or renovation of a product transferred electronically; and
             458          (ii) regardless of whether the sale provides:
             459          (A) a right of permanent use of the product; or
             460          (B) a right to use the product that is less than a permanent use, including a right:
             461          (I) for a definite or specified length of time; and


             462          (II) that terminates upon the occurrence of a condition.
             463          (2) (a) Except as provided in Subsections (2)(b) through (e), a state tax and a local tax
             464      is imposed on a transaction described in Subsection (1) equal to the sum of:
             465          (i) a state tax imposed on the transaction at a tax rate equal to the sum of:
             466          (A) subject to Section 59-12-103.1 , 4.70%; and
             467          (B) (I) the tax rate the state imposes in accordance with Part 18, Additional State Sales
             468      and Use Tax Act, if the location of the transaction as determined under Sections 59-12-211
             469      through 59-12-215 is in a county in which the state imposes the tax under Part 18, Additional
             470      State Sales and Use Tax Act; and
             471          (II) the tax rate the state imposes in accordance with Part 20, Supplemental State Sales
             472      and Use Tax Act, if the location of the transaction as determined under Sections 59-12-211
             473      through 59-12-215 is in a city, town, or the unincorporated area of a county in which the state
             474      imposes the tax under Part 20, Supplemental State Sales and Use Tax Act; and
             475          (ii) a local tax equal to the sum of the tax rates a county, city, or town imposes on the
             476      transaction under this chapter other than this part.
             477          (b) Except as provided in Subsection (2)(d) or (e), a state tax and a local tax is imposed
             478      on a transaction described in Subsection (1)(d) equal to the sum of:
             479          (i) a state tax imposed on the transaction at a tax rate of 2%; and
             480          (ii) a local tax equal to the sum of the tax rates a county, city, or town imposes on the
             481      transaction under this chapter other than this part.
             482          (c) Except as provided in Subsection (2)(d) or (e), a state tax and a local tax is imposed
             483      on amounts paid or charged for food and food ingredients equal to the sum of:
             484          (i) a state tax imposed on the amounts paid or charged for food and food ingredients at
             485      a tax rate of 1.75%; and
             486          (ii) a local tax equal to the sum of the tax rates a county, city, or town imposes on the
             487      amounts paid or charged for food and food ingredients under this chapter other than this part.
             488          (d) (i) For a bundled transaction that is attributable to food and food ingredients and
             489      tangible personal property other than food and food ingredients, a state tax and a local tax is
             490      imposed on the entire bundled transaction equal to the sum of:
             491          (A) a state tax imposed on the entire bundled transaction equal to the sum of:
             492          (I) the tax rate described in Subsection (2)(a)(i)(A); and


             493          (II) (Aa) the tax rate the state imposes in accordance with Part 18, Additional State
             494      Sales and Use Tax Act, if the location of the transaction as determined under Sections
             495      59-12-211 through 59-12-215 is in a county in which the state imposes the tax under Part 18,
             496      Additional State Sales and Use Tax Act; and
             497          (Bb) the tax rate the state imposes in accordance with Part 20, Supplemental State
             498      Sales and Use Tax Act, if the location of the transaction as determined under Sections
             499      59-12-211 through 59-12-215 is in a city, town, or the unincorporated area of a county in which
             500      the state imposes the tax under Part 20, Supplemental State Sales and Use Tax Act; and
             501          (B) a local tax imposed on the entire bundled transaction at the sum of the tax rates
             502      described in Subsection (2)(a)(ii).
             503          (ii) If an optional computer software maintenance contract is a bundled transaction that
             504      consists of taxable and nontaxable products that are not separately itemized on an invoice or
             505      similar billing document, the purchase of the optional computer software maintenance contract
             506      is 40% taxable under this chapter and 60% nontaxable under this chapter.
             507          (iii) Subject to Subsection (2)(d)(iv), for a bundled transaction other than a bundled
             508      transaction described in Subsection (2)(d)(i) or (ii):
             509          (A) if the sales price of the bundled transaction is attributable to tangible personal
             510      property, a product, or a service that is subject to taxation under this chapter and tangible
             511      personal property, a product, or service that is not subject to taxation under this chapter, the
             512      entire bundled transaction is subject to taxation under this chapter unless:
             513          (I) the seller is able to identify by reasonable and verifiable standards the tangible
             514      personal property, product, or service that is not subject to taxation under this chapter from the
             515      books and records the seller keeps in the seller's regular course of business; or
             516          (II) state or federal law provides otherwise; or
             517          (B) if the sales price of a bundled transaction is attributable to two or more items of
             518      tangible personal property, products, or services that are subject to taxation under this chapter
             519      at different rates, the entire bundled transaction is subject to taxation under this chapter at the
             520      higher tax rate unless:
             521          (I) the seller is able to identify by reasonable and verifiable standards the tangible
             522      personal property, product, or service that is subject to taxation under this chapter at the lower
             523      tax rate from the books and records the seller keeps in the seller's regular course of business; or


