1
2
3
4
5
6
7 LONG TITLE
8 General Description:
9 This bill modifies incentives for the production and use of alternative fuels.
10 Highlighted Provisions:
11 This bill:
12 ▸ modifies the corporate and individual tax credits for commercial energy systems
13 that use solar equipment to produce electricity;
14 ▸ creates refundable and nonrefundable corporate and individual tax credits for certain
15 hydrogen fuel cells and hydrogen production systems;
16 ▸ provides a process for a lessee of a renewable energy system, a hydrogen fuel cell,
17 or a hydrogen production system income tax credit to obtain a written certification;
18 ▸ modifies sales and use tax definitions to:
19 • add hydrogen to the list of fuels that are subject to a lower sales and use tax rate
20 if for residential use and a sales tax exemption if for industrial use;
21 • extend the sales and use tax exemption for sales of electricity made under a
22 Public Service Commission tariff to include electricity produced with a
23 hydrogen fuel cell; and
24 • exempt sales of electricity made under a Public Service Commission tariff to
25 include electricity produced with a hydrogen fuel cell from municipal energy
26 tax;
27 ▸ defines "infrastructure" to include hydrogen fuel production or distribution projects
28 for purposes of qualifying for a high cost infrastructure development tax credit;
29 ▸ repeals the Alternative Energy Development Tax Credit Act and related tax credits;
30 and
31 ▸ makes technical and conforming changes.
32 Money Appropriated in this Bill:
33 None
34 Other Special Clauses:
35 This bill provides a special effective date.
36 Utah Code Sections Affected:
37 AMENDS:
38 59-7-159, as last amended by Laws of Utah 2019, Chapters 247 and 465
39 59-7-614, as last amended by Laws of Utah 2019, Chapter 247
40 59-7-619, as last amended by Laws of Utah 2016, Third Special Session, Chapter 1
41 59-10-137, as last amended by Laws of Utah 2019, Chapters 247 and 465
42 59-10-1014, as last amended by Laws of Utah 2019, Chapter 247
43 59-10-1034, as last amended by Laws of Utah 2016, Third Special Session, Chapter 1
44 59-10-1106, as last amended by Laws of Utah 2016, Third Special Session, Chapter 1
45 59-12-102, as last amended by Laws of Utah 2020, Chapters 354, 365, and 438
46 59-12-103, as last amended by Laws of Utah 2020, Fifth Special Session, Chapter 20
47 63M-4-401, as last amended by Laws of Utah 2019, Chapter 247
48 63M-4-602, as last amended by Laws of Utah 2019, Chapter 501
49 ENACTS:
50 59-7-626, Utah Code Annotated 1953
51 59-10-1113, Utah Code Annotated 1953
52 REPEALS:
53 59-7-614.7, as last amended by Laws of Utah 2016, Third Special Session, Chapter 1
54 59-10-1029, as last amended by Laws of Utah 2016, Third Special Session, Chapter 1
55 63M-4-501, as enacted by Laws of Utah 2012, Chapter 410
56 63M-4-502, as enacted by Laws of Utah 2012, Chapter 410
57 63M-4-503, as last amended by Laws of Utah 2018, Chapter 149
58 63M-4-504, as enacted by Laws of Utah 2012, Chapter 410
59 63M-4-505, as last amended by Laws of Utah 2016, Chapters 13 and 135
60
61 Be it enacted by the Legislature of the state of Utah:
62 Section 1. Section 59-7-159 is amended to read:
63 59-7-159. Review of credits allowed under this chapter.
64 (1) As used in this section, "committee" means the Revenue and Taxation Interim
65 Committee.
66 (2) (a) The committee shall review the tax credits described in this chapter as provided
67 in Subsection (3) and make recommendations concerning whether the tax credits should be
68 continued, modified, or repealed.
69 (b) In conducting the review required under Subsection (2)(a), the committee shall:
70 (i) schedule time on at least one committee agenda to conduct the review;
71 (ii) invite state agencies, individuals, and organizations concerned with the tax credit
72 under review to provide testimony;
73 (iii) (A) invite the Governor's Office of Economic Development to present a summary
74 and analysis of the information for each tax credit regarding which the Governor's Office of
75 Economic Development is required to make a report under this chapter; and
76 (B) invite the Office of the Legislative Fiscal Analyst to present a summary and
77 analysis of the information for each tax credit regarding which the Office of the Legislative
78 Fiscal Analyst is required to make a report under this chapter;
79 (iv) ensure that the committee's recommendations described in this section include an
80 evaluation of:
81 (A) the cost of the tax credit to the state;
82 (B) the purpose and effectiveness of the tax credit; and
83 (C) the extent to which the state benefits from the tax credit; and
84 (v) undertake other review efforts as determined by the committee chairs or as
85 otherwise required by law.
86 (3) (a) On or before November 30, 2017, and every three years after 2017, the
87 committee shall conduct the review required under Subsection (2) of the tax credits allowed
88 under the following sections:
89 (i) Section 59-7-601;
90 (ii) Section 59-7-607;
91 (iii) Section 59-7-612;
92 (iv) Section 59-7-614.1; and
93 (v) Section 59-7-614.5.
94 (b) On or before November 30, 2018, and every three years after 2018, the committee
95 shall conduct the review required under Subsection (2) of the tax credits allowed under the
96 following sections:
97 (i) Section 59-7-609;
98 (ii) Section 59-7-614.2;
99 (iii) Section 59-7-614.10;
100 (iv) Section 59-7-619;
101 (v) Section 59-7-620; and
102 (vi) Section 59-7-624.
103 (c) On or before November 30, 2019, and every three years after 2019, the committee
104 shall conduct the review required under Subsection (2) of the tax credits allowed under the
105 following sections:
106 (i) Section 59-7-610;
107 (ii) Section 59-7-614; and
108 [
109 [
110 (d) (i) In addition to the reviews described in this Subsection (3), the committee shall
111 conduct a review of a tax credit described in this chapter that is enacted on or after January 1,
112 2017.
113 (ii) The committee shall complete a review described in this Subsection (3)(d) three
114 years after the effective date of the tax credit and every three years after the initial review date.
115 Section 2. Section 59-7-614 is amended to read:
116 59-7-614. Renewable energy systems tax credits -- Definitions -- Certification --
117 Rulemaking authority.
118 (1) As used in this section:
119 (a) (i) "Active solar system" means a system of equipment that is capable of:
120 (A) collecting and converting incident solar radiation into thermal, mechanical, or
121 electrical energy; and
122 (B) transferring a form of energy described in Subsection (1)(a)(i)(A) by a separate
123 apparatus to storage or to the point of use.
124 (ii) "Active solar system" includes water heating, space heating or cooling, and
125 electrical or mechanical energy generation.
126 (b) "Biomass system" means a system of apparatus and equipment for use in:
127 (i) converting material into biomass energy, as defined in Section 59-12-102; and
128 (ii) transporting the biomass energy by separate apparatus to the point of use or storage.
129 (c) "Commercial energy system" means a system that is:
130 (i) (A) an active solar system;
131 (B) a biomass system;
132 (C) a direct use geothermal system;
133 (D) a geothermal electricity system;
134 (E) a geothermal heat pump system;
135 (F) a hydroenergy system;
136 (G) a passive solar system; or
137 (H) a wind system;
138 (ii) located in the state; and
139 (iii) used:
140 (A) to supply energy to a commercial unit; or
141 (B) as a commercial enterprise.
142 (d) "Commercial enterprise" means an entity, the purpose of which is to produce:
143 (i) electrical, mechanical, or thermal energy for sale from a commercial energy system;
144 or
145 (ii) hydrogen for sale from a hydrogen production system.
146 (e) (i) "Commercial unit" means a building or structure that an entity uses to transact
147 business.
148 (ii) Notwithstanding Subsection (1)(e)(i):
149 (A) with respect to an active solar system used for agricultural water pumping or a
150 wind system, each individual energy generating device is considered to be a commercial unit;
151 or
152 (B) if an energy system is the building or structure that an entity uses to transact
153 business, a commercial unit is the complete energy system itself.
154 (f) "Direct use geothermal system" means a system of apparatus and equipment that
155 enables the direct use of geothermal energy to meet energy needs, including heating a building,
156 an industrial process, and aquaculture.
157 (g) "Fuel cell" means any electrochemical device and any accompanying system
158 components that:
159 (i) react hydrogen with oxygen to produce electricity; and
160 (ii) produce zero emissions of carbon dioxide, nitrides of oxygen, or sulfides of
161 oxygen.
162 [
163 (i) contained in heat that continuously flows outward from the earth; and
164 (ii) used as a sole source of energy to produce electricity.
165 [
166 earth.
167 [
168 that:
169 (i) enables the use of thermal properties contained in the earth at temperatures well
170 below 100 degrees Fahrenheit; and
171 (ii) helps meet heating and cooling needs of a structure.
172 [
173 capable of:
174 (i) intercepting and converting kinetic water energy into electrical or mechanical
175 energy; and
176 (ii) transferring this form of energy by separate apparatus to the point of use or storage.
177 (l) "Hydrogen production system" means a system of apparatus and equipment, located
178 in this state, that uses:
179 (i) electricity from a renewable energy source to create hydrogen gas from water,
180 regardless of whether the renewable energy source is at a separate facility or the same facility
181 as the system of apparatus and equipment; or
182 (ii) uses renewable natural gas to produce hydrogen gas.
183 [
184 63M-4-401.
185 [
186 structure of a building and [
187 storage, and distribution of heating or cooling during the appropriate times of the year by
188 utilizing the climate resources available at the site.
189 (ii) "Passive solar system" includes those portions and components of a building that
190 are expressly designed and required for the collection, storage, and distribution of solar energy.
191 [
192 from sunlight.
193 [
194 constitutes the cost a person incurs in acquiring a commercial energy system.
195 (ii) "Principal recovery portion" does not include:
196 (A) an interest charge; or
197 (B) a maintenance expense.
198 (q) "Renewable energy source" means the same as that term is defined in Section
199 54-17-601.
200 [
201 for a residential unit:
202 (i) an active solar system;
203 (ii) a biomass system;
204 (iii) a direct use geothermal system;
205 (iv) a geothermal heat pump system;
206 (v) a hydroenergy system;
207 (vi) a passive solar system; or
208 (vii) a wind system.
209 [
210 dwelling unit that:
211 (A) is located in the state; and
212 (B) serves as a dwelling for a person, group of persons, or a family.
213 (ii) "Residential unit" does not include property subject to a fee under:
214 (A) Section 59-2-405;
215 (B) Section 59-2-405.1;
216 (C) Section 59-2-405.2;
217 (D) Section 59-2-405.3; or
218 (E) Section 72-10-110.5.
219 [
220 (i) intercepting and converting wind energy into mechanical or electrical energy; and
221 (ii) transferring these forms of energy by a separate apparatus to the point of use, sale,
222 or storage.
223 (2) A taxpayer may claim an energy system tax credit as provided in this section
224 against a tax due under this chapter for a taxable year.
225 (3) (a) Subject to the other provisions of this Subsection (3), a taxpayer may claim a
226 nonrefundable tax credit under this Subsection (3) with respect to a residential unit the taxpayer
227 owns or uses if:
228 (i) the taxpayer:
229 (A) purchases and completes a residential energy system to supply all or part of the
230 energy required for the residential unit; or
231 (B) participates in the financing of a residential energy system to supply all or part of
232 the energy required for the residential unit; and
233 [
234
235 [
236 Subsection [
237 (b) (i) Subject to Subsections (3)(b)(ii) through (iv) and, as applicable, Subsection
238 (3)(c) or (d), the tax credit is equal to 25% of the reasonable costs of each residential energy
239 system installed with respect to each residential unit the taxpayer owns or uses.
240 (ii) A tax credit under this Subsection (3) may include installation costs.
241 (iii) A taxpayer may claim a tax credit under this Subsection (3) for the taxable year in
242 which the residential energy system is completed and placed in service.
243 (iv) If the amount of a tax credit under this Subsection (3) exceeds a taxpayer's tax
244 liability under this chapter for a taxable year, the taxpayer may carry forward the amount of the
245 tax credit exceeding the liability [
246 next four taxable years.
247 (c) The total amount of tax credit a taxpayer may claim under this Subsection (3) for a
248 residential energy system, other than a photovoltaic system, may not exceed $2,000 per
249 residential unit.
250 (d) The total amount of tax credit a taxpayer may claim under this Subsection (3) for a
251 photovoltaic system may not exceed:
252 (i) for a system installed on or after January 1, 2018, but on or before December 31,
253 2020, $1,600;
254 (ii) for a system installed on or after January 1, 2021, but on or before December 31,
255 2021, $1,200;
256 (iii) for a system installed on or after January 1, 2022, but on or before December 31,
257 2022, $800;
258 (iv) for a system installed on or after January 1, 2023, but on or before December 31,
259 2023, $400; and
260 (v) for a system installed on or after January 1, 2024, $0.
261 (e) If a taxpayer sells a residential unit to another person before the taxpayer claims the
262 tax credit under this Subsection (3):
263 (i) the taxpayer may assign the tax credit to the other person; and
264 (ii) (A) if the other person files a return under this chapter, the other person may claim
265 the tax credit under this section as if the other person had met the requirements of this section
266 to claim the tax credit; or
267 (B) if the other person files a return under Chapter 10, Individual Income Tax Act, the
268 other person may claim the tax credit under Section 59-10-1014 as if the other person had met
269 the requirements of Section 59-10-1014 to claim the tax credit.
270 (4) (a) Subject to the other provisions of this Subsection (4), a taxpayer may claim a
271 refundable tax credit under this Subsection (4) with respect to a commercial energy system if:
272 (i) the commercial energy system does not use:
273 (A) wind, geothermal electricity, [
274 total of 660 or more kilowatts of electricity; or
275 (B) solar equipment capable of producing 2,000 or more kilowatts of electricity;
276 (ii) the taxpayer purchases or participates in the financing of the commercial energy
277 system;
278 (iii) (A) the commercial energy system supplies all or part of the energy required by
279 commercial units owned or used by the taxpayer; or
280 (B) the taxpayer sells all or part of the energy produced by the commercial energy
281 system as a commercial enterprise;
282 [
283
284 (iv) the taxpayer has not claimed and will not claim a tax credit under Subsection (6) or
285 (7) for fuel cell use or hydrogen production using electricity for which the taxpayer claims a tax
286 credit under this Subsection (4); and
287 (v) the taxpayer obtains a written certification from the office in accordance with
288 Subsection [
289 (b) (i) Subject to Subsections (4)(b)(ii) through [
290 of the reasonable costs of the commercial energy system.
291 (ii) A tax credit under this Subsection (4) may include installation costs.
292 (iii) A taxpayer [
293 for the taxable year in which the commercial energy system is completed and placed in service.
294 [
295 [
296 may not exceed $50,000 per commercial unit.
297 (c) (i) Subject to Subsections (4)(c)(ii) and (iii), a taxpayer that is a lessee of a
298 commercial energy system installed on a commercial unit may claim a tax credit under this
299 Subsection (4) if the taxpayer [
300
301 (ii) A taxpayer described in Subsection (4)(c)(i) may claim as a tax credit under this
302 Subsection (4) only the principal recovery portion of the lease payments.
303 (iii) A taxpayer described in Subsection (4)(c)(i) may claim a tax credit under this
304 Subsection (4) for a period that does not exceed seven taxable years after the [
305 which the lease begins, as stated in the lease agreement.
306 (5) (a) Subject to the other provisions of this Subsection (5), a taxpayer may claim a
307 refundable tax credit under this Subsection (5) with respect to a commercial energy system if:
308 (i) (A) the commercial energy system uses wind, geothermal electricity, or biomass
309 equipment capable of producing a total of 660 or more kilowatts of electricity; or
310 (B) the commercial energy system uses solar equipment capable of producing a total of
311 2,000 or more kilowatts of electricity;
312 (ii) (A) the commercial energy system supplies all or part of the energy required by
313 commercial units owned or used by the taxpayer; or
314 (B) the taxpayer sells all or part of the energy produced by the commercial energy
315 system as a commercial enterprise;
316 [
317
318 (iii) the taxpayer has not claimed and will not claim a tax credit under Subsection (6)
319 or (7) for fuel cell use or hydrogen production using electricity for which the taxpayer claims a
320 tax credit under this Subsection (5); and
321 (iv) the taxpayer obtains a written certification from the office in accordance with
322 Subsection [
323 (b) (i) Subject to [
324 Subsection (5) is equal to the product of:
325 (A) 0.35 cents; and
326 (B) the kilowatt hours of electricity produced and used or sold during the taxable year.
327 (ii) A taxpayer is eligible to claim a tax credit under this Subsection (5) [
328
329 which the commercial energy system is placed in commercial service.
330 [
331 (c) A taxpayer that is a lessee of a commercial energy system installed on a commercial
332 unit may claim a tax credit under this Subsection (5) if the taxpayer [
333
334 accordance with Subsection (8).
335 [
336
337 [
338
339 [
340
341 [
342
343 [
344 [
345
346 [
347
348 [
349
350 [
351 [
352
353 [
354
355
356 [
357 [
358
359
360 (6) (a) A taxpayer may claim a nonrefundable tax credit as provided in this Subsection
361 (6) if:
362 (i) the taxpayer owns a fuel cell that has a rated capacity for generating electricity of
363 five megawatts or smaller;
364 (ii) the fuel cell is completed and placed in service in this state on or after January 1,
365 2022;
366 (iii) the fuel cell supplies all or part of the electricity required by commercial units
367 owned or used by the taxpayer;
368 (iv) the taxpayer has not claimed and will not claim a tax credit under Subsection (4),
369 (5), or (7) or Section 59-7-626 for electricity or hydrogen used to meet the requirements of this
370 Subsection (6); and
371 (v) the taxpayer obtains a written certification from the office in accordance with
372 Subsection (8).
373 (b) (i) Subject to Subsections (6)(b)(ii) through (iv), a tax credit under this Subsection
374 (6) is equal to 10% of the reasonable costs of the fuel cell.
375 (ii) A tax credit under this Subsection (6) may include installation costs.
376 (iii) A taxpayer is eligible to claim a tax credit under this Subsection (6) for the taxable
377 year in which the fuel cell is placed in service.
378 (iv) If the amount of a tax credit under this Subsection (6) exceeds a taxpayer's tax
379 liability under this chapter for a taxable year, the taxpayer may carry forward the amount of the
380 tax credit exceeding the liability for a period that does not exceed the next four taxable years.
381 (c) (i) Subject to Subsections (6)(c)(ii) and (iii), a taxpayer that is a lessee of a fuel cell
382 installed on a commercial unit may claim a tax credit under this Subsection (6) if the lessee
383 obtains a written certification from the office in accordance with Subsection (8).
384 (ii) A taxpayer described in Subsection (6)(c)(i) may claim as a tax credit under this
385 Subsection (6) only the principal recovery portion of the lease payments.
386 (iii) A taxpayer described in Subsection (6)(c)(i) may claim a tax credit under this
387 Subsection (6) for a period that does not exceed seven taxable years after the day on which the
388 lease begins, as stated in the lease agreement.
389 (7) (a) A taxpayer may claim a refundable tax credit as provided in this Subsection (7)
390 if:
391 (i) the taxpayer owns a hydrogen production system;
392 (ii) the hydrogen production system is completed and placed in service on or after
393 January 1, 2022;
394 (iii) the taxpayer sells as a commercial enterprise, or supplies for the taxpayer's own
395 use in commercial units, the hydrogen produced from the hydrogen production system for use
396 in:
397 (A) a vehicle; or
398 (B) a fuel cell that has a rated capacity for generating electricity of five megawatts or
399 less;
400 (iv) the taxpayer has not claimed and will not claim a tax credit under Subsection (4),
401 (5), or (6) or Section 59-7-626 for electricity or hydrogen used to meet the requirements of this
402 Subsection (7); and
403 (v) the taxpayer obtains a written certification from the office in accordance with
404 Subsection (8).
405 (b) (i) Subject to Subsections (7)(b)(ii) and (iii), a tax credit under this Subsection (7)
406 is equal to the product of:
407 (A) $2.34; and
408 (B) the number of kilograms of hydrogen produced and stored, used, or sold during the
409 taxable year.
410 (ii) A taxpayer may not receive a tax credit under this Subsection (7) for more than 365
411 metric tons of hydrogen per taxable year.
412 (iii) A taxpayer is eligible to claim a tax credit under this Subsection (7) for production
413 occurring during a period of 48 months beginning with the month in which the hydrogen
414 production system is placed in commercial service.
415 (c) (i) Subject to Subsections (7)(c)(ii) and (iii), a taxpayer that is a lessee of a
416 hydrogen production system installed on a commercial unit may claim a tax credit under this
417 Subsection (7) if the lessee obtains a written certification from the office in accordance with
418 Subsection (8).
419 (ii) A taxpayer described in Subsection (7)(c)(i) may claim as a tax credit under this
420 Subsection (7) only the principal recovery portion of the lease payments.
421 (iii) A taxpayer described in Subsection (7)(c)(i) may claim a tax credit under this
422 Subsection (7) for a period that does not exceed seven taxable years after the day on which the
423 lease begins, as stated in the lease agreement.
424 [
425 may claim a tax credit under this section, the taxpayer shall obtain a written certification from
426 the office.
427 (b) The office shall issue a taxpayer that is not a lessee a written certification if the
428 office determines that:
429 (i) the taxpayer meets the requirements of this section to receive a tax credit; and
430 (ii) the residential energy system [
431 the hydrogen production system with respect to which the taxpayer seeks to claim a tax credit:
432 (A) has been completely installed;
433 (B) is a viable system for saving or producing energy from renewable resources; and
434 (C) is safe, reliable, efficient, and technically feasible to ensure that the residential
435 energy system [
436 system uses the state's renewable and nonrenewable energy resources in an appropriate and
437 economic manner.
438 (c) The office shall issue a taxpayer that is a lessee a written certification if the office
439 receives:
440 (i) a copy of the lessor's written certification or other proof, in a form established by the
441 office, that the lessor qualified for a tax credit under Subsection (4), (5), (6), or (7); and
442 (ii) proof that the lessor irrevocably elects not to claim the tax credit for which the
443 lessor qualified.
444 [
445 Act, the office may make rules:
446 (i) for determining whether a residential energy system [
447 system, a fuel cell, or a hydrogen production system meets the requirements of Subsection [
448 (8)(b)(ii); and
449 (ii) for purposes of a tax credit under Subsection (3) [
450 reasonable costs of a residential energy system [
451 as an amount per unit of energy production.
452 [
453 office shall retain the certification for the same time period a person is required to keep books
454 and records under Section 59-1-1406.
455 [
456 (i) the name and identifying information of each taxpayer or lessee to which the office
457 issues a written certification; and
458 (ii) for each taxpayer or lessee:
459 (A) the amount of the tax credit listed on the written certification; and
460 (B) the date the renewable energy system was installed.
461 [
462 Act, the commission may make rules to address the certification of a tax credit under this
463 section.
464 [
465 the laws or rules and regulations of the United States.
466 Section 3. Section 59-7-619 is amended to read:
467 59-7-619. Nonrefundable high cost infrastructure development tax credit.
468 (1) As used in this section:
469 (a) "High cost infrastructure project" means the same as that term is defined in Section
470 63M-4-602.
