2
3
4
5
6 Cosponsor:
Curtis S. Bramble
7
8 LONG TITLE
9 General Description:
10 This bill amends sales and use tax exemptions relating to a purchase or lease of
11 machinery, equipment, normal operating repair or replacement parts, and materials.
12 Highlighted Provisions:
13 This bill:
14 ▸ amends sales and use tax definitions;
15 ▸ repeals the economic life provision of the sales and use tax exemption for the
16 purchase or lease of machinery, equipment, or normal operating repair or
17 replacement parts by a manufacturing facility, certain mining establishments, or a
18 web search portal for use in certain business activities;
19 ▸ creates a sales and use tax exemption for the purchase or lease of materials, except
20 office equipment and office supplies, by a manufacturing facility, certain mining
21 establishments, or a web search portal that are used or consumed in certain business
22 activities;
23 ▸ creates a sales and use tax exemption for the purchase or lease of machinery,
24 equipment, normal operating repair or replacement parts, or materials, except office
25 equipment or office supplies, by a medical laboratory;
26 ▸ makes the expansion of the exemption for a manufacturing facility, certain mining
27 operations, or a web search portal and the new exemption for a medical laboratory effective
28 upon action by the federal government permitting the state to require remote sellers to collect
29 sales and use tax ; and
30 ▸ makes technical and conforming changes.
31 Money Appropriated in this Bill:
32 None
33 Other Special Clauses:
34 None
35 Utah Code Sections Affected:
36 AMENDS:
37 59-12-102, as last amended by Laws of Utah 2017, Chapters 181, 382, and 422
38 59-12-104, as last amended by Laws of Utah 2017, Chapters 264, 268, and 429
39 59-12-104.5, as last amended by Laws of Utah 2017, Chapter 268
40 59-12-104.7, as enacted by Laws of Utah 2017, Chapter 268
41 63N-1-302, as enacted by Laws of Utah 2017, Chapter 268
42 ENACTS:
43 59-12-104.8, Utah Code Annotated 1953
44
45 Be it enacted by the Legislature of the state of Utah:
46 Section 1. Section 59-12-102 is amended to read:
47 59-12-102. Definitions.
48 As used in this chapter:
49 (1) "800 service" means a telecommunications service that:
50 (a) allows a caller to dial a toll-free number without incurring a charge for the call; and
51 (b) is typically marketed:
52 (i) under the name 800 toll-free calling;
53 (ii) under the name 855 toll-free calling;
54 (iii) under the name 866 toll-free calling;
55 (iv) under the name 877 toll-free calling;
56 (v) under the name 888 toll-free calling; or
57 (vi) under a name similar to Subsections (1)(b)(i) through (v) as designated by the
58 Federal Communications Commission.
59 (2) (a) "900 service" means an inbound toll telecommunications service that:
60 (i) a subscriber purchases;
61 (ii) allows a customer of the subscriber described in Subsection (2)(a)(i) to call in to
62 the subscriber's:
63 (A) prerecorded announcement; or
64 (B) live service; and
65 (iii) is typically marketed:
66 (A) under the name 900 service; or
67 (B) under a name similar to Subsection (2)(a)(iii)(A) as designated by the Federal
68 Communications Commission.
69 (b) "900 service" does not include a charge for:
70 (i) a collection service a seller of a telecommunications service provides to a
71 subscriber; or
72 (ii) the following a subscriber sells to the subscriber's customer:
73 (A) a product; or
74 (B) a service.
75 (3) (a) "Admission or user fees" includes season passes.
76 (b) "Admission or user fees" does not include annual membership dues to private
77 organizations.
78 (4) "Agreement" means the Streamlined Sales and Use Tax Agreement adopted on
79 November 12, 2002, including amendments made to the Streamlined Sales and Use Tax
80 Agreement after November 12, 2002.
81 (5) "Agreement combined tax rate" means the sum of the tax rates:
82 (a) listed under Subsection (6); and
83 (b) that are imposed within a local taxing jurisdiction.
84 (6) "Agreement sales and use tax" means a tax imposed under:
85 (a) Subsection 59-12-103(2)(a)(i)(A);
86 (b) Subsection 59-12-103(2)(b)(i);
87 (c) Subsection 59-12-103(2)(c)(i);
88 (d) Subsection 59-12-103(2)(d)(i)(A)(I);
89 (e) Section 59-12-204;
90 (f) Section 59-12-401;
91 (g) Section 59-12-402;
92 (h) Section 59-12-402.1;
93 (i) Section 59-12-703;
94 (j) Section 59-12-802;
95 (k) Section 59-12-804;
96 (l) Section 59-12-1102;
97 (m) Section 59-12-1302;
98 (n) Section 59-12-1402;
99 (o) Section 59-12-1802;
100 (p) Section 59-12-2003;
101 (q) Section 59-12-2103;
102 (r) Section 59-12-2213;
103 (s) Section 59-12-2214;
104 (t) Section 59-12-2215;
105 (u) Section 59-12-2216;
106 (v) Section 59-12-2217;
107 (w) Section 59-12-2218; or
108 (x) Section 59-12-2219.
109 (7) "Aircraft" means the same as that term is defined in Section 72-10-102.
110 (8) "Aircraft maintenance, repair, and overhaul provider" means a business entity:
111 (a) except for:
112 (i) an airline as defined in Section 59-2-102; or
113 (ii) an affiliated group, as defined in Section 59-7-101, except that "affiliated group"
114 includes a corporation that is qualified to do business but is not otherwise doing business in the
115 state, of an airline; and
116 (b) that has the workers, expertise, and facilities to perform the following, regardless of
117 whether the business entity performs the following in this state:
118 (i) check, diagnose, overhaul, and repair:
119 (A) an onboard system of a fixed wing turbine powered aircraft; and
120 (B) the parts that comprise an onboard system of a fixed wing turbine powered aircraft;
121 (ii) assemble, change, dismantle, inspect, and test a fixed wing turbine powered aircraft
122 engine;
123 (iii) perform at least the following maintenance on a fixed wing turbine powered
124 aircraft:
125 (A) an inspection;
126 (B) a repair, including a structural repair or modification;
127 (C) changing landing gear; and
128 (D) addressing issues related to an aging fixed wing turbine powered aircraft;
129 (iv) completely remove the existing paint of a fixed wing turbine powered aircraft and
130 completely apply new paint to the fixed wing turbine powered aircraft; and
131 (v) refurbish the interior of a fixed wing turbine powered aircraft in a manner that
132 results in a change in the fixed wing turbine powered aircraft's certification requirements by the
133 authority that certifies the fixed wing turbine powered aircraft.
134 (9) "Alcoholic beverage" means a beverage that:
135 (a) is suitable for human consumption; and
136 (b) contains .5% or more alcohol by volume.
137 (10) "Alternative energy" means:
138 (a) biomass energy;
139 (b) geothermal energy;
140 (c) hydroelectric energy;
141 (d) solar energy;
142 (e) wind energy; or
143 (f) energy that is derived from:
144 (i) coal-to-liquids;
145 (ii) nuclear fuel;
146 (iii) oil-impregnated diatomaceous earth;
147 (iv) oil sands;
148 (v) oil shale;
149 (vi) petroleum coke; or
150 (vii) waste heat from:
151 (A) an industrial facility; or
152 (B) a power station in which an electric generator is driven through a process in which
153 water is heated, turns into steam, and spins a steam turbine.
154 (11) (a) Subject to Subsection (11)(b), "alternative energy electricity production
155 facility" means a facility that:
156 (i) uses alternative energy to produce electricity; and
157 (ii) has a production capacity of two megawatts or greater.
158 (b) A facility is an alternative energy electricity production facility regardless of
159 whether the facility is:
160 (i) connected to an electric grid; or
161 (ii) located on the premises of an electricity consumer.
162 (12) (a) "Ancillary service" means a service associated with, or incidental to, the
163 provision of telecommunications service.
164 (b) "Ancillary service" includes:
165 (i) a conference bridging service;
166 (ii) a detailed communications billing service;
167 (iii) directory assistance;
168 (iv) a vertical service; or
169 (v) a voice mail service.
170 (13) "Area agency on aging" means the same as that term is defined in Section
171 62A-3-101.
172 (14) "Assisted amusement device" means an amusement device, skill device, or ride
173 device that is started and stopped by an individual:
174 (a) who is not the purchaser or renter of the right to use or operate the amusement
175 device, skill device, or ride device; and
176 (b) at the direction of the seller of the right to use the amusement device, skill device,
177 or ride device.
178 (15) "Assisted cleaning or washing of tangible personal property" means cleaning or
179 washing of tangible personal property if the cleaning or washing labor is primarily performed
180 by an individual:
181 (a) who is not the purchaser of the cleaning or washing of the tangible personal
182 property; and
183 (b) at the direction of the seller of the cleaning or washing of the tangible personal
184 property.
185 (16) "Authorized carrier" means:
186 (a) in the case of vehicles operated over public highways, the holder of credentials
187 indicating that the vehicle is or will be operated pursuant to both the International Registration
188 Plan and the International Fuel Tax Agreement;
189 (b) in the case of aircraft, the holder of a Federal Aviation Administration operating
190 certificate or air carrier's operating certificate; or
191 (c) in the case of locomotives, freight cars, railroad work equipment, or other rolling
192 stock, a person who uses locomotives, freight cars, railroad work equipment, or other rolling
193 stock in more than one state.
194 (17) (a) Except as provided in Subsection (17)(b), "biomass energy" means any of the
195 following that is used as the primary source of energy to produce fuel or electricity:
196 (i) material from a plant or tree; or
197 (ii) other organic matter that is available on a renewable basis, including:
198 (A) slash and brush from forests and woodlands;
199 (B) animal waste;
200 (C) waste vegetable oil;
201 (D) methane or synthetic gas produced at a landfill, as a byproduct of the treatment of
202 wastewater residuals, or through the conversion of a waste material through a nonincineration,
203 thermal conversion process;
204 (E) aquatic plants; and
205 (F) agricultural products.
206 (b) "Biomass energy" does not include:
207 (i) black liquor; or
208 (ii) treated woods.
209 (18) (a) "Bundled transaction" means the sale of two or more items of tangible personal
210 property, products, or services if the tangible personal property, products, or services are:
211 (i) distinct and identifiable; and
212 (ii) sold for one nonitemized price.
213 (b) "Bundled transaction" does not include:
214 (i) the sale of tangible personal property if the sales price varies, or is negotiable, on
215 the basis of the selection by the purchaser of the items of tangible personal property included in
216 the transaction;
217 (ii) the sale of real property;
218 (iii) the sale of services to real property;
219 (iv) the retail sale of tangible personal property and a service if:
220 (A) the tangible personal property:
221 (I) is essential to the use of the service; and
222 (II) is provided exclusively in connection with the service; and
223 (B) the service is the true object of the transaction;
224 (v) the retail sale of two services if:
225 (A) one service is provided that is essential to the use or receipt of a second service;
226 (B) the first service is provided exclusively in connection with the second service; and
227 (C) the second service is the true object of the transaction;
228 (vi) a transaction that includes tangible personal property or a product subject to
229 taxation under this chapter and tangible personal property or a product that is not subject to
230 taxation under this chapter if the:
231 (A) seller's purchase price of the tangible personal property or product subject to
232 taxation under this chapter is de minimis; or
233 (B) seller's sales price of the tangible personal property or product subject to taxation
234 under this chapter is de minimis; and
235 (vii) the retail sale of tangible personal property that is not subject to taxation under
236 this chapter and tangible personal property that is subject to taxation under this chapter if:
237 (A) that retail sale includes:
238 (I) food and food ingredients;
239 (II) a drug;
240 (III) durable medical equipment;
241 (IV) mobility enhancing equipment;
242 (V) an over-the-counter drug;
243 (VI) a prosthetic device; or
244 (VII) a medical supply; and
245 (B) subject to Subsection (18)(f):
246 (I) the seller's purchase price of the tangible personal property subject to taxation under
247 this chapter is 50% or less of the seller's total purchase price of that retail sale; or
248 (II) the seller's sales price of the tangible personal property subject to taxation under
249 this chapter is 50% or less of the seller's total sales price of that retail sale.
250 (c) (i) For purposes of Subsection (18)(a)(i), tangible personal property, a product, or a
251 service that is distinct and identifiable does not include:
252 (A) packaging that:
253 (I) accompanies the sale of the tangible personal property, product, or service; and
254 (II) is incidental or immaterial to the sale of the tangible personal property, product, or
255 service;
256 (B) tangible personal property, a product, or a service provided free of charge with the
257 purchase of another item of tangible personal property, a product, or a service; or
258 (C) an item of tangible personal property, a product, or a service included in the
259 definition of "purchase price."
260 (ii) For purposes of Subsection (18)(c)(i)(B), an item of tangible personal property, a
261 product, or a service is provided free of charge with the purchase of another item of tangible
262 personal property, a product, or a service if the sales price of the purchased item of tangible
263 personal property, product, or service does not vary depending on the inclusion of the tangible
264 personal property, product, or service provided free of charge.
265 (d) (i) For purposes of Subsection (18)(a)(ii), property sold for one nonitemized price
266 does not include a price that is separately identified by tangible personal property, product, or
267 service on the following, regardless of whether the following is in paper format or electronic
268 format:
269 (A) a binding sales document; or
270 (B) another supporting sales-related document that is available to a purchaser.
271 (ii) For purposes of Subsection (18)(d)(i), a binding sales document or another
272 supporting sales-related document that is available to a purchaser includes:
273 (A) a bill of sale;
274 (B) a contract;
275 (C) an invoice;
276 (D) a lease agreement;
277 (E) a periodic notice of rates and services;
278 (F) a price list;
279 (G) a rate card;
280 (H) a receipt; or
281 (I) a service agreement.
282 (e) (i) For purposes of Subsection (18)(b)(vi), the sales price of tangible personal
283 property or a product subject to taxation under this chapter is de minimis if:
284 (A) the seller's purchase price of the tangible personal property or product is 10% or
285 less of the seller's total purchase price of the bundled transaction; or
286 (B) the seller's sales price of the tangible personal property or product is 10% or less of
287 the seller's total sales price of the bundled transaction.
288 (ii) For purposes of Subsection (18)(b)(vi), a seller:
289 (A) shall use the seller's purchase price or the seller's sales price to determine if the
290 purchase price or sales price of the tangible personal property or product subject to taxation
291 under this chapter is de minimis; and
292 (B) may not use a combination of the seller's purchase price and the seller's sales price
293 to determine if the purchase price or sales price of the tangible personal property or product
294 subject to taxation under this chapter is de minimis.
295 (iii) For purposes of Subsection (18)(b)(vi), a seller shall use the full term of a service
296 contract to determine if the sales price of tangible personal property or a product is de minimis.
297 (f) For purposes of Subsection (18)(b)(vii)(B), a seller may not use a combination of
298 the seller's purchase price and the seller's sales price to determine if tangible personal property
299 subject to taxation under this chapter is 50% or less of the seller's total purchase price or sales
300 price of that retail sale.
301 (19) "Certified automated system" means software certified by the governing board of
302 the agreement that:
303 (a) calculates the agreement sales and use tax imposed within a local taxing
304 jurisdiction:
305 (i) on a transaction; and
306 (ii) in the states that are members of the agreement;
307 (b) determines the amount of agreement sales and use tax to remit to a state that is a
308 member of the agreement; and
309 (c) maintains a record of the transaction described in Subsection (19)(a)(i).
310 (20) "Certified service provider" means an agent certified:
311 (a) by the governing board of the agreement; and
312 (b) to perform all of a seller's sales and use tax functions for an agreement sales and
313 use tax other than the seller's obligation under Section 59-12-124 to remit a tax on the seller's
314 own purchases.
315 (21) (a) Subject to Subsection (21)(b), "clothing" means all human wearing apparel
316 suitable for general use.
317 (b) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
318 commission shall make rules:
319 (i) listing the items that constitute "clothing"; and
320 (ii) that are consistent with the list of items that constitute "clothing" under the
321 agreement.
322 (22) "Coal-to-liquid" means the process of converting coal into a liquid synthetic fuel.
323 (23) "Commercial use" means the use of gas, electricity, heat, coal, fuel oil, or other
324 fuels that does not constitute industrial use under Subsection (56) or residential use under
325 Subsection (106).
326 (24) (a) "Common carrier" means a person engaged in or transacting the business of
327 transporting passengers, freight, merchandise, or other property for hire within this state.
328 (b) (i) "Common carrier" does not include a person who, at the time the person is
329 traveling to or from that person's place of employment, transports a passenger to or from the
330 passenger's place of employment.