             524          (II) state or federal law provides otherwise.
             525          (iv) For purposes of Subsection (2)(d)(iii), books and records that a seller keeps in the
             526      seller's regular course of business includes books and records the seller keeps in the regular
             527      course of business for nontax purposes.
             528          (e) (i) Except as otherwise provided in this chapter and subject to Subsections (2)(e)(ii)
             529      and (iii), if a transaction consists of the sale, lease, or rental of tangible personal property, a
             530      product, or a service that is subject to taxation under this chapter, and the sale, lease, or rental
             531      of tangible personal property, other property, a product, or a service that is not subject to
             532      taxation under this chapter, the entire transaction is subject to taxation under this chapter unless
             533      the seller, at the time of the transaction:
             534          (A) separately states the portion of the transaction that is not subject to taxation under
             535      this chapter on an invoice, bill of sale, or similar document provided to the purchaser; or
             536          (B) is able to identify by reasonable and verifiable standards, from the books and
             537      records the seller keeps in the seller's regular course of business, the portion of the transaction
             538      that is not subject to taxation under this chapter.
             539          (ii) A purchaser and a seller may correct the taxability of a transaction if:
             540          (A) after the transaction occurs, the purchaser and the seller discover that the portion of
             541      the transaction that is not subject to taxation under this chapter was not separately stated on an
             542      invoice, bill of sale, or similar document provided to the purchaser because of an error or
             543      ignorance of the law; and
             544          (B) the seller is able to identify by reasonable and verifiable standards, from the books
             545      and records the seller keeps in the seller's regular course of business, the portion of the
             546      transaction that is not subject to taxation under this chapter.
             547          (iii) For purposes of Subsections (2)(e)(i) and (ii), books and records that a seller keeps
             548      in the seller's regular course of business includes books and records the seller keeps in the
             549      regular course of business for nontax purposes.
             550          (f) (i) If the sales price of a transaction is attributable to two or more items of tangible
             551      personal property, products, or services that are subject to taxation under this chapter at
             552      different rates, the entire purchase is subject to taxation under this chapter at the higher tax rate
             553      unless the seller, at the time of the transaction:
             554          (A) separately states the items subject to taxation under this chapter at each of the


