1     
FOOD SALES TAX MODIFICATIONS

2     
2022 GENERAL SESSION

3     
STATE OF UTAH

4     
Chief Sponsor: Judy Weeks Rohner

5     
Senate Sponsor: ____________

6     

7     LONG TITLE
8     General Description:
9          This bill reduces the tax imposed on amounts paid or charged for food and food
10     ingredients.
11     Highlighted Provisions:
12          This bill:
13          ▸     removes the state tax imposed on amounts paid or charged for food and food
14     ingredients; and
15          ▸     makes technical and conforming changes.
16     Money Appropriated in this Bill:
17          None
18     Other Special Clauses:
19          This bill provides a special effective date.
20     Utah Code Sections Affected:
21     AMENDS:
22          11-41-102, as last amended by Laws of Utah 2021, Chapter 367
23          59-12-102, as last amended by Laws of Utah 2021, Chapters 64, 367, 414 and last
24     amended by Coordination Clause, Laws of Utah 2021, Chapter 367
25          59-12-103, as last amended by Laws of Utah 2021, Chapters 367, 387, and 411
26          59-12-108, as last amended by Laws of Utah 2020, Chapters 294 and 407
27          63N-7-301, as last amended by Laws of Utah 2020, Chapter 154

28     

29     Be it enacted by the Legislature of the state of Utah:
30          Section 1. Section 11-41-102 is amended to read:
31          11-41-102. Definitions.
32          As used in this chapter:
33          (1) "Agreement" means an oral or written agreement between a:
34          (a) (i) county; or
35          (ii) municipality; and
36          (b) person.
37          (2) "Municipality" means a:
38          (a) city;
39          (b) town; or
40          (c) metro township.
41          (3) "Payment" includes:
42          (a) a payment;
43          (b) a rebate;
44          (c) a refund; or
45          (d) an amount similar to Subsections (3)(a) through (c).
46          (4) "Regional retail business" means a:
47          (a) retail business that occupies a floor area of more than 80,000 square feet;
48          (b) dealer as defined in Section 41-1a-102;
49          (c) retail shopping facility that has at least two anchor tenants if the total number of
50     anchor tenants in the shopping facility occupy a total floor area of more than 150,000 square
51     feet; or
52          (d) grocery store that occupies a floor area of more than 30,000 square feet.
53          (5) (a) "Sales and use tax" means a tax:
54          (i) imposed on transactions within a:
55          (A) county; or
56          (B) municipality; and
57          (ii) except as provided in Subsection (5)(b), authorized under Title 59, Chapter 12,
58     Sales and Use Tax Act.

59          (b) "Sales and use tax" does not include a tax authorized under:
60          (i) Subsection 59-12-103(2)(a)(i);
61          (ii) Subsection 59-12-103(2)(b)(i);
62          [(iii) Subsection 59-12-103(2)(c)(i);]
63          [(iv)] (iii) Subsection 59-12-103(2)(d);
64          [(v)] (iv) Subsection 59-12-103(2)(e)(i)(A);
65          [(vi)] (v) Section 59-12-301;
66          [(vii)] (vi) Section 59-12-352;
67          [(viii)] (vii) Section 59-12-353;
68          [(ix)] (viii) Section 59-12-603; or
69          [(x)] (ix) Section 59-12-1201.
70          (6) (a) "Sales and use tax incentive payment" means a payment of revenues:
71          (i) to a person;
72          (ii) by a:
73          (A) county; or
74          (B) municipality;
75          (iii) to induce the person to locate or relocate a regional retail business within the:
76          (A) county; or
77          (B) municipality; and
78          (iv) that are derived from a sales and use tax.
79          (b) "Sales and use tax incentive payment" does not include funding for public
80     infrastructure.
81          Section 2. Section 59-12-102 is amended to read:
82          59-12-102. Definitions.
83          As used in this chapter:
84          (1) "800 service" means a telecommunications service that:
85          (a) allows a caller to dial a toll-free number without incurring a charge for the call; and
86          (b) is typically marketed:
87          (i) under the name 800 toll-free calling;
88          (ii) under the name 855 toll-free calling;
89          (iii) under the name 866 toll-free calling;

90          (iv) under the name 877 toll-free calling;
91          (v) under the name 888 toll-free calling; or
92          (vi) under a name similar to Subsections (1)(b)(i) through (v) as designated by the
93     Federal Communications Commission.
94          (2) (a) "900 service" means an inbound toll telecommunications service that:
95          (i) a subscriber purchases;
96          (ii) allows a customer of the subscriber described in Subsection (2)(a)(i) to call in to
97     the subscriber's:
98          (A) prerecorded announcement; or
99          (B) live service; and
100          (iii) is typically marketed:
101          (A) under the name 900 service; or
102          (B) under a name similar to Subsection (2)(a)(iii)(A) as designated by the Federal
103     Communications Commission.
104          (b) "900 service" does not include a charge for:
105          (i) a collection service a seller of a telecommunications service provides to a
106     subscriber; or
107          (ii) the following a subscriber sells to the subscriber's customer:
108          (A) a product; or
109          (B) a service.
110          (3) (a) "Admission or user fees" includes season passes.
111          (b) "Admission or user fees" does not include:
112          (i) annual membership dues to private organizations; or
113          (ii) a lesson, including a lesson that involves as part of the lesson equipment or a
114     facility listed in Subsection 59-12-103(1)(f).
115          (4) "Affiliate" or "affiliated person" means a person that, with respect to another
116     person:
117          (a) has an ownership interest of more than 5%, whether direct or indirect, in that other
118     person; or
119          (b) is related to the other person because a third person, or a group of third persons who
120     are affiliated persons with respect to each other, holds an ownership interest of more than 5%,

121     whether direct or indirect, in the related persons.
122          (5) "Agreement" means the Streamlined Sales and Use Tax Agreement adopted on
123     November 12, 2002, including amendments made to the Streamlined Sales and Use Tax
124     Agreement after November 12, 2002.
125          (6) "Agreement combined tax rate" means the sum of the tax rates:
126          (a) listed under Subsection (7); and
127          (b) that are imposed within a local taxing jurisdiction.
128          (7) "Agreement sales and use tax" means a tax imposed under:
129          (a) Subsection 59-12-103(2)(a)(i)(A);
130          (b) Subsection 59-12-103(2)(b)(i);
131          [(c) Subsection 59-12-103(2)(c)(i);]
132          [(d)] (c) Subsection 59-12-103(2)(d);
133          [(e)] (d) Subsection 59-12-103(2)(e)(i)(A)(I);
134          [(f)] (e) Section 59-12-204;
135          [(g)] (f) Section 59-12-401;
136          [(h)] (g) Section 59-12-402;
137          [(i)] (h) Section 59-12-402.1;
138          [(j)] (i) Section 59-12-703;
139          [(k)] (j) Section 59-12-802;
140          [(l)] (k) Section 59-12-804;
141          [(m)] (l) Section 59-12-1102;
142          [(n)] (m) Section 59-12-1302;
143          [(o)] (n) Section 59-12-1402;
144          [(p)] (o) Section 59-12-1802;
145          [(q)] (p) Section 59-12-2003;
146          [(r)] (q) Section 59-12-2103;
147          [(s)] (r) Section 59-12-2213;
148          [(t)] (s) Section 59-12-2214;
149          [(u)] (t) Section 59-12-2215;
150          [(v)] (u) Section 59-12-2216;
151          [(w)] (v) Section 59-12-2217;

152          [(x)] (w) Section 59-12-2218;
153          [(y)] (x) Section 59-12-2219; or
154          [(z)] (y) Section 59-12-2220.
155          (8) "Aircraft" means the same as that term is defined in Section 72-10-102.
156          (9) "Aircraft maintenance, repair, and overhaul provider" means a business entity:
157          (a) except for:
158          (i) an airline as defined in Section 59-2-102; or
159          (ii) an affiliated group, as defined in Section 59-7-101, except that "affiliated group"
160     includes a corporation that is qualified to do business but is not otherwise doing business in the
161     state, of an airline; and
162          (b) that has the workers, expertise, and facilities to perform the following, regardless of
163     whether the business entity performs the following in this state:
164          (i) check, diagnose, overhaul, and repair:
165          (A) an onboard system of a fixed wing turbine powered aircraft; and
166          (B) the parts that comprise an onboard system of a fixed wing turbine powered aircraft;
167          (ii) assemble, change, dismantle, inspect, and test a fixed wing turbine powered aircraft
168     engine;
169          (iii) perform at least the following maintenance on a fixed wing turbine powered
170     aircraft:
171          (A) an inspection;
172          (B) a repair, including a structural repair or modification;
173          (C) changing landing gear; and
174          (D) addressing issues related to an aging fixed wing turbine powered aircraft;
175          (iv) completely remove the existing paint of a fixed wing turbine powered aircraft and
176     completely apply new paint to the fixed wing turbine powered aircraft; and
177          (v) refurbish the interior of a fixed wing turbine powered aircraft in a manner that
178     results in a change in the fixed wing turbine powered aircraft's certification requirements by the
179     authority that certifies the fixed wing turbine powered aircraft.
180          (10) "Alcoholic beverage" means a beverage that:
181          (a) is suitable for human consumption; and
182          (b) contains .5% or more alcohol by volume.

183          (11) "Alternative energy" means:
184          (a) biomass energy;
185          (b) geothermal energy;
186          (c) hydroelectric energy;
187          (d) solar energy;
188          (e) wind energy; or
189          (f) energy that is derived from:
190          (i) coal-to-liquids;
191          (ii) nuclear fuel;
192          (iii) oil-impregnated diatomaceous earth;
193          (iv) oil sands;
194          (v) oil shale;
195          (vi) petroleum coke; or
196          (vii) waste heat from:
197          (A) an industrial facility; or
198          (B) a power station in which an electric generator is driven through a process in which
199     water is heated, turns into steam, and spins a steam turbine.
200          (12) (a) Subject to Subsection (12)(b), "alternative energy electricity production
201     facility" means a facility that:
202          (i) uses alternative energy to produce electricity; and
203          (ii) has a production capacity of two megawatts or greater.
204          (b) A facility is an alternative energy electricity production facility regardless of
205     whether the facility is:
206          (i) connected to an electric grid; or
207          (ii) located on the premises of an electricity consumer.
208          (13) (a) "Ancillary service" means a service associated with, or incidental to, the
209     provision of telecommunications service.
210          (b) "Ancillary service" includes:
211          (i) a conference bridging service;
212          (ii) a detailed communications billing service;
213          (iii) directory assistance;

214          (iv) a vertical service; or
215          (v) a voice mail service.
216          (14) "Area agency on aging" means the same as that term is defined in Section
217     62A-3-101.
218          (15) "Assisted amusement device" means an amusement device, skill device, or ride
219     device that is started and stopped by an individual:
220          (a) who is not the purchaser or renter of the right to use or operate the amusement
221     device, skill device, or ride device; and
222          (b) at the direction of the seller of the right to use the amusement device, skill device,
223     or ride device.
224          (16) "Assisted cleaning or washing of tangible personal property" means cleaning or
225     washing of tangible personal property if the cleaning or washing labor is primarily performed
226     by an individual:
227          (a) who is not the purchaser of the cleaning or washing of the tangible personal
228     property; and
229          (b) at the direction of the seller of the cleaning or washing of the tangible personal
230     property.
231          (17) "Authorized carrier" means:
232          (a) in the case of vehicles operated over public highways, the holder of credentials
233     indicating that the vehicle is or will be operated pursuant to both the International Registration
234     Plan and the International Fuel Tax Agreement;
235          (b) in the case of aircraft, the holder of a Federal Aviation Administration operating
236     certificate or air carrier's operating certificate; or
237          (c) in the case of locomotives, freight cars, railroad work equipment, or other rolling
238     stock, a person who uses locomotives, freight cars, railroad work equipment, or other rolling
239     stock in more than one state.
240          (18) (a) Except as provided in Subsection (18)(b), "biomass energy" means any of the
241     following that is used as the primary source of energy to produce fuel or electricity:
242          (i) material from a plant or tree; or
243          (ii) other organic matter that is available on a renewable basis, including:
244          (A) slash and brush from forests and woodlands;