471 (b) "Infrastructure cost-burdened entity" means the same as that term is defined in
472 Section 63M-4-602.
473 (c) "Infrastructure-related revenue" means the same as that term is defined in Section
474 63M-4-602.
475 (d) "Office" means the Office of Energy Development created in Section 63M-4-401.
476 (2) Subject to the other provisions of this section, a corporation that is an infrastructure
477 cost-burdened entity may claim a nonrefundable tax credit for development of a high cost
478 infrastructure project as provided in this section.
479 (3) The tax credit under this section is the amount listed as the tax credit amount on a
480 tax credit certificate that the office issues under Title 63M, Chapter 4, Part 6, High Cost
481 Infrastructure Development Tax Credit Act, to the infrastructure cost-burdened entity for the
482 taxable year.
483 (4) An infrastructure cost-burdened entity may carry forward a tax credit under this
484 section for a period that does not exceed the next seven taxable years if:
485 (a) the infrastructure cost-burdened entity is allowed to claim a tax credit under this
486 section for a taxable year; and
487 (b) the amount of the tax credit exceeds the infrastructure cost-burdened entity's tax
488 liability under this chapter for that taxable year.
489 (5) (a) In accordance with Section 59-7-159, the Revenue and Taxation Interim
490 Committee shall study the tax credit allowed by this section and make recommendations
491 concerning whether the tax credit should be continued, modified, or repealed.
492 (b) (i) Except as provided in Subsection (5)(b)(ii), for purposes of the study required by
493 this Subsection (5), the office shall provide the following information, if available to the office,
494 to the Office of the Legislative Fiscal Analyst:
495 (A) the amount of tax credit that the office grants to each infrastructure cost-burdened
496 entity for each taxable year;
497 (B) the infrastructure-related revenue generated by each high cost infrastructure
498 project;
499 (C) the information contained in the office's latest report under Section [
500 63M-4-605; and
501 (D) any other information that the Office of the Legislative Fiscal Analyst requests.
502 (ii) (A) In providing the information described in Subsection (5)(b)(i), the office shall
503 redact information that identifies a recipient of a tax credit under this section.
504 (B) If, notwithstanding the redactions made under Subsection (5)(b)(ii)(A), reporting
505 the information described in Subsection (5)(b)(i) might disclose the identity of a recipient of a
506 tax credit, the office may file a request with the Revenue and Taxation Interim Committee to
507 provide the information described in Subsection (5)(b)(i) in the aggregate for all infrastructure
508 cost-burdened entities that receive the tax credit under this section.
509 (c) As part of the study required by this Subsection (5), the Office of the Legislative
510 Fiscal Analyst shall report to the Revenue and Taxation Interim Committee a summary and
511 analysis of the information provided to the Office of the Legislative Fiscal Analyst by the
512 office under Subsection (5)(b).
513 (d) The Revenue and Taxation Interim Committee shall ensure that the
514 recommendations described in Subsection (5)(a) include an evaluation of:
515 (i) the cost of the tax credit to the state;
516 (ii) the purpose and effectiveness of the tax credit; and
517 (iii) the extent to which the state benefits from the tax credit.
518 Section 4. Section 59-7-626 is enacted to read:
519 59-7-626. Refundable tax credit for nonrenewable hydrogen production system.
520 (1) As used in this section:
521 (a) "Commercial enterprise" means an entity, the purpose of which is to produce
522 hydrogen for sale from a hydrogen production system.
523 (b) "Commercial unit" means a building or structure that an entity uses to transact
524 business.
525 (c) "Hydrogen production system" means a system of apparatus and equipment, located
526 in this state, that produces hydrogen from nonrenewable sources.
527 (d) "Office" means the Office of Energy Development created in Section 63M-4-401.
528 (2) (a) A taxpayer may claim a refundable credit under this section if:
529 (i) the taxpayer owns a hydrogen production system;
530 (ii) the hydrogen production system is completed and placed in service on or after
531 January 1, 2022;
532 (iii) the taxpayer sells as a commercial enterprise, or supplies for the taxpayer's own
533 use in commercial units, the hydrogen produced from the hydrogen production system for use
534 in:
535 (A) a vehicle; or
536 (B) a fuel cell that has a rated capacity for generating electricity of five megawatts or
537 less;
538 (iv) the taxpayer has not claimed and will not claim a tax credit under Section 59-7-614
539 for electricity or hydrogen used to meet the requirements of this section; and
540 (v) the taxpayer obtains a written certification from the office in accordance with
541 Subsection (3).
542 (b) (i) Subject to Subsections (2)(b)(ii) and (iii), a tax credit under this section is equal
543 to the product of:
544 (A) $2.34; and
545 (B) the number of kilograms of hydrogen produced and stored, used, or sold during the
546 taxable year.
547 (ii) A taxpayer may not receive a tax credit under this section for more than 365 metric
548 tons of hydrogen per taxable year.
549 (iii) A taxpayer is eligible to claim a tax credit under this section for production
550 occurring during a period of 48 months beginning with the month in which the hydrogen
551 production system is placed in commercial service.
552 (c) (i) Subject to Subsections (2)(c)(ii) and (iii), a taxpayer that is a lessee of a
553 hydrogen production system installed on a commercial unit may claim a tax credit under this
554 section if the lessee obtains a written certification from the office in accordance with
555 Subsection (3).
556 (ii) A taxpayer described in Subsection (2)(c)(i) may claim as a tax credit under this
557 section only the principal recovery portion of the lease payments.
558 (iii) A taxpayer described in Subsection (2)(c)(i) may claim a tax credit under this
559 section for a period that does not exceed seven taxable years after the day on which the lease
560 begins, as stated in the lease agreement.
561 (3) (a) Before a taxpayer, including a lessee, may claim a tax credit under this section,
562 the taxpayer shall obtain a written certification from the office.
563 (b) The office shall issue a taxpayer that is not a lessee a written certification if the
564 office determines that:
565 (i) the taxpayer meets the requirements of this section to receive a tax credit; and
566 (ii) the hydrogen production system with respect to which the taxpayer seeks to claim a
567 tax credit:
568 (A) has been completely installed; and
569 (B) is safe, reliable, efficient, and technically feasible to ensure that the hydrogen
570 production system uses the state's nonrenewable energy resources in an appropriate and
571 economic manner.
572 (c) The office shall issue a taxpayer that is a lessee a written certification if the office
573 receives:
574 (i) a copy of the lessor's written certification or other proof, in a form established by the
575 office, that the lessor qualified for a tax credit under this section; and
576 (ii) proof that the lessor irrevocably elects not to claim the tax credit for which the
577 lessor qualified.
578 (d) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
579 office may make rules for determining whether a hydrogen production system meets the
580 requirements of Subsection (3)(b)(ii).
581 (e) A taxpayer, including a lessee, that obtains a written certification from the office
582 shall retain the certification for the same time period a person is required to keep books and
583 records under Section 59-1-1406.
584 (f) The office shall submit to the commission an electronic list that includes:
585 (i) the name and identifying information of each taxpayer or lessee to which the office
586 issues a written certification; and
587 (ii) for each taxpayer or lessee:
588 (A) the amount of the tax credit listed on the written certification; and
589 (B) the date the hydrogen production system was installed.
590 (4) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
591 commission may make rules to address the certification of a tax credit under this section.
592 (5) A tax credit under this section is in addition to any tax credits provided under the
593 laws or rules and regulations of the United States.
594 Section 5. Section 59-10-137 is amended to read:
595 59-10-137. Review of credits allowed under this chapter.
596 (1) As used in this section, "committee" means the Revenue and Taxation Interim
597 Committee.
598 (2) (a) The committee shall review the tax credits described in this chapter as provided
599 in Subsection (3) and make recommendations concerning whether the tax credits should be
600 continued, modified, or repealed.
601 (b) In conducting the review required under Subsection (2)(a), the committee shall:
602 (i) schedule time on at least one committee agenda to conduct the review;
603 (ii) invite state agencies, individuals, and organizations concerned with the tax credit
604 under review to provide testimony;
605 (iii) (A) invite the Governor's Office of Economic Development to present a summary
606 and analysis of the information for each tax credit regarding which the Governor's Office of
607 Economic Development is required to make a report under this chapter; and
608 (B) invite the Office of the Legislative Fiscal Analyst to present a summary and
609 analysis of the information for each tax credit regarding which the Office of the Legislative
610 Fiscal Analyst is required to make a report under this chapter;
611 (iv) ensure that the committee's recommendations described in this section include an
612 evaluation of:
613 (A) the cost of the tax credit to the state;
614 (B) the purpose and effectiveness of the tax credit; and
615 (C) the extent to which the state benefits from the tax credit; and
616 (v) undertake other review efforts as determined by the committee chairs or as
617 otherwise required by law.
618 (3) (a) On or before November 30, 2017, and every three years after 2017, the
619 committee shall conduct the review required under Subsection (2) of the tax credits allowed
620 under the following sections:
621 (i) Section 59-10-1004;
622 (ii) Section 59-10-1010;
623 (iii) Section 59-10-1015;
624 (iv) Section 59-10-1025;
625 (v) Section 59-10-1027;
626 (vi) Section 59-10-1031;
627 (vii) Section 59-10-1032;
628 (viii) Section 59-10-1035;
629 (ix) Section 59-10-1104;
630 (x) Section 59-10-1105; and
631 (xi) Section 59-10-1108.
632 (b) On or before November 30, 2018, and every three years after 2018, the committee
633 shall conduct the review required under Subsection (2) of the tax credits allowed under the
634 following sections:
635 (i) Section 59-10-1005;
636 (ii) Section 59-10-1006;
637 (iii) Section 59-10-1012;
638 (iv) Section 59-10-1022;
639 (v) Section 59-10-1023;
640 (vi) Section 59-10-1028;
641 (vii) Section 59-10-1034;
642 (viii) Section 59-10-1037;
643 (ix) Section 59-10-1107; and
644 (x) Section 59-10-1112.
645 (c) On or before November 30, 2019, and every three years after 2019, the committee
646 shall conduct the review required under Subsection (2) of the tax credits allowed under the
647 following sections:
648 (i) Section 59-10-1007;
649 (ii) Section 59-10-1014;
650 (iii) Section 59-10-1017;
651 (iv) Section 59-10-1018;
652 (v) Section 59-10-1019;
653 (vi) Section 59-10-1024;
654 [
655 [
656 [
657 [
658 [
659 (d) (i) In addition to the reviews described in this Subsection (3), the committee shall
660 conduct a review of a tax credit described in this chapter that is enacted on or after January 1,
661 2017.
662 (ii) The committee shall complete a review described in this Subsection (3)(d) three
663 years after the effective date of the tax credit and every three years after the initial review date.
664 Section 6. Section 59-10-1014 is amended to read:
665 59-10-1014. Nonrefundable renewable energy systems tax credits -- Definitions --
666 Certification -- Rulemaking authority.
667 (1) As used in this section:
668 (a) (i) "Active solar system" means a system of equipment that is capable of:
669 (A) collecting and converting incident solar radiation into thermal, mechanical, or
670 electrical energy; and
671 (B) transferring a form of energy described in Subsection (1)(a)(i)(A) by a separate
672 apparatus to storage or to the point of use.
673 (ii) "Active solar system" includes water heating, space heating or cooling, and
674 electrical or mechanical energy generation.
675 (b) "Biomass system" means a system of apparatus and equipment for use in:
676 (i) converting material into biomass energy, as defined in Section 59-12-102; and
677 (ii) transporting the biomass energy by separate apparatus to the point of use or storage.
678 (c) "Direct use geothermal system" means a system of apparatus and equipment that
679 enables the direct use of geothermal energy to meet energy needs, including heating a building,
680 an industrial process, and aquaculture.
681 (d) "Fuel cell" means the same as that term is defined in Section 59-7-614.
682 [
683 (i) contained in heat that continuously flows outward from the earth; and
684 (ii) used as a sole source of energy to produce electricity.
685 [
686 earth.
687 [
688 that:
689 (i) enables the use of thermal properties contained in the earth at temperatures well
690 below 100 degrees Fahrenheit; and
691 (ii) helps meet heating and cooling needs of a structure.
692 [
693 capable of:
694 (i) intercepting and converting kinetic water energy into electrical or mechanical
695 energy; and
696 (ii) transferring this form of energy by separate apparatus to the point of use or storage.
697 [
698 63M-4-401.
699 [
700 structure of a building and its operable components to provide for collection, storage, and
701 distribution of heating or cooling during the appropriate times of the year by utilizing the
702 climate resources available at the site.
703 (ii) "Passive solar system" includes those portions and components of a building that
704 are expressly designed and required for the collection, storage, and distribution of solar energy.
705 [
706 from sunlight.
707 [
708 constitutes the cost a person incurs in acquiring a residential energy system.
709 (ii) "Principal recovery portion" does not include:
710 (A) an interest charge; or
711 (B) a maintenance expense.
712 [
713 for a residential unit:
714 (i) an active solar system;
715 (ii) a biomass system;
716 (iii) a direct use geothermal system;
717 (iv) a geothermal heat pump system;
718 (v) a hydroenergy system;
719 (vi) a passive solar system; or
720 (vii) a wind system.
721 [
722 dwelling unit that:
723 (A) is located in the state; and
724 (B) serves as a dwelling for a person, group of persons, or a family.
725 (ii) "Residential unit" does not include property subject to a fee under:
726 (A) Section 59-2-405;
727 (B) Section 59-2-405.1;
728 (C) Section 59-2-405.2;
729 (D) Section 59-2-405.3; or
730 (E) Section 72-10-110.5.
731 [
732 (i) intercepting and converting wind energy into mechanical or electrical energy; and
733 (ii) transferring these forms of energy by a separate apparatus to the point of use or
734 storage.
735 (2) A claimant, estate, or trust may claim an energy system tax credit as provided in
736 this section against a tax due under this chapter for a taxable year.
737 [
738 (3) (a) A claimant, estate, or trust may claim a nonrefundable tax credit under this
739 [
740 uses if:
741 [
742 [
743 the energy required for the residential unit; or
744 [
745 part of the energy required for the residential unit; and
746 [
747 [
748 accordance with Subsection (5).
749 [
750 credit described in this section is equal to the lesser of:
751 (i) 25% of the reasonable costs, including installation costs, of each residential energy
752 system installed with respect to each residential unit the claimant, estate, or trust owns or uses;
753 and
754 (ii) $2,000.
755 [
756 (c) For a residential energy system that is a photovoltaic system, the tax credit
757 described in this section is equal to the lesser of:
758 (i) 25% of the reasonable costs, including installation costs, of each system installed
759 with respect to each residential unit the claimant, estate, or trust owns or uses; or
760 (ii) (A) for a system installed on or after January 1, 2007, but on or before December
761 31, 2017, $2,000;
762 (B) for a system installed on or after January 1, 2018, but on or before December 31,
763 2020, $1,600;
764 (C) for a system installed on or after January 1, 2021, but on or before December 31,
765 2021, $1,200;
766 (D) for a system installed on or after January 1, 2022, but on or before December 31,
767 2022, $800;
768 (E) for a system installed on or after January 1, 2023, but on or before December 31,
769 2023, $400; and
770 (F) for a system installed on or after January 1, 2024, $0.
771 [
772 estate, or trust may claim and list that amount on the written certification that the office issues
773 under Subsection (5).
774 (ii) The claimant, estate, or trust may claim the tax credit in the amount listed on the
775 written certification that the office issues under Subsection (5).
776 [
777 the taxable year in which the residential energy system is installed.
778 [
779 claimant's, estate's, or trust's tax liability under this chapter for a taxable year, the claimant,
780 estate, or trust may carry forward the amount of the tax credit exceeding the liability for a
781 period that does not exceed the next four taxable years.
782 [
783 residential energy systems or parts of residential energy systems for a subsequent taxable year
784 if the total amount of tax credit the claimant, estate, or trust claims does not exceed $2,000 per
785 residential unit.
786 [
787 trust that leases a residential energy system installed on a residential unit may claim a tax credit
788 under this Subsection (3) if the claimant, estate, or trust [
789
790 (5).
791 (ii) A claimant, estate, or trust described in Subsection [
792 residential energy system may claim as a tax credit under this Subsection (3) only the principal
793 recovery portion of the lease payments.
794 (iii) A claimant, estate, or trust described in Subsection [
795 residential energy system may claim a tax credit under this Subsection (3) for a period that does
796 not exceed seven taxable years [
797 in the lease agreement.
798 [
799 claimant, estate, or trust claims the tax credit under this Subsection (3):
800 (i) the claimant, estate, or trust may assign the tax credit to the other person; and
801 (ii) (A) if the other person files a return under Chapter 7, Corporate Franchise and
802 Income Taxes, the other person may claim the tax credit as if the other person had met the
803 requirements of Section 59-7-614 to claim the tax credit; or
804 (B) if the other person files a return under this chapter, the other person may claim the
805 tax credit under this section as if the other person had met the requirements of this section to
806 claim the tax credit.
807 (4) (a) A claimant, estate, or trust may claim a nonrefundable tax credit as provided in
808 this Subsection (4) if:
809 (i) the claimant, estate, or trust owns a fuel cell that has a rated capacity for generating
810 electricity of five megawatts or smaller;
811 (ii) the fuel cell is completed and placed in service in this state on or after January 1,
812 2022;
813 (iii) the fuel cell supplies all or part of the electricity required by commercial units
814 owned or used by the claimant, estate, or trust;
815 (iv) the claimant, estate, or trust has not claimed and will not claim a tax credit under
816 Subsection 59-10-1106(3), (4), or (5) or Section 59-10-1113 for electricity or hydrogen used to
817 meet the requirements of this Subsection (4); and
818 (v) the claimant, estate, or trust obtains a written certification from the office in
819 accordance with Subsection (5).
820 (b) (i) Subject to Subsections (4)(b)(ii) through (iv), a tax credit under this Subsection
821 (4) is equal to 10% of the reasonable costs of the fuel cell.
822 (ii) A tax credit under this Subsection (4) may include installation costs.
823 (iii) A claimant, estate, or trust is eligible to claim a tax credit under this Subsection (4)
824 for the taxable year in which the fuel cell is placed in service.
825 (iv) If the amount of a tax credit listed on the written certification exceeds a claimant's,
826 estate's, or trust's tax liability under this chapter for a taxable year, the claimant, estate, or trust
827 may carry forward the amount of the tax credit exceeding the liability for a period that does not
828 exceed the next four taxable years.
829 (c) (i) Subject to Subsections (4)(c)(ii) and (iii), a claimant, estate, or trust that is a
830 lessee of a fuel cell installed on a commercial unit may claim a tax credit under this Subsection
831 (4) if the lessee obtains a written certification from the office in accordance with Subsection
832 (5).
833 (ii) A claimant, estate, or trust described in Subsection (4)(c)(i) may claim as a tax
834 credit under this Subsection (4) only the principal recovery portion of the lease payments.
835 (iii) A claimant, estate, or trust described in Subsection (4)(c)(i) may claim a tax credit
836 under this Subsection (4) for a period that does not exceed seven taxable years after the day on
837 which the lease begins, as stated in the lease agreement.
838 (5) (a) Before a claimant, estate, or trust, including a lessee, may claim a tax credit
839 under this section, the claimant, estate, or trust shall obtain a written certification from the
840 office.
841 (b) The office shall issue a claimant, estate, or trust that is not a lessee a written
842 certification if the office determines that:
843 (i) the claimant, estate, or trust meets the requirements of this section to receive a tax
844 credit; and
845 (ii) the office determines that the residential energy system or the fuel cell with respect
846 to which the claimant, estate, or trust seeks to claim a tax credit:
847 (A) has been completely installed;
848 (B) is a viable system for saving or producing energy from renewable resources; and
849 (C) is safe, reliable, efficient, and technically feasible to ensure that the residential
850 energy system or the fuel cell uses the state's renewable and nonrenewable energy resources in
851 an appropriate and economic manner.
852 (c) The office shall issue a claimant, estate, or trustee that is a lessee a written
853 certification if the office receives:
854 (i) a copy of the lessor's written certification or other proof, in a form established by the
855 office, that the lessor qualified for a tax credit under this section; and
856 (ii) proof that the lessor irrevocably elects not to claim the tax credit for which the
857 lessor qualified.
858 [
859 Act, the office may make rules:
860 (i) for determining whether a residential energy system or a fuel cell meets the
861 requirements of Subsection (5)(b)(ii); and
862 (ii) for purposes of determining the amount of a tax credit that a claimant, estate, or
863 trust may receive under Subsection (3) or (4), establishing the reasonable costs of a residential
864 energy system or a fuel cell, as an amount per unit of energy production.
865 [
866 certification from the office shall retain the certification for the same time period a person is
867 required to keep books and records under Section 59-1-1406.
868 [
869 (i) the name and identifying information of each claimant, estate, [
870 which the office issues a written certification; and
871 (ii) for each claimant, estate, [
872 (A) the amount of the tax credit listed on the written certification; and
873 (B) the date the renewable energy system or the fuel cell was installed.
874 (6) A tax credit under this section is in addition to any tax credits provided under the
875 laws or rules and regulations of the United States.
876 (7) A purchaser of one or more solar units that claims a tax credit under Section
877 59-10-1024 for the purchase of the one or more solar units may not claim a tax credit under this
878 section for that purchase.
879 Section 7. Section 59-10-1034 is amended to read:
880 59-10-1034. Nonrefundable high cost infrastructure development tax credit.
881 (1) As used in this section:
882 (a) "High cost infrastructure project" means the same as that term is defined in Section
883 63M-4-602.
884 (b) "Infrastructure cost-burdened entity" means the same as that term is defined in
885 Section 63M-4-602.
886 (c) "Infrastructure-related revenue" means the same as that term is defined in Section
887 63M-4-602.
888 (d) "Office" means the Office of Energy Development created in Section 63M-4-401.
889 (2) Subject to the other provisions of this section, a claimant, estate, or trust that is an
890 infrastructure cost-burdened entity may claim a nonrefundable tax credit for development of a
891 high cost infrastructure project as provided in this section.
892 (3) The tax credit under this section is the amount listed as the tax credit amount on a
893 tax credit certificate that the office issues under Title 63M, Chapter 4, Part 6, High Cost
894 Infrastructure Development Tax Credit Act, to the infrastructure cost-burdened entity for the
895 taxable year.
896 (4) An infrastructure cost-burdened entity may carry forward a tax credit under this
897 section for a period that does not exceed the next seven taxable years if:
898 (a) the infrastructure cost-burdened entity is allowed to claim a tax credit under this
899 section for a taxable year; and
900 (b) the amount of the tax credit exceeds the infrastructure cost-burdened entity's tax
901 liability under this chapter for that taxable year.
902 (5) (a) In accordance with Section 59-10-137, the Revenue and Taxation Interim
903 Committee shall study the tax credit allowed by this section and make recommendations
904 concerning whether the tax credit should be continued, modified, or repealed.
905 (b) (i) Except as provided in Subsection (5)(b)(ii), for purposes of the study required by
906 this Subsection (5), the office shall provide the following information, if available to the office,
907 to the Office of the Legislative Fiscal Analyst:
908 (A) the amount of tax credit that the office grants to each infrastructure cost-burdened
909 entity for each taxable year;
910 (B) the infrastructure-related revenue generated by each high cost infrastructure
911 project;
912 (C) the information contained in the office's latest report under Section [
913 63M-4-605; and
914 (D) any other information that the Office of the Legislative Fiscal Analyst requests.