             555      different rates on an invoice, bill of sale, or similar document provided to the purchaser; or
             556          (B) is able to identify by reasonable and verifiable standards the tangible personal
             557      property, product, or service that is subject to taxation under this chapter at the lower tax rate
             558      from the books and records the seller keeps in the seller's regular course of business.
             559          (ii) For purposes of Subsection (2)(f)(i), books and records that a seller keeps in the
             560      seller's regular course of business includes books and records the seller keeps in the regular
             561      course of business for nontax purposes.
             562          (g) Subject to Subsections (2)(h) and (i), a tax rate repeal or tax rate change for a tax
             563      rate imposed under the following shall take effect on the first day of a calendar quarter:
             564          (i) Subsection (2)(a)(i)(A);
             565          (ii) Subsection (2)(b)(i);
             566          (iii) Subsection (2)(c)(i); or
             567          (iv) Subsection (2)(d)(i)(A)(I).
             568          (h) (i) A tax rate increase takes effect on the first day of the first billing period that
             569      begins on or after the effective date of the tax rate increase if the billing period for the
             570      transaction begins before the effective date of a tax rate increase imposed under:
             571          (A) Subsection (2)(a)(i)(A);
             572          (B) Subsection (2)(b)(i);
             573          (C) Subsection (2)(c)(i); or
             574          (D) Subsection (2)(d)(i)(A)(I).
             575          (ii) The repeal of a tax or a tax rate decrease applies to a billing period if the billing
             576      statement for the billing period is rendered on or after the effective date of the repeal of the tax
             577      or the tax rate decrease imposed under:
             578          (A) Subsection (2)(a)(i)(A);
             579          (B) Subsection (2)(b)(i);
             580          (C) Subsection (2)(c)(i); or
             581          (D) Subsection (2)(d)(i)(A)(I).
             582          (i) (i) For a tax rate described in Subsection (2)(i)(ii), if a tax due on a catalogue sale is
             583      computed on the basis of sales and use tax rates published in the catalogue, a tax rate repeal or
             584      change in a tax rate takes effect:
             585          (A) on the first day of a calendar quarter; and


             586          (B) beginning 60 days after the effective date of the tax rate repeal or tax rate change.
             587          (ii) Subsection (2)(i)(i) applies to the tax rates described in the following:
             588          (A) Subsection (2)(a)(i)(A);
             589          (B) Subsection (2)(b)(i);
             590          (C) Subsection (2)(c)(i); or
             591          (D) Subsection (2)(d)(i)(A)(I).
             592          (iii) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act,
             593      the commission may by rule define the term "catalogue sale."
             594          (3) (a) The following state taxes shall be deposited into the General Fund:
             595          (i) the tax imposed by Subsection (2)(a)(i)(A);
             596          (ii) the tax imposed by Subsection (2)(b)(i);
             597          (iii) the tax imposed by Subsection (2)(c)(i); or
             598          (iv) the tax imposed by Subsection (2)(d)(i)(A)(I).
             599          (b) The following local taxes shall be distributed to a county, city, or town as provided
             600      in this chapter:
             601          (i) the tax imposed by Subsection (2)(a)(ii);
             602          (ii) the tax imposed by Subsection (2)(b)(ii);
             603          (iii) the tax imposed by Subsection (2)(c)(ii); and
             604          (iv) the tax imposed by Subsection (2)(d)(i)(B).
             605          (4) (a) Notwithstanding Subsection (3)(a), for a fiscal year beginning on or after July 1,
             606      2003, the lesser of the following amounts shall be expended as provided in Subsections (4)(b)
             607      through (g):
             608          (i) for taxes listed under Subsection (3)(a), the amount of tax revenue generated:
             609          (A) by a 1/16% tax rate on the transactions described in Subsection (1); and
             610          (B) for the fiscal year; or
             611          (ii) $17,500,000.
             612          (b) (i) For a fiscal year beginning on or after July 1, 2003, 14% of the amount
             613      described in Subsection (4)(a) shall be transferred each year as dedicated credits to the
             614      Department of Natural Resources to:
             615          (A) implement the measures described in Subsections 79-2-303 (3)(a) through (d) to
             616      protect sensitive plant and animal species; or