245          (B) animal waste;
246          (C) waste vegetable oil;
247          (D) methane or synthetic gas produced at a landfill, as a byproduct of the treatment of
248     wastewater residuals, or through the conversion of a waste material through a nonincineration,
249     thermal conversion process;
250          (E) aquatic plants; and
251          (F) agricultural products.
252          (b) "Biomass energy" does not include:
253          (i) black liquor; or
254          (ii) treated woods.
255          (19) (a) "Bundled transaction" means the sale of two or more items of tangible personal
256     property, products, or services if the tangible personal property, products, or services are:
257          (i) distinct and identifiable; and
258          (ii) sold for one nonitemized price.
259          (b) "Bundled transaction" does not include:
260          (i) the sale of tangible personal property if the sales price varies, or is negotiable, on
261     the basis of the selection by the purchaser of the items of tangible personal property included in
262     the transaction;
263          (ii) the sale of real property;
264          (iii) the sale of services to real property;
265          (iv) the retail sale of tangible personal property and a service if:
266          (A) the tangible personal property:
267          (I) is essential to the use of the service; and
268          (II) is provided exclusively in connection with the service; and
269          (B) the service is the true object of the transaction;
270          (v) the retail sale of two services if:
271          (A) one service is provided that is essential to the use or receipt of a second service;
272          (B) the first service is provided exclusively in connection with the second service; and
273          (C) the second service is the true object of the transaction;
274          (vi) a transaction that includes tangible personal property or a product subject to
275     taxation under this chapter and tangible personal property or a product that is not subject to

276     taxation under this chapter if the:
277          (A) seller's purchase price of the tangible personal property or product subject to
278     taxation under this chapter is de minimis; or
279          (B) seller's sales price of the tangible personal property or product subject to taxation
280     under this chapter is de minimis; and
281          (vii) the retail sale of tangible personal property that is not subject to taxation under
282     this chapter and tangible personal property that is subject to taxation under this chapter if:
283          (A) that retail sale includes:
284          (I) food and food ingredients;
285          (II) a drug;
286          (III) durable medical equipment;
287          (IV) mobility enhancing equipment;
288          (V) an over-the-counter drug;
289          (VI) a prosthetic device; or
290          (VII) a medical supply; and
291          (B) subject to Subsection (19)(f):
292          (I) the seller's purchase price of the tangible personal property subject to taxation under
293     this chapter is 50% or less of the seller's total purchase price of that retail sale; or
294          (II) the seller's sales price of the tangible personal property subject to taxation under
295     this chapter is 50% or less of the seller's total sales price of that retail sale.
296          (c) (i) For purposes of Subsection (19)(a)(i), tangible personal property, a product, or a
297     service that is distinct and identifiable does not include:
298          (A) packaging that:
299          (I) accompanies the sale of the tangible personal property, product, or service; and
300          (II) is incidental or immaterial to the sale of the tangible personal property, product, or
301     service;
302          (B) tangible personal property, a product, or a service provided free of charge with the
303     purchase of another item of tangible personal property, a product, or a service; or
304          (C) an item of tangible personal property, a product, or a service included in the
305     definition of "purchase price."
306          (ii) For purposes of Subsection (19)(c)(i)(B), an item of tangible personal property, a

307     product, or a service is provided free of charge with the purchase of another item of tangible
308     personal property, a product, or a service if the sales price of the purchased item of tangible
309     personal property, product, or service does not vary depending on the inclusion of the tangible
310     personal property, product, or service provided free of charge.
311          (d) (i) For purposes of Subsection (19)(a)(ii), property sold for one nonitemized price
312     does not include a price that is separately identified by tangible personal property, product, or
313     service on the following, regardless of whether the following is in paper format or electronic
314     format:
315          (A) a binding sales document; or
316          (B) another supporting sales-related document that is available to a purchaser.
317          (ii) For purposes of Subsection (19)(d)(i), a binding sales document or another
318     supporting sales-related document that is available to a purchaser includes:
319          (A) a bill of sale;
320          (B) a contract;
321          (C) an invoice;
322          (D) a lease agreement;
323          (E) a periodic notice of rates and services;
324          (F) a price list;
325          (G) a rate card;
326          (H) a receipt; or
327          (I) a service agreement.
328          (e) (i) For purposes of Subsection (19)(b)(vi), the sales price of tangible personal
329     property or a product subject to taxation under this chapter is de minimis if:
330          (A) the seller's purchase price of the tangible personal property or product is 10% or
331     less of the seller's total purchase price of the bundled transaction; or
332          (B) the seller's sales price of the tangible personal property or product is 10% or less of
333     the seller's total sales price of the bundled transaction.
334          (ii) For purposes of Subsection (19)(b)(vi), a seller:
335          (A) shall use the seller's purchase price or the seller's sales price to determine if the
336     purchase price or sales price of the tangible personal property or product subject to taxation
337     under this chapter is de minimis; and

338          (B) may not use a combination of the seller's purchase price and the seller's sales price
339     to determine if the purchase price or sales price of the tangible personal property or product
340     subject to taxation under this chapter is de minimis.
341          (iii) For purposes of Subsection (19)(b)(vi), a seller shall use the full term of a service
342     contract to determine if the sales price of tangible personal property or a product is de minimis.
343          (f) For purposes of Subsection (19)(b)(vii)(B), a seller may not use a combination of
344     the seller's purchase price and the seller's sales price to determine if tangible personal property
345     subject to taxation under this chapter is 50% or less of the seller's total purchase price or sales
346     price of that retail sale.
347          (20) "Certified automated system" means software certified by the governing board of
348     the agreement that:
349          (a) calculates the agreement sales and use tax imposed within a local taxing
350     jurisdiction:
351          (i) on a transaction; and
352          (ii) in the states that are members of the agreement;
353          (b) determines the amount of agreement sales and use tax to remit to a state that is a
354     member of the agreement; and
355          (c) maintains a record of the transaction described in Subsection (20)(a)(i).
356          (21) "Certified service provider" means an agent certified:
357          (a) by the governing board of the agreement; and
358          (b) to perform a seller's sales and use tax functions for an agreement sales and use tax,
359     as outlined in the contract between the governing board of the agreement and the certified
360     service provider, other than the seller's obligation under Section 59-12-124 to remit a tax on the
361     seller's own purchases.
362          (22) (a) Subject to Subsection (22)(b), "clothing" means all human wearing apparel
363     suitable for general use.
364          (b) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
365     commission shall make rules:
366          (i) listing the items that constitute "clothing"; and
367          (ii) that are consistent with the list of items that constitute "clothing" under the
368     agreement.

369          (23) "Coal-to-liquid" means the process of converting coal into a liquid synthetic fuel.
370          (24) "Commercial use" means the use of gas, electricity, heat, coal, fuel oil, or other
371     fuels that does not constitute industrial use under Subsection (57) or residential use under
372     Subsection (112).
373          (25) (a) "Common carrier" means a person engaged in or transacting the business of
374     transporting passengers, freight, merchandise, or other property for hire within this state.
375          (b) (i) "Common carrier" does not include a person that, at the time the person is
376     traveling to or from that person's place of employment, transports a passenger to or from the
377     passenger's place of employment.
378          (ii) For purposes of Subsection (25)(b)(i), in accordance with Title 63G, Chapter 3,
379     Utah Administrative Rulemaking Act, the commission may make rules defining what
380     constitutes a person's place of employment.
381          (c) "Common carrier" does not include a person that provides transportation network
382     services, as defined in Section 13-51-102.
383          (26) "Component part" includes:
384          (a) poultry, dairy, and other livestock feed, and their components;
385          (b) baling ties and twine used in the baling of hay and straw;
386          (c) fuel used for providing temperature control of orchards and commercial
387     greenhouses doing a majority of their business in wholesale sales, and for providing power for
388     off-highway type farm machinery; and
389          (d) feed, seeds, and seedlings.
390          (27) "Computer" means an electronic device that accepts information:
391          (a) (i) in digital form; or
392          (ii) in a form similar to digital form; and
393          (b) manipulates that information for a result based on a sequence of instructions.
394          (28) "Computer software" means a set of coded instructions designed to cause:
395          (a) a computer to perform a task; or
396          (b) automatic data processing equipment to perform a task.
397          (29) "Computer software maintenance contract" means a contract that obligates a seller
398     of computer software to provide a customer with:
399          (a) future updates or upgrades to computer software;

400          (b) support services with respect to computer software; or
401          (c) a combination of Subsections (29)(a) and (b).
402          (30) (a) "Conference bridging service" means an ancillary service that links two or
403     more participants of an audio conference call or video conference call.
404          (b) "Conference bridging service" may include providing a telephone number as part of
405     the ancillary service described in Subsection (30)(a).
406          (c) "Conference bridging service" does not include a telecommunications service used
407     to reach the ancillary service described in Subsection (30)(a).
408          (31) "Construction materials" means any tangible personal property that will be
409     converted into real property.
410          (32) "Delivered electronically" means delivered to a purchaser by means other than
411     tangible storage media.
412          (33) (a) "Delivery charge" means a charge:
413          (i) by a seller of:
414          (A) tangible personal property;
415          (B) a product transferred electronically; or
416          (C) a service; and
417          (ii) for preparation and delivery of the tangible personal property, product transferred
418     electronically, or services described in Subsection (33)(a)(i) to a location designated by the
419     purchaser.
420          (b) "Delivery charge" includes a charge for the following:
421          (i) transportation;
422          (ii) shipping;
423          (iii) postage;
424          (iv) handling;
425          (v) crating; or
426          (vi) packing.
427          (34) "Detailed telecommunications billing service" means an ancillary service of
428     separately stating information pertaining to individual calls on a customer's billing statement.
429          (35) "Dietary supplement" means a product, other than tobacco, that:
430          (a) is intended to supplement the diet;

431          (b) contains one or more of the following dietary ingredients:
432          (i) a vitamin;
433          (ii) a mineral;
434          (iii) an herb or other botanical;
435          (iv) an amino acid;
436          (v) a dietary substance for use by humans to supplement the diet by increasing the total
437     dietary intake; or
438          (vi) a concentrate, metabolite, constituent, extract, or combination of any ingredient
439     described in Subsections (35)(b)(i) through (v);
440          (c) (i) except as provided in Subsection (35)(c)(ii), is intended for ingestion in:
441          (A) tablet form;
442          (B) capsule form;
443          (C) powder form;
444          (D) softgel form;
445          (E) gelcap form; or
446          (F) liquid form; or
447          (ii) if the product is not intended for ingestion in a form described in Subsections
448     (35)(c)(i)(A) through (F), is not represented:
449          (A) as conventional food; and
450          (B) for use as a sole item of:
451          (I) a meal; or
452          (II) the diet; and
453          (d) is required to be labeled as a dietary supplement:
454          (i) identifiable by the "Supplemental Facts" box found on the label; and
455          (ii) as required by 21 C.F.R. Sec. 101.36.
456          (36) (a) "Digital audio work" means a work that results from the fixation of a series of
457     musical, spoken, or other sounds.
458          (b) "Digital audio work" includes a ringtone.
459          (37) "Digital audio-visual work" means a series of related images which, when shown
460     in succession, imparts an impression of motion, together with accompanying sounds, if any.
461          (38) "Digital book" means a work that is generally recognized in the ordinary and usual