915 (ii) (A) In providing the information described in Subsection (5)(b)(i), the office shall
916 redact information that identifies a recipient of a tax credit under this section.
917 (B) If, notwithstanding the redactions made under Subsection (5)(b)(ii)(A), reporting
918 the information described in Subsection (5)(b)(i) might disclose the identity of a recipient of a
919 tax credit, the office may file a request with the Revenue and Taxation Interim Committee to
920 provide the information described in Subsection (5)(b)(i) in the aggregate for all infrastructure
921 cost-burdened entities that receive the tax credit under this section.
922 (c) As part of the study required by this Subsection (5), the Office of the Legislative
923 Fiscal Analyst shall report to the Revenue and Taxation Interim Committee a summary and
924 analysis of the information provided to the Office of the Legislative Fiscal Analyst by the
925 office under Subsection (5)(b).
926 (d) The Revenue and Taxation Interim Committee shall ensure that the
927 recommendations described in Subsection (5)(a) include an evaluation of:
928 (i) the cost of the tax credit to the state;
929 (ii) the purpose and effectiveness of the tax credit; and
930 (iii) the extent to which the state benefits from the tax credit.
931 Section 8. Section 59-10-1106 is amended to read:
932 59-10-1106. Refundable renewable energy systems tax credits -- Definitions --
933 Certification -- Rulemaking authority.
934 (1) As used in this section:
935 (a) "Active solar system" means the same as that term is defined in Section
936 59-10-1014.
937 (b) "Biomass system" means the same as that term is defined in Section 59-10-1014.
938 (c) "Commercial energy system" means the same as that term is defined in Section
939 59-7-614.
940 (d) "Commercial enterprise" means the same as that term is defined in Section
941 59-7-614.
942 (e) [
943 [
944 [
945
946
947 [
948
949 (f) "Direct use geothermal system" means the same as that term is defined in Section
950 59-10-1014.
951 (g) "Fuel cell" means the same as that term is defined in Section 59-7-614.
952 [
953 59-10-1014.
954 [
955 59-10-1014.
956 [
957 Section 59-10-1014.
958 [
959 59-10-1014.
960 (l) "Hydrogen production system" means the same as that term is defined in Section
961 59-7-614.
962 [
963 63M-4-401.
964 [
965 59-10-1014.
966 [
967 59-10-1014.
968 [
969 (2) A claimant, estate, or trust may claim an energy system tax credit as provided in
970 this section against a tax due under this chapter for a taxable year.
971 (3) (a) Subject to the other provisions of this Subsection (3), a claimant, estate, or trust
972 may claim a refundable tax credit under this Subsection (3) with respect to a commercial
973 energy system if:
974 (i) the commercial energy system does not use:
975 (A) wind, geothermal electricity, [
976 total of 660 or more kilowatts of electricity; or
977 (B) solar equipment capable of producing 2,000 or more kilowatts of electricity;
978 (ii) the claimant, estate, or trust purchases or participates in the financing of the
979 commercial energy system;
980 (iii) (A) the commercial energy system supplies all or part of the energy required by
981 commercial units owned or used by the claimant, estate, or trust; or
982 (B) the claimant, estate, or trust sells all or part of the energy produced by the
983 commercial energy system as a commercial enterprise;
984 [
985
986 (iv) the claimant, estate, or trust has not claimed and will not claim a tax credit under
987 Subsection (5) or Subsection 59-10-1014(4) for fuel cell use or hydrogen production using
988 electricity for which the claimant, estate, or trust claims a tax credit under this Subsection (3);
989 and
990 (v) the claimant, estate, or trust obtains a written certification from the office in
991 accordance with Subsection (6).
992 (b) (i) Subject to Subsections (3)(b)(ii) through [
993 of the reasonable costs of the commercial energy system.
994 (ii) A tax credit under this Subsection (3) may include installation costs.
995 (iii) A claimant, estate, or trust [
996 Subsection (3) for the taxable year in which the commercial energy system is completed and
997 placed in service.
998 [
999 [
1000 Subsection (3) may not exceed $50,000 per commercial unit.
1001 (c) (i) Subject to Subsections (3)(c)(ii) and (iii), a claimant, estate, or trust that is a
1002 lessee of a commercial energy system installed on a commercial unit may claim a tax credit
1003 under this Subsection (3) if the claimant, estate, or trust [
1004
1005 with Subsection (6).
1006 (ii) A claimant, estate, or trust described in Subsection (3)(c)(i) may claim as a tax
1007 credit under this Subsection (3) only the principal recovery portion of the lease payments.
1008 (iii) A claimant, estate, or trust described in Subsection (3)(c)(i) may claim a tax credit
1009 under this Subsection (3) for a period that does not exceed seven taxable years after the [
1010 day on which the lease begins, as stated in the lease agreement.
1011 (4) (a) Subject to the other provisions of this Subsection (4), a claimant, estate, or trust
1012 may claim a refundable tax credit under this Subsection (4) with respect to a commercial
1013 energy system if:
1014 (i) (A) the commercial energy system uses wind, geothermal electricity, or biomass
1015 equipment capable of producing a total of 660 or more kilowatts of electricity; or
1016 (B) the commercial energy system uses solar equipment capable of producing a total of
1017 2,000 or more kilowatts of electricity;
1018 (ii) (A) the commercial energy system supplies all or part of the energy required by
1019 commercial units owned or used by the claimant, estate, or trust; or
1020 (B) the claimant, estate, or trust sells all or part of the energy produced by the
1021 commercial energy system as a commercial enterprise; and
1022 [
1023
1024 (iii) the claimant, estate, or trust has not claimed and will not claim a tax credit under
1025 Subsection (5) or Subsection 59-10-1014(4) for fuel cell use or hydrogen production using
1026 electricity for which the claimant, estate, or trust claims a tax credit under this Subsection (4);
1027 and
1028 (iv) the claimant, estate, or trust obtains a written certification from the office in
1029 accordance with Subsection (6).
1030 (b) (i) Subject to [
1031 Subsection (4) is equal to the product of:
1032 (A) 0.35 cents; and
1033 (B) the kilowatt hours of electricity produced and used or sold during the taxable year.
1034 (ii) A claimant, estate, or trust is eligible to claim a tax credit under this Subsection (4)
1035 [
1036 month in which the commercial energy system is placed in commercial service.
1037 [
1038 (c) A claimant, estate, or trust that is a lessee of a commercial energy system installed
1039 on a commercial unit may claim a tax credit under this Subsection (4) if the claimant, estate, or
1040 trust [
1041 certification from the office in accordance with Subsection (6).
1042 [
1043
1044 [
1045
1046 [
1047
1048 [
1049
1050 [
1051 [
1052
1053 [
1054
1055 [
1056
1057 [
1058 [
1059
1060 [
1061
1062
1063 [
1064 [
1065
1066
1067 (5) (a) A claimant, estate, or trust may claim a refundable tax credit as provided in this
1068 Subsection (5) if:
1069 (i) the claimant, estate, or trust owns a hydrogen production system;
1070 (ii) the hydrogen production system is completed and placed in service on or after
1071 January 1, 2022;
1072 (iii) the claimant, estate, or trust sells as a commercial enterprise, or supplies for the
1073 claimant's, estate's, or trust's own use in commercial units, the hydrogen produced from the
1074 hydrogen production system for use in:
1075 (A) a vehicle; or
1076 (B) a fuel cell that has a rated capacity for generating electricity of five megawatts or
1077 less;
1078 (iv) the claimant, estate, or trust has not claimed and will not claim a tax credit under
1079 Subsection (3), (4), or 59-10-1014(4) or Section 59-10-1113 for electricity or hydrogen used to
1080 meet the requirements of this Subsection (5); and
1081 (v) the claimant, estate, or trust obtains a written certification from the office in
1082 accordance with Subsection (6).
1083 (b) (i) Subject to Subsections (5)(b)(ii) and (iii), a tax credit under this Subsection (5)
1084 is equal to the product of:
1085 (A) $2.34; and
1086 (B) the number of kilograms of hydrogen produced and stored, used, or sold during the
1087 taxable year.
1088 (ii) A claimant, estate, or trust may not receive a tax credit under this Subsection (5) for
1089 more than 365 metric tons of hydrogen per taxable year.
1090 (iii) A claimant, estate, or trust is eligible to claim a tax credit under this Subsection (5)
1091 for production occurring during a period of 48 months beginning with the month in which the
1092 hydrogen production system is placed in commercial service.
1093 (c) (i) Subject to Subsections (5)(c)(ii) and (iii), a claimant, estate, or trust that is a
1094 lessee of a hydrogen production system installed on a commercial unit may claim a tax credit
1095 under this Subsection (5) if the lessee obtains a written certification from the office in
1096 accordance with Subsection (6).
1097 (ii) A claimant, estate, or trust described in Subsection (5)(c)(i) may claim as a tax
1098 credit under this Subsection (5) only the principal recovery portion of the lease payments.
1099 (iii) A claimant, estate, or trust described in Subsection (5)(c)(i) may claim a tax credit
1100 under this Subsection (5) for a period that does not exceed seven taxable years after the day on
1101 which the lease begins, as stated in the lease agreement.
1102 (6) (a) Before a claimant, estate, or trust, including a lessee, may claim a tax credit
1103 under this section, the claimant, estate, or trust shall obtain a written certification from the
1104 office.
1105 (b) The office shall issue a claimant, estate, or trust that is not a lessee a written
1106 certification if the office determines that:
1107 (i) the claimant, estate, or trust meets the requirements of this section to receive a tax
1108 credit; and
1109 (ii) [
1110 production system with respect to which the claimant, estate, or trust seeks to claim a tax
1111 credit:
1112 (A) has been completely installed;
1113 (B) is a viable system for saving or producing energy from renewable resources; and
1114 (C) is safe, reliable, efficient, and technically feasible to ensure that the commercial
1115 energy system or the hydrogen production system uses the state's renewable and nonrenewable
1116 resources in an appropriate and economic manner.
1117 (c) The office shall issue a claimant, estate, or trust that is a lessee a written
1118 certification if the office receives:
1119 (i) a copy of the lessor's written certification or other proof, in a form established by the
1120 office, that the lessor qualified for a tax credit under this section; and
1121 (ii) proof that the lessor irrevocably elects not to claim the tax credit for which the
1122 lessor qualified.
1123 [
1124 Act, the office may make rules:
1125 (i) for determining whether a commercial energy system or a hydrogen production
1126 system meets the requirements of Subsection (6)(b)(ii); and
1127 (ii) for purposes of a tax credit under Subsection (3), establishing the reasonable costs
1128 of a commercial energy system, as an amount per unit of energy production.
1129 [
1130 certification from the office shall retain the certification for the same time period a person is
1131 required to keep books and records under Section 59-1-1406.
1132 (f) The office shall submit to the commission an electronic list that includes:
1133 (i) the name and identifying information of each claimant, estate, trust, or lessee to
1134 which the office issues a written certification; and
1135 (ii) for each claimant, estate, trust, or lessee:
1136 (A) the amount of the tax credit listed on the written certification; and
1137 (B) the date the commercial energy system or the hydrogen production system was
1138 installed.
1139 (7) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
1140 commission may make rules to address the certification of a tax credit under this section.
1141 (8) A tax credit under this section is in addition to any tax credits provided under the
1142 laws or rules and regulations of the United States.
1143 (9) A purchaser of one or more solar units that claims a tax credit under Section
1144 59-10-1024 for the purchase of the one or more solar units may not claim a tax credit under this
1145 section for that purchase.
1146 Section 9. Section 59-10-1113 is enacted to read:
1147 59-10-1113. Refundable tax credit for nonrenewable hydrogen production system.
1148 (1) As used in this section:
1149 (a) "Commercial enterprise" means the same as that term is defined in Section
1150 59-7-626.
1151 (b) "Commercial unit" means the same as that term is defined in Section 59-7-626.
1152 (c) "Hydrogen production system" means the same as that term is defined in Section
1153 59-7-626.
1154 (d) "Office" means the Office of Energy Development created in Section 63M-4-401.
1155 (2) (a) A claimant, estate, or trust may claim a refundable credit under this section if:
1156 (i) the claimant, estate, or trust owns a hydrogen production system;
1157 (ii) the hydrogen production system is completed and placed in service on or after
1158 January 1, 2022;
1159 (iii) the claimant, estate, or trust sells as a commercial enterprise, or supplies for the
1160 claimant's, estate's, or trust's own use in commercial units, the hydrogen produced from the
1161 hydrogen production system for use in:
1162 (A) a vehicle; or
1163 (B) a fuel cell that has a rated capacity for generating electricity of five megawatts or
1164 less;
1165 (iv) the claimant, estate, or trust has not claimed and will not claim a tax credit under
1166 Section 59-10-1014 or 59-10-1106 for electricity or hydrogen used to meet the requirements of
1167 this section; and
1168 (v) the taxpayer obtains a written certification from the office in accordance with
1169 Subsection (3).
1170 (b) (i) Subject to Subsections (2)(b)(ii) and (iii), a tax credit under this section is equal
1171 to the product of:
1172 (A) $2.34; and
1173 (B) the number of kilograms of hydrogen produced and stored, used, or sold during the
1174 taxable year.
1175 (ii) A claimant, estate, or trust may not receive a tax credit under this section for more
1176 than 365 metric tons of hydrogen per taxable year.
1177 (iii) A claimant, estate, or trust is eligible to claim a tax credit under this section for
1178 production occurring during a period of 48 months beginning with the month in which the
1179 hydrogen production system is placed in commercial service.
1180 (c) (i) Subject to Subsections (2)(c)(ii) and (iii), a claimant, estate, or trust that is a
1181 lessee of a hydrogen production system installed on a commercial unit may claim a tax credit
1182 under this section if the lessee obtains a written certification from the office in accordance with
1183 Subsection (3).
1184 (ii) A claimant, estate, or trust described in Subsection (2)(c)(i) may claim as a tax
1185 credit under this section only the principal recovery portion of the lease payments.
1186 (iii) A claimant, estate, or trust described in Subsection (2)(c)(i) may claim a tax credit
1187 under this section for a period that does not exceed seven taxable years after the day on which
1188 the lease begins, as stated in the lease agreement.
1189 (3) (a) Before a claimant, estate, or trust, including a lessee, may claim a tax credit
1190 under this section, the claimant, estate, or trust shall obtain a written certification from the
1191 office.
1192 (b) The office shall issue a claimant, estate, or trust that is not a lessee a written
1193 certification if the office determines that:
1194 (i) the claimant, estate, or trust meets the requirements of this section to receive a tax
1195 credit; and
1196 (ii) the hydrogen production system with respect to which the claimant, estate, or trust
1197 seeks to claim a tax credit:
1198 (A) has been completely installed;
1199 (B) is safe, reliable, efficient, and technically feasible to ensure that the
1200 hydrogen production system uses the state's nonrenewable energy resources in an
1201 appropriate and economic manner.
1202 (c) The office shall issue a claimant, estate, or trust that is a lessee a written
1203 certification if the office receives:
1204 (i) a copy of the lessor's written certification or other proof, in a form established by the
1205 office, that the lessor qualified for a tax credit under this section; and
1206 (ii) proof that the lessor irrevocably elects not to claim the tax credit for which the
1207 lessor qualified.
1208 (d) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking
1209 Act, the office may make rules for determining whether a hydrogen production system
1210 meets the requirements of this Subsection (3)(b)(ii).
1211 (e) A claimant, estate, or trust, including a lessee, that obtains a written certification
1212 from the office shall retain the certification for the same time period a person is required to
1213 keep books and records under Section 59-1-1406.
1214 (f) The office shall submit to the commission an electronic list that includes:
1215 (i) the name and identifying information of each claimant, estate, trust, or lessee to
1216 which the office issues a written certification; and
1217 (ii) for each claimant, estate, trust, or lessee:
1218 (A) the amount of the tax credit listed on the written certification; and
1219 (B) the date the hydrogen production system was installed.
1220 (4) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking
1221 Act, the commission may make rules to address the certification of a tax credit under
1222 this section.
1223 (5) A tax credit under this section is in addition to any tax credits provided under the
1224 laws or rules and regulations of the United States.
1225 Section 10. Section 59-12-102 is amended to read:
1226 59-12-102. Definitions.
1227 As used in this chapter:
1228 (1) "800 service" means a telecommunications service that:
1229 (a) allows a caller to dial a toll-free number without incurring a charge for the call; and
1230 (b) is typically marketed:
1231 (i) under the name 800 toll-free calling;
1232 (ii) under the name 855 toll-free calling;
1233 (iii) under the name 866 toll-free calling;
1234 (iv) under the name 877 toll-free calling;
1235 (v) under the name 888 toll-free calling; or
1236 (vi) under a name similar to Subsections (1)(b)(i) through (v) as designated by the
1237 Federal Communications Commission.
1238 (2) (a) "900 service" means an inbound toll telecommunications service that:
1239 (i) a subscriber purchases;
1240 (ii) allows a customer of the subscriber described in Subsection (2)(a)(i) to call in to
1241 the subscriber's:
1242 (A) prerecorded announcement; or
1243 (B) live service; and
1244 (iii) is typically marketed:
1245 (A) under the name 900 service; or
1246 (B) under a name similar to Subsection (2)(a)(iii)(A) as designated by the Federal
1247 Communications Commission.
1248 (b) "900 service" does not include a charge for:
1249 (i) a collection service a seller of a telecommunications service provides to a
1250 subscriber; or
1251 (ii) the following a subscriber sells to the subscriber's customer:
1252 (A) a product; or
1253 (B) a service.
1254 (3) (a) "Admission or user fees" includes season passes.
1255 (b) "Admission or user fees" does not include:
1256 (i) annual membership dues to private organizations; or
1257 (ii) a lesson, including a lesson that involves as part of the lesson equipment or a
1258 facility listed in Subsection 59-12-103(1)(f).
1259 (4) "Affiliate" or "affiliated person" means a person that, with respect to another
1260 person:
1261 (a) has an ownership interest of more than 5%, whether direct or indirect, in that other
1262 person; or
1263 (b) is related to the other person because a third person, or a group of third persons who
1264 are affiliated persons with respect to each other, holds an ownership interest of more than 5%,
1265 whether direct or indirect, in the related persons.
1266 (5) "Agreement" means the Streamlined Sales and Use Tax Agreement adopted on
1267 November 12, 2002, including amendments made to the Streamlined Sales and Use Tax
1268 Agreement after November 12, 2002.
1269 (6) "Agreement combined tax rate" means the sum of the tax rates:
1270 (a) listed under Subsection (7); and
1271 (b) that are imposed within a local taxing jurisdiction.
1272 (7) "Agreement sales and use tax" means a tax imposed under:
1273 (a) Subsection 59-12-103(2)(a)(i)(A);
1274 (b) Subsection 59-12-103(2)(b)(i);
1275 (c) Subsection 59-12-103(2)(c)(i);
1276 (d) Subsection 59-12-103(2)(d)(i)(A)(I);
1277 (e) Section 59-12-204;
1278 (f) Section 59-12-401;
1279 (g) Section 59-12-402;
1280 (h) Section 59-12-402.1;
1281 (i) Section 59-12-703;
1282 (j) Section 59-12-802;
1283 (k) Section 59-12-804;
1284 (l) Section 59-12-1102;
1285 (m) Section 59-12-1302;
1286 (n) Section 59-12-1402;
1287 (o) Section 59-12-1802;
1288 (p) Section 59-12-2003;
1289 (q) Section 59-12-2103;
1290 (r) Section 59-12-2213;
1291 (s) Section 59-12-2214;
1292 (t) Section 59-12-2215;
1293 (u) Section 59-12-2216;
1294 (v) Section 59-12-2217;
1295 (w) Section 59-12-2218;
1296 (x) Section 59-12-2219; or
1297 (y) Section 59-12-2220.
1298 (8) "Aircraft" means the same as that term is defined in Section 72-10-102.
1299 (9) "Aircraft maintenance, repair, and overhaul provider" means a business entity:
1300 (a) except for:
1301 (i) an airline as defined in Section 59-2-102; or
1302 (ii) an affiliated group, as defined in Section 59-7-101, except that "affiliated group"
1303 includes a corporation that is qualified to do business but is not otherwise doing business in the
1304 state, of an airline; and
1305 (b) that has the workers, expertise, and facilities to perform the following, regardless of
1306 whether the business entity performs the following in this state:
1307 (i) check, diagnose, overhaul, and repair:
1308 (A) an onboard system of a fixed wing turbine powered aircraft; and
1309 (B) the parts that comprise an onboard system of a fixed wing turbine powered aircraft;
1310 (ii) assemble, change, dismantle, inspect, and test a fixed wing turbine powered aircraft
1311 engine;
1312 (iii) perform at least the following maintenance on a fixed wing turbine powered
1313 aircraft:
1314 (A) an inspection;
1315 (B) a repair, including a structural repair or modification;
1316 (C) changing landing gear; and
1317 (D) addressing issues related to an aging fixed wing turbine powered aircraft;
1318 (iv) completely remove the existing paint of a fixed wing turbine powered aircraft and
1319 completely apply new paint to the fixed wing turbine powered aircraft; and
1320 (v) refurbish the interior of a fixed wing turbine powered aircraft in a manner that
1321 results in a change in the fixed wing turbine powered aircraft's certification requirements by the
1322 authority that certifies the fixed wing turbine powered aircraft.
1323 (10) "Alcoholic beverage" means a beverage that:
1324 (a) is suitable for human consumption; and
1325 (b) contains .5% or more alcohol by volume.
1326 (11) "Alternative energy" means:
1327 (a) biomass energy;
1328 (b) hydrogen fuel cell system energy;
1329 [
1330 [
1331 [
1332 [
1333 [
1334 (i) coal-to-liquids;
1335 (ii) nuclear fuel;
1336 (iii) oil-impregnated diatomaceous earth;
1337 (iv) oil sands;
1338 (v) oil shale;
1339 (vi) petroleum coke; or
1340 (vii) waste heat from:
1341 (A) an industrial facility; or
1342 (B) a power station in which an electric generator is driven through a process in which
1343 water is heated, turns into steam, and spins a steam turbine.
1344 (12) (a) Subject to Subsection (12)(b), "alternative energy electricity production
1345 facility" means a facility that:
1346 (i) uses alternative energy to produce electricity; and
1347 (ii) has a production capacity of two megawatts or greater.
1348 (b) A facility is an alternative energy electricity production facility regardless of
1349 whether the facility is:
1350 (i) connected to an electric grid; or
1351 (ii) located on the premises of an electricity consumer.
1352 (13) (a) "Ancillary service" means a service associated with, or incidental to, the
1353 provision of telecommunications service.
1354 (b) "Ancillary service" includes:
1355 (i) a conference bridging service;
1356 (ii) a detailed communications billing service;
1357 (iii) directory assistance;
1358 (iv) a vertical service; or
1359 (v) a voice mail service.
1360 (14) "Area agency on aging" means the same as that term is defined in Section
1361 62A-3-101.
1362 (15) "Assisted amusement device" means an amusement device, skill device, or ride
1363 device that is started and stopped by an individual:
1364 (a) who is not the purchaser or renter of the right to use or operate the amusement
1365 device, skill device, or ride device; and
1366 (b) at the direction of the seller of the right to use the amusement device, skill device,
1367 or ride device.