331 (ii) For purposes of Subsection (24)(b)(i), in accordance with Title 63G, Chapter 3,
332 Utah Administrative Rulemaking Act, the commission may make rules defining what
333 constitutes a person's place of employment.
334 (c) "Common carrier" does not include a person that provides transportation network
335 services, as defined in Section 13-51-102.
336 (25) "Component part" includes:
337 (a) poultry, dairy, and other livestock feed, and their components;
338 (b) baling ties and twine used in the baling of hay and straw;
339 (c) fuel used for providing temperature control of orchards and commercial
340 greenhouses doing a majority of their business in wholesale sales, and for providing power for
341 off-highway type farm machinery; and
342 (d) feed, seeds, and seedlings.
343 (26) "Computer" means an electronic device that accepts information:
344 (a) (i) in digital form; or
345 (ii) in a form similar to digital form; and
346 (b) manipulates that information for a result based on a sequence of instructions.
347 (27) "Computer software" means a set of coded instructions designed to cause:
348 (a) a computer to perform a task; or
349 (b) automatic data processing equipment to perform a task.
350 (28) "Computer software maintenance contract" means a contract that obligates a seller
351 of computer software to provide a customer with:
352 (a) future updates or upgrades to computer software;
353 (b) support services with respect to computer software; or
354 (c) a combination of Subsections (28)(a) and (b).
355 (29) (a) "Conference bridging service" means an ancillary service that links two or
356 more participants of an audio conference call or video conference call.
357 (b) "Conference bridging service" may include providing a telephone number as part of
358 the ancillary service described in Subsection (29)(a).
359 (c) "Conference bridging service" does not include a telecommunications service used
360 to reach the ancillary service described in Subsection (29)(a).
361 (30) "Construction materials" means any tangible personal property that will be
362 converted into real property.
363 (31) "Delivered electronically" means delivered to a purchaser by means other than
364 tangible storage media.
365 (32) (a) "Delivery charge" means a charge:
366 (i) by a seller of:
367 (A) tangible personal property;
368 (B) a product transferred electronically; or
369 (C) services; and
370 (ii) for preparation and delivery of the tangible personal property, product transferred
371 electronically, or services described in Subsection (32)(a)(i) to a location designated by the
372 purchaser.
373 (b) "Delivery charge" includes a charge for the following:
374 (i) transportation;
375 (ii) shipping;
376 (iii) postage;
377 (iv) handling;
378 (v) crating; or
379 (vi) packing.
380 (33) "Detailed telecommunications billing service" means an ancillary service of
381 separately stating information pertaining to individual calls on a customer's billing statement.
382 (34) "Dietary supplement" means a product, other than tobacco, that:
383 (a) is intended to supplement the diet;
384 (b) contains one or more of the following dietary ingredients:
385 (i) a vitamin;
386 (ii) a mineral;
387 (iii) an herb or other botanical;
388 (iv) an amino acid;
389 (v) a dietary substance for use by humans to supplement the diet by increasing the total
390 dietary intake; or
391 (vi) a concentrate, metabolite, constituent, extract, or combination of any ingredient
392 described in Subsections (34)(b)(i) through (v);
393 (c) (i) except as provided in Subsection (34)(c)(ii), is intended for ingestion in:
394 (A) tablet form;
395 (B) capsule form;
396 (C) powder form;
397 (D) softgel form;
398 (E) gelcap form; or
399 (F) liquid form; or
400 (ii) if the product is not intended for ingestion in a form described in Subsections
401 (34)(c)(i)(A) through (F), is not represented:
402 (A) as conventional food; and
403 (B) for use as a sole item of:
404 (I) a meal; or
405 (II) the diet; and
406 (d) is required to be labeled as a dietary supplement:
407 (i) identifiable by the "Supplemental Facts" box found on the label; and
408 (ii) as required by 21 C.F.R. Sec. 101.36.
409 (35) "Digital audio-visual work" means a series of related images which, when shown
410 in succession, imparts an impression of motion, together with accompanying sounds, if any.
411 (36) (a) "Digital audio work" means a work that results from the fixation of a series of
412 musical, spoken, or other sounds.
413 (b) "Digital audio work" includes a ringtone.
414 (37) "Digital book" means a work that is generally recognized in the ordinary and usual
415 sense as a book.
416 (38) (a) "Direct mail" means printed material delivered or distributed by United States
417 mail or other delivery service:
418 (i) to:
419 (A) a mass audience; or
420 (B) addressees on a mailing list provided:
421 (I) by a purchaser of the mailing list; or
422 (II) at the discretion of the purchaser of the mailing list; and
423 (ii) if the cost of the printed material is not billed directly to the recipients.
424 (b) "Direct mail" includes tangible personal property supplied directly or indirectly by a
425 purchaser to a seller of direct mail for inclusion in a package containing the printed material.
426 (c) "Direct mail" does not include multiple items of printed material delivered to a
427 single address.
428 (39) "Directory assistance" means an ancillary service of providing:
429 (a) address information; or
430 (b) telephone number information.
431 (40) (a) "Disposable home medical equipment or supplies" means medical equipment
432 or supplies that:
433 (i) cannot withstand repeated use; and
434 (ii) are purchased by, for, or on behalf of a person other than:
435 (A) a health care facility as defined in Section 26-21-2;
436 (B) a health care provider as defined in Section 78B-3-403;
437 (C) an office of a health care provider described in Subsection (40)(a)(ii)(B); or
438 (D) a person similar to a person described in Subsections (40)(a)(ii)(A) through (C).
439 (b) "Disposable home medical equipment or supplies" does not include:
440 (i) a drug;
441 (ii) durable medical equipment;
442 (iii) a hearing aid;
443 (iv) a hearing aid accessory;
444 (v) mobility enhancing equipment; or
445 (vi) tangible personal property used to correct impaired vision, including:
446 (A) eyeglasses; or
447 (B) contact lenses.
448 (c) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
449 commission may by rule define what constitutes medical equipment or supplies.
450 (41) "Drilling equipment manufacturer" means a facility:
451 (a) located in the state;
452 (b) with respect to which 51% or more of the manufacturing activities of the facility
453 consist of manufacturing component parts of drilling equipment;
454 (c) that uses pressure of 800,000 or more pounds per square inch as part of the
455 manufacturing process; and
456 (d) that uses a temperature of 2,000 or more degrees Fahrenheit as part of the
457 manufacturing process.
458 (42) (a) "Drug" means a compound, substance, or preparation, or a component of a
459 compound, substance, or preparation that is:
460 (i) recognized in:
461 (A) the official United States Pharmacopoeia;
462 (B) the official Homeopathic Pharmacopoeia of the United States;
463 (C) the official National Formulary; or
464 (D) a supplement to a publication listed in Subsections (42)(a)(i)(A) through (C);
465 (ii) intended for use in the:
466 (A) diagnosis of disease;
467 (B) cure of disease;
468 (C) mitigation of disease;
469 (D) treatment of disease; or
470 (E) prevention of disease; or
471 (iii) intended to affect:
472 (A) the structure of the body; or
473 (B) any function of the body.
474 (b) "Drug" does not include:
475 (i) food and food ingredients;
476 (ii) a dietary supplement;
477 (iii) an alcoholic beverage; or
478 (iv) a prosthetic device.
479 (43) (a) Except as provided in Subsection (43)(c), "durable medical equipment" means
480 equipment that:
481 (i) can withstand repeated use;
482 (ii) is primarily and customarily used to serve a medical purpose;
483 (iii) generally is not useful to a person in the absence of illness or injury; and
484 (iv) is not worn in or on the body.
485 (b) "Durable medical equipment" includes parts used in the repair or replacement of the
486 equipment described in Subsection (43)(a).
487 (c) "Durable medical equipment" does not include mobility enhancing equipment.
488 (44) "Electronic" means:
489 (a) relating to technology; and
490 (b) having:
491 (i) electrical capabilities;
492 (ii) digital capabilities;
493 (iii) magnetic capabilities;
494 (iv) wireless capabilities;
495 (v) optical capabilities;
496 (vi) electromagnetic capabilities; or
497 (vii) capabilities similar to Subsections (44)(b)(i) through (vi).
498 (45) "Electronic financial payment service" means an establishment:
499 (a) within NAICS Code 522320, Financial Transactions Processing, Reserve, and
500 Clearinghouse Activities, of the 2012 North American Industry Classification System of the
501 federal Executive Office of the President, Office of Management and Budget; and
502 (b) that performs electronic financial payment services.
503 (46) "Employee" means the same as that term is defined in Section 59-10-401.
504 (47) "Fixed guideway" means a public transit facility that uses and occupies:
505 (a) rail for the use of public transit; or
506 (b) a separate right-of-way for the use of public transit.
507 (48) "Fixed wing turbine powered aircraft" means an aircraft that:
508 (a) is powered by turbine engines;
509 (b) operates on jet fuel; and
510 (c) has wings that are permanently attached to the fuselage of the aircraft.
511 (49) "Fixed wireless service" means a telecommunications service that provides radio
512 communication between fixed points.
513 (50) (a) "Food and food ingredients" means substances:
514 (i) regardless of whether the substances are in:
515 (A) liquid form;
516 (B) concentrated form;
517 (C) solid form;
518 (D) frozen form;
519 (E) dried form; or
520 (F) dehydrated form; and
521 (ii) that are:
522 (A) sold for:
523 (I) ingestion by humans; or
524 (II) chewing by humans; and
525 (B) consumed for the substance's:
526 (I) taste; or
527 (II) nutritional value.
528 (b) "Food and food ingredients" includes an item described in Subsection (91)(b)(iii).
529 (c) "Food and food ingredients" does not include:
530 (i) an alcoholic beverage;
531 (ii) tobacco; or
532 (iii) prepared food.
533 (51) (a) "Fundraising sales" means sales:
534 (i) (A) made by a school; or
535 (B) made by a school student;
536 (ii) that are for the purpose of raising funds for the school to purchase equipment,
537 materials, or provide transportation; and
538 (iii) that are part of an officially sanctioned school activity.
539 (b) For purposes of Subsection (51)(a)(iii), "officially sanctioned school activity"
540 means a school activity:
541 (i) that is conducted in accordance with a formal policy adopted by the school or school
542 district governing the authorization and supervision of fundraising activities;
543 (ii) that does not directly or indirectly compensate an individual teacher or other
544 educational personnel by direct payment, commissions, or payment in kind; and
545 (iii) the net or gross revenues from which are deposited in a dedicated account
546 controlled by the school or school district.
547 (52) "Geothermal energy" means energy contained in heat that continuously flows
548 outward from the earth that is used as the sole source of energy to produce electricity.
549 (53) "Governing board of the agreement" means the governing board of the agreement
550 that is:
551 (a) authorized to administer the agreement; and
552 (b) established in accordance with the agreement.
553 (54) (a) For purposes of Subsection 59-12-104(41), "governmental entity" means:
554 (i) the executive branch of the state, including all departments, institutions, boards,
555 divisions, bureaus, offices, commissions, and committees;
556 (ii) the judicial branch of the state, including the courts, the Judicial Council, the
557 Office of the Court Administrator, and similar administrative units in the judicial branch;
558 (iii) the legislative branch of the state, including the House of Representatives, the
559 Senate, the Legislative Printing Office, the Office of Legislative Research and General
560 Counsel, the Office of the Legislative Auditor General, and the Office of the Legislative Fiscal
561 Analyst;
562 (iv) the National Guard;
563 (v) an independent entity as defined in Section 63E-1-102; or
564 (vi) a political subdivision as defined in Section 17B-1-102.
565 (b) "Governmental entity" does not include the state systems of public and higher
566 education, including:
567 (i) a school;
568 (ii) the State Board of Education;
569 (iii) the State Board of Regents; or
570 (iv) an institution of higher education described in Section 53B-1-102.
571 (55) "Hydroelectric energy" means water used as the sole source of energy to produce
572 electricity.
573 (56) "Industrial use" means the use of natural gas, electricity, heat, coal, fuel oil, or
574 other fuels:
575 (a) in mining or extraction of minerals;
576 (b) in agricultural operations to produce an agricultural product up to the time of
577 harvest or placing the agricultural product into a storage facility, including:
578 (i) commercial greenhouses;
579 (ii) irrigation pumps;
580 (iii) farm machinery;
581 (iv) implements of husbandry as defined in Section 41-1a-102 that are not registered
582 under Title 41, Chapter 1a, Part 2, Registration; and
583 (v) other farming activities;
584 (c) in manufacturing tangible personal property at an establishment described in:
585 (i) SIC Codes 2000 to 3999 of the 1987 Standard Industrial Classification Manual of
586 the federal Executive Office of the President, Office of Management and Budget; or
587 (ii) a NAICS code within NAICS Sector 31-33, Manufacturing, of the 2017 North
588 American Industry Classification System of the federal Executive Office of the President,
589 Office of Management and Budget;
590 (d) by a scrap recycler if:
591 (i) from a fixed location, the scrap recycler utilizes machinery or equipment to process
592 one or more of the following items into prepared grades of processed materials for use in new
593 products:
594 (A) iron;
595 (B) steel;
596 (C) nonferrous metal;
597 (D) paper;
598 (E) glass;
599 (F) plastic;
600 (G) textile; or
601 (H) rubber; and
602 (ii) the new products under Subsection (56)(d)(i) would otherwise be made with
603 nonrecycled materials; or
604 (e) in producing a form of energy or steam described in Subsection 54-2-1(3)(a) by a
605 cogeneration facility as defined in Section 54-2-1.
606 (57) (a) Except as provided in Subsection (57)(b), "installation charge" means a charge
607 for installing:
608 (i) tangible personal property; or
609 (ii) a product transferred electronically.
610 (b) "Installation charge" does not include a charge for:
611 (i) repairs or renovations of:
612 (A) tangible personal property; or
613 (B) a product transferred electronically; or
614 (ii) attaching tangible personal property or a product transferred electronically:
615 (A) to other tangible personal property; and
616 (B) as part of a manufacturing or fabrication process.
617 (58) "Institution of higher education" means an institution of higher education listed in
618 Section 53B-2-101.
619 (59) (a) "Lease" or "rental" means a transfer of possession or control of tangible
620 personal property or a product transferred electronically for:
621 (i) (A) a fixed term; or
622 (B) an indeterminate term; and
623 (ii) consideration.
624 (b) "Lease" or "rental" includes an agreement covering a motor vehicle and trailer if the
625 amount of consideration may be increased or decreased by reference to the amount realized
626 upon sale or disposition of the property as defined in Section 7701(h)(1), Internal Revenue
627 Code.
628 (c) "Lease" or "rental" does not include:
629 (i) a transfer of possession or control of property under a security agreement or
630 deferred payment plan that requires the transfer of title upon completion of the required
631 payments;
632 (ii) a transfer of possession or control of property under an agreement that requires the
633 transfer of title:
634 (A) upon completion of required payments; and
635 (B) if the payment of an option price does not exceed the greater of:
636 (I) $100; or
637 (II) 1% of the total required payments; or
638 (iii) providing tangible personal property along with an operator for a fixed period of
639 time or an indeterminate period of time if the operator is necessary for equipment to perform as
640 designed.
641 (d) For purposes of Subsection (59)(c)(iii), an operator is necessary for equipment to
642 perform as designed if the operator's duties exceed the:
643 (i) set-up of tangible personal property;
644 (ii) maintenance of tangible personal property; or
645 (iii) inspection of tangible personal property.
646 (60) "Life science establishment" means an establishment in this state that is classified
647 under the following NAICS codes of the 2007 North American Industry Classification System
648 of the federal Executive Office of the President, Office of Management and Budget:
649 (a) NAICS Code 33911, Medical Equipment and Supplies Manufacturing;
650 (b) NAICS Code 334510, Electromedical and Electrotherapeutic Apparatus
651 Manufacturing; or
652 (c) NAICS Code 334517, Irradiation Apparatus Manufacturing.
653 (61) "Life science research and development facility" means a facility owned, leased,
654 or rented by a life science establishment if research and development is performed in 51% or
655 more of the total area of the facility.
656 (62) "Load and leave" means delivery to a purchaser by use of a tangible storage media
657 if the tangible storage media is not physically transferred to the purchaser.
658 (63) "Local taxing jurisdiction" means a:
659 (a) county that is authorized to impose an agreement sales and use tax;
660 (b) city that is authorized to impose an agreement sales and use tax; or
661 (c) town that is authorized to impose an agreement sales and use tax.
662 (64) "Manufactured home" means the same as that term is defined in Section
663 15A-1-302.