             617          (B) award grants, up to the amount authorized by the Legislature in an appropriations
             618      act, to political subdivisions of the state to implement the measures described in Subsections
             619      79-2-303 (3)(a) through (d) to protect sensitive plant and animal species.
             620          (ii) Money transferred to the Department of Natural Resources under Subsection
             621      (4)(b)(i) may not be used to assist the United States Fish and Wildlife Service or any other
             622      person to list or attempt to have listed a species as threatened or endangered under the
             623      Endangered Species Act of 1973, 16 U.S.C. Sec. 1531 et seq.
             624          (iii) At the end of each fiscal year:
             625          (A) 50% of any unexpended dedicated credits shall lapse to the Water Resources
             626      Conservation and Development Fund created in Section 73-10-24 ;
             627          (B) 25% of any unexpended dedicated credits shall lapse to the Utah Wastewater Loan
             628      Program Subaccount created in Section 73-10c-5 ; and
             629          (C) 25% of any unexpended dedicated credits shall lapse to the Drinking Water Loan
             630      Program Subaccount created in Section 73-10c-5 .
             631          (c) For a fiscal year beginning on or after July 1, 2003, 3% of the amount described in
             632      Subsection (4)(a) shall be deposited each year in the Agriculture Resource Development Fund
             633      created in Section 4-18-106 .
             634          (d) (i) For a fiscal year beginning on or after July 1, 2003, 1% of the amount described
             635      in Subsection (4)(a) shall be transferred each year as dedicated credits to the Division of Water
             636      Rights to cover the costs incurred in hiring legal and technical staff for the adjudication of
             637      water rights.
             638          (ii) At the end of each fiscal year:
             639          (A) 50% of any unexpended dedicated credits shall lapse to the Water Resources
             640      Conservation and Development Fund created in Section 73-10-24 ;
             641          (B) 25% of any unexpended dedicated credits shall lapse to the Utah Wastewater Loan
             642      Program Subaccount created in Section 73-10c-5 ; and
             643          (C) 25% of any unexpended dedicated credits shall lapse to the Drinking Water Loan
             644      Program Subaccount created in Section 73-10c-5 .
             645          (e) (i) For a fiscal year beginning on or after July 1, 2003, 41% of the amount described
             646      in Subsection (4)(a) shall be deposited in the Water Resources Conservation and Development
             647      Fund created in Section 73-10-24 for use by the Division of Water Resources.


             648          (ii) In addition to the uses allowed of the Water Resources Conservation and
             649      Development Fund under Section 73-10-24 , the Water Resources Conservation and
             650      Development Fund may also be used to:
             651          (A) conduct hydrologic and geotechnical investigations by the Division of Water
             652      Resources in a cooperative effort with other state, federal, or local entities, for the purpose of
             653      quantifying surface and ground water resources and describing the hydrologic systems of an
             654      area in sufficient detail so as to enable local and state resource managers to plan for and
             655      accommodate growth in water use without jeopardizing the resource;
             656          (B) fund state required dam safety improvements; and
             657          (C) protect the state's interest in interstate water compact allocations, including the
             658      hiring of technical and legal staff.
             659          (f) For a fiscal year beginning on or after July 1, 2003, 20.5% of the amount described
             660      in Subsection (4)(a) shall be deposited in the Utah Wastewater Loan Program Subaccount
             661      created in Section 73-10c-5 for use by the Water Quality Board to fund wastewater projects.
             662          (g) For a fiscal year beginning on or after July 1, 2003, 20.5% of the amount described
             663      in Subsection (4)(a) shall be deposited in the Drinking Water Loan Program Subaccount
             664      created in Section 73-10c-5 for use by the Division of Drinking Water to:
             665          (i) provide for the installation and repair of collection, treatment, storage, and
             666      distribution facilities for any public water system, as defined in Section 19-4-102 ;
             667          (ii) develop underground sources of water, including springs and wells; and
             668          (iii) develop surface water sources.
             669          (5) (a) Notwithstanding Subsection (3)(a), for a fiscal year beginning on or after July 1,
             670      2006, the difference between the following amounts shall be expended as provided in this
             671      Subsection (5), if that difference is greater than $1:
             672          (i) for taxes listed under Subsection (3)(a), the amount of tax revenue generated for the
             673      fiscal year by a 1/16% tax rate on the transactions described in Subsection (1); and
             674          (ii) $17,500,000.
             675          (b) (i) The first $500,000 of the difference described in Subsection (5)(a) shall be:
             676          (A) transferred each fiscal year to the Department of Natural Resources as dedicated
             677      credits; and
             678          (B) expended by the Department of Natural Resources for watershed rehabilitation or