1368 (16) "Assisted cleaning or washing of tangible personal property" means cleaning or
1369 washing of tangible personal property if the cleaning or washing labor is primarily performed
1370 by an individual:
1371 (a) who is not the purchaser of the cleaning or washing of the tangible personal
1372 property; and
1373 (b) at the direction of the seller of the cleaning or washing of the tangible personal
1374 property.
1375 (17) "Authorized carrier" means:
1376 (a) in the case of vehicles operated over public highways, the holder of credentials
1377 indicating that the vehicle is or will be operated pursuant to both the International Registration
1378 Plan and the International Fuel Tax Agreement;
1379 (b) in the case of aircraft, the holder of a Federal Aviation Administration operating
1380 certificate or air carrier's operating certificate; or
1381 (c) in the case of locomotives, freight cars, railroad work equipment, or other rolling
1382 stock, a person who uses locomotives, freight cars, railroad work equipment, or other rolling
1383 stock in more than one state.
1384 (18) (a) [
1385 any of the following that is used as the primary source of energy to produce fuel or electricity:
1386 (i) material from a plant or tree; or
1387 (ii) other organic matter that is available on a renewable basis, including:
1388 (A) slash and brush from forests and woodlands;
1389 (B) animal waste;
1390 (C) waste vegetable oil;
1391 (D) methane or synthetic gas produced at a landfill, as a byproduct of the treatment of
1392 wastewater residuals, or through the conversion of a waste material through a nonincineration,
1393 thermal conversion process;
1394 (E) aquatic plants; and
1395 (F) agricultural products.
1396 (b) "Biomass energy" does not include:
1397 (i) black liquor; or
1398 (ii) treated woods.
1399 (19) (a) "Bundled transaction" means the sale of two or more items of tangible personal
1400 property, products, or services if the tangible personal property, products, or services are:
1401 (i) distinct and identifiable; and
1402 (ii) sold for one nonitemized price.
1403 (b) "Bundled transaction" does not include:
1404 (i) the sale of tangible personal property if the sales price varies, or is negotiable, on
1405 the basis of the selection by the purchaser of the items of tangible personal property included in
1406 the transaction;
1407 (ii) the sale of real property;
1408 (iii) the sale of services to real property;
1409 (iv) the retail sale of tangible personal property and a service if:
1410 (A) the tangible personal property:
1411 (I) is essential to the use of the service; and
1412 (II) is provided exclusively in connection with the service; and
1413 (B) the service is the true object of the transaction;
1414 (v) the retail sale of two services if:
1415 (A) one service is provided that is essential to the use or receipt of a second service;
1416 (B) the first service is provided exclusively in connection with the second service; and
1417 (C) the second service is the true object of the transaction;
1418 (vi) a transaction that includes tangible personal property or a product subject to
1419 taxation under this chapter and tangible personal property or a product that is not subject to
1420 taxation under this chapter if the:
1421 (A) seller's purchase price of the tangible personal property or product subject to
1422 taxation under this chapter is de minimis; or
1423 (B) seller's sales price of the tangible personal property or product subject to taxation
1424 under this chapter is de minimis; and
1425 (vii) the retail sale of tangible personal property that is not subject to taxation under
1426 this chapter and tangible personal property that is subject to taxation under this chapter if:
1427 (A) that retail sale includes:
1428 (I) food and food ingredients;
1429 (II) a drug;
1430 (III) durable medical equipment;
1431 (IV) mobility enhancing equipment;
1432 (V) an over-the-counter drug;
1433 (VI) a prosthetic device; or
1434 (VII) a medical supply; and
1435 (B) subject to Subsection (19)(f):
1436 (I) the seller's purchase price of the tangible personal property subject to taxation under
1437 this chapter is 50% or less of the seller's total purchase price of that retail sale; or
1438 (II) the seller's sales price of the tangible personal property subject to taxation under
1439 this chapter is 50% or less of the seller's total sales price of that retail sale.
1440 (c) (i) For purposes of Subsection (19)(a)(i), tangible personal property, a product, or a
1441 service that is distinct and identifiable does not include:
1442 (A) packaging that:
1443 (I) accompanies the sale of the tangible personal property, product, or service; and
1444 (II) is incidental or immaterial to the sale of the tangible personal property, product, or
1445 service;
1446 (B) tangible personal property, a product, or a service provided free of charge with the
1447 purchase of another item of tangible personal property, a product, or a service; or
1448 (C) an item of tangible personal property, a product, or a service included in the
1449 definition of "purchase price."
1450 (ii) For purposes of Subsection (19)(c)(i)(B), an item of tangible personal property, a
1451 product, or a service is provided free of charge with the purchase of another item of tangible
1452 personal property, a product, or a service if the sales price of the purchased item of tangible
1453 personal property, product, or service does not vary depending on the inclusion of the tangible
1454 personal property, product, or service provided free of charge.
1455 (d) (i) For purposes of Subsection (19)(a)(ii), property sold for one nonitemized price
1456 does not include a price that is separately identified by tangible personal property, product, or
1457 service on the following, regardless of whether the following is in paper format or electronic
1458 format:
1459 (A) a binding sales document; or
1460 (B) another supporting sales-related document that is available to a purchaser.
1461 (ii) For purposes of Subsection (19)(d)(i), a binding sales document or another
1462 supporting sales-related document that is available to a purchaser includes:
1463 (A) a bill of sale;
1464 (B) a contract;
1465 (C) an invoice;
1466 (D) a lease agreement;
1467 (E) a periodic notice of rates and services;
1468 (F) a price list;
1469 (G) a rate card;
1470 (H) a receipt; or
1471 (I) a service agreement.
1472 (e) (i) For purposes of Subsection (19)(b)(vi), the sales price of tangible personal
1473 property or a product subject to taxation under this chapter is de minimis if:
1474 (A) the seller's purchase price of the tangible personal property or product is 10% or
1475 less of the seller's total purchase price of the bundled transaction; or
1476 (B) the seller's sales price of the tangible personal property or product is 10% or less of
1477 the seller's total sales price of the bundled transaction.
1478 (ii) For purposes of Subsection (19)(b)(vi), a seller:
1479 (A) shall use the seller's purchase price or the seller's sales price to determine if the
1480 purchase price or sales price of the tangible personal property or product subject to taxation
1481 under this chapter is de minimis; and
1482 (B) may not use a combination of the seller's purchase price and the seller's sales price
1483 to determine if the purchase price or sales price of the tangible personal property or product
1484 subject to taxation under this chapter is de minimis.
1485 (iii) For purposes of Subsection (19)(b)(vi), a seller shall use the full term of a service
1486 contract to determine if the sales price of tangible personal property or a product is de minimis.
1487 (f) For purposes of Subsection (19)(b)(vii)(B), a seller may not use a combination of
1488 the seller's purchase price and the seller's sales price to determine if tangible personal property
1489 subject to taxation under this chapter is 50% or less of the seller's total purchase price or sales
1490 price of that retail sale.
1491 (20) "Certified automated system" means software certified by the governing board of
1492 the agreement that:
1493 (a) calculates the agreement sales and use tax imposed within a local taxing
1494 jurisdiction:
1495 (i) on a transaction; and
1496 (ii) in the states that are members of the agreement;
1497 (b) determines the amount of agreement sales and use tax to remit to a state that is a
1498 member of the agreement; and
1499 (c) maintains a record of the transaction described in Subsection (20)(a)(i).
1500 (21) "Certified service provider" means an agent certified:
1501 (a) by the governing board of the agreement; and
1502 (b) to perform a seller's sales and use tax functions for an agreement sales and use tax,
1503 as outlined in the contract between the governing board of the agreement and the certified
1504 service provider, other than the seller's obligation under Section 59-12-124 to remit a tax on the
1505 seller's own purchases.
1506 (22) (a) Subject to Subsection (22)(b), "clothing" means all human wearing apparel
1507 suitable for general use.
1508 (b) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
1509 commission shall make rules:
1510 (i) listing the items that constitute "clothing"; and
1511 (ii) that are consistent with the list of items that constitute "clothing" under the
1512 agreement.
1513 (23) "Coal-to-liquid" means the process of converting coal into a liquid synthetic fuel.
1514 (24) "Commercial use" means the use of gas, electricity, heat, coal, fuel oil, hydrogen,
1515 or other fuels that does not constitute industrial use under Subsection (57) or residential use
1516 under Subsection (112).
1517 (25) (a) "Common carrier" means a person engaged in or transacting the business of
1518 transporting passengers, freight, merchandise, or other property for hire within this state.
1519 (b) (i) "Common carrier" does not include a person that, at the time the person is
1520 traveling to or from that person's place of employment, transports a passenger to or from the
1521 passenger's place of employment.
1522 (ii) For purposes of Subsection (25)(b)(i), in accordance with Title 63G, Chapter 3,
1523 Utah Administrative Rulemaking Act, the commission may make rules defining what
1524 constitutes a person's place of employment.
1525 (c) "Common carrier" does not include a person that provides transportation network
1526 services, as defined in Section 13-51-102.
1527 (26) "Component part" includes:
1528 (a) poultry, dairy, and other livestock feed, and their components;
1529 (b) baling ties and twine used in the baling of hay and straw;
1530 (c) fuel used for providing temperature control of orchards and commercial
1531 greenhouses doing a majority of their business in wholesale sales, and for providing power for
1532 off-highway type farm machinery; and
1533 (d) feed, seeds, and seedlings.
1534 (27) "Computer" means an electronic device that accepts information:
1535 (a) (i) in digital form; or
1536 (ii) in a form similar to digital form; and
1537 (b) manipulates that information for a result based on a sequence of instructions.
1538 (28) "Computer software" means a set of coded instructions designed to cause:
1539 (a) a computer to perform a task; or
1540 (b) automatic data processing equipment to perform a task.
1541 (29) "Computer software maintenance contract" means a contract that obligates a seller
1542 of computer software to provide a customer with:
1543 (a) future updates or upgrades to computer software;
1544 (b) support services with respect to computer software; or
1545 (c) a combination of Subsections (29)(a) and (b).
1546 (30) (a) "Conference bridging service" means an ancillary service that links two or
1547 more participants of an audio conference call or video conference call.
1548 (b) "Conference bridging service" may include providing a telephone number as part of
1549 the ancillary service described in Subsection (30)(a).
1550 (c) "Conference bridging service" does not include a telecommunications service used
1551 to reach the ancillary service described in Subsection (30)(a).
1552 (31) "Construction materials" means any tangible personal property that will be
1553 converted into real property.
1554 (32) "Delivered electronically" means delivered to a purchaser by means other than
1555 tangible storage media.
1556 (33) (a) "Delivery charge" means a charge:
1557 (i) by a seller of:
1558 (A) tangible personal property;
1559 (B) a product transferred electronically; or
1560 (C) a service; and
1561 (ii) for preparation and delivery of the tangible personal property, product transferred
1562 electronically, or services described in Subsection (33)(a)(i) to a location designated by the
1563 purchaser.
1564 (b) "Delivery charge" includes a charge for the following:
1565 (i) transportation;
1566 (ii) shipping;
1567 (iii) postage;
1568 (iv) handling;
1569 (v) crating; or
1570 (vi) packing.
1571 (34) "Detailed telecommunications billing service" means an ancillary service of
1572 separately stating information pertaining to individual calls on a customer's billing statement.
1573 (35) "Dietary supplement" means a product, other than tobacco, that:
1574 (a) is intended to supplement the diet;
1575 (b) contains one or more of the following dietary ingredients:
1576 (i) a vitamin;
1577 (ii) a mineral;
1578 (iii) an herb or other botanical;
1579 (iv) an amino acid;
1580 (v) a dietary substance for use by humans to supplement the diet by increasing the total
1581 dietary intake; or
1582 (vi) a concentrate, metabolite, constituent, extract, or combination of any ingredient
1583 described in Subsections (35)(b)(i) through (v);
1584 (c) (i) except as provided in Subsection (35)(c)(ii), is intended for ingestion in:
1585 (A) tablet form;
1586 (B) capsule form;
1587 (C) powder form;
1588 (D) softgel form;
1589 (E) gelcap form; or
1590 (F) liquid form; or
1591 (ii) if the product is not intended for ingestion in a form described in Subsections
1592 (35)(c)(i)(A) through (F), is not represented:
1593 (A) as conventional food; and
1594 (B) for use as a sole item of:
1595 (I) a meal; or
1596 (II) the diet; and
1597 (d) is required to be labeled as a dietary supplement:
1598 (i) identifiable by the "Supplemental Facts" box found on the label; and
1599 (ii) as required by 21 C.F.R. Sec. 101.36.
1600 (36) (a) "Digital audio work" means a work that results from the fixation of a series of
1601 musical, spoken, or other sounds.
1602 (b) "Digital audio work" includes a ringtone.
1603 (37) "Digital audio-visual work" means a series of related images which, when shown
1604 in succession, imparts an impression of motion, together with accompanying sounds, if any.
1605 (38) "Digital book" means a work that is generally recognized in the ordinary and usual
1606 sense as a book.
1607 (39) (a) "Direct mail" means printed material delivered or distributed by United States
1608 mail or other delivery service:
1609 (i) to:
1610 (A) a mass audience; or
1611 (B) addressees on a mailing list provided:
1612 (I) by a purchaser of the mailing list; or
1613 (II) at the discretion of the purchaser of the mailing list; and
1614 (ii) if the cost of the printed material is not billed directly to the recipients.
1615 (b) "Direct mail" includes tangible personal property supplied directly or indirectly by a
1616 purchaser to a seller of direct mail for inclusion in a package containing the printed material.
1617 (c) "Direct mail" does not include multiple items of printed material delivered to a
1618 single address.
1619 (40) "Directory assistance" means an ancillary service of providing:
1620 (a) address information; or
1621 (b) telephone number information.
1622 (41) (a) "Disposable home medical equipment or supplies" means medical equipment
1623 or supplies that:
1624 (i) cannot withstand repeated use; and
1625 (ii) are purchased by, for, or on behalf of a person other than:
1626 (A) a health care facility as defined in Section 26-21-2;
1627 (B) a health care provider as defined in Section 78B-3-403;
1628 (C) an office of a health care provider described in Subsection (41)(a)(ii)(B); or
1629 (D) a person similar to a person described in Subsections (41)(a)(ii)(A) through (C).
1630 (b) "Disposable home medical equipment or supplies" does not include:
1631 (i) a drug;
1632 (ii) durable medical equipment;
1633 (iii) a hearing aid;
1634 (iv) a hearing aid accessory;
1635 (v) mobility enhancing equipment; or
1636 (vi) tangible personal property used to correct impaired vision, including:
1637 (A) eyeglasses; or
1638 (B) contact lenses.
1639 (c) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
1640 commission may by rule define what constitutes medical equipment or supplies.
1641 (42) "Drilling equipment manufacturer" means a facility:
1642 (a) located in the state;
1643 (b) with respect to which 51% or more of the manufacturing activities of the facility
1644 consist of manufacturing component parts of drilling equipment;
1645 (c) that uses pressure of 800,000 or more pounds per square inch as part of the
1646 manufacturing process; and
1647 (d) that uses a temperature of 2,000 or more degrees Fahrenheit as part of the
1648 manufacturing process.
1649 (43) (a) "Drug" means a compound, substance, or preparation, or a component of a
1650 compound, substance, or preparation that is:
1651 (i) recognized in:
1652 (A) the official United States Pharmacopoeia;
1653 (B) the official Homeopathic Pharmacopoeia of the United States;
1654 (C) the official National Formulary; or
1655 (D) a supplement to a publication listed in Subsections (43)(a)(i)(A) through (C);
1656 (ii) intended for use in the:
1657 (A) diagnosis of disease;
1658 (B) cure of disease;
1659 (C) mitigation of disease;
1660 (D) treatment of disease; or
1661 (E) prevention of disease; or
1662 (iii) intended to affect:
1663 (A) the structure of the body; or
1664 (B) any function of the body.
1665 (b) "Drug" does not include:
1666 (i) food and food ingredients;
1667 (ii) a dietary supplement;
1668 (iii) an alcoholic beverage; or
1669 (iv) a prosthetic device.
1670 (44) (a) [
1671 equipment" means equipment that:
1672 (i) can withstand repeated use;
1673 (ii) is primarily and customarily used to serve a medical purpose;
1674 (iii) generally is not useful to a person in the absence of illness or injury; and
1675 (iv) is not worn in or on the body.
1676 (b) "Durable medical equipment" includes parts used in the repair or replacement of the
1677 equipment described in Subsection (44)(a).
1678 (c) "Durable medical equipment" does not include mobility enhancing equipment.
1679 (45) "Electronic" means:
1680 (a) relating to technology; and
1681 (b) having:
1682 (i) electrical capabilities;
1683 (ii) digital capabilities;
1684 (iii) magnetic capabilities;
1685 (iv) wireless capabilities;
1686 (v) optical capabilities;
1687 (vi) electromagnetic capabilities; or
1688 (vii) capabilities similar to Subsections (45)(b)(i) through (vi).
1689 (46) "Electronic financial payment service" means an establishment:
1690 (a) within NAICS Code 522320, Financial Transactions Processing, Reserve, and
1691 Clearinghouse Activities, of the 2012 North American Industry Classification System of the
1692 federal Executive Office of the President, Office of Management and Budget; and
1693 (b) that performs electronic financial payment services.
1694 (47) "Employee" means the same as that term is defined in Section 59-10-401.
1695 (48) "Fixed guideway" means a public transit facility that uses and occupies:
1696 (a) rail for the use of public transit; or
1697 (b) a separate right-of-way for the use of public transit.
1698 (49) "Fixed wing turbine powered aircraft" means an aircraft that:
1699 (a) is powered by turbine engines;
1700 (b) operates on jet fuel; and
1701 (c) has wings that are permanently attached to the fuselage of the aircraft.
1702 (50) "Fixed wireless service" means a telecommunications service that provides radio
1703 communication between fixed points.
1704 (51) (a) "Food and food ingredients" means substances:
1705 (i) regardless of whether the substances are in:
1706 (A) liquid form;
1707 (B) concentrated form;
1708 (C) solid form;
1709 (D) frozen form;
1710 (E) dried form; or
1711 (F) dehydrated form; and
1712 (ii) that are:
1713 (A) sold for:
1714 (I) ingestion by humans; or
1715 (II) chewing by humans; and
1716 (B) consumed for the substance's:
1717 (I) taste; or
1718 (II) nutritional value.
1719 (b) "Food and food ingredients" includes an item described in Subsection (96)(b)(iii).
1720 (c) "Food and food ingredients" does not include:
1721 (i) an alcoholic beverage;
1722 (ii) tobacco; or
1723 (iii) prepared food.
1724 (52) (a) "Fundraising sales" means sales:
1725 (i) (A) made by a school; or
1726 (B) made by a school student;
1727 (ii) that are for the purpose of raising funds for the school to purchase equipment,
1728 materials, or provide transportation; and
1729 (iii) that are part of an officially sanctioned school activity.
1730 (b) For purposes of Subsection (52)(a)(iii), "officially sanctioned school activity"
1731 means a school activity:
1732 (i) that is conducted in accordance with a formal policy adopted by the school or school
1733 district governing the authorization and supervision of fundraising activities;
1734 (ii) that does not directly or indirectly compensate an individual teacher or other
1735 educational personnel by direct payment, commissions, or payment in kind; and
1736 (iii) the net or gross revenues from which are deposited in a dedicated account
1737 controlled by the school or school district.
1738 (53) "Geothermal energy" means energy contained in heat that continuously flows
1739 outward from the earth that is used as the sole source of energy to produce electricity.
1740 (54) "Governing board of the agreement" means the governing board of the agreement
1741 that is:
1742 (a) authorized to administer the agreement; and
1743 (b) established in accordance with the agreement.
1744 (55) (a) For purposes of Subsection 59-12-104(41), "governmental entity" means:
1745 (i) the executive branch of the state, including all departments, institutions, boards,
1746 divisions, bureaus, offices, commissions, and committees;
1747 (ii) the judicial branch of the state, including the courts, the Judicial Council, the
1748 Administrative Office of the Courts, and similar administrative units in the judicial branch;
1749 (iii) the legislative branch of the state, including the House of Representatives, the
1750 Senate, the Legislative Printing Office, the Office of Legislative Research and General
1751 Counsel, the Office of the Legislative Auditor General, and the Office of the Legislative Fiscal
1752 Analyst;
1753 (iv) the National Guard;
1754 (v) an independent entity as defined in Section 63E-1-102; or
1755 (vi) a political subdivision as defined in Section 17B-1-102.
1756 (b) "Governmental entity" does not include the state systems of public and higher
1757 education, including:
1758 (i) a school;
1759 (ii) the State Board of Education;
1760 (iii) the Utah Board of Higher Education; or
1761 (iv) an institution of higher education described in Section 53B-1-102.
1762 (56) "Hydroelectric energy" means water used as the sole source of energy to produce
1763 electricity.
1764 (57) "Industrial use" means the use of natural gas, electricity, heat, coal, fuel oil,
1765 hydrogen, or other fuels:
1766 (a) in mining or extraction of minerals;
1767 (b) in agricultural operations to produce an agricultural product up to the time of
1768 harvest or placing the agricultural product into a storage facility, including:
1769 (i) commercial greenhouses;
1770 (ii) irrigation pumps;
1771 (iii) farm machinery;
1772 (iv) implements of husbandry as defined in Section 41-1a-102 that are not registered
1773 under Title 41, Chapter 1a, Part 2, Registration; and
1774 (v) other farming activities;
1775 (c) in manufacturing tangible personal property at an establishment described in:
1776 (i) SIC Codes 2000 to 3999 of the 1987 Standard Industrial Classification Manual of
1777 the federal Executive Office of the President, Office of Management and Budget; or
1778 (ii) a NAICS code within NAICS Sector 31-33, Manufacturing, of the 2017 North
1779 American Industry Classification System of the federal Executive Office of the President,
1780 Office of Management and Budget;
1781 (d) by a scrap recycler if:
1782 (i) from a fixed location, the scrap recycler utilizes machinery or equipment to process
1783 one or more of the following items into prepared grades of processed materials for use in new
1784 products:
1785 (A) iron;
1786 (B) steel;
1787 (C) nonferrous metal;
1788 (D) paper;
1789 (E) glass;
1790 (F) plastic;
1791 (G) textile; or
1792 (H) rubber; and
1793 (ii) the new products under Subsection (57)(d)(i) would otherwise be made with
1794 nonrecycled materials; or
1795 (e) in producing a form of energy or steam described in Subsection 54-2-1(3)(a) by a
1796 cogeneration facility as defined in Section 54-2-1.
1797 (58) (a) [
1798 means a charge for installing:
1799 (i) tangible personal property; or
1800 (ii) a product transferred electronically.
1801 (b) "Installation charge" does not include a charge for:
1802 (i) repairs or renovations of:
1803 (A) tangible personal property; or
1804 (B) a product transferred electronically; or
1805 (ii) attaching tangible personal property or a product transferred electronically:
1806 (A) to other tangible personal property; and
1807 (B) as part of a manufacturing or fabrication process.
1808 (59) "Institution of higher education" means an institution of higher education listed in
1809 Section 53B-2-101.
1810 (60) (a) "Lease" or "rental" means a transfer of possession or control of tangible
1811 personal property or a product transferred electronically for:
1812 (i) (A) a fixed term; or
1813 (B) an indeterminate term; and
1814 (ii) consideration.