664 (65) "Manufacturing facility" means:
665 (a) an establishment described in:
666 (i) SIC Codes 2000 to 3999 of the 1987 Standard Industrial Classification Manual of
667 the federal Executive Office of the President, Office of Management and Budget; or
668 (ii) a NAICS code within NAICS Sector 31-33, Manufacturing, of the 2017 North
669 American Industry Classification System of the federal Executive Office of the President,
670 Office of Management and Budget;
671 (b) a scrap recycler if:
672 (i) from a fixed location, the scrap recycler utilizes machinery or equipment to process
673 one or more of the following items into prepared grades of processed materials for use in new
674 products:
675 (A) iron;
676 (B) steel;
677 (C) nonferrous metal;
678 (D) paper;
679 (E) glass;
680 (F) plastic;
681 (G) textile; or
682 (H) rubber; and
683 (ii) the new products under Subsection (65)(b)(i) would otherwise be made with
684 nonrecycled materials; or
685 (c) a cogeneration facility as defined in Section 54-2-1 if the cogeneration facility is
686 placed in service on or after May 1, 2006.
687 (66) "Member of the immediate family of the producer" means a person who is related
688 to a producer described in Subsection 59-12-104(20)(a) as a:
689 (a) child or stepchild, regardless of whether the child or stepchild is:
690 (i) an adopted child or adopted stepchild; or
691 (ii) a foster child or foster stepchild;
692 (b) grandchild or stepgrandchild;
693 (c) grandparent or stepgrandparent;
694 (d) nephew or stepnephew;
695 (e) niece or stepniece;
696 (f) parent or stepparent;
697 (g) sibling or stepsibling;
698 (h) spouse;
699 (i) person who is the spouse of a person described in Subsections (66)(a) through (g);
700 or
701 (j) person similar to a person described in Subsections (66)(a) through (i) as
702 determined by the commission by rule made in accordance with Title 63G, Chapter 3, Utah
703 Administrative Rulemaking Act.
704 (67) "Mobile home" means the same as that term is defined in Section 15A-1-302.
705 (68) "Mobile telecommunications service" is as defined in the Mobile
706 Telecommunications Sourcing Act, 4 U.S.C. Sec. 124.
707 (69) (a) "Mobile wireless service" means a telecommunications service, regardless of
708 the technology used, if:
709 (i) the origination point of the conveyance, routing, or transmission is not fixed;
710 (ii) the termination point of the conveyance, routing, or transmission is not fixed; or
711 (iii) the origination point described in Subsection (69)(a)(i) and the termination point
712 described in Subsection (69)(a)(ii) are not fixed.
713 (b) "Mobile wireless service" includes a telecommunications service that is provided
714 by a commercial mobile radio service provider.
715 (c) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
716 commission may by rule define "commercial mobile radio service provider."
717 (70) (a) Except as provided in Subsection (70)(c), "mobility enhancing equipment"
718 means equipment that is:
719 (i) primarily and customarily used to provide or increase the ability to move from one
720 place to another;
721 (ii) appropriate for use in a:
722 (A) home; or
723 (B) motor vehicle; and
724 (iii) not generally used by persons with normal mobility.
725 (b) "Mobility enhancing equipment" includes parts used in the repair or replacement of
726 the equipment described in Subsection (70)(a).
727 (c) "Mobility enhancing equipment" does not include:
728 (i) a motor vehicle;
729 (ii) equipment on a motor vehicle if that equipment is normally provided by the motor
730 vehicle manufacturer;
731 (iii) durable medical equipment; or
732 (iv) a prosthetic device.
733 (71) "Model 1 seller" means a seller registered under the agreement that has selected a
734 certified service provider as the seller's agent to perform all of the seller's sales and use tax
735 functions for agreement sales and use taxes other than the seller's obligation under Section
736 59-12-124 to remit a tax on the seller's own purchases.
737 (72) "Model 2 seller" means a seller registered under the agreement that:
738 (a) except as provided in Subsection (72)(b), has selected a certified automated system
739 to perform the seller's sales tax functions for agreement sales and use taxes; and
740 (b) retains responsibility for remitting all of the sales tax:
741 (i) collected by the seller; and
742 (ii) to the appropriate local taxing jurisdiction.
743 (73) (a) Subject to Subsection (73)(b), "model 3 seller" means a seller registered under
744 the agreement that has:
745 (i) sales in at least five states that are members of the agreement;
746 (ii) total annual sales revenues of at least $500,000,000;
747 (iii) a proprietary system that calculates the amount of tax:
748 (A) for an agreement sales and use tax; and
749 (B) due to each local taxing jurisdiction; and
750 (iv) entered into a performance agreement with the governing board of the agreement.
751 (b) For purposes of Subsection (73)(a), "model 3 seller" includes an affiliated group of
752 sellers using the same proprietary system.
753 (74) "Model 4 seller" means a seller that is registered under the agreement and is not a
754 model 1 seller, model 2 seller, or model 3 seller.
755 (75) "Modular home" means a modular unit as defined in Section 15A-1-302.
756 (76) "Motor vehicle" means the same as that term is defined in Section 41-1a-102.
757 (77) "Oil sands" means impregnated bituminous sands that:
758 (a) contain a heavy, thick form of petroleum that is released when heated, mixed with
759 other hydrocarbons, or otherwise treated;
760 (b) yield mixtures of liquid hydrocarbon; and
761 (c) require further processing other than mechanical blending before becoming finished
762 petroleum products.
763 (78) "Oil shale" means a group of fine black to dark brown shales containing kerogen
764 material that yields petroleum upon heating and distillation.
765 (79) "Optional computer software maintenance contract" means a computer software
766 maintenance contract that a customer is not obligated to purchase as a condition to the retail
767 sale of computer software.
768 (80) (a) "Other fuels" means products that burn independently to produce heat or
769 energy.
770 (b) "Other fuels" includes oxygen when it is used in the manufacturing of tangible
771 personal property.
772 (81) (a) "Paging service" means a telecommunications service that provides
773 transmission of a coded radio signal for the purpose of activating a specific pager.
774 (b) For purposes of Subsection (81)(a), the transmission of a coded radio signal
775 includes a transmission by message or sound.
776 (82) "Pawnbroker" means the same as that term is defined in Section 13-32a-102.
777 (83) "Pawn transaction" means the same as that term is defined in Section 13-32a-102.
778 (84) (a) "Permanently attached to real property" means that for tangible personal
779 property attached to real property:
780 (i) the attachment of the tangible personal property to the real property:
781 (A) is essential to the use of the tangible personal property; and
782 (B) suggests that the tangible personal property will remain attached to the real
783 property in the same place over the useful life of the tangible personal property; or
784 (ii) if the tangible personal property is detached from the real property, the detachment
785 would:
786 (A) cause substantial damage to the tangible personal property; or
787 (B) require substantial alteration or repair of the real property to which the tangible
788 personal property is attached.
789 (b) "Permanently attached to real property" includes:
790 (i) the attachment of an accessory to the tangible personal property if the accessory is:
791 (A) essential to the operation of the tangible personal property; and
792 (B) attached only to facilitate the operation of the tangible personal property;
793 (ii) a temporary detachment of tangible personal property from real property for a
794 repair or renovation if the repair or renovation is performed where the tangible personal
795 property and real property are located; or
796 (iii) property attached to oil, gas, or water pipelines, except for the property listed in
797 Subsection (84)(c)(iii) or (iv).
798 (c) "Permanently attached to real property" does not include:
799 (i) the attachment of portable or movable tangible personal property to real property if
800 that portable or movable tangible personal property is attached to real property only for:
801 (A) convenience;
802 (B) stability; or
803 (C) for an obvious temporary purpose;
804 (ii) the detachment of tangible personal property from real property except for the
805 detachment described in Subsection (84)(b)(ii);
806 (iii) an attachment of the following tangible personal property to real property if the
807 attachment to real property is only through a line that supplies water, electricity, gas,
808 telecommunications, cable, or supplies a similar item as determined by the commission by rule
809 made in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act:
810 (A) a computer;
811 (B) a telephone;
812 (C) a television; or
813 (D) tangible personal property similar to Subsections (84)(c)(iii)(A) through (C) as
814 determined by the commission by rule made in accordance with Title 63G, Chapter 3, Utah
815 Administrative Rulemaking Act; or
816 (iv) an item listed in Subsection (125)(c).
817 (85) "Person" includes any individual, firm, partnership, joint venture, association,
818 corporation, estate, trust, business trust, receiver, syndicate, this state, any county, city,
819 municipality, district, or other local governmental entity of the state, or any group or
820 combination acting as a unit.
821 (86) "Place of primary use":
822 (a) for telecommunications service other than mobile telecommunications service,
823 means the street address representative of where the customer's use of the telecommunications
824 service primarily occurs, which shall be:
825 (i) the residential street address of the customer; or
826 (ii) the primary business street address of the customer; or
827 (b) for mobile telecommunications service, is as defined in the Mobile
828 Telecommunications Sourcing Act, 4 U.S.C. Sec. 124.
829 (87) (a) "Postpaid calling service" means a telecommunications service a person
830 obtains by making a payment on a call-by-call basis:
831 (i) through the use of a:
832 (A) bank card;
833 (B) credit card;
834 (C) debit card; or
835 (D) travel card; or
836 (ii) by a charge made to a telephone number that is not associated with the origination
837 or termination of the telecommunications service.
838 (b) "Postpaid calling service" includes a service, except for a prepaid wireless calling
839 service, that would be a prepaid wireless calling service if the service were exclusively a
840 telecommunications service.
841 (88) "Postproduction" means an activity related to the finishing or duplication of a
842 medium described in Subsection 59-12-104(54)(a).
843 (89) "Prepaid calling service" means a telecommunications service:
844 (a) that allows a purchaser access to telecommunications service that is exclusively
845 telecommunications service;
846 (b) that:
847 (i) is paid for in advance; and
848 (ii) enables the origination of a call using an:
849 (A) access number; or
850 (B) authorization code;
851 (c) that is dialed:
852 (i) manually; or
853 (ii) electronically; and
854 (d) sold in predetermined units or dollars that decline:
855 (i) by a known amount; and
856 (ii) with use.
857 (90) "Prepaid wireless calling service" means a telecommunications service:
858 (a) that provides the right to utilize:
859 (i) mobile wireless service; and
860 (ii) other service that is not a telecommunications service, including:
861 (A) the download of a product transferred electronically;
862 (B) a content service; or
863 (C) an ancillary service;
864 (b) that:
865 (i) is paid for in advance; and
866 (ii) enables the origination of a call using an:
867 (A) access number; or
868 (B) authorization code;
869 (c) that is dialed:
870 (i) manually; or
871 (ii) electronically; and
872 (d) sold in predetermined units or dollars that decline:
873 (i) by a known amount; and
874 (ii) with use.
875 (91) (a) "Prepared food" means:
876 (i) food:
877 (A) sold in a heated state; or
878 (B) heated by a seller;
879 (ii) two or more food ingredients mixed or combined by the seller for sale as a single
880 item; or
881 (iii) except as provided in Subsection (91)(c), food sold with an eating utensil provided
882 by the seller, including a:
883 (A) plate;
884 (B) knife;
885 (C) fork;
886 (D) spoon;
887 (E) glass;
888 (F) cup;
889 (G) napkin; or
890 (H) straw.
891 (b) "Prepared food" does not include:
892 (i) food that a seller only:
893 (A) cuts;
894 (B) repackages; or
895 (C) pasteurizes; or
896 (ii) (A) the following:
897 (I) raw egg;
898 (II) raw fish;
899 (III) raw meat;
900 (IV) raw poultry; or
901 (V) a food containing an item described in Subsections (91)(b)(ii)(A)(I) through (IV);
902 and
903 (B) if the Food and Drug Administration recommends in Chapter 3, Part 401.11 of the
904 Food and Drug Administration's Food Code that a consumer cook the items described in
905 Subsection (91)(b)(ii)(A) to prevent food borne illness; or
906 (iii) the following if sold without eating utensils provided by the seller:
907 (A) food and food ingredients sold by a seller if the seller's proper primary
908 classification under the 2002 North American Industry Classification System of the federal
909 Executive Office of the President, Office of Management and Budget, is manufacturing in
910 Sector 311, Food Manufacturing, except for Subsector 3118, Bakeries and Tortilla
911 Manufacturing;
912 (B) food and food ingredients sold in an unheated state:
913 (I) by weight or volume; and
914 (II) as a single item; or
915 (C) a bakery item, including:
916 (I) a bagel;
917 (II) a bar;
918 (III) a biscuit;
919 (IV) bread;
920 (V) a bun;
921 (VI) a cake;
922 (VII) a cookie;
923 (VIII) a croissant;
924 (IX) a danish;
925 (X) a donut;
926 (XI) a muffin;
927 (XII) a pastry;
928 (XIII) a pie;
929 (XIV) a roll;
930 (XV) a tart;
931 (XVI) a torte; or
932 (XVII) a tortilla.
933 (c) An eating utensil provided by the seller does not include the following used to
934 transport the food:
935 (i) a container; or
936 (ii) packaging.
937 (92) "Prescription" means an order, formula, or recipe that is issued:
938 (a) (i) orally;
939 (ii) in writing;
940 (iii) electronically; or
941 (iv) by any other manner of transmission; and
942 (b) by a licensed practitioner authorized by the laws of a state.
943 (93) (a) Except as provided in Subsection (93)(b)(ii) or (iii), "prewritten computer
944 software" means computer software that is not designed and developed:
945 (i) by the author or other creator of the computer software; and
946 (ii) to the specifications of a specific purchaser.
947 (b) "Prewritten computer software" includes:
948 (i) a prewritten upgrade to computer software if the prewritten upgrade to the computer
949 software is not designed and developed:
950 (A) by the author or other creator of the computer software; and
951 (B) to the specifications of a specific purchaser;
952 (ii) computer software designed and developed by the author or other creator of the
953 computer software to the specifications of a specific purchaser if the computer software is sold
954 to a person other than the purchaser; or
955 (iii) except as provided in Subsection (93)(c), prewritten computer software or a
956 prewritten portion of prewritten computer software:
957 (A) that is modified or enhanced to any degree; and
958 (B) if the modification or enhancement described in Subsection (93)(b)(iii)(A) is
959 designed and developed to the specifications of a specific purchaser.
960 (c) "Prewritten computer software" does not include a modification or enhancement
961 described in Subsection (93)(b)(iii) if the charges for the modification or enhancement are:
962 (i) reasonable; and
963 (ii) subject to Subsections 59-12-103(2)(e)(ii) and (2)(f)(i), separately stated on the
964 invoice or other statement of price provided to the purchaser at the time of sale or later, as
965 demonstrated by:
966 (A) the books and records the seller keeps at the time of the transaction in the regular
967 course of business, including books and records the seller keeps at the time of the transaction in
968 the regular course of business for nontax purposes;
969 (B) a preponderance of the facts and circumstances at the time of the transaction; and
970 (C) the understanding of all of the parties to the transaction.
971 (94) (a) "Private communications service" means a telecommunications service:
972 (i) that entitles a customer to exclusive or priority use of one or more communications
973 channels between or among termination points; and
974 (ii) regardless of the manner in which the one or more communications channels are
975 connected.
976 (b) "Private communications service" includes the following provided in connection
977 with the use of one or more communications channels:
978 (i) an extension line;
979 (ii) a station;
980 (iii) switching capacity; or
981 (iv) another associated service that is provided in connection with the use of one or
982 more communications channels as defined in Section 59-12-215.
983 (95) (a) Except as provided in Subsection (95)(b), "product transferred electronically"
984 means a product transferred electronically that would be subject to a tax under this chapter if
985 that product was transferred in a manner other than electronically.
986 (b) "Product transferred electronically" does not include:
987 (i) an ancillary service;
988 (ii) computer software; or
989 (iii) a telecommunications service.
990 (96) (a) "Prosthetic device" means a device that is worn on or in the body to:
991 (i) artificially replace a missing portion of the body;
992 (ii) prevent or correct a physical deformity or physical malfunction; or
993 (iii) support a weak or deformed portion of the body.
994 (b) "Prosthetic device" includes:
995 (i) parts used in the repairs or renovation of a prosthetic device;
996 (ii) replacement parts for a prosthetic device;
997 (iii) a dental prosthesis; or
998 (iv) a hearing aid.
999 (c) "Prosthetic device" does not include:
1000 (i) corrective eyeglasses; or
1001 (ii) contact lenses.
1002 (97) (a) "Protective equipment" means an item:
1003 (i) for human wear; and
1004 (ii) that is:
1005 (A) designed as protection:
1006 (I) to the wearer against injury or disease; or
1007 (II) against damage or injury of other persons or property; and
1008 (B) not suitable for general use.