             679      restoration.
             680          (ii) At the end of each fiscal year, 100% of any unexpended dedicated credits described
             681      in Subsection (5)(b)(i) shall lapse to the Water Resources Conservation and Development Fund
             682      created in Section 73-10-24 .
             683          (c) (i) After making the transfer required by Subsection (5)(b)(i), $150,000 of the
             684      remaining difference described in Subsection (5)(a) shall be:
             685          (A) transferred each fiscal year to the Division of Water Resources as dedicated
             686      credits; and
             687          (B) expended by the Division of Water Resources for cloud-seeding projects
             688      authorized by Title 73, Chapter 15, Modification of Weather.
             689          (ii) At the end of each fiscal year, 100% of any unexpended dedicated credits described
             690      in Subsection (5)(c)(i) shall lapse to the Water Resources Conservation and Development Fund
             691      created in Section 73-10-24 .
             692          (d) After making the transfers required by Subsections (5)(b) and (c), 94% of the
             693      remaining difference described in Subsection (5)(a) shall be deposited into the Water
             694      Resources Conservation and Development Fund created in Section 73-10-24 for use by the
             695      Division of Water Resources for:
             696          (i) preconstruction costs:
             697          (A) as defined in Subsection 73-26-103 (6) for projects authorized by Title 73, Chapter
             698      26, Bear River Development Act; and
             699          (B) as defined in Subsection 73-28-103 (8) for the Lake Powell Pipeline project
             700      authorized by Title 73, Chapter 28, Lake Powell Pipeline Development Act;
             701          (ii) the cost of employing a civil engineer to oversee any project authorized by Title 73,
             702      Chapter 26, Bear River Development Act;
             703          (iii) the cost of employing a civil engineer to oversee the Lake Powell Pipeline project
             704      authorized by Title 73, Chapter 28, Lake Powell Pipeline Development Act; and
             705          (iv) other uses authorized under Sections 73-10-24 , 73-10-25.1 , 73-10-30 , and
             706      Subsection (4)(e)(ii) after funding the uses specified in Subsections (5)(d)(i) through (iii).
             707          (e) After making the transfers required by Subsections (5)(b) and (c) and subject to
             708      Subsection (5)(f), 6% of the remaining difference described in Subsection (5)(a) shall be
             709      transferred each year as dedicated credits to the Division of Water Rights to cover the costs