1815 (b) "Lease" or "rental" includes an agreement covering a motor vehicle and trailer if the
1816 amount of consideration may be increased or decreased by reference to the amount realized
1817 upon sale or disposition of the property as defined in Section 7701(h)(1), Internal Revenue
1818 Code.
1819 (c) "Lease" or "rental" does not include:
1820 (i) a transfer of possession or control of property under a security agreement or
1821 deferred payment plan that requires the transfer of title upon completion of the required
1822 payments;
1823 (ii) a transfer of possession or control of property under an agreement that requires the
1824 transfer of title:
1825 (A) upon completion of required payments; and
1826 (B) if the payment of an option price does not exceed the greater of:
1827 (I) $100; or
1828 (II) 1% of the total required payments; or
1829 (iii) providing tangible personal property along with an operator for a fixed period of
1830 time or an indeterminate period of time if the operator is necessary for equipment to perform as
1831 designed.
1832 (d) For purposes of Subsection (60)(c)(iii), an operator is necessary for equipment to
1833 perform as designed if the operator's duties exceed the:
1834 (i) set-up of tangible personal property;
1835 (ii) maintenance of tangible personal property; or
1836 (iii) inspection of tangible personal property.
1837 (61) "Lesson" means a fixed period of time for the duration of which a trained
1838 instructor:
1839 (a) is present with a student in person or by video; and
1840 (b) actively instructs the student, including by providing observation or feedback.
1841 (62) "Life science establishment" means an establishment in this state that is classified
1842 under the following NAICS codes of the 2007 North American Industry Classification System
1843 of the federal Executive Office of the President, Office of Management and Budget:
1844 (a) NAICS Code 33911, Medical Equipment and Supplies Manufacturing;
1845 (b) NAICS Code 334510, Electromedical and Electrotherapeutic Apparatus
1846 Manufacturing; or
1847 (c) NAICS Code 334517, Irradiation Apparatus Manufacturing.
1848 (63) "Life science research and development facility" means a facility owned, leased,
1849 or rented by a life science establishment if research and development is performed in 51% or
1850 more of the total area of the facility.
1851 (64) "Load and leave" means delivery to a purchaser by use of a tangible storage media
1852 if the tangible storage media is not physically transferred to the purchaser.
1853 (65) "Local taxing jurisdiction" means a:
1854 (a) county that is authorized to impose an agreement sales and use tax;
1855 (b) city that is authorized to impose an agreement sales and use tax; or
1856 (c) town that is authorized to impose an agreement sales and use tax.
1857 (66) "Manufactured home" means the same as that term is defined in Section
1858 15A-1-302.
1859 (67) "Manufacturing facility" means:
1860 (a) an establishment described in:
1861 (i) SIC Codes 2000 to 3999 of the 1987 Standard Industrial Classification Manual of
1862 the federal Executive Office of the President, Office of Management and Budget; or
1863 (ii) a NAICS code within NAICS Sector 31-33, Manufacturing, of the 2017 North
1864 American Industry Classification System of the federal Executive Office of the President,
1865 Office of Management and Budget;
1866 (b) a scrap recycler if:
1867 (i) from a fixed location, the scrap recycler utilizes machinery or equipment to process
1868 one or more of the following items into prepared grades of processed materials for use in new
1869 products:
1870 (A) iron;
1871 (B) steel;
1872 (C) nonferrous metal;
1873 (D) paper;
1874 (E) glass;
1875 (F) plastic;
1876 (G) textile; or
1877 (H) rubber; and
1878 (ii) the new products under Subsection (67)(b)(i) would otherwise be made with
1879 nonrecycled materials; or
1880 (c) a cogeneration facility as defined in Section 54-2-1 if the cogeneration facility is
1881 placed in service on or after May 1, 2006.
1882 (68) (a) "Marketplace" means a physical or electronic place, platform, or forum where
1883 tangible personal property, a product transferred electronically, or a service is offered for sale.
1884 (b) "Marketplace" includes a store, a booth, an Internet website, a catalog, or a
1885 dedicated sales software application.
1886 (69) (a) "Marketplace facilitator" means a person, including an affiliate of the person,
1887 that enters into a contract, an agreement, or otherwise with sellers, for consideration, to
1888 facilitate the sale of a seller's product through a marketplace that the person owns, operates, or
1889 controls and that directly or indirectly:
1890 (i) does any of the following:
1891 (A) lists, makes available, or advertises tangible personal property, a product
1892 transferred electronically, or a service for sale by a marketplace seller on a marketplace that the
1893 person owns, operates, or controls;
1894 (B) facilitates the sale of a marketplace seller's tangible personal property, product
1895 transferred electronically, or service by transmitting or otherwise communicating an offer or
1896 acceptance of a retail sale between the marketplace seller and a purchaser using the
1897 marketplace;
1898 (C) owns, rents, licenses, makes available, or operates any electronic or physical
1899 infrastructure or any property, process, method, copyright, trademark, or patent that connects a
1900 marketplace seller to a purchaser for the purpose of making a retail sale of tangible personal
1901 property, a product transferred electronically, or a service;
1902 (D) provides a marketplace for making, or otherwise facilitates, a retail sale of tangible
1903 personal property, a product transferred electronically, or a service, regardless of ownership or
1904 control of the tangible personal property, the product transferred electronically, or the service
1905 that is the subject of the retail sale;
1906 (E) provides software development or research and development activities related to
1907 any activity described in this Subsection (69)(a)(i), if the software development or research and
1908 development activity is directly related to the person's marketplace;
1909 (F) provides or offers fulfillment or storage services for a marketplace seller;
1910 (G) sets prices for the sale of tangible personal property, a product transferred
1911 electronically, or a service by a marketplace seller;
1912 (H) provides or offers customer service to a marketplace seller or a marketplace seller's
1913 purchaser or accepts or assists with taking orders, returns, or exchanges of tangible personal
1914 property, a product transferred electronically, or a service sold by a marketplace seller on the
1915 person's marketplace; or
1916 (I) brands or otherwise identifies sales as those of the person; and
1917 (ii) does any of the following:
1918 (A) collects the sales price or purchase price of a retail sale of tangible personal
1919 property, a product transferred electronically, or a service;
1920 (B) provides payment processing services for a retail sale of tangible personal property,
1921 a product transferred electronically, or a service;
1922 (C) charges, collects, or otherwise receives a selling fee, listing fee, referral fee, closing
1923 fee, a fee for inserting or making available tangible personal property, a product transferred
1924 electronically, or a service on the person's marketplace, or other consideration for the
1925 facilitation of a retail sale of tangible personal property, a product transferred electronically, or
1926 a service, regardless of ownership or control of the tangible personal property, the product
1927 transferred electronically, or the service that is the subject of the retail sale;
1928 (D) through terms and conditions, an agreement, or another arrangement with a third
1929 person, collects payment from a purchase for a retail sale of tangible personal property, a
1930 product transferred electronically, or a service and transmits that payment to the marketplace
1931 seller, regardless of whether the third person receives compensation or other consideration in
1932 exchange for the service; or
1933 (E) provides a virtual currency for a purchaser to use to purchase tangible personal
1934 property, a product transferred electronically, or service offered for sale.
1935 (b) "Marketplace facilitator" does not include:
1936 (i) a person that only provides payment processing services; or
1937 (ii) a person described in Subsection (69)(a) to the extent the person is facilitating a
1938 sale for a seller that is a restaurant as defined in Section 59-12-602.
1939 (70) "Marketplace seller" means a seller that makes one or more retail sales through a
1940 marketplace that a marketplace facilitator owns, operates, or controls, regardless of whether the
1941 seller is required to be registered to collect and remit the tax under this part.
1942 (71) "Member of the immediate family of the producer" means a person who is related
1943 to a producer described in Subsection 59-12-104(20)(a) as a:
1944 (a) child or stepchild, regardless of whether the child or stepchild is:
1945 (i) an adopted child or adopted stepchild; or
1946 (ii) a foster child or foster stepchild;
1947 (b) grandchild or stepgrandchild;
1948 (c) grandparent or stepgrandparent;
1949 (d) nephew or stepnephew;
1950 (e) niece or stepniece;
1951 (f) parent or stepparent;
1952 (g) sibling or stepsibling;
1953 (h) spouse;
1954 (i) person who is the spouse of a person described in Subsections (71)(a) through (g);
1955 or
1956 (j) person similar to a person described in Subsections (71)(a) through (i) as
1957 determined by the commission by rule made in accordance with Title 63G, Chapter 3, Utah
1958 Administrative Rulemaking Act.
1959 (72) "Mobile home" means the same as that term is defined in Section 15A-1-302.
1960 (73) "Mobile telecommunications service" means the same as that term is defined in
1961 the Mobile Telecommunications Sourcing Act, 4 U.S.C. Sec. 124.
1962 (74) (a) "Mobile wireless service" means a telecommunications service, regardless of
1963 the technology used, if:
1964 (i) the origination point of the conveyance, routing, or transmission is not fixed;
1965 (ii) the termination point of the conveyance, routing, or transmission is not fixed; or
1966 (iii) the origination point described in Subsection (74)(a)(i) and the termination point
1967 described in Subsection (74)(a)(ii) are not fixed.
1968 (b) "Mobile wireless service" includes a telecommunications service that is provided
1969 by a commercial mobile radio service provider.
1970 (c) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
1971 commission may by rule define "commercial mobile radio service provider."
1972 (75) (a) [
1973 equipment" means equipment that is:
1974 (i) primarily and customarily used to provide or increase the ability to move from one
1975 place to another;
1976 (ii) appropriate for use in a:
1977 (A) home; or
1978 (B) motor vehicle; and
1979 (iii) not generally used by persons with normal mobility.
1980 (b) "Mobility enhancing equipment" includes parts used in the repair or replacement of
1981 the equipment described in Subsection (75)(a).
1982 (c) "Mobility enhancing equipment" does not include:
1983 (i) a motor vehicle;
1984 (ii) equipment on a motor vehicle if that equipment is normally provided by the motor
1985 vehicle manufacturer;
1986 (iii) durable medical equipment; or
1987 (iv) a prosthetic device.
1988 (76) "Model 1 seller" means a seller registered under the agreement that has selected a
1989 certified service provider as the seller's agent to perform the seller's sales and use tax functions
1990 for agreement sales and use taxes, as outlined in the contract between the governing board of
1991 the agreement and the certified service provider, other than the seller's obligation under Section
1992 59-12-124 to remit a tax on the seller's own purchases.
1993 (77) "Model 2 seller" means a seller registered under the agreement that:
1994 (a) except as provided in Subsection (77)(b), has selected a certified automated system
1995 to perform the seller's sales tax functions for agreement sales and use taxes; and
1996 (b) retains responsibility for remitting all of the sales tax:
1997 (i) collected by the seller; and
1998 (ii) to the appropriate local taxing jurisdiction.
1999 (78) (a) Subject to Subsection (78)(b), "model 3 seller" means a seller registered under
2000 the agreement that has:
2001 (i) sales in at least five states that are members of the agreement;
2002 (ii) total annual sales revenues of at least $500,000,000;
2003 (iii) a proprietary system that calculates the amount of tax:
2004 (A) for an agreement sales and use tax; and
2005 (B) due to each local taxing jurisdiction; and
2006 (iv) entered into a performance agreement with the governing board of the agreement.
2007 (b) [
2008 group of sellers using the same proprietary system.
2009 (79) "Model 4 seller" means a seller that is registered under the agreement and is not a
2010 model 1 seller, model 2 seller, or model 3 seller.
2011 (80) "Modular home" means a modular unit as defined in Section 15A-1-302.
2012 (81) "Motor vehicle" means the same as that term is defined in Section 41-1a-102.
2013 (82) "Oil sands" means impregnated bituminous sands that:
2014 (a) contain a heavy, thick form of petroleum that is released when heated, mixed with
2015 other hydrocarbons, or otherwise treated;
2016 (b) yield mixtures of liquid hydrocarbon; and
2017 (c) require further processing other than mechanical blending before becoming finished
2018 petroleum products.
2019 (83) "Oil shale" means a group of fine black to dark brown shales containing kerogen
2020 material that yields petroleum upon heating and distillation.
2021 (84) "Optional computer software maintenance contract" means a computer software
2022 maintenance contract that a customer is not obligated to purchase as a condition to the retail
2023 sale of computer software.
2024 (85) (a) "Other fuels" means products that burn independently to produce heat or
2025 energy.
2026 (b) "Other fuels" includes oxygen when it is used in the manufacturing of tangible
2027 personal property.
2028 (86) (a) "Paging service" means a telecommunications service that provides
2029 transmission of a coded radio signal for the purpose of activating a specific pager.
2030 (b) For purposes of Subsection (86)(a), the transmission of a coded radio signal
2031 includes a transmission by message or sound.
2032 (87) "Pawn transaction" means the same as that term is defined in Section 13-32a-102.
2033 [
2034 13-32a-102.
2035 [
2036
2037 (89) (a) "Permanently attached to real property" means that for tangible personal
2038 property attached to real property:
2039 (i) the attachment of the tangible personal property to the real property:
2040 (A) is essential to the use of the tangible personal property; and
2041 (B) suggests that the tangible personal property will remain attached to the real
2042 property in the same place over the useful life of the tangible personal property; or
2043 (ii) if the tangible personal property is detached from the real property, the detachment
2044 would:
2045 (A) cause substantial damage to the tangible personal property; or
2046 (B) require substantial alteration or repair of the real property to which the tangible
2047 personal property is attached.
2048 (b) "Permanently attached to real property" includes:
2049 (i) the attachment of an accessory to the tangible personal property if the accessory is:
2050 (A) essential to the operation of the tangible personal property; and
2051 (B) attached only to facilitate the operation of the tangible personal property;
2052 (ii) a temporary detachment of tangible personal property from real property for a
2053 repair or renovation if the repair or renovation is performed where the tangible personal
2054 property and real property are located; or
2055 (iii) property attached to oil, gas, or water pipelines, except for the property listed in
2056 Subsection (89)(c)(iii) or (iv).
2057 (c) "Permanently attached to real property" does not include:
2058 (i) the attachment of portable or movable tangible personal property to real property if
2059 that portable or movable tangible personal property is attached to real property only for:
2060 (A) convenience;
2061 (B) stability; or
2062 (C) for an obvious temporary purpose;
2063 (ii) the detachment of tangible personal property from real property except for the
2064 detachment described in Subsection (89)(b)(ii);
2065 (iii) an attachment of the following tangible personal property to real property if the
2066 attachment to real property is only through a line that supplies water, electricity, gas,
2067 telecommunications, cable, or supplies a similar item as determined by the commission by rule
2068 made in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act:
2069 (A) a computer;
2070 (B) a telephone;
2071 (C) a television; or
2072 (D) tangible personal property similar to Subsections (89)(c)(iii)(A) through (C) as
2073 determined by the commission by rule made in accordance with Title 63G, Chapter 3, Utah
2074 Administrative Rulemaking Act; or
2075 (iv) an item listed in Subsection (130)(c).
2076 (90) "Person" includes any individual, firm, partnership, joint venture, association,
2077 corporation, estate, trust, business trust, receiver, syndicate, this state, any county, city,
2078 municipality, district, or other local governmental entity of the state, or any group or
2079 combination acting as a unit.
2080 (91) "Place of primary use":
2081 (a) for telecommunications service other than mobile telecommunications service,
2082 means the street address representative of where the customer's use of the telecommunications
2083 service primarily occurs, which shall be:
2084 (i) the residential street address of the customer; or
2085 (ii) the primary business street address of the customer; or
2086 (b) for mobile telecommunications service, means the same as that term is defined in
2087 the Mobile Telecommunications Sourcing Act, 4 U.S.C. Sec. 124.
2088 (92) (a) "Postpaid calling service" means a telecommunications service a person
2089 obtains by making a payment on a call-by-call basis:
2090 (i) through the use of a:
2091 (A) bank card;
2092 (B) credit card;
2093 (C) debit card; or
2094 (D) travel card; or
2095 (ii) by a charge made to a telephone number that is not associated with the origination
2096 or termination of the telecommunications service.
2097 (b) "Postpaid calling service" includes a service, except for a prepaid wireless calling
2098 service, that would be a prepaid wireless calling service if the service were exclusively a
2099 telecommunications service.
2100 (93) "Postproduction" means an activity related to the finishing or duplication of a
2101 medium described in Subsection 59-12-104(54)(a).
2102 (94) "Prepaid calling service" means a telecommunications service:
2103 (a) that allows a purchaser access to telecommunications service that is exclusively
2104 telecommunications service;
2105 (b) that:
2106 (i) is paid for in advance; and
2107 (ii) enables the origination of a call using an:
2108 (A) access number; or
2109 (B) authorization code;
2110 (c) that is dialed:
2111 (i) manually; or
2112 (ii) electronically; and
2113 (d) sold in predetermined units or dollars that decline:
2114 (i) by a known amount; and
2115 (ii) with use.
2116 (95) "Prepaid wireless calling service" means a telecommunications service:
2117 (a) that provides the right to utilize:
2118 (i) mobile wireless service; and
2119 (ii) other service that is not a telecommunications service, including:
2120 (A) the download of a product transferred electronically;
2121 (B) a content service; or
2122 (C) an ancillary service;
2123 (b) that:
2124 (i) is paid for in advance; and
2125 (ii) enables the origination of a call using an:
2126 (A) access number; or
2127 (B) authorization code;
2128 (c) that is dialed:
2129 (i) manually; or
2130 (ii) electronically; and
2131 (d) sold in predetermined units or dollars that decline:
2132 (i) by a known amount; and
2133 (ii) with use.
2134 (96) (a) "Prepared food" means:
2135 (i) food:
2136 (A) sold in a heated state; or
2137 (B) heated by a seller;
2138 (ii) two or more food ingredients mixed or combined by the seller for sale as a single
2139 item; or
2140 (iii) except as provided in Subsection (96)(c), food sold with an eating utensil provided
2141 by the seller, including a:
2142 (A) plate;
2143 (B) knife;
2144 (C) fork;
2145 (D) spoon;
2146 (E) glass;
2147 (F) cup;
2148 (G) napkin; or
2149 (H) straw.
2150 (b) "Prepared food" does not include:
2151 (i) food that a seller only:
2152 (A) cuts;
2153 (B) repackages; or
2154 (C) pasteurizes; or
2155 (ii) (A) the following:
2156 (I) raw egg;
2157 (II) raw fish;
2158 (III) raw meat;
2159 (IV) raw poultry; or
2160 (V) a food containing an item described in Subsections (96)(b)(ii)(A)(I) through (IV);
2161 and
2162 (B) if the Food and Drug Administration recommends in Chapter 3, Part 401.11 of the
2163 Food and Drug Administration's Food Code that a consumer cook the items described in
2164 Subsection (96)(b)(ii)(A) to prevent food borne illness; or
2165 (iii) the following if sold without eating utensils provided by the seller:
2166 (A) food and food ingredients sold by a seller if the seller's proper primary
2167 classification under the 2002 North American Industry Classification System of the federal
2168 Executive Office of the President, Office of Management and Budget, is manufacturing in
2169 Sector 311, Food Manufacturing, except for Subsector 3118, Bakeries and Tortilla
2170 Manufacturing;
2171 (B) food and food ingredients sold in an unheated state:
2172 (I) by weight or volume; and
2173 (II) as a single item; or
2174 (C) a bakery item, including:
2175 (I) a bagel;
2176 (II) a bar;
2177 (III) a biscuit;
2178 (IV) bread;
2179 (V) a bun;
2180 (VI) a cake;
2181 (VII) a cookie;
2182 (VIII) a croissant;
2183 (IX) a danish;
2184 (X) a donut;
2185 (XI) a muffin;
2186 (XII) a pastry;
2187 (XIII) a pie;
2188 (XIV) a roll;
2189 (XV) a tart;
2190 (XVI) a torte; or
2191 (XVII) a tortilla.
2192 (c) An eating utensil provided by the seller does not include the following used to
2193 transport the food:
2194 (i) a container; or
2195 (ii) packaging.
2196 (97) "Prescription" means an order, formula, or recipe that is issued:
2197 (a) (i) orally;
2198 (ii) in writing;
2199 (iii) electronically; or
2200 (iv) by any other manner of transmission; and
2201 (b) by a licensed practitioner authorized by the laws of a state.
2202 (98) (a) [
2203 computer software" means computer software that is not designed and developed:
2204 (i) by the author or other creator of the computer software; and
2205 (ii) to the specifications of a specific purchaser.
2206 (b) "Prewritten computer software" includes:
2207 (i) a prewritten upgrade to computer software if the prewritten upgrade to the computer
2208 software is not designed and developed:
2209 (A) by the author or other creator of the computer software; and
2210 (B) to the specifications of a specific purchaser;
2211 (ii) computer software designed and developed by the author or other creator of the
2212 computer software to the specifications of a specific purchaser if the computer software is sold
2213 to a person other than the purchaser; or
2214 (iii) except as provided in Subsection (98)(c), prewritten computer software or a
2215 prewritten portion of prewritten computer software:
2216 (A) that is modified or enhanced to any degree; and
2217 (B) if the modification or enhancement described in Subsection (98)(b)(iii)(A) is
2218 designed and developed to the specifications of a specific purchaser.
2219 (c) "Prewritten computer software" does not include a modification or enhancement
2220 described in Subsection (98)(b)(iii) if the charges for the modification or enhancement are:
2221 (i) reasonable; and
2222 (ii) subject to Subsections 59-12-103(2)(e)(ii) and (2)(f)(i), separately stated on the
2223 invoice or other statement of price provided to the purchaser at the time of sale or later, as
2224 demonstrated by:
2225 (A) the books and records the seller keeps at the time of the transaction in the regular
2226 course of business, including books and records the seller keeps at the time of the transaction in
2227 the regular course of business for nontax purposes;
2228 (B) a preponderance of the facts and circumstances at the time of the transaction; and
2229 (C) the understanding of all of the parties to the transaction.
2230 (99) (a) "Private communications service" means a telecommunications service:
2231 (i) that entitles a customer to exclusive or priority use of one or more communications
2232 channels between or among termination points; and
2233 (ii) regardless of the manner in which the one or more communications channels are
2234 connected.
2235 (b) "Private communications service" includes the following provided in connection
2236 with the use of one or more communications channels:
2237 (i) an extension line;
2238 (ii) a station;
2239 (iii) switching capacity; or
2240 (iv) another associated service that is provided in connection with the use of one or
2241 more communications channels as defined in Section 59-12-215.
2242 (100) (a) [
2243 electronically" means a product transferred electronically that would be subject to a tax under
2244 this chapter if that product was transferred in a manner other than electronically.
2245 (b) "Product transferred electronically" does not include:
2246 (i) an ancillary service;
2247 (ii) computer software; or
2248 (iii) a telecommunications service.
2249 (101) (a) "Prosthetic device" means a device that is worn on or in the body to:
2250 (i) artificially replace a missing portion of the body;
2251 (ii) prevent or correct a physical deformity or physical malfunction; or
2252 (iii) support a weak or deformed portion of the body.
2253 (b) "Prosthetic device" includes:
2254 (i) parts used in the repairs or renovation of a prosthetic device;
2255 (ii) replacement parts for a prosthetic device;
2256 (iii) a dental prosthesis; or
2257 (iv) a hearing aid.
2258 (c) "Prosthetic device" does not include:
2259 (i) corrective eyeglasses; or
2260 (ii) contact lenses.