462     sense as a book.
463          (39) (a) "Direct mail" means printed material delivered or distributed by United States
464     mail or other delivery service:
465          (i) to:
466          (A) a mass audience; or
467          (B) addressees on a mailing list provided:
468          (I) by a purchaser of the mailing list; or
469          (II) at the discretion of the purchaser of the mailing list; and
470          (ii) if the cost of the printed material is not billed directly to the recipients.
471          (b) "Direct mail" includes tangible personal property supplied directly or indirectly by a
472     purchaser to a seller of direct mail for inclusion in a package containing the printed material.
473          (c) "Direct mail" does not include multiple items of printed material delivered to a
474     single address.
475          (40) "Directory assistance" means an ancillary service of providing:
476          (a) address information; or
477          (b) telephone number information.
478          (41) (a) "Disposable home medical equipment or supplies" means medical equipment
479     or supplies that:
480          (i) cannot withstand repeated use; and
481          (ii) are purchased by, for, or on behalf of a person other than:
482          (A) a health care facility as defined in Section 26-21-2;
483          (B) a health care provider as defined in Section 78B-3-403;
484          (C) an office of a health care provider described in Subsection (41)(a)(ii)(B); or
485          (D) a person similar to a person described in Subsections (41)(a)(ii)(A) through (C).
486          (b) "Disposable home medical equipment or supplies" does not include:
487          (i) a drug;
488          (ii) durable medical equipment;
489          (iii) a hearing aid;
490          (iv) a hearing aid accessory;
491          (v) mobility enhancing equipment; or
492          (vi) tangible personal property used to correct impaired vision, including:

493          (A) eyeglasses; or
494          (B) contact lenses.
495          (c) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
496     commission may by rule define what constitutes medical equipment or supplies.
497          (42) "Drilling equipment manufacturer" means a facility:
498          (a) located in the state;
499          (b) with respect to which 51% or more of the manufacturing activities of the facility
500     consist of manufacturing component parts of drilling equipment;
501          (c) that uses pressure of 800,000 or more pounds per square inch as part of the
502     manufacturing process; and
503          (d) that uses a temperature of 2,000 or more degrees Fahrenheit as part of the
504     manufacturing process.
505          (43) (a) "Drug" means a compound, substance, or preparation, or a component of a
506     compound, substance, or preparation that is:
507          (i) recognized in:
508          (A) the official United States Pharmacopoeia;
509          (B) the official Homeopathic Pharmacopoeia of the United States;
510          (C) the official National Formulary; or
511          (D) a supplement to a publication listed in Subsections (43)(a)(i)(A) through (C);
512          (ii) intended for use in the:
513          (A) diagnosis of disease;
514          (B) cure of disease;
515          (C) mitigation of disease;
516          (D) treatment of disease; or
517          (E) prevention of disease; or
518          (iii) intended to affect:
519          (A) the structure of the body; or
520          (B) any function of the body.
521          (b) "Drug" does not include:
522          (i) food and food ingredients;
523          (ii) a dietary supplement;

524          (iii) an alcoholic beverage; or
525          (iv) a prosthetic device.
526          (44) (a) Except as provided in Subsection (44)(c), "durable medical equipment" means
527     equipment that:
528          (i) can withstand repeated use;
529          (ii) is primarily and customarily used to serve a medical purpose;
530          (iii) generally is not useful to a person in the absence of illness or injury; and
531          (iv) is not worn in or on the body.
532          (b) "Durable medical equipment" includes parts used in the repair or replacement of the
533     equipment described in Subsection (44)(a).
534          (c) "Durable medical equipment" does not include mobility enhancing equipment.
535          (45) "Electronic" means:
536          (a) relating to technology; and
537          (b) having:
538          (i) electrical capabilities;
539          (ii) digital capabilities;
540          (iii) magnetic capabilities;
541          (iv) wireless capabilities;
542          (v) optical capabilities;
543          (vi) electromagnetic capabilities; or
544          (vii) capabilities similar to Subsections (45)(b)(i) through (vi).
545          (46) "Electronic financial payment service" means an establishment:
546          (a) within NAICS Code 522320, Financial Transactions Processing, Reserve, and
547     Clearinghouse Activities, of the 2012 North American Industry Classification System of the
548     federal Executive Office of the President, Office of Management and Budget; and
549          (b) that performs electronic financial payment services.
550          (47) "Employee" means the same as that term is defined in Section 59-10-401.
551          (48) "Fixed guideway" means a public transit facility that uses and occupies:
552          (a) rail for the use of public transit; or
553          (b) a separate right-of-way for the use of public transit.
554          (49) "Fixed wing turbine powered aircraft" means an aircraft that:

555          (a) is powered by turbine engines;
556          (b) operates on jet fuel; and
557          (c) has wings that are permanently attached to the fuselage of the aircraft.
558          (50) "Fixed wireless service" means a telecommunications service that provides radio
559     communication between fixed points.
560          (51) (a) "Food and food ingredients" means substances:
561          (i) regardless of whether the substances are in:
562          (A) liquid form;
563          (B) concentrated form;
564          (C) solid form;
565          (D) frozen form;
566          (E) dried form; or
567          (F) dehydrated form; and
568          (ii) that are:
569          (A) sold for:
570          (I) ingestion by humans; or
571          (II) chewing by humans; and
572          (B) consumed for the substance's:
573          (I) taste; or
574          (II) nutritional value.
575          (b) "Food and food ingredients" includes an item described in Subsection (96)(b)(iii).
576          (c) "Food and food ingredients" does not include:
577          (i) an alcoholic beverage;
578          (ii) tobacco; or
579          (iii) prepared food.
580          (52) (a) "Fundraising sales" means sales:
581          (i) (A) made by a school; or
582          (B) made by a school student;
583          (ii) that are for the purpose of raising funds for the school to purchase equipment,
584     materials, or provide transportation; and
585          (iii) that are part of an officially sanctioned school activity.

586          (b) For purposes of Subsection (52)(a)(iii), "officially sanctioned school activity"
587     means a school activity:
588          (i) that is conducted in accordance with a formal policy adopted by the school or school
589     district governing the authorization and supervision of fundraising activities;
590          (ii) that does not directly or indirectly compensate an individual teacher or other
591     educational personnel by direct payment, commissions, or payment in kind; and
592          (iii) the net or gross revenues from which are deposited in a dedicated account
593     controlled by the school or school district.
594          (53) "Geothermal energy" means energy contained in heat that continuously flows
595     outward from the earth that is used as the sole source of energy to produce electricity.
596          (54) "Governing board of the agreement" means the governing board of the agreement
597     that is:
598          (a) authorized to administer the agreement; and
599          (b) established in accordance with the agreement.
600          (55) (a) For purposes of Subsection 59-12-104(41), "governmental entity" means:
601          (i) the executive branch of the state, including all departments, institutions, boards,
602     divisions, bureaus, offices, commissions, and committees;
603          (ii) the judicial branch of the state, including the courts, the Judicial Council, the
604     Administrative Office of the Courts, and similar administrative units in the judicial branch;
605          (iii) the legislative branch of the state, including the House of Representatives, the
606     Senate, the Legislative Printing Office, the Office of Legislative Research and General
607     Counsel, the Office of the Legislative Auditor General, and the Office of the Legislative Fiscal
608     Analyst;
609          (iv) the National Guard;
610          (v) an independent entity as defined in Section 63E-1-102; or
611          (vi) a political subdivision as defined in Section 17B-1-102.
612          (b) "Governmental entity" does not include the state systems of public and higher
613     education, including:
614          (i) a school;
615          (ii) the State Board of Education;
616          (iii) the Utah Board of Higher Education; or

617          (iv) an institution of higher education described in Section 53B-1-102.
618          (56) "Hydroelectric energy" means water used as the sole source of energy to produce
619     electricity.
620          (57) "Industrial use" means the use of natural gas, electricity, heat, coal, fuel oil, or
621     other fuels:
622          (a) in mining or extraction of minerals;
623          (b) in agricultural operations to produce an agricultural product up to the time of
624     harvest or placing the agricultural product into a storage facility, including:
625          (i) commercial greenhouses;
626          (ii) irrigation pumps;
627          (iii) farm machinery;
628          (iv) implements of husbandry as defined in Section 41-1a-102 that are not registered
629     under Title 41, Chapter 1a, Part 2, Registration; and
630          (v) other farming activities;
631          (c) in manufacturing tangible personal property at an establishment described in:
632          (i) SIC Codes 2000 to 3999 of the 1987 Standard Industrial Classification Manual of
633     the federal Executive Office of the President, Office of Management and Budget; or
634          (ii) a NAICS code within NAICS Sector 31-33, Manufacturing, of the 2017 North
635     American Industry Classification System of the federal Executive Office of the President,
636     Office of Management and Budget;
637          (d) by a scrap recycler if:
638          (i) from a fixed location, the scrap recycler utilizes machinery or equipment to process
639     one or more of the following items into prepared grades of processed materials for use in new
640     products:
641          (A) iron;
642          (B) steel;
643          (C) nonferrous metal;
644          (D) paper;
645          (E) glass;
646          (F) plastic;
647          (G) textile; or

648          (H) rubber; and
649          (ii) the new products under Subsection (57)(d)(i) would otherwise be made with
650     nonrecycled materials; or
651          (e) in producing a form of energy or steam described in Subsection 54-2-1(3)(a) by a
652     cogeneration facility as defined in Section 54-2-1.
653          (58) (a) Except as provided in Subsection (58)(b), "installation charge" means a charge
654     for installing:
655          (i) tangible personal property; or
656          (ii) a product transferred electronically.
657          (b) "Installation charge" does not include a charge for:
658          (i) repairs or renovations of:
659          (A) tangible personal property; or
660          (B) a product transferred electronically; or
661          (ii) attaching tangible personal property or a product transferred electronically:
662          (A) to other tangible personal property; and
663          (B) as part of a manufacturing or fabrication process.
664          (59) "Institution of higher education" means an institution of higher education listed in
665     Section 53B-2-101.
666          (60) (a) "Lease" or "rental" means a transfer of possession or control of tangible
667     personal property or a product transferred electronically for:
668          (i) (A) a fixed term; or
669          (B) an indeterminate term; and
670          (ii) consideration.
671          (b) "Lease" or "rental" includes an agreement covering a motor vehicle and trailer if the
672     amount of consideration may be increased or decreased by reference to the amount realized
673     upon sale or disposition of the property as defined in Section 7701(h)(1), Internal Revenue
674     Code.
675          (c) "Lease" or "rental" does not include:
676          (i) a transfer of possession or control of property under a security agreement or
677     deferred payment plan that requires the transfer of title upon completion of the required
678     payments;

679          (ii) a transfer of possession or control of property under an agreement that requires the
680     transfer of title:
681          (A) upon completion of required payments; and
682          (B) if the payment of an option price does not exceed the greater of:
683          (I) $100; or
684          (II) 1% of the total required payments; or
685          (iii) providing tangible personal property along with an operator for a fixed period of
686     time or an indeterminate period of time if the operator is necessary for equipment to perform as
687     designed.
688          (d) For purposes of Subsection (60)(c)(iii), an operator is necessary for equipment to
689     perform as designed if the operator's duties exceed the:
690          (i) set-up of tangible personal property;
691          (ii) maintenance of tangible personal property; or
692          (iii) inspection of tangible personal property.
693          (61) "Lesson" means a fixed period of time for the duration of which a trained
694     instructor:
695          (a) is present with a student in person or by video; and
696          (b) actively instructs the student, including by providing observation or feedback.
697          (62) "Life science establishment" means an establishment in this state that is classified
698     under the following NAICS codes of the 2007 North American Industry Classification System
699     of the federal Executive Office of the President, Office of Management and Budget:
700          (a) NAICS Code 33911, Medical Equipment and Supplies Manufacturing;
701          (b) NAICS Code 334510, Electromedical and Electrotherapeutic Apparatus
702     Manufacturing; or
703          (c) NAICS Code 334517, Irradiation Apparatus Manufacturing.
704          (63) "Life science research and development facility" means a facility owned, leased,
705     or rented by a life science establishment if research and development is performed in 51% or
706     more of the total area of the facility.
707          (64) "Load and leave" means delivery to a purchaser by use of a tangible storage media
708     if the tangible storage media is not physically transferred to the purchaser.
709          (65) "Local taxing jurisdiction" means a:

710          (a) county that is authorized to impose an agreement sales and use tax;
711          (b) city that is authorized to impose an agreement sales and use tax; or
712          (c) town that is authorized to impose an agreement sales and use tax.
713          (66) "Manufactured home" means the same as that term is defined in Section
714     15A-1-302.
715          (67) "Manufacturing facility" means:
716          (a) an establishment described in:
717          (i) SIC Codes 2000 to 3999 of the 1987 Standard Industrial Classification Manual of
718     the federal Executive Office of the President, Office of Management and Budget; or
719          (ii) a NAICS code within NAICS Sector 31-33, Manufacturing, of the 2017 North
720     American Industry Classification System of the federal Executive Office of the President,
721     Office of Management and Budget;
722          (b) a scrap recycler if:
723          (i) from a fixed location, the scrap recycler utilizes machinery or equipment to process
724     one or more of the following items into prepared grades of processed materials for use in new
725     products:
726          (A) iron;
727          (B) steel;
728          (C) nonferrous metal;
729          (D) paper;
730          (E) glass;
731          (F) plastic;
732          (G) textile; or
733          (H) rubber; and
734          (ii) the new products under Subsection (67)(b)(i) would otherwise be made with
735     nonrecycled materials; or
736          (c) a cogeneration facility as defined in Section 54-2-1 if the cogeneration facility is
737     placed in service on or after May 1, 2006.
738          (68) (a) "Marketplace" means a physical or electronic place, platform, or forum where
739     tangible personal property, a product transferred electronically, or a service is offered for sale.
740          (b) "Marketplace" includes a store, a booth, an Internet website, a catalog, or a

741     dedicated sales software application.
742          (69) (a) "Marketplace facilitator" means a person, including an affiliate of the person,
743     that enters into a contract, an agreement, or otherwise with sellers, for consideration, to
744     facilitate the sale of a seller's product through a marketplace that the person owns, operates, or
745     controls and that directly or indirectly:
746          (i) does any of the following:
747          (A) lists, makes available, or advertises tangible personal property, a product
748     transferred electronically, or a service for sale by a marketplace seller on a marketplace that the
749     person owns, operates, or controls;
750          (B) facilitates the sale of a marketplace seller's tangible personal property, product
751     transferred electronically, or service by transmitting or otherwise communicating an offer or
752     acceptance of a retail sale between the marketplace seller and a purchaser using the
753     marketplace;
754          (C) owns, rents, licenses, makes available, or operates any electronic or physical
755     infrastructure or any property, process, method, copyright, trademark, or patent that connects a
756     marketplace seller to a purchaser for the purpose of making a retail sale of tangible personal
757     property, a product transferred electronically, or a service;
758          (D) provides a marketplace for making, or otherwise facilitates, a retail sale of tangible
759     personal property, a product transferred electronically, or a service, regardless of ownership or
760     control of the tangible personal property, the product transferred electronically, or the service
761     that is the subject of the retail sale;
762          (E) provides software development or research and development activities related to
763     any activity described in this Subsection (69)(a)(i), if the software development or research and
764     development activity is directly related to the person's marketplace;
765          (F) provides or offers fulfillment or storage services for a marketplace seller;
766          (G) sets prices for the sale of tangible personal property, a product transferred
767     electronically, or a service by a marketplace seller;
768          (H) provides or offers customer service to a marketplace seller or a marketplace seller's
769     purchaser or accepts or assists with taking orders, returns, or exchanges of tangible personal
770     property, a product transferred electronically, or a service sold by a marketplace seller on the
771     person's marketplace; or

772          (I) brands or otherwise identifies sales as those of the person; and
773          (ii) does any of the following:
774          (A) collects the sales price or purchase price of a retail sale of tangible personal
775     property, a product transferred electronically, or a service;
776          (B) provides payment processing services for a retail sale of tangible personal property,
777     a product transferred electronically, or a service;
778          (C) charges, collects, or otherwise receives a selling fee, listing fee, referral fee, closing
779     fee, a fee for inserting or making available tangible personal property, a product transferred
780     electronically, or a service on the person's marketplace, or other consideration for the
781     facilitation of a retail sale of tangible personal property, a product transferred electronically, or
782     a service, regardless of ownership or control of the tangible personal property, the product
783     transferred electronically, or the service that is the subject of the retail sale;
784          (D) through terms and conditions, an agreement, or another arrangement with a third
785     person, collects payment from a purchase for a retail sale of tangible personal property, a
786     product transferred electronically, or a service and transmits that payment to the marketplace
787     seller, regardless of whether the third person receives compensation or other consideration in
788     exchange for the service; or
789          (E) provides a virtual currency for a purchaser to use to purchase tangible personal
790     property, a product transferred electronically, or service offered for sale.
791          (b) "Marketplace facilitator" does not include:
792          (i) a person that only provides payment processing services; or
793          (ii) a person described in Subsection (69)(a) to the extent the person is facilitating a
794     sale for a seller that is a restaurant as defined in Section 59-12-602.
795          (70) "Marketplace seller" means a seller that makes one or more retail sales through a
796     marketplace that a marketplace facilitator owns, operates, or controls, regardless of whether the
797     seller is required to be registered to collect and remit the tax under this part.
798          (71) "Member of the immediate family of the producer" means a person who is related
799     to a producer described in Subsection 59-12-104(20)(a) as a:
800          (a) child or stepchild, regardless of whether the child or stepchild is:
801          (i) an adopted child or adopted stepchild; or
802          (ii) a foster child or foster stepchild;

803          (b) grandchild or stepgrandchild;
804          (c) grandparent or stepgrandparent;
805          (d) nephew or stepnephew;
806          (e) niece or stepniece;
807          (f) parent or stepparent;
808          (g) sibling or stepsibling;
809          (h) spouse;
810          (i) person who is the spouse of a person described in Subsections (71)(a) through (g);
811     or
812          (j) person similar to a person described in Subsections (71)(a) through (i) as
813     determined by the commission by rule made in accordance with Title 63G, Chapter 3, Utah
814     Administrative Rulemaking Act.
815          (72) "Mobile home" means the same as that term is defined in Section 15A-1-302.
816          (73) "Mobile telecommunications service" means the same as that term is defined in
817     the Mobile Telecommunications Sourcing Act, 4 U.S.C. Sec. 124.
818          (74) (a) "Mobile wireless service" means a telecommunications service, regardless of
819     the technology used, if:
820          (i) the origination point of the conveyance, routing, or transmission is not fixed;
821          (ii) the termination point of the conveyance, routing, or transmission is not fixed; or
822          (iii) the origination point described in Subsection (74)(a)(i) and the termination point
823     described in Subsection (74)(a)(ii) are not fixed.
824          (b) "Mobile wireless service" includes a telecommunications service that is provided
825     by a commercial mobile radio service provider.
826          (c) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
827     commission may by rule define "commercial mobile radio service provider."
828          (75) (a) Except as provided in Subsection (75)(c), "mobility enhancing equipment"
829     means equipment that is:
830          (i) primarily and customarily used to provide or increase the ability to move from one
831     place to another;
832          (ii) appropriate for use in a:
833          (A) home; or

834          (B) motor vehicle; and
835          (iii) not generally used by persons with normal mobility.
836          (b) "Mobility enhancing equipment" includes parts used in the repair or replacement of
837     the equipment described in Subsection (75)(a).
838          (c) "Mobility enhancing equipment" does not include:
839          (i) a motor vehicle;
840          (ii) equipment on a motor vehicle if that equipment is normally provided by the motor
841     vehicle manufacturer;
842          (iii) durable medical equipment; or
843          (iv) a prosthetic device.
844          (76) "Model 1 seller" means a seller registered under the agreement that has selected a
845     certified service provider as the seller's agent to perform the seller's sales and use tax functions
846     for agreement sales and use taxes, as outlined in the contract between the governing board of
847     the agreement and the certified service provider, other than the seller's obligation under Section
848     59-12-124 to remit a tax on the seller's own purchases.
849          (77) "Model 2 seller" means a seller registered under the agreement that:
850          (a) except as provided in Subsection (77)(b), has selected a certified automated system
851     to perform the seller's sales tax functions for agreement sales and use taxes; and
852          (b) retains responsibility for remitting all of the sales tax:
853          (i) collected by the seller; and
854          (ii) to the appropriate local taxing jurisdiction.
855          (78) (a) Subject to Subsection (78)(b), "model 3 seller" means a seller registered under
856     the agreement that has:
857          (i) sales in at least five states that are members of the agreement;
858          (ii) total annual sales revenues of at least $500,000,000;
859          (iii) a proprietary system that calculates the amount of tax:
860          (A) for an agreement sales and use tax; and
861          (B) due to each local taxing jurisdiction; and
862          (iv) entered into a performance agreement with the governing board of the agreement.
863          (b) For purposes of Subsection (78)(a), "model 3 seller" includes an affiliated group of
864     sellers using the same proprietary system.

865          (79) "Model 4 seller" means a seller that is registered under the agreement and is not a
866     model 1 seller, model 2 seller, or model 3 seller.
867          (80) "Modular home" means a modular unit as defined in Section 15A-1-302.
868          (81) "Motor vehicle" means the same as that term is defined in Section 41-1a-102.
869          (82) "Oil sands" means impregnated bituminous sands that:
870          (a) contain a heavy, thick form of petroleum that is released when heated, mixed with
871     other hydrocarbons, or otherwise treated;
872          (b) yield mixtures of liquid hydrocarbon; and
873          (c) require further processing other than mechanical blending before becoming finished
874     petroleum products.
875          (83) "Oil shale" means a group of fine black to dark brown shales containing kerogen
876     material that yields petroleum upon heating and distillation.
877          (84) "Optional computer software maintenance contract" means a computer software
878     maintenance contract that a customer is not obligated to purchase as a condition to the retail
879     sale of computer software.
880          (85) (a) "Other fuels" means products that burn independently to produce heat or
881     energy.
882          (b) "Other fuels" includes oxygen when it is used in the manufacturing of tangible
883     personal property.
884          (86) (a) "Paging service" means a telecommunications service that provides
885     transmission of a coded radio signal for the purpose of activating a specific pager.
886          (b) For purposes of Subsection (86)(a), the transmission of a coded radio signal
887     includes a transmission by message or sound.
888          (87) "Pawn transaction" means the same as that term is defined in Section 13-32a-102.
889          (88) "Pawnbroker" means the same as that term is defined in Section 13-32a-102.
890          (89) (a) "Permanently attached to real property" means that for tangible personal
891     property attached to real property:
892          (i) the attachment of the tangible personal property to the real property:
893          (A) is essential to the use of the tangible personal property; and
894          (B) suggests that the tangible personal property will remain attached to the real
895     property in the same place over the useful life of the tangible personal property; or

896          (ii) if the tangible personal property is detached from the real property, the detachment
897     would:
898          (A) cause substantial damage to the tangible personal property; or
899          (B) require substantial alteration or repair of the real property to which the tangible
900     personal property is attached.
901          (b) "Permanently attached to real property" includes:
902          (i) the attachment of an accessory to the tangible personal property if the accessory is:
903          (A) essential to the operation of the tangible personal property; and
904          (B) attached only to facilitate the operation of the tangible personal property;
905          (ii) a temporary detachment of tangible personal property from real property for a
906     repair or renovation if the repair or renovation is performed where the tangible personal
907     property and real property are located; or
908          (iii) property attached to oil, gas, or water pipelines, except for the property listed in
909     Subsection (89)(c)(iii) or (iv).
910          (c) "Permanently attached to real property" does not include:
911          (i) the attachment of portable or movable tangible personal property to real property if
912     that portable or movable tangible personal property is attached to real property only for:
913          (A) convenience;
914          (B) stability; or
915          (C) for an obvious temporary purpose;
916          (ii) the detachment of tangible personal property from real property except for the
917     detachment described in Subsection (89)(b)(ii);
918          (iii) an attachment of the following tangible personal property to real property if the
919     attachment to real property is only through a line that supplies water, electricity, gas,
920     telecommunications, cable, or supplies a similar item as determined by the commission by rule
921     made in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act:
922          (A) a computer;
923          (B) a telephone;
924          (C) a television; or
925          (D) tangible personal property similar to Subsections (89)(c)(iii)(A) through (C) as
926     determined by the commission by rule made in accordance with Title 63G, Chapter 3, Utah