1009 (b) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
1010 commission shall make rules:
1011 (i) listing the items that constitute "protective equipment"; and
1012 (ii) that are consistent with the list of items that constitute "protective equipment"
1013 under the agreement.
1014 (98) (a) For purposes of Subsection 59-12-104(41), "publication" means any written or
1015 printed matter, other than a photocopy:
1016 (i) regardless of:
1017 (A) characteristics;
1018 (B) copyright;
1019 (C) form;
1020 (D) format;
1021 (E) method of reproduction; or
1022 (F) source; and
1023 (ii) made available in printed or electronic format.
1024 (b) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
1025 commission may by rule define the term "photocopy."
1026 (99) (a) "Purchase price" and "sales price" mean the total amount of consideration:
1027 (i) valued in money; and
1028 (ii) for which tangible personal property, a product transferred electronically, or
1029 services are:
1030 (A) sold;
1031 (B) leased; or
1032 (C) rented.
1033 (b) "Purchase price" and "sales price" include:
1034 (i) the seller's cost of the tangible personal property, a product transferred
1035 electronically, or services sold;
1036 (ii) expenses of the seller, including:
1037 (A) the cost of materials used;
1038 (B) a labor cost;
1039 (C) a service cost;
1040 (D) interest;
1041 (E) a loss;
1042 (F) the cost of transportation to the seller; or
1043 (G) a tax imposed on the seller;
1044 (iii) a charge by the seller for any service necessary to complete the sale; or
1045 (iv) consideration a seller receives from a person other than the purchaser if:
1046 (A) (I) the seller actually receives consideration from a person other than the purchaser;
1047 and
1048 (II) the consideration described in Subsection (99)(b)(iv)(A)(I) is directly related to a
1049 price reduction or discount on the sale;
1050 (B) the seller has an obligation to pass the price reduction or discount through to the
1051 purchaser;
1052 (C) the amount of the consideration attributable to the sale is fixed and determinable by
1053 the seller at the time of the sale to the purchaser; and
1054 (D) (I) (Aa) the purchaser presents a certificate, coupon, or other documentation to the
1055 seller to claim a price reduction or discount; and
1056 (Bb) a person other than the seller authorizes, distributes, or grants the certificate,
1057 coupon, or other documentation with the understanding that the person other than the seller
1058 will reimburse any seller to whom the certificate, coupon, or other documentation is presented;
1059 (II) the purchaser identifies that purchaser to the seller as a member of a group or
1060 organization allowed a price reduction or discount, except that a preferred customer card that is
1061 available to any patron of a seller does not constitute membership in a group or organization
1062 allowed a price reduction or discount; or
1063 (III) the price reduction or discount is identified as a third party price reduction or
1064 discount on the:
1065 (Aa) invoice the purchaser receives; or
1066 (Bb) certificate, coupon, or other documentation the purchaser presents.
1067 (c) "Purchase price" and "sales price" do not include:
1068 (i) a discount:
1069 (A) in a form including:
1070 (I) cash;
1071 (II) term; or
1072 (III) coupon;
1073 (B) that is allowed by a seller;
1074 (C) taken by a purchaser on a sale; and
1075 (D) that is not reimbursed by a third party; or
1076 (ii) subject to Subsections 59-12-103(2)(e)(ii) and (2)(f)(i), the following if separately
1077 stated on an invoice, bill of sale, or similar document provided to the purchaser at the time of
1078 sale or later, as demonstrated by the books and records the seller keeps at the time of the
1079 transaction in the regular course of business, including books and records the seller keeps at the
1080 time of the transaction in the regular course of business for nontax purposes, by a
1081 preponderance of the facts and circumstances at the time of the transaction, and by the
1082 understanding of all of the parties to the transaction:
1083 (A) the following from credit extended on the sale of tangible personal property or
1084 services:
1085 (I) a carrying charge;
1086 (II) a financing charge; or
1087 (III) an interest charge;
1088 (B) a delivery charge;
1089 (C) an installation charge;
1090 (D) a manufacturer rebate on a motor vehicle; or
1091 (E) a tax or fee legally imposed directly on the consumer.
1092 (100) "Purchaser" means a person to whom:
1093 (a) a sale of tangible personal property is made;
1094 (b) a product is transferred electronically; or
1095 (c) a service is furnished.
1096 (101) "Qualifying enterprise data center" means an establishment that will:
1097 (a) own and operate a data center facility that will house a group of networked server
1098 computers in one physical location in order to centralize the dissemination, management, and
1099 storage of data and information;
1100 (b) be located in the state;
1101 (c) be a new operation constructed on or after July 1, 2016;
1102 (d) consist of one or more buildings that total 150,000 or more square feet;
1103 (e) be owned or leased by:
1104 (i) the establishment; or
1105 (ii) a person under common ownership, as defined in Section 59-7-101, of the
1106 establishment; and
1107 (f) be located on one or more parcels of land that are owned or leased by:
1108 (i) the establishment; or
1109 (ii) a person under common ownership, as defined in Section 59-7-101, of the
1110 establishment.
1111 (102) "Regularly rented" means:
1112 (a) rented to a guest for value three or more times during a calendar year; or
1113 (b) advertised or held out to the public as a place that is regularly rented to guests for
1114 value.
1115 (103) "Rental" means the same as that term is defined in Subsection (59).
1116 (104) (a) Except as provided in Subsection (104)(b), "repairs or renovations of tangible
1117 personal property" means:
1118 (i) a repair or renovation of tangible personal property that is not permanently attached
1119 to real property; or
1120 (ii) attaching tangible personal property or a product transferred electronically to other
1121 tangible personal property or detaching tangible personal property or a product transferred
1122 electronically from other tangible personal property if:
1123 (A) the other tangible personal property to which the tangible personal property or
1124 product transferred electronically is attached or from which the tangible personal property or
1125 product transferred electronically is detached is not permanently attached to real property; and
1126 (B) the attachment of tangible personal property or a product transferred electronically
1127 to other tangible personal property or detachment of tangible personal property or a product
1128 transferred electronically from other tangible personal property is made in conjunction with a
1129 repair or replacement of tangible personal property or a product transferred electronically.
1130 (b) "Repairs or renovations of tangible personal property" does not include:
1131 (i) attaching prewritten computer software to other tangible personal property if the
1132 other tangible personal property to which the prewritten computer software is attached is not
1133 permanently attached to real property; or
1134 (ii) detaching prewritten computer software from other tangible personal property if the
1135 other tangible personal property from which the prewritten computer software is detached is
1136 not permanently attached to real property.
1137 (105) "Research and development" means the process of inquiry or experimentation
1138 aimed at the discovery of facts, devices, technologies, or applications and the process of
1139 preparing those devices, technologies, or applications for marketing.
1140 (106) (a) "Residential telecommunications services" means a telecommunications
1141 service or an ancillary service that is provided to an individual for personal use:
1142 (i) at a residential address; or
1143 (ii) at an institution, including a nursing home or a school, if the telecommunications
1144 service or ancillary service is provided to and paid for by the individual residing at the
1145 institution rather than the institution.
1146 (b) For purposes of Subsection (106)(a)(i), a residential address includes an:
1147 (i) apartment; or
1148 (ii) other individual dwelling unit.
1149 (107) "Residential use" means the use in or around a home, apartment building,
1150 sleeping quarters, and similar facilities or accommodations.
1151 (108) (a) "Retailer" means any person engaged in a regularly organized business in
1152 tangible personal property or any other taxable transaction under Subsection 59-12-103(1), and
1153 who is selling to the user or consumer and not for resale.
1154 (b) "Retailer" includes commission merchants, auctioneers, and any person regularly
1155 engaged in the business of selling to users or consumers within the state.
1156 (109) "Retail sale" or "sale at retail" means a sale, lease, or rental for a purpose other
1157 than:
1158 (a) resale;
1159 (b) sublease; or
1160 (c) subrent.
1161 (110) (a) "Sale" means any transfer of title, exchange, or barter, conditional or
1162 otherwise, in any manner, of tangible personal property or any other taxable transaction under
1163 Subsection 59-12-103(1), for consideration.
1164 (b) "Sale" includes:
1165 (i) installment and credit sales;
1166 (ii) any closed transaction constituting a sale;
1167 (iii) any sale of electrical energy, gas, services, or entertainment taxable under this
1168 chapter;
1169 (iv) any transaction if the possession of property is transferred but the seller retains the
1170 title as security for the payment of the price; and
1171 (v) any transaction under which right to possession, operation, or use of any article of
1172 tangible personal property is granted under a lease or contract and the transfer of possession
1173 would be taxable if an outright sale were made.
1174 (111) "Sale at retail" means the same as that term is defined in Subsection (109).
1175 (112) "Sale-leaseback transaction" means a transaction by which title to tangible
1176 personal property or a product transferred electronically that is subject to a tax under this
1177 chapter is transferred:
1178 (a) by a purchaser-lessee;
1179 (b) to a lessor;
1180 (c) for consideration; and
1181 (d) if:
1182 (i) the purchaser-lessee paid sales and use tax on the purchaser-lessee's initial purchase
1183 of the tangible personal property or product transferred electronically;
1184 (ii) the sale of the tangible personal property or product transferred electronically to the
1185 lessor is intended as a form of financing:
1186 (A) for the tangible personal property or product transferred electronically; and
1187 (B) to the purchaser-lessee; and
1188 (iii) in accordance with generally accepted accounting principles, the purchaser-lessee
1189 is required to:
1190 (A) capitalize the tangible personal property or product transferred electronically for
1191 financial reporting purposes; and
1192 (B) account for the lease payments as payments made under a financing arrangement.
1193 (113) "Sales price" means the same as that term is defined in Subsection (99).
1194 (114) (a) "Sales relating to schools" means the following sales by, amounts paid to, or
1195 amounts charged by a school:
1196 (i) sales that are directly related to the school's educational functions or activities
1197 including:
1198 (A) the sale of:
1199 (I) textbooks;
1200 (II) textbook fees;
1201 (III) laboratory fees;
1202 (IV) laboratory supplies; or
1203 (V) safety equipment;
1204 (B) the sale of a uniform, protective equipment, or sports or recreational equipment
1205 that:
1206 (I) a student is specifically required to wear as a condition of participation in a
1207 school-related event or school-related activity; and
1208 (II) is not readily adaptable to general or continued usage to the extent that it takes the
1209 place of ordinary clothing;
1210 (C) sales of the following if the net or gross revenues generated by the sales are
1211 deposited into a school district fund or school fund dedicated to school meals:
1212 (I) food and food ingredients; or
1213 (II) prepared food; or
1214 (D) transportation charges for official school activities; or
1215 (ii) amounts paid to or amounts charged by a school for admission to a school-related
1216 event or school-related activity.
1217 (b) "Sales relating to schools" does not include:
1218 (i) bookstore sales of items that are not educational materials or supplies;
1219 (ii) except as provided in Subsection (114)(a)(i)(B):
1220 (A) clothing;
1221 (B) clothing accessories or equipment;
1222 (C) protective equipment; or
1223 (D) sports or recreational equipment; or
1224 (iii) amounts paid to or amounts charged by a school for admission to a school-related
1225 event or school-related activity if the amounts paid or charged are passed through to a person:
1226 (A) other than a:
1227 (I) school;
1228 (II) nonprofit organization authorized by a school board or a governing body of a
1229 private school to organize and direct a competitive secondary school activity; or
1230 (III) nonprofit association authorized by a school board or a governing body of a
1231 private school to organize and direct a competitive secondary school activity; and
1232 (B) that is required to collect sales and use taxes under this chapter.
1233 (c) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
1234 commission may make rules defining the term "passed through."
1235 (115) For purposes of this section and Section 59-12-104, "school":
1236 (a) means:
1237 (i) an elementary school or a secondary school that:
1238 (A) is a:
1239 (I) public school; or
1240 (II) private school; and
1241 (B) provides instruction for one or more grades kindergarten through 12; or
1242 (ii) a public school district; and
1243 (b) includes the Electronic High School as defined in Section 53A-15-1002.
1244 (116) "Seller" means a person that makes a sale, lease, or rental of:
1245 (a) tangible personal property;
1246 (b) a product transferred electronically; or
1247 (c) a service.
1248 (117) (a) "Semiconductor fabricating, processing, research, or development materials"
1249 means tangible personal property or a product transferred electronically if the tangible personal
1250 property or product transferred electronically is:
1251 (i) used primarily in the process of:
1252 (A) (I) manufacturing a semiconductor;
1253 (II) fabricating a semiconductor; or
1254 (III) research or development of a:
1255 (Aa) semiconductor; or
1256 (Bb) semiconductor manufacturing process; or
1257 (B) maintaining an environment suitable for a semiconductor; or
1258 (ii) consumed primarily in the process of:
1259 (A) (I) manufacturing a semiconductor;
1260 (II) fabricating a semiconductor; or
1261 (III) research or development of a:
1262 (Aa) semiconductor; or
1263 (Bb) semiconductor manufacturing process; or
1264 (B) maintaining an environment suitable for a semiconductor.
1265 (b) "Semiconductor fabricating, processing, research, or development materials"
1266 includes:
1267 (i) parts used in the repairs or renovations of tangible personal property or a product
1268 transferred electronically described in Subsection (117)(a); or
1269 (ii) a chemical, catalyst, or other material used to:
1270 (A) produce or induce in a semiconductor a:
1271 (I) chemical change; or
1272 (II) physical change;
1273 (B) remove impurities from a semiconductor; or
1274 (C) improve the marketable condition of a semiconductor.
1275 (118) "Senior citizen center" means a facility having the primary purpose of providing
1276 services to the aged as defined in Section 62A-3-101.
1277 (119) (a) Subject to Subsections (119)(b) and (c), "short-term lodging consumable"
1278 means tangible personal property that:
1279 (i) a business that provides accommodations and services described in Subsection
1280 59-12-103(1)(i) purchases as part of a transaction to provide the accommodations and services
1281 to a purchaser;
1282 (ii) is intended to be consumed by the purchaser; and
1283 (iii) is:
1284 (A) included in the purchase price of the accommodations and services; and
1285 (B) not separately stated on an invoice, bill of sale, or other similar document provided
1286 to the purchaser.
1287 (b) "Short-term lodging consumable" includes:
1288 (i) a beverage;
1289 (ii) a brush or comb;
1290 (iii) a cosmetic;
1291 (iv) a hair care product;
1292 (v) lotion;
1293 (vi) a magazine;
1294 (vii) makeup;
1295 (viii) a meal;
1296 (ix) mouthwash;
1297 (x) nail polish remover;
1298 (xi) a newspaper;
1299 (xii) a notepad;
1300 (xiii) a pen;
1301 (xiv) a pencil;
1302 (xv) a razor;
1303 (xvi) saline solution;
1304 (xvii) a sewing kit;
1305 (xviii) shaving cream;
1306 (xix) a shoe shine kit;
1307 (xx) a shower cap;
1308 (xxi) a snack item;
1309 (xxii) soap;
1310 (xxiii) toilet paper;
1311 (xxiv) a toothbrush;
1312 (xxv) toothpaste; or
1313 (xxvi) an item similar to Subsections (119)(b)(i) through (xxv) as the commission may
1314 provide by rule made in accordance with Title 63G, Chapter 3, Utah Administrative
1315 Rulemaking Act.
1316 (c) "Short-term lodging consumable" does not include:
1317 (i) tangible personal property that is cleaned or washed to allow the tangible personal
1318 property to be reused; or
1319 (ii) a product transferred electronically.
1320 (120) "Simplified electronic return" means the electronic return:
1321 (a) described in Section 318(C) of the agreement; and
1322 (b) approved by the governing board of the agreement.
1323 (121) "Solar energy" means the sun used as the sole source of energy for producing
1324 electricity.
1325 (122) (a) "Sports or recreational equipment" means an item:
1326 (i) designed for human use; and
1327 (ii) that is:
1328 (A) worn in conjunction with:
1329 (I) an athletic activity; or
1330 (II) a recreational activity; and
1331 (B) not suitable for general use.
1332 (b) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
1333 commission shall make rules:
1334 (i) listing the items that constitute "sports or recreational equipment"; and
1335 (ii) that are consistent with the list of items that constitute "sports or recreational
1336 equipment" under the agreement.
1337 (123) "State" means the state of Utah, its departments, and agencies.
1338 (124) "Storage" means any keeping or retention of tangible personal property or any
1339 other taxable transaction under Subsection 59-12-103(1), in this state for any purpose except
1340 sale in the regular course of business.