2261 (102) (a) "Protective equipment" means an item:
2262 (i) for human wear; and
2263 (ii) that is:
2264 (A) designed as protection:
2265 (I) to the wearer against injury or disease; or
2266 (II) against damage or injury of other persons or property; and
2267 (B) not suitable for general use.
2268 (b) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
2269 commission shall make rules:
2270 (i) listing the items that constitute "protective equipment"; and
2271 (ii) that are consistent with the list of items that constitute "protective equipment"
2272 under the agreement.
2273 (103) (a) For purposes of Subsection 59-12-104(41), "publication" means any written
2274 or printed matter, other than a photocopy:
2275 (i) regardless of:
2276 (A) characteristics;
2277 (B) copyright;
2278 (C) form;
2279 (D) format;
2280 (E) method of reproduction; or
2281 (F) source; and
2282 (ii) made available in printed or electronic format.
2283 (b) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
2284 commission may by rule define the term "photocopy."
2285 (104) (a) "Purchase price" and "sales price" mean the total amount of consideration:
2286 (i) valued in money; and
2287 (ii) for which tangible personal property, a product transferred electronically, or
2288 services are:
2289 (A) sold;
2290 (B) leased; or
2291 (C) rented.
2292 (b) "Purchase price" and "sales price" include:
2293 (i) the seller's cost of the tangible personal property, a product transferred
2294 electronically, or services sold;
2295 (ii) expenses of the seller, including:
2296 (A) the cost of materials used;
2297 (B) a labor cost;
2298 (C) a service cost;
2299 (D) interest;
2300 (E) a loss;
2301 (F) the cost of transportation to the seller; or
2302 (G) a tax imposed on the seller;
2303 (iii) a charge by the seller for any service necessary to complete the sale; or
2304 (iv) consideration a seller receives from a person other than the purchaser if:
2305 (A) (I) the seller actually receives consideration from a person other than the purchaser;
2306 and
2307 (II) the consideration described in Subsection (104)(b)(iv)(A)(I) is directly related to a
2308 price reduction or discount on the sale;
2309 (B) the seller has an obligation to pass the price reduction or discount through to the
2310 purchaser;
2311 (C) the amount of the consideration attributable to the sale is fixed and determinable by
2312 the seller at the time of the sale to the purchaser; and
2313 (D) (I) (Aa) the purchaser presents a certificate, coupon, or other documentation to the
2314 seller to claim a price reduction or discount; and
2315 (Bb) a person other than the seller authorizes, distributes, or grants the certificate,
2316 coupon, or other documentation with the understanding that the person other than the seller
2317 will reimburse any seller to whom the certificate, coupon, or other documentation is presented;
2318 (II) the purchaser identifies that purchaser to the seller as a member of a group or
2319 organization allowed a price reduction or discount, except that a preferred customer card that is
2320 available to any patron of a seller does not constitute membership in a group or organization
2321 allowed a price reduction or discount; or
2322 (III) the price reduction or discount is identified as a third party price reduction or
2323 discount on the:
2324 (Aa) invoice the purchaser receives; or
2325 (Bb) certificate, coupon, or other documentation the purchaser presents.
2326 (c) "Purchase price" and "sales price" do not include:
2327 (i) a discount:
2328 (A) in a form including:
2329 (I) cash;
2330 (II) term; or
2331 (III) coupon;
2332 (B) that is allowed by a seller;
2333 (C) taken by a purchaser on a sale; and
2334 (D) that is not reimbursed by a third party; or
2335 (ii) subject to Subsections 59-12-103(2)(e)(ii) and (2)(f)(i), the following if separately
2336 stated on an invoice, bill of sale, or similar document provided to the purchaser at the time of
2337 sale or later, as demonstrated by the books and records the seller keeps at the time of the
2338 transaction in the regular course of business, including books and records the seller keeps at the
2339 time of the transaction in the regular course of business for nontax purposes, by a
2340 preponderance of the facts and circumstances at the time of the transaction, and by the
2341 understanding of all of the parties to the transaction:
2342 (A) the following from credit extended on the sale of tangible personal property or
2343 services:
2344 (I) a carrying charge;
2345 (II) a financing charge; or
2346 (III) an interest charge;
2347 (B) a delivery charge;
2348 (C) an installation charge;
2349 (D) a manufacturer rebate on a motor vehicle; or
2350 (E) a tax or fee legally imposed directly on the consumer.
2351 (105) "Purchaser" means a person to whom:
2352 (a) a sale of tangible personal property is made;
2353 (b) a product is transferred electronically; or
2354 (c) a service is furnished.
2355 (106) "Qualifying data center" means a data center facility that:
2356 (a) houses a group of networked server computers in one physical location in order to
2357 disseminate, manage, and store data and information;
2358 (b) is located in the state;
2359 (c) is a new operation constructed on or after July 1, 2016;
2360 (d) consists of one or more buildings that total 150,000 or more square feet;
2361 (e) is owned or leased by:
2362 (i) the operator of the data center facility; or
2363 (ii) a person under common ownership, as defined in Section 59-7-101, of the operator
2364 of the data center facility; and
2365 (f) is located on one or more parcels of land that are owned or leased by:
2366 (i) the operator of the data center facility; or
2367 (ii) a person under common ownership, as defined in Section 59-7-101, of the operator
2368 of the data center facility.
2369 (107) "Regularly rented" means:
2370 (a) rented to a guest for value three or more times during a calendar year; or
2371 (b) advertised or held out to the public as a place that is regularly rented to guests for
2372 value.
2373 (108) "Rental" means the same as that term is defined in Subsection (60).
2374 (109) (a) [
2375 of tangible personal property" means:
2376 (i) a repair or renovation of tangible personal property that is not permanently attached
2377 to real property; or
2378 (ii) attaching tangible personal property or a product transferred electronically to other
2379 tangible personal property or detaching tangible personal property or a product transferred
2380 electronically from other tangible personal property if:
2381 (A) the other tangible personal property to which the tangible personal property or
2382 product transferred electronically is attached or from which the tangible personal property or
2383 product transferred electronically is detached is not permanently attached to real property; and
2384 (B) the attachment of tangible personal property or a product transferred electronically
2385 to other tangible personal property or detachment of tangible personal property or a product
2386 transferred electronically from other tangible personal property is made in conjunction with a
2387 repair or replacement of tangible personal property or a product transferred electronically.
2388 (b) "Repairs or renovations of tangible personal property" does not include:
2389 (i) attaching prewritten computer software to other tangible personal property if the
2390 other tangible personal property to which the prewritten computer software is attached is not
2391 permanently attached to real property; or
2392 (ii) detaching prewritten computer software from other tangible personal property if the
2393 other tangible personal property from which the prewritten computer software is detached is
2394 not permanently attached to real property.
2395 (110) "Research and development" means the process of inquiry or experimentation
2396 aimed at the discovery of facts, devices, technologies, or applications and the process of
2397 preparing those devices, technologies, or applications for marketing.
2398 (111) (a) "Residential telecommunications services" means a telecommunications
2399 service or an ancillary service that is provided to an individual for personal use:
2400 (i) at a residential address; or
2401 (ii) at an institution, including a nursing home or a school, if the telecommunications
2402 service or ancillary service is provided to and paid for by the individual residing at the
2403 institution rather than the institution.
2404 (b) For purposes of Subsection (111)(a)(i), a residential address includes an:
2405 (i) apartment; or
2406 (ii) other individual dwelling unit.
2407 (112) "Residential use" means the use in or around a home, apartment building,
2408 sleeping quarters, and similar facilities or accommodations.
2409 (113) "Retail sale" or "sale at retail" means a sale, lease, or rental for a purpose other
2410 than:
2411 (a) resale;
2412 (b) sublease; or
2413 (c) subrent.
2414 (114) (a) "Retailer" means any person, unless prohibited by the Constitution of the
2415 United States or federal law, that is engaged in a regularly organized business in tangible
2416 personal property or any other taxable transaction under Subsection 59-12-103(1), and who is
2417 selling to the user or consumer and not for resale.
2418 (b) "Retailer" includes commission merchants, auctioneers, and any person regularly
2419 engaged in the business of selling to users or consumers within the state.
2420 (115) (a) "Sale" means any transfer of title, exchange, or barter, conditional or
2421 otherwise, in any manner, of tangible personal property or any other taxable transaction under
2422 Subsection 59-12-103(1), for consideration.
2423 (b) "Sale" includes:
2424 (i) installment and credit sales;
2425 (ii) any closed transaction constituting a sale;
2426 (iii) any sale of electrical energy, gas, services, or entertainment taxable under this
2427 chapter;
2428 (iv) any transaction if the possession of property is transferred but the seller retains the
2429 title as security for the payment of the price; and
2430 (v) any transaction under which right to possession, operation, or use of any article of
2431 tangible personal property is granted under a lease or contract and the transfer of possession
2432 would be taxable if an outright sale were made.
2433 (116) "Sale at retail" means the same as that term is defined in Subsection (113).
2434 (117) "Sale-leaseback transaction" means a transaction by which title to tangible
2435 personal property or a product transferred electronically that is subject to a tax under this
2436 chapter is transferred:
2437 (a) by a purchaser-lessee;
2438 (b) to a lessor;
2439 (c) for consideration; and
2440 (d) if:
2441 (i) the purchaser-lessee paid sales and use tax on the purchaser-lessee's initial purchase
2442 of the tangible personal property or product transferred electronically;
2443 (ii) the sale of the tangible personal property or product transferred electronically to the
2444 lessor is intended as a form of financing:
2445 (A) for the tangible personal property or product transferred electronically; and
2446 (B) to the purchaser-lessee; and
2447 (iii) in accordance with generally accepted accounting principles, the purchaser-lessee
2448 is required to:
2449 (A) capitalize the tangible personal property or product transferred electronically for
2450 financial reporting purposes; and
2451 (B) account for the lease payments as payments made under a financing arrangement.
2452 (118) "Sales price" means the same as that term is defined in Subsection (104).
2453 (119) (a) "Sales relating to schools" means the following sales by, amounts paid to, or
2454 amounts charged by a school:
2455 (i) sales that are directly related to the school's educational functions or activities
2456 including:
2457 (A) the sale of:
2458 (I) textbooks;
2459 (II) textbook fees;
2460 (III) laboratory fees;
2461 (IV) laboratory supplies; or
2462 (V) safety equipment;
2463 (B) the sale of a uniform, protective equipment, or sports or recreational equipment
2464 that:
2465 (I) a student is specifically required to wear as a condition of participation in a
2466 school-related event or school-related activity; and
2467 (II) is not readily adaptable to general or continued usage to the extent that it takes the
2468 place of ordinary clothing;
2469 (C) sales of the following if the net or gross revenues generated by the sales are
2470 deposited into a school district fund or school fund dedicated to school meals:
2471 (I) food and food ingredients; or
2472 (II) prepared food; or
2473 (D) transportation charges for official school activities; or
2474 (ii) amounts paid to or amounts charged by a school for admission to a school-related
2475 event or school-related activity.
2476 (b) "Sales relating to schools" does not include:
2477 (i) bookstore sales of items that are not educational materials or supplies;
2478 (ii) except as provided in Subsection (119)(a)(i)(B):
2479 (A) clothing;
2480 (B) clothing accessories or equipment;
2481 (C) protective equipment; or
2482 (D) sports or recreational equipment; or
2483 (iii) amounts paid to or amounts charged by a school for admission to a school-related
2484 event or school-related activity if the amounts paid or charged are passed through to a person:
2485 (A) other than a:
2486 (I) school;
2487 (II) nonprofit organization authorized by a school board or a governing body of a
2488 private school to organize and direct a competitive secondary school activity; or
2489 (III) nonprofit association authorized by a school board or a governing body of a
2490 private school to organize and direct a competitive secondary school activity; and
2491 (B) that is required to collect sales and use taxes under this chapter.
2492 (c) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
2493 commission may make rules defining the term "passed through."
2494 (120) For purposes of this section and Section 59-12-104, "school" means:
2495 (a) an elementary school or a secondary school that:
2496 (i) is a:
2497 (A) public school; or
2498 (B) private school; and
2499 (ii) provides instruction for one or more grades kindergarten through 12; or
2500 (b) a public school district.
2501 (121) (a) "Seller" means a person that makes a sale, lease, or rental of:
2502 (i) tangible personal property;
2503 (ii) a product transferred electronically; or
2504 (iii) a service.
2505 (b) "Seller" includes a marketplace facilitator.
2506 (122) (a) "Semiconductor fabricating, processing, research, or development materials"
2507 means tangible personal property or a product transferred electronically if the tangible personal
2508 property or product transferred electronically is:
2509 (i) used primarily in the process of:
2510 (A) (I) manufacturing a semiconductor;
2511 (II) fabricating a semiconductor; or
2512 (III) research or development of a:
2513 (Aa) semiconductor; or
2514 (Bb) semiconductor manufacturing process; or
2515 (B) maintaining an environment suitable for a semiconductor; or
2516 (ii) consumed primarily in the process of:
2517 (A) (I) manufacturing a semiconductor;
2518 (II) fabricating a semiconductor; or
2519 (III) research or development of a:
2520 (Aa) semiconductor; or
2521 (Bb) semiconductor manufacturing process; or
2522 (B) maintaining an environment suitable for a semiconductor.
2523 (b) "Semiconductor fabricating, processing, research, or development materials"
2524 includes:
2525 (i) parts used in the repairs or renovations of tangible personal property or a product
2526 transferred electronically described in Subsection (122)(a); or
2527 (ii) a chemical, catalyst, or other material used to:
2528 (A) produce or induce in a semiconductor a:
2529 (I) chemical change; or
2530 (II) physical change;
2531 (B) remove impurities from a semiconductor; or
2532 (C) improve the marketable condition of a semiconductor.
2533 (123) "Senior citizen center" means a facility having the primary purpose of providing
2534 services to the aged as defined in Section 62A-3-101.
2535 (124) (a) [
2536 consumable" means tangible personal property that:
2537 (i) a business that provides accommodations and services described in Subsection
2538 59-12-103(1)(i) purchases as part of a transaction to provide the accommodations and services
2539 to a purchaser;
2540 (ii) is intended to be consumed by the purchaser; and
2541 (iii) is:
2542 (A) included in the purchase price of the accommodations and services; and
2543 (B) not separately stated on an invoice, bill of sale, or other similar document provided
2544 to the purchaser.
2545 (b) "Short-term lodging consumable" includes:
2546 (i) a beverage;
2547 (ii) a brush or comb;
2548 (iii) a cosmetic;
2549 (iv) a hair care product;
2550 (v) lotion;
2551 (vi) a magazine;
2552 (vii) makeup;
2553 (viii) a meal;
2554 (ix) mouthwash;
2555 (x) nail polish remover;
2556 (xi) a newspaper;
2557 (xii) a notepad;
2558 (xiii) a pen;
2559 (xiv) a pencil;
2560 (xv) a razor;
2561 (xvi) saline solution;
2562 (xvii) a sewing kit;
2563 (xviii) shaving cream;
2564 (xix) a shoe shine kit;
2565 (xx) a shower cap;
2566 (xxi) a snack item;
2567 (xxii) soap;
2568 (xxiii) toilet paper;
2569 (xxiv) a toothbrush;
2570 (xxv) toothpaste; or
2571 (xxvi) an item similar to Subsections (124)(b)(i) through (xxv) as the commission may
2572 provide by rule made in accordance with Title 63G, Chapter 3, Utah Administrative
2573 Rulemaking Act.
2574 (c) "Short-term lodging consumable" does not include:
2575 (i) tangible personal property that is cleaned or washed to allow the tangible personal
2576 property to be reused; or
2577 (ii) a product transferred electronically.
2578 (125) "Simplified electronic return" means the electronic return:
2579 (a) described in Section 318(C) of the agreement; and
2580 (b) approved by the governing board of the agreement.
2581 (126) "Solar energy" means the sun used as the sole source of energy for producing
2582 electricity.
2583 (127) (a) "Sports or recreational equipment" means an item:
2584 (i) designed for human use; and
2585 (ii) that is:
2586 (A) worn in conjunction with:
2587 (I) an athletic activity; or
2588 (II) a recreational activity; and
2589 (B) not suitable for general use.
2590 (b) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
2591 commission shall make rules:
2592 (i) listing the items that constitute "sports or recreational equipment"; and
2593 (ii) that are consistent with the list of items that constitute "sports or recreational
2594 equipment" under the agreement.
2595 (128) "State" means the state of Utah, its departments, and agencies.
2596 (129) "Storage" means any keeping or retention of tangible personal property or any
2597 other taxable transaction under Subsection 59-12-103(1), in this state for any purpose except
2598 sale in the regular course of business.
2599 (130) (a) [
2600 personal property" means personal property that:
2601 (i) may be:
2602 (A) seen;
2603 (B) weighed;
2604 (C) measured;
2605 (D) felt; or
2606 (E) touched; or
2607 (ii) is in any manner perceptible to the senses.
2608 (b) "Tangible personal property" includes:
2609 (i) electricity;
2610 (ii) water;
2611 (iii) gas;
2612 (iv) steam; or
2613 (v) prewritten computer software, regardless of the manner in which the prewritten
2614 computer software is transferred.
2615 (c) "Tangible personal property" includes the following regardless of whether the item
2616 is attached to real property:
2617 (i) a dishwasher;
2618 (ii) a dryer;
2619 (iii) a freezer;
2620 (iv) a microwave;
2621 (v) a refrigerator;
2622 (vi) a stove;
2623 (vii) a washer; or
2624 (viii) an item similar to Subsections (130)(c)(i) through (vii) as determined by the
2625 commission by rule made in accordance with Title 63G, Chapter 3, Utah Administrative
2626 Rulemaking Act.
2627 (d) "Tangible personal property" does not include a product that is transferred
2628 electronically.
2629 (e) "Tangible personal property" does not include the following if attached to real
2630 property, regardless of whether the attachment to real property is only through a line that
2631 supplies water, electricity, gas, telephone, cable, or supplies a similar item as determined by the
2632 commission by rule made in accordance with Title 63G, Chapter 3, Utah Administrative
2633 Rulemaking Act:
2634 (i) a hot water heater;
2635 (ii) a water filtration system; or
2636 (iii) a water softener system.
2637 (131) (a) "Telecommunications enabling or facilitating equipment, machinery, or
2638 software" means an item listed in Subsection (131)(b) if that item is purchased or leased
2639 primarily to enable or facilitate one or more of the following to function:
2640 (i) telecommunications switching or routing equipment, machinery, or software; or
2641 (ii) telecommunications transmission equipment, machinery, or software.
2642 (b) The following apply to Subsection (131)(a):
2643 (i) a pole;
2644 (ii) software;
2645 (iii) a supplementary power supply;
2646 (iv) temperature or environmental equipment or machinery;
2647 (v) test equipment;
2648 (vi) a tower; or
2649 (vii) equipment, machinery, or software that functions similarly to an item listed in
2650 Subsections (131)(b)(i) through (vi) as determined by the commission by rule made in
2651 accordance with Subsection (131)(c).
2652 (c) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
2653 commission may by rule define what constitutes equipment, machinery, or software that
2654 functions similarly to an item listed in Subsections (131)(b)(i) through (vi).
2655 (132) "Telecommunications equipment, machinery, or software required for 911
2656 service" means equipment, machinery, or software that is required to comply with 47 C.F.R.
2657 Sec. 20.18.
2658 (133) "Telecommunications maintenance or repair equipment, machinery, or software"
2659 means equipment, machinery, or software purchased or leased primarily to maintain or repair
2660 one or more of the following, regardless of whether the equipment, machinery, or software is
2661 purchased or leased as a spare part or as an upgrade or modification to one or more of the
2662 following:
2663 (a) telecommunications enabling or facilitating equipment, machinery, or software;
2664 (b) telecommunications switching or routing equipment, machinery, or software; or
2665 (c) telecommunications transmission equipment, machinery, or software.
2666 (134) (a) "Telecommunications service" means the electronic conveyance, routing, or
2667 transmission of audio, data, video, voice, or any other information or signal to a point, or
2668 among or between points.
2669 (b) "Telecommunications service" includes:
2670 (i) an electronic conveyance, routing, or transmission with respect to which a computer
2671 processing application is used to act:
2672 (A) on the code, form, or protocol of the content;
2673 (B) for the purpose of electronic conveyance, routing, or transmission; and
2674 (C) regardless of whether the service:
2675 (I) is referred to as voice over Internet protocol service; or
2676 (II) is classified by the Federal Communications Commission as enhanced or value
2677 added;
2678 (ii) an 800 service;
2679 (iii) a 900 service;
2680 (iv) a fixed wireless service;
2681 (v) a mobile wireless service;
2682 (vi) a postpaid calling service;
2683 (vii) a prepaid calling service;
2684 (viii) a prepaid wireless calling service; or
2685 (ix) a private communications service.
2686 (c) "Telecommunications service" does not include:
2687 (i) advertising, including directory advertising;
2688 (ii) an ancillary service;
2689 (iii) a billing and collection service provided to a third party;
2690 (iv) a data processing and information service if:
2691 (A) the data processing and information service allows data to be:
2692 (I) (Aa) acquired;
2693 (Bb) generated;
2694 (Cc) processed;
2695 (Dd) retrieved; or
2696 (Ee) stored; and
2697 (II) delivered by an electronic transmission to a purchaser; and
2698 (B) the purchaser's primary purpose for the underlying transaction is the processed data
2699 or information;
2700 (v) installation or maintenance of the following on a customer's premises:
2701 (A) equipment; or
2702 (B) wiring;
2703 (vi) Internet access service;
2704 (vii) a paging service;
2705 (viii) a product transferred electronically, including:
2706 (A) music;
2707 (B) reading material;
2708 (C) a ring tone;
2709 (D) software; or
2710 (E) video;
2711 (ix) a radio and television audio and video programming service:
2712 (A) regardless of the medium; and
2713 (B) including:
2714 (I) furnishing conveyance, routing, or transmission of a television audio and video
2715 programming service by a programming service provider;
2716 (II) cable service as defined in 47 U.S.C. Sec. 522(6); or
2717 (III) audio and video programming services delivered by a commercial mobile radio
2718 service provider as defined in 47 C.F.R. Sec. 20.3;
2719 (x) a value-added nonvoice data service; or
2720 (xi) tangible personal property.
2721 (135) (a) "Telecommunications service provider" means a person that:
2722 (i) owns, controls, operates, or manages a telecommunications service; and
2723 (ii) engages in an activity described in Subsection (135)(a)(i) for the shared use with or
2724 resale to any person of the telecommunications service.
2725 (b) A person described in Subsection (135)(a) is a telecommunications service provider
2726 whether or not the Public Service Commission of Utah regulates:
2727 (i) that person; or
2728 (ii) the telecommunications service that the person owns, controls, operates, or
2729 manages.
2730 (136) (a) "Telecommunications switching or routing equipment, machinery, or
2731 software" means an item listed in Subsection (136)(b) if that item is purchased or leased
2732 primarily for switching or routing:
2733 (i) an ancillary service;
2734 (ii) data communications;
2735 (iii) voice communications; or
2736 (iv) telecommunications service.
2737 (b) The following apply to Subsection (136)(a):
2738 (i) a bridge;
2739 (ii) a computer;
2740 (iii) a cross connect;
2741 (iv) a modem;
2742 (v) a multiplexer;
2743 (vi) plug in circuitry;
2744 (vii) a router;
2745 (viii) software;
2746 (ix) a switch; or
2747 (x) equipment, machinery, or software that functions similarly to an item listed in
2748 Subsections (136)(b)(i) through (ix) as determined by the commission by rule made in
2749 accordance with Subsection (136)(c).