927     Administrative Rulemaking Act; or
928          (iv) an item listed in Subsection (130)(c).
929          (90) "Person" includes any individual, firm, partnership, joint venture, association,
930     corporation, estate, trust, business trust, receiver, syndicate, this state, any county, city,
931     municipality, district, or other local governmental entity of the state, or any group or
932     combination acting as a unit.
933          (91) "Place of primary use":
934          (a) for telecommunications service other than mobile telecommunications service,
935     means the street address representative of where the customer's use of the telecommunications
936     service primarily occurs, which shall be:
937          (i) the residential street address of the customer; or
938          (ii) the primary business street address of the customer; or
939          (b) for mobile telecommunications service, means the same as that term is defined in
940     the Mobile Telecommunications Sourcing Act, 4 U.S.C. Sec. 124.
941          (92) (a) "Postpaid calling service" means a telecommunications service a person
942     obtains by making a payment on a call-by-call basis:
943          (i) through the use of a:
944          (A) bank card;
945          (B) credit card;
946          (C) debit card; or
947          (D) travel card; or
948          (ii) by a charge made to a telephone number that is not associated with the origination
949     or termination of the telecommunications service.
950          (b) "Postpaid calling service" includes a service, except for a prepaid wireless calling
951     service, that would be a prepaid wireless calling service if the service were exclusively a
952     telecommunications service.
953          (93) "Postproduction" means an activity related to the finishing or duplication of a
954     medium described in Subsection 59-12-104(54)(a).
955          (94) "Prepaid calling service" means a telecommunications service:
956          (a) that allows a purchaser access to telecommunications service that is exclusively
957     telecommunications service;

958          (b) that:
959          (i) is paid for in advance; and
960          (ii) enables the origination of a call using an:
961          (A) access number; or
962          (B) authorization code;
963          (c) that is dialed:
964          (i) manually; or
965          (ii) electronically; and
966          (d) sold in predetermined units or dollars that decline:
967          (i) by a known amount; and
968          (ii) with use.
969          (95) "Prepaid wireless calling service" means a telecommunications service:
970          (a) that provides the right to utilize:
971          (i) mobile wireless service; and
972          (ii) other service that is not a telecommunications service, including:
973          (A) the download of a product transferred electronically;
974          (B) a content service; or
975          (C) an ancillary service;
976          (b) that:
977          (i) is paid for in advance; and
978          (ii) enables the origination of a call using an:
979          (A) access number; or
980          (B) authorization code;
981          (c) that is dialed:
982          (i) manually; or
983          (ii) electronically; and
984          (d) sold in predetermined units or dollars that decline:
985          (i) by a known amount; and
986          (ii) with use.
987          (96) (a) "Prepared food" means:
988          (i) food:

989          (A) sold in a heated state; or
990          (B) heated by a seller;
991          (ii) two or more food ingredients mixed or combined by the seller for sale as a single
992     item; or
993          (iii) except as provided in Subsection (96)(c), food sold with an eating utensil provided
994     by the seller, including a:
995          (A) plate;
996          (B) knife;
997          (C) fork;
998          (D) spoon;
999          (E) glass;
1000          (F) cup;
1001          (G) napkin; or
1002          (H) straw.
1003          (b) "Prepared food" does not include:
1004          (i) food that a seller only:
1005          (A) cuts;
1006          (B) repackages; or
1007          (C) pasteurizes; or
1008          (ii) (A) the following:
1009          (I) raw egg;
1010          (II) raw fish;
1011          (III) raw meat;
1012          (IV) raw poultry; or
1013          (V) a food containing an item described in Subsections (96)(b)(ii)(A)(I) through (IV);
1014     and
1015          (B) if the Food and Drug Administration recommends in Chapter 3, Part 401.11 of the
1016     Food and Drug Administration's Food Code that a consumer cook the items described in
1017     Subsection (96)(b)(ii)(A) to prevent food borne illness; or
1018          (iii) the following if sold without eating utensils provided by the seller:
1019          (A) food and food ingredients sold by a seller if the seller's proper primary

1020     classification under the 2002 North American Industry Classification System of the federal
1021     Executive Office of the President, Office of Management and Budget, is manufacturing in
1022     Sector 311, Food Manufacturing, except for Subsector 3118, Bakeries and Tortilla
1023     Manufacturing;
1024          (B) food and food ingredients sold in an unheated state:
1025          (I) by weight or volume; and
1026          (II) as a single item; or
1027          (C) a bakery item, including:
1028          (I) a bagel;
1029          (II) a bar;
1030          (III) a biscuit;
1031          (IV) bread;
1032          (V) a bun;
1033          (VI) a cake;
1034          (VII) a cookie;
1035          (VIII) a croissant;
1036          (IX) a danish;
1037          (X) a donut;
1038          (XI) a muffin;
1039          (XII) a pastry;
1040          (XIII) a pie;
1041          (XIV) a roll;
1042          (XV) a tart;
1043          (XVI) a torte; or
1044          (XVII) a tortilla.
1045          (c) An eating utensil provided by the seller does not include the following used to
1046     transport the food:
1047          (i) a container; or
1048          (ii) packaging.
1049          (97) "Prescription" means an order, formula, or recipe that is issued:
1050          (a) (i) orally;

1051          (ii) in writing;
1052          (iii) electronically; or
1053          (iv) by any other manner of transmission; and
1054          (b) by a licensed practitioner authorized by the laws of a state.
1055          (98) (a) Except as provided in Subsection (98)(b)(ii) or (iii), "prewritten computer
1056     software" means computer software that is not designed and developed:
1057          (i) by the author or other creator of the computer software; and
1058          (ii) to the specifications of a specific purchaser.
1059          (b) "Prewritten computer software" includes:
1060          (i) a prewritten upgrade to computer software if the prewritten upgrade to the computer
1061     software is not designed and developed:
1062          (A) by the author or other creator of the computer software; and
1063          (B) to the specifications of a specific purchaser;
1064          (ii) computer software designed and developed by the author or other creator of the
1065     computer software to the specifications of a specific purchaser if the computer software is sold
1066     to a person other than the purchaser; or
1067          (iii) except as provided in Subsection (98)(c), prewritten computer software or a
1068     prewritten portion of prewritten computer software:
1069          (A) that is modified or enhanced to any degree; and
1070          (B) if the modification or enhancement described in Subsection (98)(b)(iii)(A) is
1071     designed and developed to the specifications of a specific purchaser.
1072          (c) "Prewritten computer software" does not include a modification or enhancement
1073     described in Subsection (98)(b)(iii) if the charges for the modification or enhancement are:
1074          (i) reasonable; and
1075          (ii) subject to Subsections 59-12-103(2)(f)(ii) and (2)(g)(i), separately stated on the
1076     invoice or other statement of price provided to the purchaser at the time of sale or later, as
1077     demonstrated by:
1078          (A) the books and records the seller keeps at the time of the transaction in the regular
1079     course of business, including books and records the seller keeps at the time of the transaction in
1080     the regular course of business for nontax purposes;
1081          (B) a preponderance of the facts and circumstances at the time of the transaction; and

1082          (C) the understanding of all of the parties to the transaction.
1083          (99) (a) "Private communications service" means a telecommunications service:
1084          (i) that entitles a customer to exclusive or priority use of one or more communications
1085     channels between or among termination points; and
1086          (ii) regardless of the manner in which the one or more communications channels are
1087     connected.
1088          (b) "Private communications service" includes the following provided in connection
1089     with the use of one or more communications channels:
1090          (i) an extension line;
1091          (ii) a station;
1092          (iii) switching capacity; or
1093          (iv) another associated service that is provided in connection with the use of one or
1094     more communications channels as defined in Section 59-12-215.
1095          (100) (a) Except as provided in Subsection (100)(b), "product transferred
1096     electronically" means a product transferred electronically that would be subject to a tax under
1097     this chapter if that product was transferred in a manner other than electronically.
1098          (b) "Product transferred electronically" does not include:
1099          (i) an ancillary service;
1100          (ii) computer software; or
1101          (iii) a telecommunications service.
1102          (101) (a) "Prosthetic device" means a device that is worn on or in the body to:
1103          (i) artificially replace a missing portion of the body;
1104          (ii) prevent or correct a physical deformity or physical malfunction; or
1105          (iii) support a weak or deformed portion of the body.
1106          (b) "Prosthetic device" includes:
1107          (i) parts used in the repairs or renovation of a prosthetic device;
1108          (ii) replacement parts for a prosthetic device;
1109          (iii) a dental prosthesis; or
1110          (iv) a hearing aid.
1111          (c) "Prosthetic device" does not include:
1112          (i) corrective eyeglasses; or

1113          (ii) contact lenses.
1114          (102) (a) "Protective equipment" means an item:
1115          (i) for human wear; and
1116          (ii) that is:
1117          (A) designed as protection:
1118          (I) to the wearer against injury or disease; or
1119          (II) against damage or injury of other persons or property; and
1120          (B) not suitable for general use.
1121          (b) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
1122     commission shall make rules:
1123          (i) listing the items that constitute "protective equipment"; and
1124          (ii) that are consistent with the list of items that constitute "protective equipment"
1125     under the agreement.
1126          (103) (a) For purposes of Subsection 59-12-104(41), "publication" means any written
1127     or printed matter, other than a photocopy:
1128          (i) regardless of:
1129          (A) characteristics;
1130          (B) copyright;
1131          (C) form;
1132          (D) format;
1133          (E) method of reproduction; or
1134          (F) source; and
1135          (ii) made available in printed or electronic format.
1136          (b) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
1137     commission may by rule define the term "photocopy."
1138          (104) (a) "Purchase price" and "sales price" mean the total amount of consideration:
1139          (i) valued in money; and
1140          (ii) for which tangible personal property, a product transferred electronically, or
1141     services are:
1142          (A) sold;
1143          (B) leased; or

1144          (C) rented.
1145          (b) "Purchase price" and "sales price" include:
1146          (i) the seller's cost of the tangible personal property, a product transferred
1147     electronically, or services sold;
1148          (ii) expenses of the seller, including:
1149          (A) the cost of materials used;
1150          (B) a labor cost;
1151          (C) a service cost;
1152          (D) interest;
1153          (E) a loss;
1154          (F) the cost of transportation to the seller; or
1155          (G) a tax imposed on the seller;
1156          (iii) a charge by the seller for any service necessary to complete the sale; or
1157          (iv) consideration a seller receives from a person other than the purchaser if:
1158          (A) (I) the seller actually receives consideration from a person other than the purchaser;
1159     and
1160          (II) the consideration described in Subsection (104)(b)(iv)(A)(I) is directly related to a
1161     price reduction or discount on the sale;
1162          (B) the seller has an obligation to pass the price reduction or discount through to the
1163     purchaser;
1164          (C) the amount of the consideration attributable to the sale is fixed and determinable by
1165     the seller at the time of the sale to the purchaser; and
1166          (D) (I) (Aa) the purchaser presents a certificate, coupon, or other documentation to the
1167     seller to claim a price reduction or discount; and
1168          (Bb) a person other than the seller authorizes, distributes, or grants the certificate,
1169     coupon, or other documentation with the understanding that the person other than the seller
1170     will reimburse any seller to whom the certificate, coupon, or other documentation is presented;
1171          (II) the purchaser identifies that purchaser to the seller as a member of a group or
1172     organization allowed a price reduction or discount, except that a preferred customer card that is
1173     available to any patron of a seller does not constitute membership in a group or organization
1174     allowed a price reduction or discount; or