1341 (125) (a) Except as provided in Subsection (125)(d) or (e), "tangible personal property"
1342 means personal property that:
1343 (i) may be:
1344 (A) seen;
1345 (B) weighed;
1346 (C) measured;
1347 (D) felt; or
1348 (E) touched; or
1349 (ii) is in any manner perceptible to the senses.
1350 (b) "Tangible personal property" includes:
1351 (i) electricity;
1352 (ii) water;
1353 (iii) gas;
1354 (iv) steam; or
1355 (v) prewritten computer software, regardless of the manner in which the prewritten
1356 computer software is transferred.
1357 (c) "Tangible personal property" includes the following regardless of whether the item
1358 is attached to real property:
1359 (i) a dishwasher;
1360 (ii) a dryer;
1361 (iii) a freezer;
1362 (iv) a microwave;
1363 (v) a refrigerator;
1364 (vi) a stove;
1365 (vii) a washer; or
1366 (viii) an item similar to Subsections (125)(c)(i) through (vii) as determined by the
1367 commission by rule made in accordance with Title 63G, Chapter 3, Utah Administrative
1368 Rulemaking Act.
1369 (d) "Tangible personal property" does not include a product that is transferred
1370 electronically.
1371 (e) "Tangible personal property" does not include the following if attached to real
1372 property, regardless of whether the attachment to real property is only through a line that
1373 supplies water, electricity, gas, telephone, cable, or supplies a similar item as determined by the
1374 commission by rule made in accordance with Title 63G, Chapter 3, Utah Administrative
1375 Rulemaking Act:
1376 (i) a hot water heater;
1377 (ii) a water filtration system; or
1378 (iii) a water softener system.
1379 (126) (a) "Telecommunications enabling or facilitating equipment, machinery, or
1380 software" means an item listed in Subsection (126)(b) if that item is purchased or leased
1381 primarily to enable or facilitate one or more of the following to function:
1382 (i) telecommunications switching or routing equipment, machinery, or software; or
1383 (ii) telecommunications transmission equipment, machinery, or software.
1384 (b) The following apply to Subsection (126)(a):
1385 (i) a pole;
1386 (ii) software;
1387 (iii) a supplementary power supply;
1388 (iv) temperature or environmental equipment or machinery;
1389 (v) test equipment;
1390 (vi) a tower; or
1391 (vii) equipment, machinery, or software that functions similarly to an item listed in
1392 Subsections (126)(b)(i) through (vi) as determined by the commission by rule made in
1393 accordance with Subsection (126)(c).
1394 (c) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
1395 commission may by rule define what constitutes equipment, machinery, or software that
1396 functions similarly to an item listed in Subsections (126)(b)(i) through (vi).
1397 (127) "Telecommunications equipment, machinery, or software required for 911
1398 service" means equipment, machinery, or software that is required to comply with 47 C.F.R.
1399 Sec. 20.18.
1400 (128) "Telecommunications maintenance or repair equipment, machinery, or software"
1401 means equipment, machinery, or software purchased or leased primarily to maintain or repair
1402 one or more of the following, regardless of whether the equipment, machinery, or software is
1403 purchased or leased as a spare part or as an upgrade or modification to one or more of the
1404 following:
1405 (a) telecommunications enabling or facilitating equipment, machinery, or software;
1406 (b) telecommunications switching or routing equipment, machinery, or software; or
1407 (c) telecommunications transmission equipment, machinery, or software.
1408 (129) (a) "Telecommunications service" means the electronic conveyance, routing, or
1409 transmission of audio, data, video, voice, or any other information or signal to a point, or
1410 among or between points.
1411 (b) "Telecommunications service" includes:
1412 (i) an electronic conveyance, routing, or transmission with respect to which a computer
1413 processing application is used to act:
1414 (A) on the code, form, or protocol of the content;
1415 (B) for the purpose of electronic conveyance, routing, or transmission; and
1416 (C) regardless of whether the service:
1417 (I) is referred to as voice over Internet protocol service; or
1418 (II) is classified by the Federal Communications Commission as enhanced or value
1419 added;
1420 (ii) an 800 service;
1421 (iii) a 900 service;
1422 (iv) a fixed wireless service;
1423 (v) a mobile wireless service;
1424 (vi) a postpaid calling service;
1425 (vii) a prepaid calling service;
1426 (viii) a prepaid wireless calling service; or
1427 (ix) a private communications service.
1428 (c) "Telecommunications service" does not include:
1429 (i) advertising, including directory advertising;
1430 (ii) an ancillary service;
1431 (iii) a billing and collection service provided to a third party;
1432 (iv) a data processing and information service if:
1433 (A) the data processing and information service allows data to be:
1434 (I) (Aa) acquired;
1435 (Bb) generated;
1436 (Cc) processed;
1437 (Dd) retrieved; or
1438 (Ee) stored; and
1439 (II) delivered by an electronic transmission to a purchaser; and
1440 (B) the purchaser's primary purpose for the underlying transaction is the processed data
1441 or information;
1442 (v) installation or maintenance of the following on a customer's premises:
1443 (A) equipment; or
1444 (B) wiring;
1445 (vi) Internet access service;
1446 (vii) a paging service;
1447 (viii) a product transferred electronically, including:
1448 (A) music;
1449 (B) reading material;
1450 (C) a ring tone;
1451 (D) software; or
1452 (E) video;
1453 (ix) a radio and television audio and video programming service:
1454 (A) regardless of the medium; and
1455 (B) including:
1456 (I) furnishing conveyance, routing, or transmission of a television audio and video
1457 programming service by a programming service provider;
1458 (II) cable service as defined in 47 U.S.C. Sec. 522(6); or
1459 (III) audio and video programming services delivered by a commercial mobile radio
1460 service provider as defined in 47 C.F.R. Sec. 20.3;
1461 (x) a value-added nonvoice data service; or
1462 (xi) tangible personal property.
1463 (130) (a) "Telecommunications service provider" means a person that:
1464 (i) owns, controls, operates, or manages a telecommunications service; and
1465 (ii) engages in an activity described in Subsection (130)(a)(i) for the shared use with or
1466 resale to any person of the telecommunications service.
1467 (b) A person described in Subsection (130)(a) is a telecommunications service provider
1468 whether or not the Public Service Commission of Utah regulates:
1469 (i) that person; or
1470 (ii) the telecommunications service that the person owns, controls, operates, or
1471 manages.
1472 (131) (a) "Telecommunications switching or routing equipment, machinery, or
1473 software" means an item listed in Subsection (131)(b) if that item is purchased or leased
1474 primarily for switching or routing:
1475 (i) an ancillary service;
1476 (ii) data communications;
1477 (iii) voice communications; or
1478 (iv) telecommunications service.
1479 (b) The following apply to Subsection (131)(a):
1480 (i) a bridge;
1481 (ii) a computer;
1482 (iii) a cross connect;
1483 (iv) a modem;
1484 (v) a multiplexer;
1485 (vi) plug in circuitry;
1486 (vii) a router;
1487 (viii) software;
1488 (ix) a switch; or
1489 (x) equipment, machinery, or software that functions similarly to an item listed in
1490 Subsections (131)(b)(i) through (ix) as determined by the commission by rule made in
1491 accordance with Subsection (131)(c).
1492 (c) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
1493 commission may by rule define what constitutes equipment, machinery, or software that
1494 functions similarly to an item listed in Subsections (131)(b)(i) through (ix).
1495 (132) (a) "Telecommunications transmission equipment, machinery, or software"
1496 means an item listed in Subsection (132)(b) if that item is purchased or leased primarily for
1497 sending, receiving, or transporting:
1498 (i) an ancillary service;
1499 (ii) data communications;
1500 (iii) voice communications; or
1501 (iv) telecommunications service.
1502 (b) The following apply to Subsection (132)(a):
1503 (i) an amplifier;
1504 (ii) a cable;
1505 (iii) a closure;
1506 (iv) a conduit;
1507 (v) a controller;
1508 (vi) a duplexer;
1509 (vii) a filter;
1510 (viii) an input device;
1511 (ix) an input/output device;
1512 (x) an insulator;
1513 (xi) microwave machinery or equipment;
1514 (xii) an oscillator;
1515 (xiii) an output device;
1516 (xiv) a pedestal;
1517 (xv) a power converter;
1518 (xvi) a power supply;
1519 (xvii) a radio channel;
1520 (xviii) a radio receiver;
1521 (xix) a radio transmitter;
1522 (xx) a repeater;
1523 (xxi) software;
1524 (xxii) a terminal;
1525 (xxiii) a timing unit;
1526 (xxiv) a transformer;
1527 (xxv) a wire; or
1528 (xxvi) equipment, machinery, or software that functions similarly to an item listed in
1529 Subsections (132)(b)(i) through (xxv) as determined by the commission by rule made in
1530 accordance with Subsection (132)(c).
1531 (c) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
1532 commission may by rule define what constitutes equipment, machinery, or software that
1533 functions similarly to an item listed in Subsections (132)(b)(i) through (xxv).
1534 (133) (a) "Textbook for a higher education course" means a textbook or other printed
1535 material that is required for a course:
1536 (i) offered by an institution of higher education; and
1537 (ii) that the purchaser of the textbook or other printed material attends or will attend.
1538 (b) "Textbook for a higher education course" includes a textbook in electronic format.
1539 (134) "Tobacco" means:
1540 (a) a cigarette;
1541 (b) a cigar;
1542 (c) chewing tobacco;
1543 (d) pipe tobacco; or
1544 (e) any other item that contains tobacco.
1545 (135) "Unassisted amusement device" means an amusement device, skill device, or
1546 ride device that is started and stopped by the purchaser or renter of the right to use or operate
1547 the amusement device, skill device, or ride device.
1548 (136) (a) "Use" means the exercise of any right or power over tangible personal
1549 property, a product transferred electronically, or a service under Subsection 59-12-103(1),
1550 incident to the ownership or the leasing of that tangible personal property, product transferred
1551 electronically, or service.
1552 (b) "Use" does not include the sale, display, demonstration, or trial of tangible personal
1553 property, a product transferred electronically, or a service in the regular course of business and
1554 held for resale.
1555 (137) "Value-added nonvoice data service" means a service:
1556 (a) that otherwise meets the definition of a telecommunications service except that a
1557 computer processing application is used to act primarily for a purpose other than conveyance,
1558 routing, or transmission; and
1559 (b) with respect to which a computer processing application is used to act on data or
1560 information:
1561 (i) code;
1562 (ii) content;
1563 (iii) form; or
1564 (iv) protocol.
1565 (138) (a) Subject to Subsection (138)(b), "vehicle" means the following that are
1566 required to be titled, registered, or titled and registered:
1567 (i) an aircraft as defined in Section 72-10-102;
1568 (ii) a vehicle as defined in Section 41-1a-102;
1569 (iii) an off-highway vehicle as defined in Section 41-22-2; or
1570 (iv) a vessel as defined in Section 41-1a-102.
1571 (b) For purposes of Subsection 59-12-104(33) only, "vehicle" includes:
1572 (i) a vehicle described in Subsection (138)(a); or
1573 (ii) (A) a locomotive;
1574 (B) a freight car;
1575 (C) railroad work equipment; or
1576 (D) other railroad rolling stock.
1577 (139) "Vehicle dealer" means a person engaged in the business of buying, selling, or
1578 exchanging a vehicle as defined in Subsection (138).
1579 (140) (a) "Vertical service" means an ancillary service that:
1580 (i) is offered in connection with one or more telecommunications services; and
1581 (ii) offers an advanced calling feature that allows a customer to:
1582 (A) identify a caller; and
1583 (B) manage multiple calls and call connections.
1584 (b) "Vertical service" includes an ancillary service that allows a customer to manage a
1585 conference bridging service.
1586 (141) (a) "Voice mail service" means an ancillary service that enables a customer to
1587 receive, send, or store a recorded message.
1588 (b) "Voice mail service" does not include a vertical service that a customer is required
1589 to have in order to utilize a voice mail service.
1590 (142) (a) Except as provided in Subsection (142)(b), "waste energy facility" means a
1591 facility that generates electricity:
1592 (i) using as the primary source of energy waste materials that would be placed in a
1593 landfill or refuse pit if it were not used to generate electricity, including:
1594 (A) tires;
1595 (B) waste coal;
1596 (C) oil shale; or
1597 (D) municipal solid waste; and
1598 (ii) in amounts greater than actually required for the operation of the facility.
1599 (b) "Waste energy facility" does not include a facility that incinerates:
1600 (i) hospital waste as defined in 40 C.F.R. 60.51c; or
1601 (ii) medical/infectious waste as defined in 40 C.F.R. 60.51c.
1602 (143) "Watercraft" means a vessel as defined in Section 73-18-2.
1603 (144) "Wind energy" means wind used as the sole source of energy to produce
1604 electricity.
1605 (145) "ZIP Code" means a Zoning Improvement Plan Code assigned to a geographic
1606 location by the United States Postal Service.
1607 Section 2. Section 59-12-104 is amended to read:
1608 59-12-104. Exemptions.