2750 (c) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
2751 commission may by rule define what constitutes equipment, machinery, or software that
2752 functions similarly to an item listed in Subsections (136)(b)(i) through (ix).
2753 (137) (a) "Telecommunications transmission equipment, machinery, or software"
2754 means an item listed in Subsection (137)(b) if that item is purchased or leased primarily for
2755 sending, receiving, or transporting:
2756 (i) an ancillary service;
2757 (ii) data communications;
2758 (iii) voice communications; or
2759 (iv) telecommunications service.
2760 (b) The following apply to Subsection (137)(a):
2761 (i) an amplifier;
2762 (ii) a cable;
2763 (iii) a closure;
2764 (iv) a conduit;
2765 (v) a controller;
2766 (vi) a duplexer;
2767 (vii) a filter;
2768 (viii) an input device;
2769 (ix) an input/output device;
2770 (x) an insulator;
2771 (xi) microwave machinery or equipment;
2772 (xii) an oscillator;
2773 (xiii) an output device;
2774 (xiv) a pedestal;
2775 (xv) a power converter;
2776 (xvi) a power supply;
2777 (xvii) a radio channel;
2778 (xviii) a radio receiver;
2779 (xix) a radio transmitter;
2780 (xx) a repeater;
2781 (xxi) software;
2782 (xxii) a terminal;
2783 (xxiii) a timing unit;
2784 (xxiv) a transformer;
2785 (xxv) a wire; or
2786 (xxvi) equipment, machinery, or software that functions similarly to an item listed in
2787 Subsections (137)(b)(i) through (xxv) as determined by the commission by rule made in
2788 accordance with Subsection (137)(c).
2789 (c) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
2790 commission may by rule define what constitutes equipment, machinery, or software that
2791 functions similarly to an item listed in Subsections (137)(b)(i) through (xxv).
2792 (138) (a) "Textbook for a higher education course" means a textbook or other printed
2793 material that is required for a course:
2794 (i) offered by an institution of higher education; and
2795 (ii) that the purchaser of the textbook or other printed material attends or will attend.
2796 (b) "Textbook for a higher education course" includes a textbook in electronic format.
2797 (139) "Tobacco" means:
2798 (a) a cigarette;
2799 (b) a cigar;
2800 (c) chewing tobacco;
2801 (d) pipe tobacco; or
2802 (e) any other item that contains tobacco.
2803 (140) "Unassisted amusement device" means an amusement device, skill device, or
2804 ride device that is started and stopped by the purchaser or renter of the right to use or operate
2805 the amusement device, skill device, or ride device.
2806 (141) (a) "Use" means the exercise of any right or power over tangible personal
2807 property, a product transferred electronically, or a service under Subsection 59-12-103(1),
2808 incident to the ownership or the leasing of that tangible personal property, product transferred
2809 electronically, or service.
2810 (b) "Use" does not include the sale, display, demonstration, or trial of tangible personal
2811 property, a product transferred electronically, or a service in the regular course of business and
2812 held for resale.
2813 (142) "Value-added nonvoice data service" means a service:
2814 (a) that otherwise meets the definition of a telecommunications service except that a
2815 computer processing application is used to act primarily for a purpose other than conveyance,
2816 routing, or transmission; and
2817 (b) with respect to which a computer processing application is used to act on data or
2818 information:
2819 (i) code;
2820 (ii) content;
2821 (iii) form; or
2822 (iv) protocol.
2823 (143) (a) Subject to Subsection (143)(b), "vehicle" means the following that are
2824 required to be titled, registered, or titled and registered:
2825 (i) an aircraft as defined in Section 72-10-102;
2826 (ii) a vehicle as defined in Section 41-1a-102;
2827 (iii) an off-highway vehicle as defined in Section 41-22-2; or
2828 (iv) a vessel as defined in Section 41-1a-102.
2829 (b) For purposes of Subsection 59-12-104(33) only, "vehicle" includes:
2830 (i) a vehicle described in Subsection (143)(a); or
2831 (ii) (A) a locomotive;
2832 (B) a freight car;
2833 (C) railroad work equipment; or
2834 (D) other railroad rolling stock.
2835 (144) "Vehicle dealer" means a person engaged in the business of buying, selling, or
2836 exchanging a vehicle as defined in Subsection (143).
2837 (145) (a) "Vertical service" means an ancillary service that:
2838 (i) is offered in connection with one or more telecommunications services; and
2839 (ii) offers an advanced calling feature that allows a customer to:
2840 (A) identify a caller; and
2841 (B) manage multiple calls and call connections.
2842 (b) "Vertical service" includes an ancillary service that allows a customer to manage a
2843 conference bridging service.
2844 (146) (a) "Voice mail service" means an ancillary service that enables a customer to
2845 receive, send, or store a recorded message.
2846 (b) "Voice mail service" does not include a vertical service that a customer is required
2847 to have in order to utilize a voice mail service.
2848 (147) (a) [
2849 means a facility that generates electricity:
2850 (i) using as the primary source of energy waste materials that would be placed in a
2851 landfill or refuse pit if it were not used to generate electricity, including:
2852 (A) tires;
2853 (B) waste coal;
2854 (C) oil shale; or
2855 (D) municipal solid waste; and
2856 (ii) in amounts greater than actually required for the operation of the facility.
2857 (b) "Waste energy facility" does not include a facility that incinerates:
2858 (i) hospital waste as defined in 40 C.F.R. 60.51c; or
2859 (ii) medical/infectious waste as defined in 40 C.F.R. 60.51c.
2860 (148) "Watercraft" means a vessel as defined in Section 73-18-2.
2861 (149) "Wind energy" means wind used as the sole source of energy to produce
2862 electricity.
2863 (150) "ZIP Code" means a Zoning Improvement Plan Code assigned to a geographic
2864 location by the United States Postal Service.
2865 Section 11. Section 59-12-103 is amended to read:
2866 59-12-103. Sales and use tax base -- Rates -- Effective dates -- Use of sales and use
2867 tax revenue.
2868 (1) A tax is imposed on the purchaser as provided in this part on the purchase price or
2869 sales price for amounts paid or charged for the following transactions:
2870 (a) retail sales of tangible personal property made within the state;
2871 (b) amounts paid for:
2872 (i) telecommunications service, other than mobile telecommunications service, that
2873 originates and terminates within the boundaries of this state;
2874 (ii) mobile telecommunications service that originates and terminates within the
2875 boundaries of one state only to the extent permitted by the Mobile Telecommunications
2876 Sourcing Act, 4 U.S.C. Sec. 116 et seq.; or
2877 (iii) an ancillary service associated with a:
2878 (A) telecommunications service described in Subsection (1)(b)(i); or
2879 (B) mobile telecommunications service described in Subsection (1)(b)(ii);
2880 (c) sales of the following for commercial use:
2881 (i) gas;
2882 (ii) electricity;
2883 (iii) heat;
2884 (iv) coal;
2885 (v) fuel oil; [
2886 (vi) hydrogen; or
2887 [
2888 (d) sales of the following for residential use:
2889 (i) gas;
2890 (ii) electricity;
2891 (iii) heat;
2892 (iv) coal;
2893 (v) fuel oil; [
2894 (vi) hydrogen; or
2895 [
2896 (e) sales of prepared food;
2897 (f) except as provided in Section 59-12-104, amounts paid or charged as admission or
2898 user fees for theaters, movies, operas, museums, planetariums, shows of any type or nature,
2899 exhibitions, concerts, carnivals, amusement parks, amusement rides, circuses, menageries,
2900 fairs, races, contests, sporting events, dances, boxing matches, wrestling matches, closed circuit
2901 television broadcasts, billiard parlors, pool parlors, bowling lanes, golf, miniature golf, golf
2902 driving ranges, batting cages, skating rinks, ski lifts, ski runs, ski trails, snowmobile trails,
2903 tennis courts, swimming pools, water slides, river runs, jeep tours, boat tours, scenic cruises,
2904 horseback rides, sports activities, or any other amusement, entertainment, recreation,
2905 exhibition, cultural, or athletic activity;
2906 (g) amounts paid or charged for services for repairs or renovations of tangible personal
2907 property, unless Section 59-12-104 provides for an exemption from sales and use tax for:
2908 (i) the tangible personal property; and
2909 (ii) parts used in the repairs or renovations of the tangible personal property described
2910 in Subsection (1)(g)(i), regardless of whether:
2911 (A) any parts are actually used in the repairs or renovations of that tangible personal
2912 property; or
2913 (B) the particular parts used in the repairs or renovations of that tangible personal
2914 property are exempt from a tax under this chapter;
2915 (h) except as provided in Subsection 59-12-104(7), amounts paid or charged for
2916 assisted cleaning or washing of tangible personal property;
2917 (i) amounts paid or charged for tourist home, hotel, motel, or trailer court
2918 accommodations and services that are regularly rented for less than 30 consecutive days;
2919 (j) amounts paid or charged for laundry or dry cleaning services;
2920 (k) amounts paid or charged for leases or rentals of tangible personal property if within
2921 this state the tangible personal property is:
2922 (i) stored;
2923 (ii) used; or
2924 (iii) otherwise consumed;
2925 (l) amounts paid or charged for tangible personal property if within this state the
2926 tangible personal property is:
2927 (i) stored;
2928 (ii) used; or
2929 (iii) consumed; and
2930 (m) amounts paid or charged for a sale:
2931 (i) (A) of a product transferred electronically; or
2932 (B) of a repair or renovation of a product transferred electronically; and
2933 (ii) regardless of whether the sale provides:
2934 (A) a right of permanent use of the product; or
2935 (B) a right to use the product that is less than a permanent use, including a right:
2936 (I) for a definite or specified length of time; and
2937 (II) that terminates upon the occurrence of a condition.
2938 (2) (a) Except as provided in Subsections (2)(b) through (e), a state tax and a local tax
2939 are imposed on a transaction described in Subsection (1) equal to the sum of:
2940 (i) a state tax imposed on the transaction at a tax rate equal to the sum of:
2941 (A) (I) through March 31, 2019, 4.70%; and
2942 (II) beginning on April 1, 2019, 4.70% plus the rate specified in Subsection (13)(a);
2943 and
2944 (B) (I) the tax rate the state imposes in accordance with Part 18, Additional State Sales
2945 and Use Tax Act, if the location of the transaction as determined under Sections 59-12-211
2946 through 59-12-215 is in a county in which the state imposes the tax under Part 18, Additional
2947 State Sales and Use Tax Act; and
2948 (II) the tax rate the state imposes in accordance with Part 20, Supplemental State Sales
2949 and Use Tax Act, if the location of the transaction as determined under Sections 59-12-211
2950 through 59-12-215 is in a city, town, or the unincorporated area of a county in which the state
2951 imposes the tax under Part 20, Supplemental State Sales and Use Tax Act; and
2952 (ii) a local tax equal to the sum of the tax rates a county, city, or town imposes on the
2953 transaction under this chapter other than this part.
2954 (b) Except as provided in Subsection (2)(d) or (e) and subject to Subsection (2)(j), a
2955 state tax and a local tax are imposed on a transaction described in Subsection (1)(d) equal to
2956 the sum of:
2957 (i) a state tax imposed on the transaction at a tax rate of 2%; and
2958 (ii) a local tax equal to the sum of the tax rates a county, city, or town imposes on the
2959 transaction under this chapter other than this part.
2960 (c) Except as provided in Subsection (2)(d) or (e), a state tax and a local tax are
2961 imposed on amounts paid or charged for food and food ingredients equal to the sum of:
2962 (i) a state tax imposed on the amounts paid or charged for food and food ingredients at
2963 a tax rate of 1.75%; and
2964 (ii) a local tax equal to the sum of the tax rates a county, city, or town imposes on the
2965 amounts paid or charged for food and food ingredients under this chapter other than this part.
2966 (d) (i) For a bundled transaction that is attributable to food and food ingredients and
2967 tangible personal property other than food and food ingredients, a state tax and a local tax is
2968 imposed on the entire bundled transaction equal to the sum of:
2969 (A) a state tax imposed on the entire bundled transaction equal to the sum of:
2970 (I) the tax rate described in Subsection (2)(a)(i)(A); and
2971 (II) (Aa) the tax rate the state imposes in accordance with Part 18, Additional State
2972 Sales and Use Tax Act, if the location of the transaction as determined under Sections
2973 59-12-211 through 59-12-215 is in a county in which the state imposes the tax under Part 18,
2974 Additional State Sales and Use Tax Act; and
2975 (Bb) the tax rate the state imposes in accordance with Part 20, Supplemental State
2976 Sales and Use Tax Act, if the location of the transaction as determined under Sections
2977 59-12-211 through 59-12-215 is in a city, town, or the unincorporated area of a county in which
2978 the state imposes the tax under Part 20, Supplemental State Sales and Use Tax Act; and
2979 (B) a local tax imposed on the entire bundled transaction at the sum of the tax rates
2980 described in Subsection (2)(a)(ii).
2981 (ii) If an optional computer software maintenance contract is a bundled transaction that
2982 consists of taxable and nontaxable products that are not separately itemized on an invoice or
2983 similar billing document, the purchase of the optional computer software maintenance contract
2984 is 40% taxable under this chapter and 60% nontaxable under this chapter.
2985 (iii) Subject to Subsection (2)(d)(iv), for a bundled transaction other than a bundled
2986 transaction described in Subsection (2)(d)(i) or (ii):
2987 (A) if the sales price of the bundled transaction is attributable to tangible personal
2988 property, a product, or a service that is subject to taxation under this chapter and tangible
2989 personal property, a product, or service that is not subject to taxation under this chapter, the
2990 entire bundled transaction is subject to taxation under this chapter unless:
2991 (I) the seller is able to identify by reasonable and verifiable standards the tangible
2992 personal property, product, or service that is not subject to taxation under this chapter from the
2993 books and records the seller keeps in the seller's regular course of business; or
2994 (II) state or federal law provides otherwise; or
2995 (B) if the sales price of a bundled transaction is attributable to two or more items of
2996 tangible personal property, products, or services that are subject to taxation under this chapter
2997 at different rates, the entire bundled transaction is subject to taxation under this chapter at the
2998 higher tax rate unless:
2999 (I) the seller is able to identify by reasonable and verifiable standards the tangible
3000 personal property, product, or service that is subject to taxation under this chapter at the lower
3001 tax rate from the books and records the seller keeps in the seller's regular course of business; or
3002 (II) state or federal law provides otherwise.
3003 (iv) For purposes of Subsection (2)(d)(iii), books and records that a seller keeps in the
3004 seller's regular course of business includes books and records the seller keeps in the regular
3005 course of business for nontax purposes.
3006 (e) (i) Except as otherwise provided in this chapter and subject to Subsections (2)(e)(ii)
3007 and (iii), if a transaction consists of the sale, lease, or rental of tangible personal property, a
3008 product, or a service that is subject to taxation under this chapter, and the sale, lease, or rental
3009 of tangible personal property, other property, a product, or a service that is not subject to
3010 taxation under this chapter, the entire transaction is subject to taxation under this chapter unless
3011 the seller, at the time of the transaction:
3012 (A) separately states the portion of the transaction that is not subject to taxation under
3013 this chapter on an invoice, bill of sale, or similar document provided to the purchaser; or
3014 (B) is able to identify by reasonable and verifiable standards, from the books and
3015 records the seller keeps in the seller's regular course of business, the portion of the transaction
3016 that is not subject to taxation under this chapter.
3017 (ii) A purchaser and a seller may correct the taxability of a transaction if:
3018 (A) after the transaction occurs, the purchaser and the seller discover that the portion of
3019 the transaction that is not subject to taxation under this chapter was not separately stated on an
3020 invoice, bill of sale, or similar document provided to the purchaser because of an error or
3021 ignorance of the law; and
3022 (B) the seller is able to identify by reasonable and verifiable standards, from the books
3023 and records the seller keeps in the seller's regular course of business, the portion of the
3024 transaction that is not subject to taxation under this chapter.
3025 (iii) For purposes of Subsections (2)(e)(i) and (ii), books and records that a seller keeps
3026 in the seller's regular course of business includes books and records the seller keeps in the
3027 regular course of business for nontax purposes.
3028 (f) (i) If the sales price of a transaction is attributable to two or more items of tangible
3029 personal property, products, or services that are subject to taxation under this chapter at
3030 different rates, the entire purchase is subject to taxation under this chapter at the higher tax rate
3031 unless the seller, at the time of the transaction:
3032 (A) separately states the items subject to taxation under this chapter at each of the
3033 different rates on an invoice, bill of sale, or similar document provided to the purchaser; or
3034 (B) is able to identify by reasonable and verifiable standards the tangible personal
3035 property, product, or service that is subject to taxation under this chapter at the lower tax rate
3036 from the books and records the seller keeps in the seller's regular course of business.
3037 (ii) For purposes of Subsection (2)(f)(i), books and records that a seller keeps in the
3038 seller's regular course of business includes books and records the seller keeps in the regular
3039 course of business for nontax purposes.
3040 (g) Subject to Subsections (2)(h) and (i), a tax rate repeal or tax rate change for a tax
3041 rate imposed under the following shall take effect on the first day of a calendar quarter:
3042 (i) Subsection (2)(a)(i)(A);
3043 (ii) Subsection (2)(b)(i);
3044 (iii) Subsection (2)(c)(i); or
3045 (iv) Subsection (2)(d)(i)(A)(I).
3046 (h) (i) A tax rate increase takes effect on the first day of the first billing period that
3047 begins on or after the effective date of the tax rate increase if the billing period for the
3048 transaction begins before the effective date of a tax rate increase imposed under:
3049 (A) Subsection (2)(a)(i)(A);
3050 (B) Subsection (2)(b)(i);
3051 (C) Subsection (2)(c)(i); or
3052 (D) Subsection (2)(d)(i)(A)(I).
3053 (ii) The repeal of a tax or a tax rate decrease applies to a billing period if the billing
3054 statement for the billing period is rendered on or after the effective date of the repeal of the tax
3055 or the tax rate decrease imposed under:
3056 (A) Subsection (2)(a)(i)(A);
3057 (B) Subsection (2)(b)(i);
3058 (C) Subsection (2)(c)(i); or
3059 (D) Subsection (2)(d)(i)(A)(I).
3060 (i) (i) For a tax rate described in Subsection (2)(i)(ii), if a tax due on a catalogue sale is
3061 computed on the basis of sales and use tax rates published in the catalogue, a tax rate repeal or
3062 change in a tax rate takes effect:
3063 (A) on the first day of a calendar quarter; and
3064 (B) beginning 60 days after the effective date of the tax rate repeal or tax rate change.
3065 (ii) Subsection (2)(i)(i) applies to the tax rates described in the following:
3066 (A) Subsection (2)(a)(i)(A);
3067 (B) Subsection (2)(b)(i);
3068 (C) Subsection (2)(c)(i); or
3069 (D) Subsection (2)(d)(i)(A)(I).
3070 (iii) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act,
3071 the commission may by rule define the term "catalogue sale."
3072 (j) (i) For a location described in Subsection (2)(j)(ii), the commission shall determine
3073 the taxable status of a sale of gas, electricity, heat, coal, fuel oil, hydrogen, or other fuel based
3074 on the predominant use of the gas, electricity, heat, coal, fuel oil, hydrogen, or other fuel at the
3075 location.
3076 (ii) Subsection (2)(j)(i) applies to a location where gas, electricity, heat, coal, fuel oil,
3077 hydrogen, or other fuel is furnished through a single meter for two or more of the following
3078 uses:
3079 (A) a commercial use;
3080 (B) an industrial use; or
3081 (C) a residential use.
3082 (3) (a) The following state taxes shall be deposited into the General Fund:
3083 (i) the tax imposed by Subsection (2)(a)(i)(A);
3084 (ii) the tax imposed by Subsection (2)(b)(i);
3085 (iii) the tax imposed by Subsection (2)(c)(i); or
3086 (iv) the tax imposed by Subsection (2)(d)(i)(A)(I).
3087 (b) The following local taxes shall be distributed to a county, city, or town as provided
3088 in this chapter:
3089 (i) the tax imposed by Subsection (2)(a)(ii);
3090 (ii) the tax imposed by Subsection (2)(b)(ii);
3091 (iii) the tax imposed by Subsection (2)(c)(ii); and
3092 (iv) the tax imposed by Subsection (2)(d)(i)(B).
3093 (4) (a) Notwithstanding Subsection (3)(a), for a fiscal year beginning on or after July 1,
3094 2003, the lesser of the following amounts shall be expended as provided in Subsections (4)(b)
3095 through (g):
3096 (i) for taxes listed under Subsection (3)(a), the amount of tax revenue generated:
3097 (A) by a 1/16% tax rate on the transactions described in Subsection (1); and
3098 (B) for the fiscal year; or
3099 (ii) $17,500,000.
3100 (b) (i) For a fiscal year beginning on or after July 1, 2003, 14% of the amount
3101 described in Subsection (4)(a) shall be transferred each year as dedicated credits to the
3102 Department of Natural Resources to:
3103 (A) implement the measures described in Subsections 79-2-303(3)(a) through (d) to
3104 protect sensitive plant and animal species; or
3105 (B) award grants, up to the amount authorized by the Legislature in an appropriations
3106 act, to political subdivisions of the state to implement the measures described in Subsections
3107 79-2-303(3)(a) through (d) to protect sensitive plant and animal species.
3108 (ii) Money transferred to the Department of Natural Resources under Subsection
3109 (4)(b)(i) may not be used to assist the United States Fish and Wildlife Service or any other
3110 person to list or attempt to have listed a species as threatened or endangered under the
3111 Endangered Species Act of 1973, 16 U.S.C. Sec. 1531 et seq.
3112 (iii) At the end of each fiscal year:
3113 (A) 50% of any unexpended dedicated credits shall lapse to the Water Resources
3114 Conservation and Development Fund created in Section 73-10-24;
3115 (B) 25% of any unexpended dedicated credits shall lapse to the Utah Wastewater Loan
3116 Program Subaccount created in Section 73-10c-5; and
3117 (C) 25% of any unexpended dedicated credits shall lapse to the Drinking Water Loan
3118 Program Subaccount created in Section 73-10c-5.
3119 (c) For a fiscal year beginning on or after July 1, 2003, 3% of the amount described in
3120 Subsection (4)(a) shall be deposited each year [
3121 Fund created in Section 4-18-106.
3122 (d) (i) For a fiscal year beginning on or after July 1, 2003, 1% of the amount described
3123 in Subsection (4)(a) shall be transferred each year as dedicated credits to the Division of Water
3124 Rights to cover the costs incurred in hiring legal and technical staff for the adjudication of
3125 water rights.