             710      incurred for employing additional technical staff for the administration of water rights.
             711          (f) At the end of each fiscal year, any unexpended dedicated credits described in
             712      Subsection (5)(e) over $150,000 lapse to the Water Resources Conservation and Development
             713      Fund created in Section 73-10-24 .
             714          (6) Notwithstanding Subsection (3)(a), for a fiscal year beginning on or after July 1,
             715      2003, and for taxes listed under Subsection (3)(a), the amount of revenue generated by a 1/16%
             716      tax rate on the transactions described in Subsection (1) for the fiscal year shall be deposited in
             717      the Transportation Fund created by Section 72-2-102 .
             718          (7) Notwithstanding Subsection (3)(a), beginning on July 1, 2012, the Division of
             719      Finance shall deposit into the Transportation Investment Fund of 2005 created in Section
             720      72-2-124 a portion of the taxes listed under Subsection (3)(a) equal to the revenues generated
             721      by a 1/64% tax rate on the taxable transactions under Subsection (1).
             722          (8) (a) Notwithstanding Subsection (3)(a), in addition to the amounts deposited in
             723      Subsection (7), and subject to Subsection (8)(b), for a fiscal year beginning on or after July 1,
             724      2012, the Division of Finance shall deposit into the Transportation Investment Fund of 2005
             725      created by Section 72-2-124 :
             726          (i) a portion of the taxes listed under Subsection (3)(a) in an amount equal to 8.3% of
             727      the revenues collected from the following taxes, which represents a portion of the
             728      approximately 17% of sales and use tax revenues generated annually by the sales and use tax
             729      on vehicles and vehicle-related products:
             730          (A) the tax imposed by Subsection (2)(a)(i)(A);
             731          (B) the tax imposed by Subsection (2)(b)(i);
             732          (C) the tax imposed by Subsection (2)(c)(i); and
             733          (D) the tax imposed by Subsection (2)(d)(i)(A)(I); plus
             734          (ii) an amount equal to 30% of the growth in the amount of revenues collected in the
             735      current fiscal year from the sales and use taxes described in Subsections (8)(a)(i)(A) through
             736      (D) that exceeds the amount collected from the sales and use taxes described in Subsections
             737      (8)(a)(i)(A) through (D) in the 2010-11 fiscal year.
             738          (b) (i) Subject to Subsections (8)(b)(ii) and (iii), in any fiscal year that the portion of
             739      the sales and use taxes deposited under Subsection (8)(a) represents an amount that is a total
             740      lower percentage of the sales and use taxes described in Subsections (8)(a)(i)(A) through (D)


             741      generated in the current fiscal year than the total percentage of sales and use taxes deposited in
             742      the previous fiscal year, the Division of Finance shall deposit an amount under Subsection
             743      (8)(a) equal to the product of:
             744          (A) the total percentage of sales and use taxes deposited under Subsection (8)(a) in the
             745      previous fiscal year; and
             746          (B) the total sales and use tax revenue generated by the taxes described in Subsections
             747      (8)(a)(i)(A) through (D) in the current fiscal year.
             748          (ii) In any fiscal year in which the portion of the sales and use taxes deposited under
             749      Subsection (8)(a) would exceed 17% of the revenues collected from the sales and use taxes
             750      described in Subsections (8)(a)(i)(A) through (D) in the current fiscal year, the Division of
             751      Finance shall deposit 17% of the revenues collected from the sales and use taxes described in
             752      Subsections (8)(a)(i)(A) through (D) for the current fiscal year under Subsection (8)(a).
             753          (iii) In all subsequent fiscal years after a year in which 17% of the revenues collected
             754      from the sales and use taxes described in Subsections (8)(a)(i)(A) through (D) was deposited
             755      under Subsection (8)(a), the Division of Finance shall annually deposit 17% of the revenues
             756      collected from the sales and use taxes described in Subsections (8)(a)(i)(A) through (D) in the
             757      current fiscal year under Subsection (8)(a).
             758          (9) Notwithstanding Subsection (3)(a), and in addition to the amounts deposited under
             759      Subsections (7) and (8), for a fiscal year beginning on or after July 1, 2012, the Division of
             760      Finance shall annually deposit $90,000,000 of the revenues generated by the taxes listed under
             761      Subsection (3)(a) into the Transportation Investment Fund of 2005 created by Section
             762      72-2-124 .
             763          (10) Notwithstanding Subsection (3)(a), for each fiscal year beginning with fiscal year
             764      2009-10, $533,750 shall be deposited into the Qualified Emergency Food Agencies Fund
             765      created by Section 35A-8-1009 and expended as provided in Section 35A-8-1009 .
             766          (11) (a) Notwithstanding Subsection (3)(a), except as provided in Subsection (11)(b),
             767      and in addition to any amounts deposited under Subsections (7), (8), and (9), beginning on July
             768      1, 2012, the Division of Finance shall deposit into the Transportation Investment Fund of 2005
             769      created by Section 72-2-124 the amount of tax revenue generated by a .025% tax rate on the
             770      transactions described in Subsection (1).
             771          (b) For purposes of Subsection (11)(a), the Division of Finance may not deposit into