1609 Exemptions from the taxes imposed by this chapter are as follows:
1610 (1) sales of aviation fuel, motor fuel, and special fuel subject to a Utah state excise tax
1611 under Chapter 13, Motor and Special Fuel Tax Act;
1612 (2) subject to Section 59-12-104.6, sales to the state, its institutions, and its political
1613 subdivisions; however, this exemption does not apply to sales of:
1614 (a) construction materials except:
1615 (i) construction materials purchased by or on behalf of institutions of the public
1616 education system as defined in Utah Constitution, Article X, Section 2, provided the
1617 construction materials are clearly identified and segregated and installed or converted to real
1618 property which is owned by institutions of the public education system; and
1619 (ii) construction materials purchased by the state, its institutions, or its political
1620 subdivisions which are installed or converted to real property by employees of the state, its
1621 institutions, or its political subdivisions; or
1622 (b) tangible personal property in connection with the construction, operation,
1623 maintenance, repair, or replacement of a project, as defined in Section 11-13-103, or facilities
1624 providing additional project capacity, as defined in Section 11-13-103;
1625 (3) (a) sales of an item described in Subsection (3)(b) from a vending machine if:
1626 (i) the proceeds of each sale do not exceed $1; and
1627 (ii) the seller or operator of the vending machine reports an amount equal to 150% of
1628 the cost of the item described in Subsection (3)(b) as goods consumed; and
1629 (b) Subsection (3)(a) applies to:
1630 (i) food and food ingredients; or
1631 (ii) prepared food;
1632 (4) (a) sales of the following to a commercial airline carrier for in-flight consumption:
1633 (i) alcoholic beverages;
1634 (ii) food and food ingredients; or
1635 (iii) prepared food;
1636 (b) sales of tangible personal property or a product transferred electronically:
1637 (i) to a passenger;
1638 (ii) by a commercial airline carrier; and
1639 (iii) during a flight for in-flight consumption or in-flight use by the passenger; or
1640 (c) services related to Subsection (4)(a) or (b);
1641 [
1642
1643 [
1644
1645
1646 [
1647 [
1648
1649 [
1650 [
1651 [
1652
1653 [
1654 (5) sales of parts and equipment for installation in an aircraft operated by a common
1655 carrier in interstate or foreign commerce; [
1656 [
1657
1658
1659 [
1660 [
1661 [
1662
1663 [
1664 [
1665 [
1666
1667 (6) sales of commercials, motion picture films, prerecorded audio program tapes or
1668 records, and prerecorded video tapes by a producer, distributor, or studio to a motion picture
1669 exhibitor, distributor, or commercial television or radio broadcaster;
1670 (7) (a) except as provided in Subsection (88) and subject to Subsection (7)(b), sales of
1671 cleaning or washing of tangible personal property if the cleaning or washing of the tangible
1672 personal property is not assisted cleaning or washing of tangible personal property;
1673 (b) if a seller that sells at the same business location assisted cleaning or washing of
1674 tangible personal property and cleaning or washing of tangible personal property that is not
1675 assisted cleaning or washing of tangible personal property, the exemption described in
1676 Subsection (7)(a) applies if the seller separately accounts for the sales of the assisted cleaning
1677 or washing of the tangible personal property; and
1678 (c) for purposes of Subsection (7)(b) and in accordance with Title 63G, Chapter 3,
1679 Utah Administrative Rulemaking Act, the commission may make rules:
1680 (i) governing the circumstances under which sales are at the same business location;
1681 and
1682 (ii) establishing the procedures and requirements for a seller to separately account for
1683 sales of assisted cleaning or washing of tangible personal property;
1684 (8) sales made to or by religious or charitable institutions in the conduct of their regular
1685 religious or charitable functions and activities, if the requirements of Section 59-12-104.1 are
1686 fulfilled;
1687 (9) sales of a vehicle of a type required to be registered under the motor vehicle laws of
1688 this state if the vehicle is:
1689 (a) not registered in this state; and
1690 (b) (i) not used in this state; or
1691 (ii) used in this state:
1692 (A) if the vehicle is not used to conduct business, for a time period that does not
1693 exceed the longer of:
1694 (I) 30 days in any calendar year; or
1695 (II) the time period necessary to transport the vehicle to the borders of this state; or
1696 (B) if the vehicle is used to conduct business, for the time period necessary to transport
1697 the vehicle to the borders of this state;
1698 (10) (a) amounts paid for an item described in Subsection (10)(b) if:
1699 (i) the item is intended for human use; and
1700 (ii) (A) a prescription was issued for the item; or
1701 (B) the item was purchased by a hospital or other medical facility; and
1702 (b) (i) Subsection (10)(a) applies to:
1703 (A) a drug;
1704 (B) a syringe; or
1705 (C) a stoma supply; and
1706 (ii) in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
1707 commission may by rule define the terms:
1708 (A) "syringe"; or
1709 (B) "stoma supply";
1710 (11) purchases or leases exempt under Section 19-12-201;
1711 (12) (a) sales of an item described in Subsection (12)(c) served by:
1712 (i) the following if the item described in Subsection (12)(c) is not available to the
1713 general public:
1714 (A) a church; or
1715 (B) a charitable institution;
1716 (ii) an institution of higher education if:
1717 (A) the item described in Subsection (12)(c) is not available to the general public; or
1718 (B) the item described in Subsection (12)(c) is prepaid as part of a student meal plan
1719 offered by the institution of higher education; or
1720 (b) sales of an item described in Subsection (12)(c) provided for a patient by:
1721 (i) a medical facility; or
1722 (ii) a nursing facility; and
1723 (c) Subsections (12)(a) and (b) apply to:
1724 (i) food and food ingredients;
1725 (ii) prepared food; or
1726 (iii) alcoholic beverages;
1727 (13) (a) except as provided in Subsection (13)(b), the sale of tangible personal property
1728 or a product transferred electronically by a person:
1729 (i) regardless of the number of transactions involving the sale of that tangible personal
1730 property or product transferred electronically by that person; and
1731 (ii) not regularly engaged in the business of selling that type of tangible personal
1732 property or product transferred electronically;
1733 (b) this Subsection (13) does not apply if:
1734 (i) the sale is one of a series of sales of a character to indicate that the person is
1735 regularly engaged in the business of selling that type of tangible personal property or product
1736 transferred electronically;
1737 (ii) the person holds that person out as regularly engaged in the business of selling that
1738 type of tangible personal property or product transferred electronically;
1739 (iii) the person sells an item of tangible personal property or product transferred
1740 electronically that the person purchased as a sale that is exempt under Subsection (25); or
1741 (iv) the sale is of a vehicle or vessel required to be titled or registered under the laws of
1742 this state in which case the tax is based upon:
1743 (A) the bill of sale or other written evidence of value of the vehicle or vessel being
1744 sold; or
1745 (B) in the absence of a bill of sale or other written evidence of value, the fair market
1746 value of the vehicle or vessel being sold at the time of the sale as determined by the
1747 commission; and
1748 (c) in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
1749 commission shall make rules establishing the circumstances under which:
1750 (i) a person is regularly engaged in the business of selling a type of tangible personal
1751 property or product transferred electronically;
1752 (ii) a sale of tangible personal property or a product transferred electronically is one of
1753 a series of sales of a character to indicate that a person is regularly engaged in the business of
1754 selling that type of tangible personal property or product transferred electronically; or
1755 (iii) a person holds that person out as regularly engaged in the business of selling a type
1756 of tangible personal property or product transferred electronically;
1757 (14) subject to Section 59-12-104.8, amounts paid or charged for a purchase or lease of
1758 machinery, equipment, or normal operating repair or replacement parts with an economic life
1759 of three or more years by:
1760 (a) a manufacturing facility, except as provided in Subsection (86), that:
1761 (i) is located in the state; and
1762 (ii) uses the machinery, equipment, or normal operating repair or replacement parts:
1763 (A) in the manufacturing process to manufacture an item sold as tangible personal
1764 property, as the commission may define that phrase in accordance with Title 63G, Chapter 3,
1765 Utah Administrative Rulemaking Act; or
1766 (B) for a scrap recycler, to process an item sold as tangible personal property, as the
1767 commission may define that phrase in accordance with Title 63G, Chapter 3, Utah
1768 Administrative Rulemaking Act;
1769 (b) an establishment, as the commission defines that term in accordance with Title 63G,
1770 Chapter 3, Utah Administrative Rulemaking Act, that:
1771 (i) is described in NAICS Subsector 212, Mining (except Oil and Gas), or NAICS
1772 Code 213113, Support Activities for Coal Mining, 213114, Support Activities for Metal
1773 Mining, or 213115, Support Activities for Nonmetallic Minerals (except Fuels) Mining, of the
1774 2002 North American Industry Classification System of the federal Executive Office of the
1775 President, Office of Management and Budget;
1776 (ii) is located in the state; and
1777 (iii) uses the machinery, equipment, or normal operating repair or replacement parts in:
1778 (A) the production process to produce an item sold as tangible personal property, as the
1779 commission may define that phrase in accordance with Title 63G, Chapter 3, Utah
1780 Administrative Rulemaking Act;
1781 (B) research and development, as the commission may define that phrase in accordance
1782 with Title 63G, Chapter 3, Utah Administrative Rulemaking Act;
1783 (C) transporting, storing, or managing tailings, overburden, or similar waste materials
1784 produced from mining;
1785 (D) developing or maintaining a road, tunnel, excavation, or similar feature used in
1786 mining; or
1787 (E) preventing, controlling, or reducing dust or other pollutants from mining; or
1788 (c) an establishment, as the commission defines that term in accordance with Title 63G,
1789 Chapter 3, Utah Administrative Rulemaking Act, that:
1790 (i) is described in NAICS Code 518112, Web Search Portals, of the 2002 North
1791 American Industry Classification System of the federal Executive Office of the President,
1792 Office of Management and Budget;
1793 (ii) is located in the state; and
1794 (iii) uses the machinery, equipment, or normal operating repair or replacement parts in
1795 the operation of the web search portal;
1796 (15) (a) sales of the following if the requirements of Subsection (15)(b) are met:
1797 (i) tooling;
1798 (ii) special tooling;
1799 (iii) support equipment;
1800 (iv) special test equipment; or
1801 (v) parts used in the repairs or renovations of tooling or equipment described in
1802 Subsections (15)(a)(i) through (iv); and
1803 (b) sales of tooling, equipment, or parts described in Subsection (15)(a) are exempt if:
1804 (i) the tooling, equipment, or parts are used or consumed exclusively in the
1805 performance of any aerospace or electronics industry contract with the United States
1806 government or any subcontract under that contract; and
1807 (ii) under the terms of the contract or subcontract described in Subsection (15)(b)(i),
1808 title to the tooling, equipment, or parts is vested in the United States government as evidenced
1809 by:
1810 (A) a government identification tag placed on the tooling, equipment, or parts; or
1811 (B) listing on a government-approved property record if placing a government
1812 identification tag on the tooling, equipment, or parts is impractical;
1813 (16) sales of newspapers or newspaper subscriptions;
1814 (17) (a) except as provided in Subsection (17)(b), tangible personal property or a
1815 product transferred electronically traded in as full or part payment of the purchase price, except
1816 that for purposes of calculating sales or use tax upon vehicles not sold by a vehicle dealer,
1817 trade-ins are limited to other vehicles only, and the tax is based upon:
1818 (i) the bill of sale or other written evidence of value of the vehicle being sold and the
1819 vehicle being traded in; or
1820 (ii) in the absence of a bill of sale or other written evidence of value, the then existing
1821 fair market value of the vehicle being sold and the vehicle being traded in, as determined by the
1822 commission; and
1823 (b) Subsection (17)(a) does not apply to the following items of tangible personal
1824 property or products transferred electronically traded in as full or part payment of the purchase
1825 price:
1826 (i) money;
1827 (ii) electricity;
1828 (iii) water;
1829 (iv) gas; or
1830 (v) steam;
1831 (18) (a) (i) except as provided in Subsection (18)(b), sales of tangible personal property
1832 or a product transferred electronically used or consumed primarily and directly in farming
1833 operations, regardless of whether the tangible personal property or product transferred
1834 electronically:
1835 (A) becomes part of real estate; or
1836 (B) is installed by a[
1837 (ii) sales of parts used in the repairs or renovations of tangible personal property or a
1838 product transferred electronically if the tangible personal property or product transferred
1839 electronically is exempt under Subsection (18)(a)(i); and
1840 (b) amounts paid or charged for the following are subject to the taxes imposed by this
1841 chapter:
1842 (i) (A) subject to Subsection (18)(b)(i)(B), [
1843 materials, or supplies if used in a manner that is incidental to farming[
1844
1845 (B) tangible personal property that is considered to be used in a manner that is
1846 incidental to farming includes:
1847 (I) hand tools; or
1848 (II) maintenance and janitorial equipment and supplies;
1849 (ii) (A) subject to Subsection (18)(b)(ii)(B), tangible personal property or a product
1850 transferred electronically if the tangible personal property or product transferred electronically
1851 is used in an activity other than farming; and
1852 (B) tangible personal property or a product transferred electronically that is considered
1853 to be used in an activity other than farming includes:
1854 (I) office equipment and supplies; or
1855 (II) equipment and supplies used in:
1856 (Aa) the sale or distribution of farm products;
1857 (Bb) research; or
1858 (Cc) transportation; or
1859 (iii) a vehicle required to be registered by the laws of this state during the period
1860 ending two years after the date of the vehicle's purchase;
1861 (19) sales of hay;
1862 (20) exclusive sale during the harvest season of seasonal crops, seedling plants, or
1863 garden, farm, or other agricultural produce if the seasonal crops are, seedling plants are, or
1864 garden, farm, or other agricultural produce is sold by:
1865 (a) the producer of the seasonal crops, seedling plants, or garden, farm, or other
1866 agricultural produce;
1867 (b) an employee of the producer described in Subsection (20)(a); or
1868 (c) a member of the immediate family of the producer described in Subsection (20)(a);
1869 (21) purchases made using a coupon as defined in 7 U.S.C. Sec. 2012 that is issued
1870 under the Food Stamp Program, 7 U.S.C. Sec. 2011 et seq.;
1871 (22) sales of nonreturnable containers, nonreturnable labels, nonreturnable bags,
1872 nonreturnable shipping cases, and nonreturnable casings to a manufacturer, processor,
1873 wholesaler, or retailer for use in packaging tangible personal property to be sold by that
1874 manufacturer, processor, wholesaler, or retailer;
1875 (23) a product stored in the state for resale;
1876 (24) (a) purchases of a product if:
1877 (i) the product is:
1878 (A) purchased outside of this state;
1879 (B) brought into this state:
1880 (I) at any time after the purchase described in Subsection (24)(a)(i)(A); and
1881 (II) by a nonresident person who is not living or working in this state at the time of the
1882 purchase;
1883 (C) used for the personal use or enjoyment of the nonresident person described in
1884 Subsection (24)(a)(i)(B)(II) while that nonresident person is within the state; and
1885 (D) not used in conducting business in this state; and
1886 (ii) for:
1887 (A) a product other than a boat described in Subsection (24)(a)(ii)(B), the first use of
1888 the product for a purpose for which the product is designed occurs outside of this state;
1889 (B) a boat, the boat is registered outside of this state; or
1890 (C) a vehicle other than a vehicle sold to an authorized carrier, the vehicle is registered
1891 outside of this state;
1892 (b) the exemption provided for in Subsection (24)(a) does not apply to:
1893 (i) a lease or rental of a product; or
1894 (ii) a sale of a vehicle exempt under Subsection (33); and
1895 (c) in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, for
1896 purposes of Subsection (24)(a), the commission may by rule define what constitutes the
1897 following:
1898 (i) conducting business in this state if that phrase has the same meaning in this
1899 Subsection (24) as in Subsection (63);
1900 (ii) the first use of a product if that phrase has the same meaning in this Subsection (24)
1901 as in Subsection (63); or
1902 (iii) a purpose for which a product is designed if that phrase has the same meaning in
1903 this Subsection (24) as in Subsection (63);
1904 (25) a product purchased for resale in this state, in the regular course of business, either
1905 in its original form or as an ingredient or component part of a manufactured or compounded
1906 product;
1907 (26) a product upon which a sales or use tax was paid to some other state, or one of its
1908 subdivisions, except that the state shall be paid any difference between the tax paid and the tax
1909 imposed by this part and Part 2, Local Sales and Use Tax Act, and no adjustment is allowed if
1910 the tax paid was greater than the tax imposed by this part and Part 2, Local Sales and Use Tax
1911 Act;
1912 (27) any sale of a service described in Subsections 59-12-103(1)(b), (c), and (d) to a
1913 person for use in compounding a service taxable under the subsections;
1914 (28) purchases made in accordance with the special supplemental nutrition program for
1915 women, infants, and children established in 42 U.S.C. Sec. 1786;
1916 (29) sales or leases of rolls, rollers, refractory brick, electric motors, or other
1917 replacement parts used in the furnaces, mills, or ovens of a steel mill described in SIC Code
1918 3312 of the 1987 Standard Industrial Classification Manual of the federal Executive Office of
1919 the President, Office of Management and Budget;
1920 (30) sales of a boat of a type required to be registered under Title 73, Chapter 18, State
1921 Boating Act, a boat trailer, or an outboard motor if the boat, boat trailer, or outboard motor is:
1922 (a) not registered in this state; and
1923 (b) (i) not used in this state; or
1924 (ii) used in this state:
1925 (A) if the boat, boat trailer, or outboard motor is not used to conduct business, for a
1926 time period that does not exceed the longer of:
1927 (I) 30 days in any calendar year; or
1928 (II) the time period necessary to transport the boat, boat trailer, or outboard motor to