1175          (III) the price reduction or discount is identified as a third party price reduction or
1176     discount on the:
1177          (Aa) invoice the purchaser receives; or
1178          (Bb) certificate, coupon, or other documentation the purchaser presents.
1179          (c) "Purchase price" and "sales price" do not include:
1180          (i) a discount:
1181          (A) in a form including:
1182          (I) cash;
1183          (II) term; or
1184          (III) coupon;
1185          (B) that is allowed by a seller;
1186          (C) taken by a purchaser on a sale; and
1187          (D) that is not reimbursed by a third party; or
1188          (ii) subject to Subsections 59-12-103(2)(f)(ii) and (2)(g)(i), the following if separately
1189     stated on an invoice, bill of sale, or similar document provided to the purchaser at the time of
1190     sale or later, as demonstrated by the books and records the seller keeps at the time of the
1191     transaction in the regular course of business, including books and records the seller keeps at the
1192     time of the transaction in the regular course of business for nontax purposes, by a
1193     preponderance of the facts and circumstances at the time of the transaction, and by the
1194     understanding of all of the parties to the transaction:
1195          (A) the following from credit extended on the sale of tangible personal property or
1196     services:
1197          (I) a carrying charge;
1198          (II) a financing charge; or
1199          (III) an interest charge;
1200          (B) a delivery charge;
1201          (C) an installation charge;
1202          (D) a manufacturer rebate on a motor vehicle; or
1203          (E) a tax or fee legally imposed directly on the consumer.
1204          (105) "Purchaser" means a person to whom:
1205          (a) a sale of tangible personal property is made;

1206          (b) a product is transferred electronically; or
1207          (c) a service is furnished.
1208          (106) "Qualifying data center" means a data center facility that:
1209          (a) houses a group of networked server computers in one physical location in order to
1210     disseminate, manage, and store data and information;
1211          (b) is located in the state;
1212          (c) is a new operation constructed on or after July 1, 2016;
1213          (d) consists of one or more buildings that total 150,000 or more square feet;
1214          (e) is owned or leased by:
1215          (i) the operator of the data center facility; or
1216          (ii) a person under common ownership, as defined in Section 59-7-101, of the operator
1217     of the data center facility; and
1218          (f) is located on one or more parcels of land that are owned or leased by:
1219          (i) the operator of the data center facility; or
1220          (ii) a person under common ownership, as defined in Section 59-7-101, of the operator
1221     of the data center facility.
1222          (107) "Regularly rented" means:
1223          (a) rented to a guest for value three or more times during a calendar year; or
1224          (b) advertised or held out to the public as a place that is regularly rented to guests for
1225     value.
1226          (108) "Rental" means the same as that term is defined in Subsection (60).
1227          (109) (a) Except as provided in Subsection (109)(b), "repairs or renovations of tangible
1228     personal property" means:
1229          (i) a repair or renovation of tangible personal property that is not permanently attached
1230     to real property; or
1231          (ii) attaching tangible personal property or a product transferred electronically to other
1232     tangible personal property or detaching tangible personal property or a product transferred
1233     electronically from other tangible personal property if:
1234          (A) the other tangible personal property to which the tangible personal property or
1235     product transferred electronically is attached or from which the tangible personal property or
1236     product transferred electronically is detached is not permanently attached to real property; and

1237          (B) the attachment of tangible personal property or a product transferred electronically
1238     to other tangible personal property or detachment of tangible personal property or a product
1239     transferred electronically from other tangible personal property is made in conjunction with a
1240     repair or replacement of tangible personal property or a product transferred electronically.
1241          (b) "Repairs or renovations of tangible personal property" does not include:
1242          (i) attaching prewritten computer software to other tangible personal property if the
1243     other tangible personal property to which the prewritten computer software is attached is not
1244     permanently attached to real property; or
1245          (ii) detaching prewritten computer software from other tangible personal property if the
1246     other tangible personal property from which the prewritten computer software is detached is
1247     not permanently attached to real property.
1248          (110) "Research and development" means the process of inquiry or experimentation
1249     aimed at the discovery of facts, devices, technologies, or applications and the process of
1250     preparing those devices, technologies, or applications for marketing.
1251          (111) (a) "Residential telecommunications services" means a telecommunications
1252     service or an ancillary service that is provided to an individual for personal use:
1253          (i) at a residential address; or
1254          (ii) at an institution, including a nursing home or a school, if the telecommunications
1255     service or ancillary service is provided to and paid for by the individual residing at the
1256     institution rather than the institution.
1257          (b) For purposes of Subsection (111)(a)(i), a residential address includes an:
1258          (i) apartment; or
1259          (ii) other individual dwelling unit.
1260          (112) "Residential use" means the use in or around a home, apartment building,
1261     sleeping quarters, and similar facilities or accommodations.
1262          (113) "Retail sale" or "sale at retail" means a sale, lease, or rental for a purpose other
1263     than:
1264          (a) resale;
1265          (b) sublease; or
1266          (c) subrent.
1267          (114) (a) "Retailer" means any person, unless prohibited by the Constitution of the

1268     United States or federal law, that is engaged in a regularly organized business in tangible
1269     personal property or any other taxable transaction under Subsection 59-12-103(1), and who is
1270     selling to the user or consumer and not for resale.
1271          (b) "Retailer" includes commission merchants, auctioneers, and any person regularly
1272     engaged in the business of selling to users or consumers within the state.
1273          (115) (a) "Sale" means any transfer of title, exchange, or barter, conditional or
1274     otherwise, in any manner, of tangible personal property or any other taxable transaction under
1275     Subsection 59-12-103(1), for consideration.
1276          (b) "Sale" includes:
1277          (i) installment and credit sales;
1278          (ii) any closed transaction constituting a sale;
1279          (iii) any sale of electrical energy, gas, services, or entertainment taxable under this
1280     chapter;
1281          (iv) any transaction if the possession of property is transferred but the seller retains the
1282     title as security for the payment of the price; and
1283          (v) any transaction under which right to possession, operation, or use of any article of
1284     tangible personal property is granted under a lease or contract and the transfer of possession
1285     would be taxable if an outright sale were made.
1286          (116) "Sale at retail" means the same as that term is defined in Subsection (113).
1287          (117) "Sale-leaseback transaction" means a transaction by which title to tangible
1288     personal property or a product transferred electronically that is subject to a tax under this
1289     chapter is transferred:
1290          (a) by a purchaser-lessee;
1291          (b) to a lessor;
1292          (c) for consideration; and
1293          (d) if:
1294          (i) the purchaser-lessee paid sales and use tax on the purchaser-lessee's initial purchase
1295     of the tangible personal property or product transferred electronically;
1296          (ii) the sale of the tangible personal property or product transferred electronically to the
1297     lessor is intended as a form of financing:
1298          (A) for the tangible personal property or product transferred electronically; and

1299          (B) to the purchaser-lessee; and
1300          (iii) in accordance with generally accepted accounting principles, the purchaser-lessee
1301     is required to:
1302          (A) capitalize the tangible personal property or product transferred electronically for
1303     financial reporting purposes; and
1304          (B) account for the lease payments as payments made under a financing arrangement.
1305          (118) "Sales price" means the same as that term is defined in Subsection (104).
1306          (119) (a) "Sales relating to schools" means the following sales by, amounts paid to, or
1307     amounts charged by a school:
1308          (i) sales that are directly related to the school's educational functions or activities
1309     including:
1310          (A) the sale of:
1311          (I) textbooks;
1312          (II) textbook fees;
1313          (III) laboratory fees;
1314          (IV) laboratory supplies; or
1315          (V) safety equipment;
1316          (B) the sale of a uniform, protective equipment, or sports or recreational equipment
1317     that:
1318          (I) a student is specifically required to wear as a condition of participation in a
1319     school-related event or school-related activity; and
1320          (II) is not readily adaptable to general or continued usage to the extent that it takes the
1321     place of ordinary clothing;
1322          (C) sales of the following if the net or gross revenues generated by the sales are
1323     deposited into a school district fund or school fund dedicated to school meals:
1324          (I) food and food ingredients; or
1325          (II) prepared food; or
1326          (D) transportation charges for official school activities; or
1327          (ii) amounts paid to or amounts charged by a school for admission to a school-related
1328     event or school-related activity.
1329          (b) "Sales relating to schools" does not include:

1330          (i) bookstore sales of items that are not educational materials or supplies;
1331          (ii) except as provided in Subsection (119)(a)(i)(B):
1332          (A) clothing;
1333          (B) clothing accessories or equipment;
1334          (C) protective equipment; or
1335          (D) sports or recreational equipment; or
1336          (iii) amounts paid to or amounts charged by a school for admission to a school-related
1337     event or school-related activity if the amounts paid or charged are passed through to a person:
1338          (A) other than a:
1339          (I) school;
1340          (II) nonprofit organization authorized by a school board or a governing body of a
1341     private school to organize and direct a competitive secondary school activity; or
1342          (III) nonprofit association authorized by a school board or a governing body of a
1343     private school to organize and direct a competitive secondary school activity; and
1344          (B) that is required to collect sales and use taxes under this chapter.
1345          (c) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
1346     commission may make rules defining the term "passed through."
1347          (120) For purposes of this section and Section 59-12-104, "school" means:
1348          (a) an elementary school or a secondary school that:
1349          (i) is a:
1350          (A) public school; or
1351          (B) private school; and
1352          (ii) provides instruction for one or more grades kindergarten through 12; or
1353          (b) a public school district.
1354          (121) (a) "Seller" means a person that makes a sale, lease, or rental of:
1355          (i) tangible personal property;
1356          (ii) a product transferred electronically; or
1357          (iii) a service.
1358          (b) "Seller" includes a marketplace facilitator.
1359          (122) (a) "Semiconductor fabricating, processing, research, or development materials"
1360     means tangible personal property or a product transferred electronically if the tangible personal

1361     property or product transferred electronically is:
1362          (i) used primarily in the process of:
1363          (A) (I) manufacturing a semiconductor;
1364          (II) fabricating a semiconductor; or
1365          (III) research or development of a:
1366          (Aa) semiconductor; or
1367          (Bb) semiconductor manufacturing process; or
1368          (B) maintaining an environment suitable for a semiconductor; or
1369          (ii) consumed primarily in the process of:
1370          (A) (I) manufacturing a semiconductor;
1371          (II) fabricating a semiconductor; or
1372          (III) research or development of a:
1373          (Aa) semiconductor; or
1374          (Bb) semiconductor manufacturing process; or
1375          (B) maintaining an environment suitable for a semiconductor.
1376          (b) "Semiconductor fabricating, processing, research, or development materials"
1377     includes:
1378          (i) parts used in the repairs or renovations of tangible personal property or a product
1379     transferred electronically described in Subsection (122)(a); or
1380          (ii) a chemical, catalyst, or other material used to:
1381          (A) produce or induce in a semiconductor a:
1382          (I) chemical change; or
1383          (II) physical change;
1384          (B) remove impurities from a semiconductor; or
1385          (C) improve the marketable condition of a semiconductor.
1386          (123) "Senior citizen center" means a facility having the primary purpose of providing
1387     services to the aged as defined in Section 62A-3-101.
1388          (124) (a) Subject to Subsections (124)(b) and (c), "short-term lodging consumable"
1389     means tangible personal property that:
1390          (i) a business that provides accommodations and services described in Subsection
1391     59-12-103(1)(i) purchases as part of a transaction to provide the accommodations and services

1392     to a purchaser;
1393          (ii) is intended to be consumed by the purchaser; and
1394          (iii) is:
1395          (A) included in the purchase price of the accommodations and services; and
1396          (B) not separately stated on an invoice, bill of sale, or other similar document provided
1397     to the purchaser.
1398          (b) "Short-term lodging consumable" includes:
1399          (i) a beverage;
1400          (ii) a brush or comb;
1401          (iii) a cosmetic;
1402          (iv) a hair care product;
1403          (v) lotion;
1404          (vi) a magazine;
1405          (vii) makeup;
1406          (viii) a meal;
1407          (ix) mouthwash;
1408          (x) nail polish remover;
1409          (xi) a newspaper;
1410          (xii) a notepad;
1411          (xiii) a pen;
1412          (xiv) a pencil;
1413          (xv) a razor;
1414          (xvi) saline solution;
1415          (xvii) a sewing kit;
1416          (xviii) shaving cream;
1417          (xix) a shoe shine kit;
1418          (xx) a shower cap;
1419          (xxi) a snack item;
1420          (xxii) soap;
1421          (xxiii) toilet paper;
1422          (xxiv) a toothbrush;