             772      the Transportation Investment Fund of 2005 any tax revenue generated by amounts paid or
             773      charged for food and food ingredients, except for tax revenue generated by a bundled
             774      transaction attributable to food and food ingredients and tangible personal property other than
             775      food and food ingredients described in Subsection (2)(d).
             776          (12) (a) Notwithstanding Subsection (3)(a), and except as provided in Subsection
             777      (12)(b), beginning on January 1, 2009, the Division of Finance shall deposit into the
             778      Transportation Fund created by Section 72-2-102 the amount of tax revenue generated by a
             779      .025% tax rate on the transactions described in Subsection (1) to be expended to address
             780      chokepoints in construction management.
             781          (b) For purposes of Subsection (12)(a), the Division of Finance may not deposit into
             782      the Transportation Fund any tax revenue generated by amounts paid or charged for food and
             783      food ingredients, except for tax revenue generated by a bundled transaction attributable to food
             784      and food ingredients and tangible personal property other than food and food ingredients
             785      described in Subsection (2)(d).
             786          (13) Notwithstanding Subsections (4) through (12), an amount required to be expended
             787      or deposited in accordance with Subsections (4) through (12) may not include an amount the
             788      Division of Finance deposits in accordance with Section 59-12-103.2 .
             789          Section 3. Section 59-12-103.1 is amended to read:
             790           59-12-103.1. Action by Supreme Court of the United States authorizing or action
             791      by Congress permitting a state to require certain sellers to collect a sales or use tax --
             792      Collection of tax by commission -- Commission report to Revenue and Taxation Interim
             793      Committee -- Revenue and Taxation Interim Committee study -- Division of Finance
             794      requirement to make certain deposits -- Reduction in state sales and use tax rate.
             795          (1) Except as provided in Section 59-12-107.1 , a seller shall remit a tax to the
             796      commission as provided in Section 59-12-107 if:
             797          (a) the Supreme Court of the United States issues a decision authorizing a state to
             798      require the following sellers to collect a sales or use tax:
             799          (i) a seller that does not meet one or more of the criteria described in Subsection
             800      59-12-107 (2)(a); or
             801          (ii) a seller that is not a seller required to pay or collect and remit sales and use taxes
             802      under Subsection 59-12-107 (2)(b); or


             803          (b) Congress permits the state to require the following sellers to collect a sales or use
             804      tax:
             805          (i) a seller that does not meet one or more of the criteria described in Subsection
             806      59-12-107 (2)(a); or
             807          (ii) a seller that is not a seller required to pay or collect and remit sales and use taxes
             808      under Subsection 59-12-107 (2)(b).
             809          (2) The commission shall:
             810          (a) collect the tax described in Subsection (1) from the seller:
             811          (i) to the extent:
             812          (A) authorized by the Supreme Court of the United States; or
             813          (B) permitted by Congress; and
             814          (ii) beginning on the first day of a calendar quarter as prescribed by the Revenue and
             815      Taxation Interim Committee; and
             816          (b) make a report to the Revenue and Taxation Interim Committee:
             817          (i) regarding the actions taken by:
             818          (A) the Supreme Court of the United States; or
             819          (B) Congress;
             820          (ii) (A) stating the amount of state revenue collected at the time of the report, if any;
             821      and
             822          (B) estimating the state sales and use tax rate reduction that would offset the amount of
             823      state revenue estimated to be collected for the current fiscal year and the next fiscal year; and
             824          (iii) (A) at the Revenue and Taxation Interim Committee meeting immediately
             825      following the day on which the actions of the Supreme Court of the United States or Congress
             826      become effective; and
             827          (B) any other meeting of the Revenue and Taxation Interim Committee as requested by
             828      the chairs of the committee.
             829          (3) The Revenue and Taxation Interim Committee shall after hearing the commission's
             830      report under Subsection (2)(b):
             831          (a) review the actions taken by:
             832          (i) the Supreme Court of the United States; or
             833          (ii) Congress;