1929 the borders of this state; or
1930 (B) if the boat, boat trailer, or outboard motor is used to conduct business, for the time
1931 period necessary to transport the boat, boat trailer, or outboard motor to the borders of this
1932 state;
1933 (31) sales of aircraft manufactured in Utah;
1934 (32) amounts paid for the purchase of telecommunications service for purposes of
1935 providing telecommunications service;
1936 (33) sales, leases, or uses of the following:
1937 (a) a vehicle by an authorized carrier; or
1938 (b) tangible personal property that is installed on a vehicle:
1939 (i) sold or leased to or used by an authorized carrier; and
1940 (ii) before the vehicle is placed in service for the first time;
1941 (34) (a) 45% of the sales price of any new manufactured home; and
1942 (b) 100% of the sales price of any used manufactured home;
1943 (35) sales relating to schools and fundraising sales;
1944 (36) sales or rentals of durable medical equipment if:
1945 (a) a person presents a prescription for the durable medical equipment; and
1946 (b) the durable medical equipment is used for home use only;
1947 (37) (a) sales to a ski resort of electricity to operate a passenger ropeway as defined in
1948 Section 72-11-102; and
1949 (b) the commission shall by rule determine the method for calculating sales exempt
1950 under Subsection (37)(a) that are not separately metered and accounted for in utility billings;
1951 (38) sales to a ski resort of:
1952 (a) snowmaking equipment;
1953 (b) ski slope grooming equipment;
1954 (c) passenger ropeways as defined in Section 72-11-102; or
1955 (d) parts used in the repairs or renovations of equipment or passenger ropeways
1956 described in Subsections (38)(a) through (c);
1957 (39) sales of natural gas, electricity, heat, coal, fuel oil, or other fuels for industrial use;
1958 (40) (a) subject to Subsection (40)(b), sales or rentals of the right to use or operate for
1959 amusement, entertainment, or recreation an unassisted amusement device as defined in Section
1960 59-12-102;
1961 (b) if a seller that sells or rents at the same business location the right to use or operate
1962 for amusement, entertainment, or recreation one or more unassisted amusement devices and
1963 one or more assisted amusement devices, the exemption described in Subsection (40)(a)
1964 applies if the seller separately accounts for the sales or rentals of the right to use or operate for
1965 amusement, entertainment, or recreation for the assisted amusement devices; and
1966 (c) for purposes of Subsection (40)(b) and in accordance with Title 63G, Chapter 3,
1967 Utah Administrative Rulemaking Act, the commission may make rules:
1968 (i) governing the circumstances under which sales are at the same business location;
1969 and
1970 (ii) establishing the procedures and requirements for a seller to separately account for
1971 the sales or rentals of the right to use or operate for amusement, entertainment, or recreation for
1972 assisted amusement devices;
1973 (41) (a) sales of photocopies by:
1974 (i) a governmental entity; or
1975 (ii) an entity within the state system of public education, including:
1976 (A) a school; or
1977 (B) the State Board of Education; or
1978 (b) sales of publications by a governmental entity;
1979 (42) amounts paid for admission to an athletic event at an institution of higher
1980 education that is subject to the provisions of Title IX of the Education Amendments of 1972,
1981 20 U.S.C. Sec. 1681 et seq.;
1982 (43) (a) sales made to or by:
1983 (i) an area agency on aging; or
1984 (ii) a senior citizen center owned by a county, city, or town; or
1985 (b) sales made by a senior citizen center that contracts with an area agency on aging;
1986 (44) sales or leases of semiconductor fabricating, processing, research, or development
1987 materials regardless of whether the semiconductor fabricating, processing, research, or
1988 development materials:
1989 (a) actually come into contact with a semiconductor; or
1990 (b) ultimately become incorporated into real property;
1991 (45) an amount paid by or charged to a purchaser for accommodations and services
1992 described in Subsection 59-12-103(1)(i) to the extent the amount is exempt under Section
1993 59-12-104.2;
1994 (46) [
1995 sports event registration certificate in accordance with Section 41-3-306 for the event period
1996 specified on the temporary sports event registration certificate;
1997 (47) (a) sales or uses of electricity, if the sales or uses are made under a retail tariff
1998 adopted by the Public Service Commission only for purchase of electricity produced from a
1999 new alternative energy source built after January 1, 2016, as designated in the tariff by the
2000 Public Service Commission;
2001 (b) for a residential use customer only, the exemption under Subsection (47)(a) applies
2002 only to the portion of the tariff rate a customer pays under the tariff described in Subsection
2003 (47)(a) that exceeds the tariff rate under the tariff described in Subsection (47)(a) that the
2004 customer would have paid absent the tariff;
2005 (48) sales or rentals of mobility enhancing equipment if a person presents a
2006 prescription for the mobility enhancing equipment;
2007 (49) sales of water in a:
2008 (a) pipe;
2009 (b) conduit;
2010 (c) ditch; or
2011 (d) reservoir;
2012 (50) sales of currency or coins that constitute legal tender of a state, the United States,
2013 or a foreign nation;
2014 (51) (a) sales of an item described in Subsection (51)(b) if the item:
2015 (i) does not constitute legal tender of a state, the United States, or a foreign nation; and
2016 (ii) has a gold, silver, or platinum content of 50% or more; and
2017 (b) Subsection (51)(a) applies to a gold, silver, or platinum:
2018 (i) ingot;
2019 (ii) bar;
2020 (iii) medallion; or
2021 (iv) decorative coin;
2022 (52) amounts paid on a sale-leaseback transaction;
2023 (53) sales of a prosthetic device:
2024 (a) for use on or in a human; and
2025 (b) (i) for which a prescription is required; or
2026 (ii) if the prosthetic device is purchased by a hospital or other medical facility;
2027 (54) (a) except as provided in Subsection (54)(b), purchases, leases, or rentals of
2028 machinery or equipment by an establishment described in Subsection (54)(c) if the machinery
2029 or equipment is primarily used in the production or postproduction of the following media for
2030 commercial distribution:
2031 (i) a motion picture;
2032 (ii) a television program;
2033 (iii) a movie made for television;
2034 (iv) a music video;
2035 (v) a commercial;
2036 (vi) a documentary; or
2037 (vii) a medium similar to Subsections (54)(a)(i) through (vi) as determined by the
2038 commission by administrative rule made in accordance with Subsection (54)(d); or
2039 (b) purchases, leases, or rentals of machinery or equipment by an establishment
2040 described in Subsection (54)(c) that is used for the production or postproduction of the
2041 following are subject to the taxes imposed by this chapter:
2042 (i) a live musical performance;
2043 (ii) a live news program; or
2044 (iii) a live sporting event;
2045 (c) the following establishments listed in the 1997 North American Industry
2046 Classification System of the federal Executive Office of the President, Office of Management
2047 and Budget, apply to Subsections (54)(a) and (b):
2048 (i) NAICS Code 512110; or
2049 (ii) NAICS Code 51219; and
2050 (d) in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
2051 commission may by rule:
2052 (i) prescribe what constitutes a medium similar to Subsections (54)(a)(i) through (vi);
2053 or
2054 (ii) define:
2055 (A) "commercial distribution";
2056 (B) "live musical performance";
2057 (C) "live news program"; or
2058 (D) "live sporting event";
2059 (55) (a) leases of seven or more years or purchases made on or after July 1, 2004, but
2060 on or before June 30, 2027, of tangible personal property that:
2061 (i) is leased or purchased for or by a facility that:
2062 (A) is an alternative energy electricity production facility;
2063 (B) is located in the state; and
2064 (C) (I) becomes operational on or after July 1, 2004; or
2065 (II) has its generation capacity increased by one or more megawatts on or after July 1,
2066 2004, as a result of the use of the tangible personal property;
2067 (ii) has an economic life of five or more years; and
2068 (iii) is used to make the facility or the increase in capacity of the facility described in
2069 Subsection (55)(a)(i) operational up to the point of interconnection with an existing
2070 transmission grid including:
2071 (A) a wind turbine;
2072 (B) generating equipment;
2073 (C) a control and monitoring system;
2074 (D) a power line;
2075 (E) substation equipment;
2076 (F) lighting;
2077 (G) fencing;
2078 (H) pipes; or
2079 (I) other equipment used for locating a power line or pole; and
2080 (b) this Subsection (55) does not apply to:
2081 (i) tangible personal property used in construction of:
2082 (A) a new alternative energy electricity production facility; or
2083 (B) the increase in the capacity of an alternative energy electricity production facility;
2084 (ii) contracted services required for construction and routine maintenance activities;
2085 and
2086 (iii) unless the tangible personal property is used or acquired for an increase in capacity
2087 of the facility described in Subsection (55)(a)(i)(C)(II), tangible personal property used or
2088 acquired after:
2089 (A) the alternative energy electricity production facility described in Subsection
2090 (55)(a)(i) is operational as described in Subsection (55)(a)(iii); or
2091 (B) the increased capacity described in Subsection (55)(a)(i) is operational as described
2092 in Subsection (55)(a)(iii);
2093 (56) (a) leases of seven or more years or purchases made on or after July 1, 2004, but
2094 on or before June 30, 2027, of tangible personal property that:
2095 (i) is leased or purchased for or by a facility that:
2096 (A) is a waste energy production facility;
2097 (B) is located in the state; and
2098 (C) (I) becomes operational on or after July 1, 2004; or
2099 (II) has its generation capacity increased by one or more megawatts on or after July 1,
2100 2004, as a result of the use of the tangible personal property;
2101 (ii) has an economic life of five or more years; and
2102 (iii) is used to make the facility or the increase in capacity of the facility described in
2103 Subsection (56)(a)(i) operational up to the point of interconnection with an existing
2104 transmission grid including:
2105 (A) generating equipment;
2106 (B) a control and monitoring system;
2107 (C) a power line;
2108 (D) substation equipment;
2109 (E) lighting;
2110 (F) fencing;
2111 (G) pipes; or
2112 (H) other equipment used for locating a power line or pole; and
2113 (b) this Subsection (56) does not apply to:
2114 (i) tangible personal property used in construction of:
2115 (A) a new waste energy facility; or
2116 (B) the increase in the capacity of a waste energy facility;
2117 (ii) contracted services required for construction and routine maintenance activities;
2118 and
2119 (iii) unless the tangible personal property is used or acquired for an increase in capacity
2120 described in Subsection (56)(a)(i)(C)(II), tangible personal property used or acquired after:
2121 (A) the waste energy facility described in Subsection (56)(a)(i) is operational as
2122 described in Subsection (56)(a)(iii); or
2123 (B) the increased capacity described in Subsection (56)(a)(i) is operational as described
2124 in Subsection (56)(a)(iii);
2125 (57) (a) leases of five or more years or purchases made on or after July 1, 2004, but on
2126 or before June 30, 2027, of tangible personal property that:
2127 (i) is leased or purchased for or by a facility that:
2128 (A) is located in the state;
2129 (B) produces fuel from alternative energy, including[
2130 and
2131 (C) (I) becomes operational on or after July 1, 2004; or
2132 (II) has its capacity to produce fuel increase by 25% or more on or after July 1, 2004, as
2133 a result of the installation of the tangible personal property;
2134 (ii) has an economic life of five or more years; and
2135 (iii) is installed on the facility described in Subsection (57)(a)(i);
2136 (b) this Subsection (57) does not apply to:
2137 (i) tangible personal property used in construction of:
2138 (A) a new facility described in Subsection (57)(a)(i); or
2139 (B) the increase in capacity of the facility described in Subsection (57)(a)(i); or
2140 (ii) contracted services required for construction and routine maintenance activities;
2141 and
2142 (iii) unless the tangible personal property is used or acquired for an increase in capacity
2143 described in Subsection (57)(a)(i)(C)(II), tangible personal property used or acquired after:
2144 (A) the facility described in Subsection (57)(a)(i) is operational; or
2145 (B) the increased capacity described in Subsection (57)(a)(i) is operational;
2146 (58) (a) subject to Subsection (58)(b) [
2147 product transferred electronically to a person within this state if that tangible personal property
2148 or product transferred electronically is subsequently shipped outside the state and incorporated
2149 pursuant to contract into and becomes a part of real property located outside of this state; and
2150 (b) the exemption under Subsection (58)(a) is not allowed to the extent that the other
2151 state or political entity to which the tangible personal property is shipped imposes a sales, use,
2152 gross receipts, or other similar transaction excise tax on the transaction against which the other
2153 state or political entity allows a credit for sales and use taxes imposed by this chapter; [
2154 [
2155
2156
2157 [
2158 [
2159
2160 [
2161
2162 [
2163 [
2164 [
2165
2166 (59) purchases:
2167 (a) of one or more of the following items in printed or electronic format:
2168 (i) a list containing information that includes one or more[
2169 addresses; or
2170 (ii) a database containing information that includes one or more[
2171 [
2172 (b) used to send direct mail;
2173 (60) redemptions or repurchases of a product by a person if that product was:
2174 (a) delivered to a pawnbroker as part of a pawn transaction; and
2175 (b) redeemed or repurchased within the time period established in a written agreement
2176 between the person and the pawnbroker for redeeming or repurchasing the product;
2177 (61) (a) purchases or leases of an item described in Subsection (61)(b) if the item:
2178 (i) is purchased or leased by, or on behalf of, a telecommunications service provider;
2179 and
2180 (ii) has a useful economic life of one or more years; and
2181 (b) the following apply to Subsection (61)(a):
2182 (i) telecommunications enabling or facilitating equipment, machinery, or software;
2183 (ii) telecommunications equipment, machinery, or software required for 911 service;
2184 (iii) telecommunications maintenance or repair equipment, machinery, or software;
2185 (iv) telecommunications switching or routing equipment, machinery, or software; or
2186 (v) telecommunications transmission equipment, machinery, or software;
2187 (62) (a) beginning on July 1, 2006, and ending on June 30, 2027, purchases of tangible
2188 personal property or a product transferred electronically that are used in the research and
2189 development of alternative energy technology; and
2190 (b) in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
2191 commission may, for purposes of Subsection (62)(a), make rules defining what constitutes
2192 purchases of tangible personal property or a product transferred electronically that are used in
2193 the research and development of alternative energy technology;
2194 (63) (a) purchases of tangible personal property or a product transferred electronically
2195 if:
2196 (i) the tangible personal property or product transferred electronically is:
2197 (A) purchased outside of this state;
2198 (B) brought into this state at any time after the purchase described in Subsection
2199 (63)(a)(i)(A); and
2200 (C) used in conducting business in this state; and
2201 (ii) for:
2202 (A) tangible personal property or a product transferred electronically other than the
2203 tangible personal property described in Subsection (63)(a)(ii)(B), the first use of the property
2204 for a purpose for which the property is designed occurs outside of this state; or
2205 (B) a vehicle other than a vehicle sold to an authorized carrier, the vehicle is registered
2206 outside of this state;
2207 (b) the exemption provided for in Subsection (63)(a) does not apply to:
2208 (i) a lease or rental of tangible personal property or a product transferred electronically;
2209 or
2210 (ii) a sale of a vehicle exempt under Subsection (33); and
2211 (c) in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, for
2212 purposes of Subsection (63)(a), the commission may by rule define what constitutes the
2213 following:
2214 (i) conducting business in this state if that phrase has the same meaning in this
2215 Subsection (63) as in Subsection (24);
2216 (ii) the first use of tangible personal property or a product transferred electronically if
2217 that phrase has the same meaning in this Subsection (63) as in Subsection (24); or
2218 (iii) a purpose for which tangible personal property or a product transferred
2219 electronically is designed if that phrase has the same meaning in this Subsection (63) as in
2220 Subsection (24);
2221 (64) sales of disposable home medical equipment or supplies if:
2222 (a) a person presents a prescription for the disposable home medical equipment or
2223 supplies;
2224 (b) the disposable home medical equipment or supplies are used exclusively by the
2225 person to whom the prescription described in Subsection (64)(a) is issued; and
2226 (c) the disposable home medical equipment and supplies are listed as eligible for
2227 payment under:
2228 (i) Title XVIII, federal Social Security Act; or
2229 (ii) the state plan for medical assistance under Title XIX, federal Social Security Act;
2230 (65) sales:
2231 (a) to a public transit district under Title 17B, Chapter 2a, Part 8, Public Transit
2232 District Act; or
2233 (b) of tangible personal property to a subcontractor of a public transit district, if the
2234 tangible personal property is:
2235 (i) clearly identified; and
2236 (ii) installed or converted to real property owned by the public transit district;
2237 (66) sales of construction materials:
2238 (a) purchased on or after July 1, 2010;
2239 (b) purchased by, on behalf of, or for the benefit of an international airport:
2240 (i) located within a county of the first class; and
2241 (ii) that has a United States customs office on its premises; and
2242 (c) if the construction materials are:
2243 (i) clearly identified;
2244 (ii) segregated; and
2245 (iii) installed or converted to real property:
2246 (A) owned or operated by the international airport described in Subsection (66)(b); and
2247 (B) located at the international airport described in Subsection (66)(b);
2248 (67) sales of construction materials:
2249 (a) purchased on or after July 1, 2008;
2250 (b) purchased by, on behalf of, or for the benefit of a new airport:
2251 (i) located within a county of the second class; and
2252 (ii) that is owned or operated by a city in which an airline as defined in Section
2253 59-2-102 is headquartered; and
2254 (c) if the construction materials are:
2255 (i) clearly identified;
2256 (ii) segregated; and
2257 (iii) installed or converted to real property:
2258 (A) owned or operated by the new airport described in Subsection (67)(b);
2259 (B) located at the new airport described in Subsection (67)(b); and
2260 (C) as part of the construction of the new airport described in Subsection (67)(b);
2261 (68) sales of fuel to a common carrier that is a railroad for use in a locomotive engine;