1423          (xxv) toothpaste; or
1424          (xxvi) an item similar to Subsections (124)(b)(i) through (xxv) as the commission may
1425     provide by rule made in accordance with Title 63G, Chapter 3, Utah Administrative
1426     Rulemaking Act.
1427          (c) "Short-term lodging consumable" does not include:
1428          (i) tangible personal property that is cleaned or washed to allow the tangible personal
1429     property to be reused; or
1430          (ii) a product transferred electronically.
1431          (125) "Simplified electronic return" means the electronic return:
1432          (a) described in Section 318(C) of the agreement; and
1433          (b) approved by the governing board of the agreement.
1434          (126) "Solar energy" means the sun used as the sole source of energy for producing
1435     electricity.
1436          (127) (a) "Sports or recreational equipment" means an item:
1437          (i) designed for human use; and
1438          (ii) that is:
1439          (A) worn in conjunction with:
1440          (I) an athletic activity; or
1441          (II) a recreational activity; and
1442          (B) not suitable for general use.
1443          (b) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
1444     commission shall make rules:
1445          (i) listing the items that constitute "sports or recreational equipment"; and
1446          (ii) that are consistent with the list of items that constitute "sports or recreational
1447     equipment" under the agreement.
1448          (128) "State" means the state of Utah, its departments, and agencies.
1449          (129) "Storage" means any keeping or retention of tangible personal property or any
1450     other taxable transaction under Subsection 59-12-103(1), in this state for any purpose except
1451     sale in the regular course of business.
1452          (130) (a) Except as provided in Subsection (130)(d) or (e), "tangible personal property"
1453     means personal property that:

1454          (i) may be:
1455          (A) seen;
1456          (B) weighed;
1457          (C) measured;
1458          (D) felt; or
1459          (E) touched; or
1460          (ii) is in any manner perceptible to the senses.
1461          (b) "Tangible personal property" includes:
1462          (i) electricity;
1463          (ii) water;
1464          (iii) gas;
1465          (iv) steam; or
1466          (v) prewritten computer software, regardless of the manner in which the prewritten
1467     computer software is transferred.
1468          (c) "Tangible personal property" includes the following regardless of whether the item
1469     is attached to real property:
1470          (i) a dishwasher;
1471          (ii) a dryer;
1472          (iii) a freezer;
1473          (iv) a microwave;
1474          (v) a refrigerator;
1475          (vi) a stove;
1476          (vii) a washer; or
1477          (viii) an item similar to Subsections (130)(c)(i) through (vii) as determined by the
1478     commission by rule made in accordance with Title 63G, Chapter 3, Utah Administrative
1479     Rulemaking Act.
1480          (d) "Tangible personal property" does not include a product that is transferred
1481     electronically.
1482          (e) "Tangible personal property" does not include the following if attached to real
1483     property, regardless of whether the attachment to real property is only through a line that
1484     supplies water, electricity, gas, telephone, cable, or supplies a similar item as determined by the

1485     commission by rule made in accordance with Title 63G, Chapter 3, Utah Administrative
1486     Rulemaking Act:
1487          (i) a hot water heater;
1488          (ii) a water filtration system; or
1489          (iii) a water softener system.
1490          (131) (a) "Telecommunications enabling or facilitating equipment, machinery, or
1491     software" means an item listed in Subsection (131)(b) if that item is purchased or leased
1492     primarily to enable or facilitate one or more of the following to function:
1493          (i) telecommunications switching or routing equipment, machinery, or software; or
1494          (ii) telecommunications transmission equipment, machinery, or software.
1495          (b) The following apply to Subsection (131)(a):
1496          (i) a pole;
1497          (ii) software;
1498          (iii) a supplementary power supply;
1499          (iv) temperature or environmental equipment or machinery;
1500          (v) test equipment;
1501          (vi) a tower; or
1502          (vii) equipment, machinery, or software that functions similarly to an item listed in
1503     Subsections (131)(b)(i) through (vi) as determined by the commission by rule made in
1504     accordance with Subsection (131)(c).
1505          (c) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
1506     commission may by rule define what constitutes equipment, machinery, or software that
1507     functions similarly to an item listed in Subsections (131)(b)(i) through (vi).
1508          (132) "Telecommunications equipment, machinery, or software required for 911
1509     service" means equipment, machinery, or software that is required to comply with 47 C.F.R.
1510     Sec. 20.18.
1511          (133) "Telecommunications maintenance or repair equipment, machinery, or software"
1512     means equipment, machinery, or software purchased or leased primarily to maintain or repair
1513     one or more of the following, regardless of whether the equipment, machinery, or software is
1514     purchased or leased as a spare part or as an upgrade or modification to one or more of the
1515     following:

1516          (a) telecommunications enabling or facilitating equipment, machinery, or software;
1517          (b) telecommunications switching or routing equipment, machinery, or software; or
1518          (c) telecommunications transmission equipment, machinery, or software.
1519          (134) (a) "Telecommunications service" means the electronic conveyance, routing, or
1520     transmission of audio, data, video, voice, or any other information or signal to a point, or
1521     among or between points.
1522          (b) "Telecommunications service" includes:
1523          (i) an electronic conveyance, routing, or transmission with respect to which a computer
1524     processing application is used to act:
1525          (A) on the code, form, or protocol of the content;
1526          (B) for the purpose of electronic conveyance, routing, or transmission; and
1527          (C) regardless of whether the service:
1528          (I) is referred to as voice over Internet protocol service; or
1529          (II) is classified by the Federal Communications Commission as enhanced or value
1530     added;
1531          (ii) an 800 service;
1532          (iii) a 900 service;
1533          (iv) a fixed wireless service;
1534          (v) a mobile wireless service;
1535          (vi) a postpaid calling service;
1536          (vii) a prepaid calling service;
1537          (viii) a prepaid wireless calling service; or
1538          (ix) a private communications service.
1539          (c) "Telecommunications service" does not include:
1540          (i) advertising, including directory advertising;
1541          (ii) an ancillary service;
1542          (iii) a billing and collection service provided to a third party;
1543          (iv) a data processing and information service if:
1544          (A) the data processing and information service allows data to be:
1545          (I) (Aa) acquired;
1546          (Bb) generated;

1547          (Cc) processed;
1548          (Dd) retrieved; or
1549          (Ee) stored; and
1550          (II) delivered by an electronic transmission to a purchaser; and
1551          (B) the purchaser's primary purpose for the underlying transaction is the processed data
1552     or information;
1553          (v) installation or maintenance of the following on a customer's premises:
1554          (A) equipment; or
1555          (B) wiring;
1556          (vi) Internet access service;
1557          (vii) a paging service;
1558          (viii) a product transferred electronically, including:
1559          (A) music;
1560          (B) reading material;
1561          (C) a ring tone;
1562          (D) software; or
1563          (E) video;
1564          (ix) a radio and television audio and video programming service:
1565          (A) regardless of the medium; and
1566          (B) including:
1567          (I) furnishing conveyance, routing, or transmission of a television audio and video
1568     programming service by a programming service provider;
1569          (II) cable service as defined in 47 U.S.C. Sec. 522(6); or
1570          (III) audio and video programming services delivered by a commercial mobile radio
1571     service provider as defined in 47 C.F.R. Sec. 20.3;
1572          (x) a value-added nonvoice data service; or
1573          (xi) tangible personal property.
1574          (135) (a) "Telecommunications service provider" means a person that:
1575          (i) owns, controls, operates, or manages a telecommunications service; and
1576          (ii) engages in an activity described in Subsection (135)(a)(i) for the shared use with or
1577     resale to any person of the telecommunications service.

1578          (b) A person described in Subsection (135)(a) is a telecommunications service provider
1579     whether or not the Public Service Commission of Utah regulates:
1580          (i) that person; or
1581          (ii) the telecommunications service that the person owns, controls, operates, or
1582     manages.
1583          (136) (a) "Telecommunications switching or routing equipment, machinery, or
1584     software" means an item listed in Subsection (136)(b) if that item is purchased or leased
1585     primarily for switching or routing:
1586          (i) an ancillary service;
1587          (ii) data communications;
1588          (iii) voice communications; or
1589          (iv) telecommunications service.
1590          (b) The following apply to Subsection (136)(a):
1591          (i) a bridge;
1592          (ii) a computer;
1593          (iii) a cross connect;
1594          (iv) a modem;
1595          (v) a multiplexer;
1596          (vi) plug in circuitry;
1597          (vii) a router;
1598          (viii) software;
1599          (ix) a switch; or
1600          (x) equipment, machinery, or software that functions similarly to an item listed in
1601     Subsections (136)(b)(i) through (ix) as determined by the commission by rule made in
1602     accordance with Subsection (136)(c).
1603          (c) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
1604     commission may by rule define what constitutes equipment, machinery, or software that
1605     functions similarly to an item listed in Subsections (136)(b)(i) through (ix).
1606          (137) (a) "Telecommunications transmission equipment, machinery, or software"
1607     means an item listed in Subsection (137)(b) if that item is purchased or leased primarily for
1608     sending, receiving, or transporting:

1609          (i) an ancillary service;
1610          (ii) data communications;
1611          (iii) voice communications; or
1612          (iv) telecommunications service.
1613          (b) The following apply to Subsection (137)(a):
1614          (i) an amplifier;
1615          (ii) a cable;
1616          (iii) a closure;
1617          (iv) a conduit;
1618          (v) a controller;
1619          (vi) a duplexer;
1620          (vii) a filter;
1621          (viii) an input device;
1622          (ix) an input/output device;
1623          (x) an insulator;
1624          (xi) microwave machinery or equipment;
1625          (xii) an oscillator;
1626          (xiii) an output device;
1627          (xiv) a pedestal;
1628          (xv) a power converter;
1629          (xvi) a power supply;
1630          (xvii) a radio channel;
1631          (xviii) a radio receiver;
1632          (xix) a radio transmitter;
1633          (xx) a repeater;
1634          (xxi) software;
1635          (xxii) a terminal;
1636          (xxiii) a timing unit;
1637          (xxiv) a transformer;
1638          (xxv) a wire; or
1639          (xxvi) equipment, machinery, or software that functions similarly to an item listed in

1640     Subsections (137)(b)(i) through (xxv) as determined by the commission by rule made in
1641     accordance with Subsection (137)(c).
1642          (c) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
1643     commission may by rule define what constitutes equipment, machinery, or software that
1644     functions similarly to an item listed in Subsections (137)(b)(i) through (xxv).
1645          (138) (a) "Textbook for a higher education course" means a textbook or other printed
1646     material that is required for a course:
1647          (i) offered by an institution of higher education; and
1648          (ii) that the purchaser of the textbook or other printed material attends or will attend.
1649          (b) "Textbook for a higher education course" includes a textbook in electronic format.
1650          (139) "Tobacco" means:
1651          (a) a cigarette;
1652          (b) a cigar;
1653          (c) chewing tobacco;
1654          (d) pipe tobacco; or
1655          (e) any other item that contains tobacco.
1656          (140) "Unassisted amusement device" means an amusement device, skill device, or
1657     ride device that is started and stopped by the purchaser or renter of the right to use or operate
1658     the amusement device, skill device, or ride device.
1659          (141) (a) "Use" means the exercise of any right or power over tangible personal
1660     property, a product transferred electronically, or a service under Subsection 59-12-103(1),
1661     incident to the ownership or the leasing of that tangible personal property, product transferred
1662     electronically, or service.
1663          (b) "Use" does not include the sale, display, demonstration, or trial of tangible personal
1664     property, a product transferred electronically, or a service in the regular course of business and
1665     held for resale.
1666          (142) "Value-added nonvoice data service" means a service:
1667          (a) that otherwise meets the definition of a telecommunications service except that a
1668     computer processing application is used to act primarily for a purpose other than conveyance,
1669     routing, or transmission; and
1670          (b) with respect to which a computer processing application is used to act on data or