             834          (b) direct the commission regarding the day on which the commission is required to
             835      collect the tax described in Subsection (1); and
             836          (c) make recommendations to the Legislative Management Committee:
             837          (i) regarding whether as a result of the actions of the Supreme Court of the United
             838      States or Congress any provisions of this chapter should be amended or repealed, including
             839      whether the state sales and use tax rate reduction required by Subsection (4) should be
             840      amended; and
             841          (ii) within a one-year period after the day on which the commission makes a report
             842      under Subsection (2)(b).
             843          (4) The Division of Finance shall deposit a portion of the revenue collected under this
             844      section into the Remote Sales Restricted Account as required by Section 59-12-103.2 .
             845          (5) Beginning on the date the commission collects the tax described in Subsection (1),
             846      the state sales and use tax rate described in Subsection 59-12-103 (2)(a)(i)(A) is
             846a      H. [ 4.45 ] 4.50 .H %.
             847          Section 4. Section 59-12-103.2 is amended to read:
             848           59-12-103.2. Definitions -- Remote Sales Restricted Account -- Creation --
             849      Funding for account -- Interest -- Division of Finance accounting.
             850          (1) As used in this section[: (a) "Qualified], "qualified local revenue collected from
             851      remote sellers" means the local revenue the commission collects under Section 59-12-103.1 for
             852      a fiscal year from sellers who obtain a license under Section 59-12-106 for the first time on or
             853      after the earlier of:
             854          [(i)] (a) the date a decision described in Subsection 59-12-103.1 (1)(a) becomes a final,
             855      unappealable decision; or
             856          [(ii)] (b) the effective date of the action by Congress described in Subsection
             857      59-12-103.1 (1)(b).
             858          [(b) "Qualified state revenue collected from remote sellers" means the state revenue the
             859      commission collects under Section 59-12-103.1 for a fiscal year from sellers who obtain a
             860      license under Section 59-12-106 for the first time on or after the earlier of:]
             861          [(i) the date a decision described in Subsection 59-12-103.1 (1)(a) becomes a final,
             862      unappealable decision; or]
             863          [(ii) the effective date of the action by Congress described in Subsection
             864      59-12-103.1 (1)(b).]


             865          (2) There is created within the General Fund a restricted account known as the
             866      "Remote Sales Restricted Account."
             867          (3) The account shall be funded by[: (a)] the qualified local revenue collected from
             868      remote sellers[; and].
             869          [(b) the qualified state revenue collected from remote sellers.]
             870          (4) (a) The account shall earn interest.
             871          (b) The interest described in Subsection (4)(a) shall be deposited into the account.
             872          (5) The Division of Finance shall deposit the revenue described in Subsection (3) into
             873      the account.
             874          (6) The Division of Finance shall separately account for:
             875          (a) [(i)] the qualified local revenue collected from remote sellers; and
             876          [(ii)] (b) interest earned on the amount described in Subsection (6)(a)[(i); and].
             877          [(b) (i) the qualified state revenue collected from remote sellers; and]
             878          [(ii) interest earned on the amount described in Subsection (6)(b)(i).]
             879          (7) [(a)] The revenue and interest described in Subsection (6)[(a)] may be used to lower
             880      local sales and use tax rates as the Legislature may provide by statute.
             881          [(b) The revenue and interest described in Subsection (6)(b) may be used to lower state
             882      sales and use tax rates as the Legislature may provide by statute.]
             883          Section 5. Effective date.
             884          (1) Except as provided in Subsection (2), this bill takes effect on May 13, 2014.
             885          (2) The actions affecting Section 59-12-103 (Effective 07/01/14) take effect on July 1,
             886      2014.




Legislative Review Note
    as of 9-12-13 1:48 PM


Office of Legislative Research and General Counsel


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