3126 (ii) At the end of each fiscal year:
3127 (A) 50% of any unexpended dedicated credits shall lapse to the Water Resources
3128 Conservation and Development Fund created in Section 73-10-24;
3129 (B) 25% of any unexpended dedicated credits shall lapse to the Utah Wastewater Loan
3130 Program Subaccount created in Section 73-10c-5; and
3131 (C) 25% of any unexpended dedicated credits shall lapse to the Drinking Water Loan
3132 Program Subaccount created in Section 73-10c-5.
3133 (e) (i) For a fiscal year beginning on or after July 1, 2003, 41% of the amount described
3134 in Subsection (4)(a) shall be deposited into the Water Resources Conservation and
3135 Development Fund created in Section 73-10-24 for use by the Division of Water Resources.
3136 (ii) In addition to the uses allowed of the Water Resources Conservation and
3137 Development Fund under Section 73-10-24, the Water Resources Conservation and
3138 Development Fund may also be used to:
3139 (A) conduct hydrologic and geotechnical investigations by the Division of Water
3140 Resources in a cooperative effort with other state, federal, or local entities, for the purpose of
3141 quantifying surface and ground water resources and describing the hydrologic systems of an
3142 area in sufficient detail so as to enable local and state resource managers to plan for and
3143 accommodate growth in water use without jeopardizing the resource;
3144 (B) fund state required dam safety improvements; and
3145 (C) protect the state's interest in interstate water compact allocations, including the
3146 hiring of technical and legal staff.
3147 (f) For a fiscal year beginning on or after July 1, 2003, 20.5% of the amount described
3148 in Subsection (4)(a) shall be deposited into the Utah Wastewater Loan Program Subaccount
3149 created in Section 73-10c-5 for use by the Water Quality Board to fund wastewater projects.
3150 (g) For a fiscal year beginning on or after July 1, 2003, 20.5% of the amount described
3151 in Subsection (4)(a) shall be deposited into the Drinking Water Loan Program Subaccount
3152 created in Section 73-10c-5 for use by the Division of Drinking Water to:
3153 (i) provide for the installation and repair of collection, treatment, storage, and
3154 distribution facilities for any public water system, as defined in Section 19-4-102;
3155 (ii) develop underground sources of water, including springs and wells; and
3156 (iii) develop surface water sources.
3157 (5) (a) Notwithstanding Subsection (3)(a), for a fiscal year beginning on or after July 1,
3158 2006, the difference between the following amounts shall be expended as provided in this
3159 Subsection (5), if that difference is greater than $1:
3160 (i) for taxes listed under Subsection (3)(a), the amount of tax revenue generated for the
3161 fiscal year by a 1/16% tax rate on the transactions described in Subsection (1); and
3162 (ii) $17,500,000.
3163 (b) (i) The first $500,000 of the difference described in Subsection (5)(a) shall be:
3164 (A) transferred each fiscal year to the Department of Natural Resources as dedicated
3165 credits; and
3166 (B) expended by the Department of Natural Resources for watershed rehabilitation or
3167 restoration.
3168 (ii) At the end of each fiscal year, 100% of any unexpended dedicated credits described
3169 in Subsection (5)(b)(i) shall lapse to the Water Resources Conservation and Development Fund
3170 created in Section 73-10-24.
3171 (c) (i) After making the transfer required by Subsection (5)(b)(i), $150,000 of the
3172 remaining difference described in Subsection (5)(a) shall be:
3173 (A) transferred each fiscal year to the Division of Water Resources as dedicated
3174 credits; and
3175 (B) expended by the Division of Water Resources for cloud-seeding projects
3176 authorized by Title 73, Chapter 15, Modification of Weather.
3177 (ii) At the end of each fiscal year, 100% of any unexpended dedicated credits described
3178 in Subsection (5)(c)(i) shall lapse to the Water Resources Conservation and Development Fund
3179 created in Section 73-10-24.
3180 (d) After making the transfers required by Subsections (5)(b) and (c), 85% of the
3181 remaining difference described in Subsection (5)(a) shall be deposited into the Water
3182 Resources Conservation and Development Fund created in Section 73-10-24 for use by the
3183 Division of Water Resources for:
3184 (i) preconstruction costs:
3185 (A) as defined in Subsection 73-26-103(6) for projects authorized by Title 73, Chapter
3186 26, Bear River Development Act; and
3187 (B) as defined in Subsection 73-28-103(8) for the Lake Powell Pipeline project
3188 authorized by Title 73, Chapter 28, Lake Powell Pipeline Development Act;
3189 (ii) the cost of employing a civil engineer to oversee any project authorized by Title 73,
3190 Chapter 26, Bear River Development Act;
3191 (iii) the cost of employing a civil engineer to oversee the Lake Powell Pipeline project
3192 authorized by Title 73, Chapter 28, Lake Powell Pipeline Development Act; and
3193 (iv) other uses authorized under Sections 73-10-24, 73-10-25.1, and 73-10-30, and
3194 Subsection (4)(e)(ii) after funding the uses specified in Subsections (5)(d)(i) through (iii).
3195 (e) After making the transfers required by Subsections (5)(b) and (c) and subject to
3196 Subsection (5)(f), 15% of the remaining difference described in Subsection (5)(a) shall be
3197 transferred each year as dedicated credits to the Division of Water Rights to cover the costs
3198 incurred for employing additional technical staff for the administration of water rights.
3199 (f) At the end of each fiscal year, any unexpended dedicated credits described in
3200 Subsection (5)(e) over $150,000 lapse to the Water Resources Conservation and Development
3201 Fund created in Section 73-10-24.
3202 (6) Notwithstanding Subsection (3)(a) and for taxes listed under Subsection (3)(a), the
3203 amount of revenue generated by a 1/16% tax rate on the transactions described in Subsection
3204 (1) for the fiscal year shall be deposited as follows:
3205 (a) for fiscal year 2016-17 only, 100% of the revenue described in this Subsection (6)
3206 shall be deposited into the Transportation Investment Fund of 2005 created by Section
3207 72-2-124;
3208 (b) for fiscal year 2017-18 only:
3209 (i) 80% of the revenue described in this Subsection (6) shall be deposited into the
3210 Transportation Investment Fund of 2005 created by Section 72-2-124; and
3211 (ii) 20% of the revenue described in this Subsection (6) shall be deposited into the
3212 Water Infrastructure Restricted Account created by Section 73-10g-103;
3213 (c) for fiscal year 2018-19 only:
3214 (i) 60% of the revenue described in this Subsection (6) shall be deposited into the
3215 Transportation Investment Fund of 2005 created by Section 72-2-124; and
3216 (ii) 40% of the revenue described in this Subsection (6) shall be deposited into the
3217 Water Infrastructure Restricted Account created by Section 73-10g-103;
3218 (d) for fiscal year 2019-20 only:
3219 (i) 40% of the revenue described in this Subsection (6) shall be deposited into the
3220 Transportation Investment Fund of 2005 created by Section 72-2-124; and
3221 (ii) 60% of the revenue described in this Subsection (6) shall be deposited into the
3222 Water Infrastructure Restricted Account created by Section 73-10g-103;
3223 (e) for fiscal year 2020-21 only:
3224 (i) 20% of the revenue described in this Subsection (6) shall be deposited into the
3225 Transportation Investment Fund of 2005 created by Section 72-2-124; and
3226 (ii) 80% of the revenue described in this Subsection (6) shall be deposited into the
3227 Water Infrastructure Restricted Account created by Section 73-10g-103; and
3228 (f) for a fiscal year beginning on or after July 1, 2021, 100% of the revenue described
3229 in this Subsection (6) shall be deposited into the Water Infrastructure Restricted Account
3230 created by Section 73-10g-103.
3231 (7) (a) Notwithstanding Subsection (3)(a), in addition to the amounts deposited in
3232 Subsection (6), and subject to Subsection (7)(b), for a fiscal year beginning on or after July 1,
3233 2012, the Division of Finance shall deposit into the Transportation Investment Fund of 2005
3234 created by Section 72-2-124:
3235 (i) a portion of the taxes listed under Subsection (3)(a) in an amount equal to 8.3% of
3236 the [
3237 approximately 17% of sales and use tax [
3238 use tax on vehicles and vehicle-related products:
3239 (A) the tax imposed by Subsection (2)(a)(i)(A) at a 4.7% rate;
3240 (B) the tax imposed by Subsection (2)(b)(i);
3241 (C) the tax imposed by Subsection (2)(c)(i); and
3242 (D) the tax imposed by Subsection (2)(d)(i)(A)(I); plus
3243 (ii) an amount equal to 30% of the growth in the amount of [
3244 collected in the current fiscal year from the sales and use taxes described in Subsections
3245 (7)(a)(i)(A) through (D) that exceeds the amount collected from the sales and use taxes
3246 described in Subsections (7)(a)(i)(A) through (D) in the 2010-11 fiscal year.
3247 (b) (i) Subject to Subsections (7)(b)(ii) and (iii), in any fiscal year that the portion of
3248 the sales and use taxes deposited under Subsection (7)(a) represents an amount that is a total
3249 lower percentage of the sales and use taxes described in Subsections (7)(a)(i)(A) through (D)
3250 generated in the current fiscal year than the total percentage of sales and use taxes deposited in
3251 the previous fiscal year, the Division of Finance shall deposit an amount under Subsection
3252 (7)(a) equal to the product of:
3253 (A) the total percentage of sales and use taxes deposited under Subsection (7)(a) in the
3254 previous fiscal year; and
3255 (B) the total sales and use tax revenue generated by the taxes described in Subsections
3256 (7)(a)(i)(A) through (D) in the current fiscal year.
3257 (ii) In any fiscal year in which the portion of the sales and use taxes deposited under
3258 Subsection (7)(a) would exceed 17% of the [
3259 taxes described in Subsections (7)(a)(i)(A) through (D) in the current fiscal year, the Division
3260 of Finance shall deposit 17% of the [
3261 described in Subsections (7)(a)(i)(A) through (D) for the current fiscal year under Subsection
3262 (7)(a).
3263 (iii) In all subsequent fiscal years after a year in which 17% of the [
3264 collected from the sales and use taxes described in Subsections (7)(a)(i)(A) through (D) was
3265 deposited under Subsection (7)(a), the Division of Finance shall annually deposit 17% of the
3266 [
3267 through (D) in the current fiscal year under Subsection (7)(a).
3268 (8) (a) Notwithstanding Subsection (3)(a), and in addition to the amounts deposited
3269 under Subsections (6) and (7), for the 2016-17 fiscal year only, the Division of Finance shall
3270 deposit $64,000,000 of the revenues generated by the taxes listed under Subsection (3)(a) into
3271 the Transportation Investment Fund of 2005 created by Section 72-2-124.
3272 (b) Notwithstanding Subsection (3)(a), and in addition to the amounts deposited under
3273 Subsections (6) and (7), for the 2017-18 fiscal year only, the Division of Finance shall deposit
3274 $63,000,000 of the revenues generated by the taxes listed under Subsection (3)(a) into the
3275 Transportation Investment Fund of 2005 created by Section 72-2-124.
3276 (c) (i) Notwithstanding Subsection (3)(a), in addition to the amounts deposited under
3277 Subsections (6) and (7), and subject to Subsection (8)(c)(ii), for a fiscal year beginning on or
3278 after July 1, 2018, the commission shall annually deposit into the Transportation Investment
3279 Fund of 2005 created by Section 72-2-124 a portion of the taxes listed under Subsection (3)(a)
3280 in an amount equal to 3.68% of the [
3281 (A) the tax imposed by Subsection (2)(a)(i)(A) at a 4.7% rate;
3282 (B) the tax imposed by Subsection (2)(b)(i);
3283 (C) the tax imposed by Subsection (2)(c)(i); and
3284 (D) the tax imposed by Subsection (2)(d)(i)(A)(I).
3285 (ii) For a fiscal year beginning on or after July 1, 2019, the commission shall annually
3286 reduce the deposit into the Transportation Investment Fund of 2005 under Subsection (8)(c)(i)
3287 by an amount that is equal to 35% of the amount of revenue generated in the current fiscal year
3288 by the portion of the tax imposed on motor and special fuel that is sold, used, or received for
3289 sale or use in this state that exceeds 29.4 cents per gallon.
3290 (iii) The commission shall annually deposit the amount described in Subsection
3291 (8)(c)(ii) into the Transit and Transportation Investment Fund created in Section 72-2-124.
3292 (9) Notwithstanding Subsection (3)(a), for each fiscal year beginning with fiscal year
3293 2009-10, $533,750 shall be deposited into the Qualified Emergency Food Agencies Fund
3294 created by Section 35A-8-1009 and expended as provided in Section 35A-8-1009.
3295 (10) (a) Notwithstanding Subsection (3)(a), except as provided in Subsection (10)(c),
3296 in addition to any amounts deposited under Subsections (6), (7), and (8), and for the 2016-17
3297 fiscal year only, the Division of Finance shall deposit into the Transportation Investment Fund
3298 of 2005 created by Section 72-2-124 the amount of tax revenue generated by a .05% tax rate on
3299 the transactions described in Subsection (1).
3300 (b) Notwithstanding Subsection (3)(a), except as provided in Subsection (10)(c), and in
3301 addition to any amounts deposited under Subsections (6), (7), and (8), the Division of Finance
3302 shall deposit into the Transportation Investment Fund of 2005 created by Section 72-2-124 the
3303 amount of revenue described as follows:
3304 (i) for fiscal year 2017-18 only, 83.33% of the amount of revenue generated by a .05%
3305 tax rate on the transactions described in Subsection (1);
3306 (ii) for fiscal year 2018-19 only, 66.67% of the amount of revenue generated by a .05%
3307 tax rate on the transactions described in Subsection (1);
3308 (iii) for fiscal year 2019-20 only, 50% of the amount of revenue generated by a .05%
3309 tax rate on the transactions described in Subsection (1);
3310 (iv) for fiscal year 2020-21 only, 33.33% of the amount of revenue generated by a
3311 .05% tax rate on the transactions described in Subsection (1); and
3312 (v) for fiscal year 2021-22 only, 16.67% of the amount of revenue generated by a .05%
3313 tax rate on the transactions described in Subsection (1).
3314 (c) For purposes of Subsections (10)(a) and (b), the Division of Finance may not
3315 deposit into the Transportation Investment Fund of 2005 any tax revenue generated by amounts
3316 paid or charged for food and food ingredients, except for tax revenue generated by a bundled
3317 transaction attributable to food and food ingredients and tangible personal property other than
3318 food and food ingredients described in Subsection (2)(d).
3319 (11) Notwithstanding Subsection (3)(a), beginning the second fiscal year after the
3320 fiscal year during which the Division of Finance receives notice under Section 63N-2-510 that
3321 construction on a qualified hotel, as defined in Section 63N-2-502, has begun, the Division of
3322 Finance shall, for two consecutive fiscal years, annually deposit $1,900,000 of the revenue
3323 generated by the taxes listed under Subsection (3)(a) into the Hotel Impact Mitigation Fund,
3324 created in Section 63N-2-512.
3325 (12) (a) Notwithstanding Subsection (3)(a), for the 2016-17 fiscal year only, the
3326 Division of Finance shall deposit $26,000,000 of the revenues generated by the taxes listed
3327 under Subsection (3)(a) into the Throughput Infrastructure Fund created by Section 35A-8-308.
3328 (b) Notwithstanding Subsection (3)(a), for the 2017-18 fiscal year only, the Division of
3329 Finance shall deposit $27,000,000 of the revenues generated by the taxes listed under
3330 Subsection (3)(a) into the Throughput Infrastructure Fund created by Section 35A-8-308.
3331 (13) (a) The rate specified in this subsection is 0.15%.
3332 (b) Notwithstanding Subsection (3)(a), the Division of Finance shall[
3333
3334
3335
3336
3337 on or after July 1, 2019, annually transfer the amount of revenue collected from the rate
3338 described in Subsection (13)(a) on the transactions that are subject to the sales and use tax
3339 under Subsection (2)(a)(i)(A) into the Medicaid Expansion Fund created in Section
3340 26-36b-208.
3341 (14) Notwithstanding Subsection (3)(a), for each fiscal year beginning with fiscal year
3342 2020-21, the Division of Finance shall deposit $200,000 into the General Fund as a dedicated
3343 credit solely for use of the Search and Rescue Financial Assistance Program created in, and
3344 expended in accordance with, Title 53, Chapter 2a, Part 11, Search and Rescue Act.
3345 (15) (a) For each fiscal year beginning with fiscal year 2020-21, the Division of
3346 Finance shall annually transfer $1,813,400 of the revenue deposited into the Transportation
3347 Investment Fund of 2005 under Subsections (6) through (8) to the General Fund.
3348 (b) If the total revenue deposited into the Transportation Investment Fund of 2005
3349 under Subsections (6) through (8) is less than $1,813,400 for a fiscal year, the Division of
3350 Finance shall transfer the total revenue deposited into the Transportation Investment Fund of
3351 2005 under Subsections (6) through (8) during the fiscal year to the General Fund.
3352 Section 12. Section 63M-4-401 is amended to read:
3353 63M-4-401. Office of Energy Development -- Creation -- Director -- Purpose --
3354 Rulemaking regarding confidential information -- Fees.
3355 (1) There is created an Office of Energy Development.
3356 (2) (a) The governor's energy advisor shall serve as the director of the office or appoint
3357 a director of the office.
3358 (b) The director:
3359 (i) shall, if the governor's energy advisor appoints a director under Subsection (2)(a),
3360 report to the governor's energy advisor; and
3361 (ii) may appoint staff as funding within existing budgets allows.
3362 (c) The office may consolidate energy staff and functions existing in the state energy
3363 program.
3364 (3) The purposes of the office are to:
3365 (a) serve as the primary resource for advancing energy and mineral development in the
3366 state;
3367 (b) implement:
3368 (i) the state energy policy under Section 63M-4-301; and
3369 (ii) the governor's energy and mineral development goals and objectives;
3370 (c) advance energy education, outreach, and research, including the creation of
3371 elementary, higher education, and technical college energy education programs;
3372 (d) promote energy and mineral development workforce initiatives; and
3373 (e) support collaborative research initiatives targeted at Utah-specific energy and
3374 mineral development.
3375 (4) By following the procedures and requirements of Title 63J, Chapter 5, Federal
3376 Funds Procedures Act, the office may:
3377 (a) seek federal grants or loans;
3378 (b) seek to participate in federal programs; and
3379 (c) in accordance with applicable federal program guidelines, administer federally
3380 funded state energy programs.
3381 (5) The office shall perform the duties required by Sections 11-42a-106[
3382 59-5-102[
3383 and Part 6, High Cost Infrastructure Development Tax Credit Act.
3384 (6) (a) For purposes of administering this section, the office may make rules, by
3385 following the procedures and requirements of Title 63G, Chapter 3, Utah Administrative
3386 Rulemaking Act, to maintain as confidential, and not as a public record, information that the
3387 office receives from any source.
3388 (b) The office shall maintain information the office receives from any source at the
3389 level of confidentiality assigned by the source.
3390 (7) The office may charge application, filing, and processing fees in amounts
3391 determined by the office in accordance with Section 63J-1-504 as dedicated credits for
3392 performing office duties described in this part.
3393 Section 13. Section 63M-4-602 is amended to read:
3394 63M-4-602. Definitions.
3395 As used in this part:
3396 (1) "Applicant" means a person that conducts business in the state and that applies for a
3397 tax credit under this part.
3398 (2) "Fuel standard compliance project" means a project designed to retrofit a fuel
3399 refinery in order to make the refinery capable of producing fuel that complies with the United
3400 States Environmental Protection Agency's Tier 3 gasoline sulfur standard described in 40
3401 C.F.R. Sec. 79.54.
3402 (3) "High cost infrastructure project" means a project:
3403 (a) (i) that expands or creates new industrial, mining, manufacturing, or agriculture
3404 activity in the state, not including a retail business;
3405 (ii) that involves new investment of at least $50,000,000 in an existing industrial,
3406 mining, manufacturing, or agriculture entity, by the entity; or
3407 (iii) for the construction of a plant or other facility, including a fueling station, for the
3408 storage, production, or distribution of hydrogen fuel used for transportation, electricity
3409 generation, or industrial use;
3410 (b) that requires or is directly facilitated by infrastructure construction; and
3411 (c) for which the cost of infrastructure construction to the entity creating the project is
3412 greater than:
3413 (i) 10% of the total cost of the project; or
3414 (ii) $10,000,000.
3415 (4) "Infrastructure" means:
3416 (a) an energy delivery project as defined in Section 63H-2-102;
3417 (b) a railroad as defined in Section 54-2-1;
3418 (c) a fuel standard compliance project;
3419 (d) a road improvement project;
3420 (e) a water self-supply project;
3421 (f) a water removal system project;
3422 (g) a solution-mined subsurface salt cavern; or
3423 (h) a project that is designed to:
3424 (i) increase the capacity for water delivery to a water user in the state; [
3425 (ii) increase the capability of an existing water delivery system or related facility to
3426 deliver water to a water user in the state[
3427 (i) a hydrogen fuel production or distribution project.
3428 (5) (a) "Infrastructure cost-burdened entity" means an applicant that enters into an
3429 agreement with the office that qualifies the applicant to receive a tax credit as provided in this
3430 part.
3431 (b) "Infrastructure cost-burdened entity" includes a pass-through entity taxpayer, as
3432 defined in Section 59-10-1402, of a person described in Subsection (5)(a).
3433 (6) "Infrastructure-related revenue" means an amount of tax revenue, for an entity
3434 creating a high cost infrastructure project, in a taxable year, that is directly attributable to a high
3435 cost infrastructure project, under:
3436 (a) Title 59, Chapter 7, Corporate Franchise and Income Taxes;
3437 (b) Title 59, Chapter 10, Individual Income Tax Act; and
3438 (c) Title 59, Chapter 12, Sales and Use Tax Act.
3439 (7) "Office" means the Office of Energy Development created in Section 63M-4-401.
3440 (8) "Tax credit" means a tax credit under Section 59-7-619 or 59-10-1034.
3441 (9) "Tax credit certificate" means a certificate issued by the office to an infrastructure
3442 cost-burdened entity that:
3443 (a) lists the name of the infrastructure cost-burdened entity;
3444 (b) lists the infrastructure cost-burdened entity's taxpayer identification number;
3445 (c) lists, for a taxable year, the amount of the tax credit authorized for the infrastructure
3446 cost-burdened entity under this part; and
3447 (d) includes other information as determined by the office.
3448 Section 14. Repealer.
3449 This bill repeals:
3450 Section 59-7-614.7, Nonrefundable alternative energy development tax credit.
3451 Section 59-10-1029, Nonrefundable alternative energy development tax credit.
3452 Section 63M-4-501, Title.
3453 Section 63M-4-502, Definitions.
3454 Section 63M-4-503, Tax credits.
3455 Section 63M-4-504, Qualifications for tax credit -- Procedure.
3456 Section 63M-4-505, Report to the Legislature.
3457 Section 15. Effective date.
3458 (1) Except as provided in Subsections (2) and (3), this bill takes effect on July 1, 2021.
3459 (2) The changes to the following sections take effect on January 1, 2022:
3460 (a) Section 59-7-159;
3461 (b) Section 59-10-137;
3462 (c) Section 59-12-102; and
3463 (d) Section 59-12-103.
3464 (3) The changes to the following sections take effect for a taxable year beginning on or
3465 after January 1, 2022:
3466 (a) Section 59-7-614;
3467 (b) Section 59-7-614.7;
3468 (c) Section 59-7-626;
3469 (d) Section 59-10-1014;
3470 (e) Section 59-10-1029;
3471 (f) Section 59-10-1106;
3472 (g) Section 59-10-1113;
3473 (h) Section 63M-4-401;
3474 (i) Section 63M-4-501;
3475 (j) Section 63M-4-502;
3476 (k) Section 63M-4-503;
3477 (l) Section 63M-4-504;
3478 (m) Section 63M-4-505; and
3479 (n) Section 63M-4-602.