2262 (69) purchases and sales described in Section 63H-4-111;
2263 (70) (a) sales of tangible personal property to an aircraft maintenance, repair, and
2264 overhaul provider for use in the maintenance, repair, overhaul, or refurbishment in this state of
2265 a fixed wing turbine powered aircraft if that fixed wing turbine powered aircraft's registration
2266 lists a state or country other than this state as the location of registry of the fixed wing turbine
2267 powered aircraft; or
2268 (b) sales of tangible personal property by an aircraft maintenance, repair, and overhaul
2269 provider in connection with the maintenance, repair, overhaul, or refurbishment in this state of
2270 a fixed wing turbine powered aircraft if that fixed wing turbine powered aircraft's registration
2271 lists a state or country other than this state as the location of registry of the fixed wing turbine
2272 powered aircraft;
2273 (71) subject to Section 59-12-104.4, sales of a textbook for a higher education course:
2274 (a) to a person admitted to an institution of higher education; and
2275 (b) by a seller, other than a bookstore owned by an institution of higher education, if
2276 51% or more of that seller's sales revenue for the previous calendar quarter are sales of a
2277 textbook for a higher education course;
2278 (72) a license fee or tax a municipality imposes in accordance with Subsection
2279 10-1-203(5) on a purchaser from a business for which the municipality provides an enhanced
2280 level of municipal services;
2281 (73) amounts paid or charged for construction materials used in the construction of a
2282 new or expanding life science research and development facility in the state, if the construction
2283 materials are:
2284 (a) clearly identified;
2285 (b) segregated; and
2286 (c) installed or converted to real property;
2287 (74) amounts paid or charged for:
2288 (a) a purchase or lease of machinery and equipment that:
2289 (i) are used in performing qualified research:
2290 (A) as defined in Section 41(d), Internal Revenue Code; and
2291 (B) in the state; and
2292 (ii) have an economic life of three or more years; and
2293 (b) normal operating repair or replacement parts:
2294 (i) for the machinery and equipment described in Subsection (74)(a); and
2295 (ii) that have an economic life of three or more years;
2296 (75) a sale or lease of tangible personal property used in the preparation of prepared
2297 food if:
2298 (a) for a sale:
2299 (i) the ownership of the seller and the ownership of the purchaser are identical; and
2300 (ii) the seller or the purchaser paid a tax under this chapter on the purchase of that
2301 tangible personal property prior to making the sale; or
2302 (b) for a lease:
2303 (i) the ownership of the lessor and the ownership of the lessee are identical; and
2304 (ii) the lessor or the lessee paid a tax under this chapter on the purchase of that tangible
2305 personal property prior to making the lease;
2306 (76) (a) purchases of machinery or equipment if:
2307 (i) the purchaser is an establishment described in NAICS Subsector 713, Amusement,
2308 Gambling, and Recreation Industries, of the 2012 North American Industry Classification
2309 System of the federal Executive Office of the President, Office of Management and Budget;
2310 (ii) the machinery or equipment:
2311 (A) has an economic life of three or more years; and
2312 (B) is used by one or more persons who pay admission or user fees described in
2313 Subsection 59-12-103(1)(f) to the purchaser of the machinery and equipment; and
2314 (iii) 51% or more of the purchaser's sales revenue for the previous calendar quarter is:
2315 (A) amounts paid or charged as admission or user fees described in Subsection
2316 59-12-103(1)(f); and
2317 (B) subject to taxation under this chapter; and
2318 (b) in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
2319 commission may make rules for verifying that 51% of a purchaser's sales revenue for the
2320 previous calendar quarter is:
2321 (i) amounts paid or charged as admission or user fees described in Subsection
2322 59-12-103(1)(f); and
2323 (ii) subject to taxation under this chapter;
2324 (77) purchases of a short-term lodging consumable by a business that provides
2325 accommodations and services described in Subsection 59-12-103(1)(i);
2326 (78) amounts paid or charged to access a database:
2327 (a) if the primary purpose for accessing the database is to view or retrieve information
2328 from the database; and
2329 (b) not including amounts paid or charged for a:
2330 (i) digital audiowork;
2331 (ii) digital audio-visual work; or
2332 (iii) digital book;
2333 (79) amounts paid or charged for a purchase or lease made by an electronic financial
2334 payment service, of:
2335 (a) machinery and equipment that:
2336 (i) are used in the operation of the electronic financial payment service; and
2337 (ii) have an economic life of three or more years; and
2338 (b) normal operating repair or replacement parts that:
2339 (i) are used in the operation of the electronic financial payment service; and
2340 (ii) have an economic life of three or more years;
2341 (80) [
2342 (81) amounts paid or charged for a purchase or lease of tangible personal property or a
2343 product transferred electronically if the tangible personal property or product transferred
2344 electronically:
2345 (a) is stored, used, or consumed in the state; and
2346 (b) is temporarily brought into the state from another state:
2347 (i) during a disaster period as defined in Section 53-2a-1202;
2348 (ii) by an out-of-state business as defined in Section 53-2a-1202;
2349 (iii) for a declared state disaster or emergency as defined in Section 53-2a-1202; and
2350 (iv) for disaster- or emergency-related work as defined in Section 53-2a-1202;
2351 (82) sales of goods and services at a morale, welfare, and recreation facility, as defined
2352 in Section 39-9-102, made pursuant to Title 39, Chapter 9, State Morale, Welfare, and
2353 Recreation Program;
2354 (83) amounts paid or charged for a purchase or lease of molten magnesium;
2355 (84) [
2356 amounts paid or charged for a purchase or lease made by a drilling equipment manufacturer of
2357 machinery, equipment, [
2358 materials, except for office equipment or office supplies, that are used or consumed exclusively
2359 in the drilling equipment manufacturer's manufacturing process; [
2360 [
2361 [
2362 [
2363 [
2364
2365 [
2366 [
2367 (85) amounts paid or charged for a purchase or lease made by a qualifying enterprise
2368 data center of machinery, equipment, or normal operating repair or replacement parts, if the
2369 machinery, equipment, or normal operating repair or replacement parts:
2370 (a) are used in the operation of the establishment; and
2371 (b) have an economic life of one or more years; and
2372 (86) subject to Section 59-12-104.8, amounts paid or charged for a purchase or lease of
2373 machinery, equipment, or normal operating repair or replacement parts by a manufacturing
2374 facility that:
2375 (a) is an establishment, as the commission defines that term in accordance with Title
2376 63G, Chapter 3, Utah Administrative Rulemaking Act;
2377 (b) is described in NAICS Code 336111, Automobile Manufacturing, of the 2002
2378 North American Industry Classification System of the federal Executive Office of the
2379 President, Office of Management and Budget;
2380 (c) is located in the state; and
2381 (d) uses the machinery, equipment, or normal operating repair or replacement parts in
2382 the manufacturing process to manufacture an item sold as tangible personal property, as the
2383 commission may define that phrase in accordance with Title 63G, Chapter 3, Utah
2384 Administrative Rulemaking Act;
2385 (87) subject to Section 59-12-104.8, amounts paid or charged for a purchase or lease of
2386 equipment or normal operating repair or replacement parts with an economic life of less than
2387 three years by a manufacturing facility that:
2388 (a) is an establishment, as the commission defines that term in accordance with Title
2389 63G, Chapter 3, Utah Administrative Rulemaking Act;
2390 (b) is described in NAICS Code 325120, Industrial Gas Manufacturing, of the 2002
2391 North American Industry Classification System of the federal Executive Office of the
2392 President, Office of Management and Budget;
2393 (c) is located in the state; and
2394 (d) uses the equipment or normal operating repair or replacement parts to manufacture
2395 hydrogen;
2396 (88) sales of cleaning or washing of a vehicle, except for cleaning or washing of a
2397 vehicle that includes cleaning or washing of the interior of the vehicle; [
2398 (89) amounts paid or charged for a purchase or lease of machinery, equipment, normal
2399 operating repair or replacement parts, catalysts, chemicals, reagents, solutions, or supplies used
2400 or consumed:
2401 (a) by a refiner who owns, leases, operates, controls, or supervises a refinery as defined
2402 in Section 63M-4-701 located in the state;
2403 (b) if the machinery, equipment, normal operating repair or replacement parts,
2404 catalysts, chemicals, reagents, solutions, or supplies are used or consumed in:
2405 (i) the production process to produce gasoline or diesel fuel, or at which blendstock is
2406 added to gasoline or diesel fuel;
2407 (ii) research and development;
2408 (iii) transporting, storing, or managing raw materials, work in process, finished
2409 products, and waste materials produced from refining gasoline or diesel fuel, or adding
2410 blendstock to gasoline or diesel fuel;
2411 (iv) developing or maintaining a road, tunnel, excavation, or similar feature used in
2412 refining; or
2413 (v) preventing, controlling, or reducing pollutants from refining; and
2414 (c) beginning on July 1, 2021, if the person has obtained a form certified by the Office
2415 of Energy Development under Subsection 63M-4-702(2)[
2416 (90) subject to Section 59-12-104.8, amounts paid or charged for a purchase or lease of
2417 machinery, equipment, normal operating repair or replacement parts, or materials, except for
2418 office equipment or office supplies, by:
2419 (a) a manufacturing facility that:
2420 (i) is located in the state; and
2421 (ii) uses or consumes the machinery, equipment, normal operating repair or
2422 replacement parts, or materials:
2423 (A) in the manufacturing process to manufacture an item sold as tangible personal
2424 property, as the commission may define that phrase in accordance with Title 63G, Chapter 3,
2425 Utah Administrative Rulemaking Act; or
2426 (B) for a scrap recycler, to process an item sold as tangible personal property, as the
2427 commission may define that phrase in accordance with Title 63G, Chapter 3, Utah
2428 Administrative Rulemaking Act;
2429 (b) an establishment, as the commission defines that term in accordance with Title
2430 63G, Chapter 3, Utah Administrative Rulemaking Act, that:
2431 (i) is described in NAICS Subsector 212, Mining (except Oil and Gas), or NAICS
2432 Code 213113, Support Activities for Coal Mining, 213114, Support Activities for Metal
2433 Mining, or 213115, Support Activities for Nonmetallic Minerals (except Fuels) Mining, of the
2434 2002 North American Industry Classification System of the federal Executive Office of the
2435 President, Office of Management and Budget;
2436 (ii) is located in the state; and
2437 (iii) uses or consumes the machinery, equipment, normal operating repair or
2438 replacement parts, or materials in:
2439 (A) the production process to produce an item sold as tangible personal property, as the
2440 commission may define that phrase in accordance with Title 63G, Chapter 3, Utah
2441 Administrative Rulemaking Act;
2442 (B) research and development, as the commission may define that phrase in accordance
2443 with Title 63G, Chapter 3, Utah Administrative Rulemaking Act;
2444 (C) transporting, storing, or managing tailings, overburden, or similar waste materials
2445 produced from mining;
2446 (D) developing or maintaining a road, tunnel, excavation, or similar feature used in
2447 mining; or
2448 (E) preventing, controlling, or reducing dust or other pollutants from mining; or
2449 (c) an establishment, as the commission defines that term in accordance with Title
2450 63G, Chapter 3, Utah Administrative Rulemaking Act, that:
2451 (i) is described in NAICS Code 518112, Web Search Portals, of the 2002 North
2452 American Industry Classification System of the federal Executive Office of the President,
2453 Office of Management and Budget;
2454 (ii) is located in the state; and
2455 (iii) uses or consumes the machinery, equipment, normal operating repair or
2456 replacement parts, or materials in the operation of the web search portal; and
2457 (91) subject to Section 59-12-104.8, amounts paid or charged for a purchase or lease of
2458 machinery, equipment, normal operating repair or replacement parts, or materials, except for
2459 office equipment or office supplies, by an establishment, as the commission defines that term
2460 in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, that:
2461 (a) is described in NAICS Code 621511, Medical Laboratories, of the 2017 North
2462 American Industry Classification System of the federal Executive Office of the President,
2463 Office of Management and Budget;
2464 (b) is located in this state; and
2465 (c) uses the machinery, equipment, normal operating repair or replacement parts, or
2466 materials in the operation of the establishment.
2467 Section 3. Section 59-12-104.5 is amended to read:
2468 59-12-104.5. Revenue and Taxation Interim Committee review of sales and use
2469 taxes.
2470 (1) The Revenue and Taxation Interim Committee shall:
2471 [
2472 which Congress permits a state to participate in the special supplemental nutrition program
2473 under 42 U.S.C. Sec. 1786 even if state or local sales taxes are collected within the state on
2474 purchases of food under that program;
2475 [
2476 which Congress permits a state to participate in the SNAP as defined in Section 35A-1-102,
2477 even if state or local sales taxes are collected within the state on purchases of food under that
2478 program; and
2479 [
2480 [
2481 described in Section 63N-1-302(2);
2482 [
2483 [
2484 [
2485 [
2486 [
2487 Subsections 59-12-104(86) and (87) should be continued, modified, or repealed.
2488 (2) Once the commission implements the sales and use tax exemption described in
2489 Subsection 59-12-104(90) in accordance with Section 59-12-104.8, the provisions described in
2490 Subsection (1)(c) no longer have effect.
2491 Section 4. Section 59-12-104.7 is amended to read:
2492 59-12-104.7. Reporting by purchaser of certain sales and use tax exempt
2493 purchases.
2494 (1) A purchaser that receives a sales and use tax exemption under Subsection
2495 59-12-104(86) or (87) shall make the report described in Section 63N-1-302.
2496 (2) Once the commission implements the sales and use tax exemption described in
2497 Subsection 59-12-104(90) in accordance with Section 59-12-104.8, the provision described in
2498 Subsection (1) no longer has effect.
2499 Section 5. Section 59-12-104.8 is enacted to read:
2500 59-12-104.8. Exemption for machinery, equipment, normal operating repair or
2501 replacement parts, and materials.
2502 (1) As used in this section, "committee" means:
2503 (a) the Revenue and Taxation Interim Committee; or
2504 (b) the House Revenue and Taxation Standing Committee and the Senate Revenue and
2505 Taxation Standing Committee jointly.
2506 (2) The sales and use tax exemptions described in Subsections 59-12-104(90) and (91)
2507 take effect, in accordance with Subsection (3), if the Supreme Court of the United States issues
2508 a decision or Congress passes legislation that permits a state to require the following sellers to
2509 collect a sales or use tax:
2510 (a) a seller that does not meet one or more of the criteria described in Subsection
2511 59-12-107(2)(a); or
2512 (b) a seller that is not required to pay or collect and remit sales and use tax under
2513 Subsection 59-12-107(2)(b).
2514 (3) (a) The commission shall make an electronic report regarding the action of the
2515 Supreme Court of the United States or Congress immediately after the action becomes effective
2516 to:
2517 (i) between the conclusion of the General Session and the conclusion of interim
2518 meetings, the Revenue and Taxation Interim Committee; or
2519 (ii) between the conclusion of interim meetings and the conclusion of the General
2520 Session:
2521 (A) the House Revenue and Taxation Standing Committee; and
2522 (B) the Senate Revenue and Taxation Standing Committee.
2523 (b) After receiving the report described in this Subsection (3), the committee shall:
2524 (i) review the action taken by the Supreme Court of the United States or Congress;
2525 (ii) direct the commission to:
2526 (A) implement the sales and use tax exemptions described in Subsections
2527 59-12-104(90) and (91) on the first day of the next calendar quarter that is at least 30 days after
2528 the day on which the committee directs the commission; and
2529 (B) treat the sales and use tax exemptions described in Subsections 59-12-104(14),
2530 (84), (86), and (87) as subsumed by the sales and use tax exemption described in Subsection
2531 59-12-104(90) once the commission implements the sales and use tax exemption described in
2532 Subsection 59-12-104(90); and
2533 (iii) make a recommendation:
2534 (A) to the Legislative Management Committee that the Revenue and Taxation Interim
2535 Committee study whether as a result of the action by the Supreme Court of the United States or
2536 Congress, the Legislature should amend or repeal any provisions of this chapter; or
2537 (B) to the Legislative Management Committee or in the form of legislation regarding
2538 the need for amendment or repeal of any provisions of this chapter as a result of the action by
2539 the Supreme Court of the United States or Congress and the implementation of this section.
2540 Section 6. Section 63N-1-302 is amended to read:
2541 63N-1-302. Reporting of certain sales and use tax exempt purchases.
2542 (1) (a) On or before October 1, a purchaser that receives a sales and use tax exemption
2543 under Subsection 59-12-104(86) for the previous calendar year shall report to the office:
2544 (i) the total purchase or lease price for all machinery, equipment, or normal operating
2545 repair or replacement parts for which the purchaser received the sales and use tax exemption
2546 under Subsection 59-12-104(86); and
2547 (ii) the total amount of sales and use tax that the purchaser would have owed on the
2548 purchase or lease price but for the exemption in Subsection 59-12-104(86).
2549 (b) On or before October 1, a purchaser that receives a sales and use tax exemption
2550 under Subsection 59-12-104(87) for the previous calendar year shall report to the office:
2551 (i) the total purchase or lease price for all equipment or normal operating repair or
2552 replacement parts for which the purchaser received the sales and use tax exemption under
2553 Subsection 59-12-104(87); and
2554 (ii) the total amount of sales and use tax that the purchaser would have owed on the
2555 purchase or lease price but for the exemption in Subsection 59-12-104(87).
2556 (2) On or before November 30, the office shall report the information received under
2557 Subsection (1) to the Revenue and Taxation Interim Committee:
2558 (a) for each exemption; and
2559 (b) in the aggregate for all purchasers that make a report in accordance with this
2560 section.
2561 (3) Once the commission implements the sales and use tax exemption described in
2562 Subsection 59-12-104(90) in accordance with Section 59-12-104.8, the provisions described in
2563 this section no longer have effect.
Legislative Review Note
Office of Legislative Research and General Counsel