1671     information:
1672          (i) code;
1673          (ii) content;
1674          (iii) form; or
1675          (iv) protocol.
1676          (143) (a) Subject to Subsection (143)(b), "vehicle" means the following that are
1677     required to be titled, registered, or titled and registered:
1678          (i) an aircraft as defined in Section 72-10-102;
1679          (ii) a vehicle as defined in Section 41-1a-102;
1680          (iii) an off-highway vehicle as defined in Section 41-22-2; or
1681          (iv) a vessel as defined in Section 41-1a-102.
1682          (b) For purposes of Subsection 59-12-104(33) only, "vehicle" includes:
1683          (i) a vehicle described in Subsection (143)(a); or
1684          (ii) (A) a locomotive;
1685          (B) a freight car;
1686          (C) railroad work equipment; or
1687          (D) other railroad rolling stock.
1688          (144) "Vehicle dealer" means a person engaged in the business of buying, selling, or
1689     exchanging a vehicle as defined in Subsection (143).
1690          (145) (a) "Vertical service" means an ancillary service that:
1691          (i) is offered in connection with one or more telecommunications services; and
1692          (ii) offers an advanced calling feature that allows a customer to:
1693          (A) identify a caller; and
1694          (B) manage multiple calls and call connections.
1695          (b) "Vertical service" includes an ancillary service that allows a customer to manage a
1696     conference bridging service.
1697          (146) (a) "Voice mail service" means an ancillary service that enables a customer to
1698     receive, send, or store a recorded message.
1699          (b) "Voice mail service" does not include a vertical service that a customer is required
1700     to have in order to utilize a voice mail service.
1701          (147) (a) Except as provided in Subsection (147)(b), "waste energy facility" means a

1702     facility that generates electricity:
1703          (i) using as the primary source of energy waste materials that would be placed in a
1704     landfill or refuse pit if it were not used to generate electricity, including:
1705          (A) tires;
1706          (B) waste coal;
1707          (C) oil shale; or
1708          (D) municipal solid waste; and
1709          (ii) in amounts greater than actually required for the operation of the facility.
1710          (b) "Waste energy facility" does not include a facility that incinerates:
1711          (i) hospital waste as defined in 40 C.F.R. 60.51c; or
1712          (ii) medical/infectious waste as defined in 40 C.F.R. 60.51c.
1713          (148) "Watercraft" means a vessel as defined in Section 73-18-2.
1714          (149) "Wind energy" means wind used as the sole source of energy to produce
1715     electricity.
1716          (150) "ZIP Code" means a Zoning Improvement Plan Code assigned to a geographic
1717     location by the United States Postal Service.
1718          Section 3. Section 59-12-103 is amended to read:
1719          59-12-103. Sales and use tax base -- Rates -- Effective dates -- Use of sales and use
1720     tax revenues.
1721          (1) A tax is imposed on the purchaser as provided in this part on the purchase price or
1722     sales price for amounts paid or charged for the following transactions:
1723          (a) retail sales of tangible personal property made within the state;
1724          (b) amounts paid for:
1725          (i) telecommunications service, other than mobile telecommunications service, that
1726     originates and terminates within the boundaries of this state;
1727          (ii) mobile telecommunications service that originates and terminates within the
1728     boundaries of one state only to the extent permitted by the Mobile Telecommunications
1729     Sourcing Act, 4 U.S.C. Sec. 116 et seq.; or
1730          (iii) an ancillary service associated with a:
1731          (A) telecommunications service described in Subsection (1)(b)(i); or
1732          (B) mobile telecommunications service described in Subsection (1)(b)(ii);

1733          (c) sales of the following for commercial use:
1734          (i) gas;
1735          (ii) electricity;
1736          (iii) heat;
1737          (iv) coal;
1738          (v) fuel oil; or
1739          (vi) other fuels;
1740          (d) sales of the following for residential use:
1741          (i) gas;
1742          (ii) electricity;
1743          (iii) heat;
1744          (iv) coal;
1745          (v) fuel oil; or
1746          (vi) other fuels;
1747          (e) sales of prepared food;
1748          (f) except as provided in Section 59-12-104, amounts paid or charged as admission or
1749     user fees for theaters, movies, operas, museums, planetariums, shows of any type or nature,
1750     exhibitions, concerts, carnivals, amusement parks, amusement rides, circuses, menageries,
1751     fairs, races, contests, sporting events, dances, boxing matches, wrestling matches, closed circuit
1752     television broadcasts, billiard parlors, pool parlors, bowling lanes, golf, miniature golf, golf
1753     driving ranges, batting cages, skating rinks, ski lifts, ski runs, ski trails, snowmobile trails,
1754     tennis courts, swimming pools, water slides, river runs, jeep tours, boat tours, scenic cruises,
1755     horseback rides, sports activities, or any other amusement, entertainment, recreation,
1756     exhibition, cultural, or athletic activity;
1757          (g) amounts paid or charged for services for repairs or renovations of tangible personal
1758     property, unless Section 59-12-104 provides for an exemption from sales and use tax for:
1759          (i) the tangible personal property; and
1760          (ii) parts used in the repairs or renovations of the tangible personal property described
1761     in Subsection (1)(g)(i), regardless of whether:
1762          (A) any parts are actually used in the repairs or renovations of that tangible personal
1763     property; or

1764          (B) the particular parts used in the repairs or renovations of that tangible personal
1765     property are exempt from a tax under this chapter;
1766          (h) except as provided in Subsection 59-12-104(7), amounts paid or charged for
1767     assisted cleaning or washing of tangible personal property;
1768          (i) amounts paid or charged for tourist home, hotel, motel, or trailer court
1769     accommodations and services that are regularly rented for less than 30 consecutive days;
1770          (j) amounts paid or charged for laundry or dry cleaning services;
1771          (k) amounts paid or charged for leases or rentals of tangible personal property if within
1772     this state the tangible personal property is:
1773          (i) stored;
1774          (ii) used; or
1775          (iii) otherwise consumed;
1776          (l) amounts paid or charged for tangible personal property if within this state the
1777     tangible personal property is:
1778          (i) stored;
1779          (ii) used; or
1780          (iii) consumed; and
1781          (m) amounts paid or charged for a sale:
1782          (i) (A) of a product transferred electronically; or
1783          (B) of a repair or renovation of a product transferred electronically; and
1784          (ii) regardless of whether the sale provides:
1785          (A) a right of permanent use of the product; or
1786          (B) a right to use the product that is less than a permanent use, including a right:
1787          (I) for a definite or specified length of time; and
1788          (II) that terminates upon the occurrence of a condition.
1789          (2) (a) Except as provided in Subsections (2)(b) through (f), a state tax and a local tax
1790     are imposed on a transaction described in Subsection (1) equal to the sum of:
1791          (i) a state tax imposed on the transaction at a tax rate equal to the sum of:
1792          (A) 4.70% plus the rate specified in Subsection (12)(a); and
1793          (B) (I) the tax rate the state imposes in accordance with Part 18, Additional State Sales
1794     and Use Tax Act, if the location of the transaction as determined under Sections 59-12-211

1795     through 59-12-215 is in a county in which the state imposes the tax under Part 18, Additional
1796     State Sales and Use Tax Act; and
1797          (II) the tax rate the state imposes in accordance with Part 20, Supplemental State Sales
1798     and Use Tax Act, if the location of the transaction as determined under Sections 59-12-211
1799     through 59-12-215 is in a city, town, or the unincorporated area of a county in which the state
1800     imposes the tax under Part 20, Supplemental State Sales and Use Tax Act; and
1801          (ii) a local tax equal to the sum of the tax rates a county, city, or town imposes on the
1802     transaction under this chapter other than this part.
1803          (b) Except as provided in Subsection (2)(e) or (f) and subject to Subsection (2)(k), a
1804     state tax and a local tax are imposed on a transaction described in Subsection (1)(d) equal to
1805     the sum of:
1806          (i) a state tax imposed on the transaction at a tax rate of 2%; and
1807          (ii) a local tax equal to the sum of the tax rates a county, city, or town imposes on the
1808     transaction under this chapter other than this part.
1809          [(c) Except as provided in Subsection (2)(e) or (f), a state tax and a local tax are
1810     imposed on amounts paid or charged for food and food ingredients equal to the sum of:]
1811          [(i) a state tax imposed on the amounts paid or charged for food and food ingredients at
1812     a tax rate of 1.75%; and]
1813          [(ii) a local tax equal to the sum of the tax rates a county, city, or town imposes on the
1814     amounts paid or charged for food and food ingredients under this chapter other than this part.]
1815          (c) (i) Except as provided in Subsection (2)(e) or (f), a local tax is imposed on amounts
1816     paid or charged for food and food ingredients equal to the sum of the tax rates a county, city, or
1817     town imposes under this chapter on the amounts paid or charged for food and food ingredients.
1818          (ii) There is no state tax imposed on amounts paid or charged for food and food
1819     ingredients.
1820          (d) Except as provided in Subsection (2)(e) or (f), a state tax is imposed on amounts
1821     paid or charged for fuel to a common carrier that is a railroad for use in a locomotive engine at
1822     a rate of 4.85%.
1823          (e) (i) For a bundled transaction that is attributable to food and food ingredients and
1824     tangible personal property other than food and food ingredients, a state tax and a local tax is
1825     imposed on the entire bundled transaction equal to the sum of:

1826          (A) a state tax imposed on the entire bundled transaction equal to the sum of:
1827          (I) the tax rate described in Subsection (2)(a)(i)(A); and
1828          (II) (Aa) the tax rate the state imposes in accordance with Part 18, Additional State
1829     Sales and Use Tax Act, if the location of the transaction as determined under Sections
1830     59-12-211 through 59-12-215 is in a county in which the state imposes the tax under Part 18,
1831     Additional State Sales and Use Tax Act; and
1832          (Bb) the tax rate the state imposes in accordance with Part 20, Supplemental State
1833     Sales and Use Tax Act, if the location of the transaction as determined under Sections
1834     59-12-211 through 59-12-215 is in a city, town, or the unincorporated area of a county in which
1835     the state imposes the tax under Part 20, Supplemental State Sales and Use Tax Act; and
1836          (B) a local tax imposed on the entire bundled transaction at the sum of the tax rates
1837     described in Subsection (2)(a)(ii).
1838          (ii) If an optional computer software maintenance contract is a bundled transaction that
1839     consists of taxable and nontaxable products that are not separately itemized on an invoice or
1840     similar billing document, the purchase of the optional computer software maintenance contract
1841     is 40% taxable under this chapter and 60% nontaxable under this chapter.
1842          (iii) Subject to Subsection (2)(e)(iv), for a bundled transaction other than a bundled
1843     transaction described in Subsection (2)(e)(i) or (ii):
1844          (A) if the sales price of the bundled transaction is attributable to tangible personal
1845     property, a product, or a service that is subject to taxation under this chapter and tangible
1846     personal property, a product, or service that is not subject to taxation under this chapter, the
1847     entire bundled transaction is subject to taxation under this chapter unless:
1848          (I) the seller is able to identify by reasonable and verifiable standards the tangible
1849     personal property, product, or service that is not subject to taxation under this chapter from the
1850     books and records the seller keeps in the seller's regular course of business; or
1851          (II) state or federal law provides otherwise; or
1852          (B) if the sales price of a bundled transaction is attributable to two or more items of
1853     tangible personal property, products, or services that are subject to taxation under this chapter
1854     at different rates, the entire bundled transaction is subject to taxation under this chapter at the
1855     higher tax rate unless:
1856          (I) the seller is able to identify by reasonable and verifiable standards the tangible

1857     personal property, product, or service that is subject to taxation under this chapter at the lower
1858     tax rate from the books and records the seller keeps in the seller's regular course of business; or
1859          (II) state or federal law provides otherwise.
1860          (iv) For purposes of Subsection (2)(e)(iii), books and records that a seller keeps in the
1861     seller's regular course of business includes books and records the seller keeps in the regular
1862     course of business for nontax purposes.
1863          (f) (i) Except as otherwise provided in this chapter and subject to Subsections (2)(f)(ii)
1864     and (iii), if a transaction consists of the sale, lease, or rental of tangible personal property, a
1865     product, or a service that is subject to taxation under this chapter, and the sale, lease, or rental
1866     of tangible personal property, other property, a product, or a service that is not subject to
1867     taxation under this chapter, the entire transaction is subject to taxation under this chapter unless
1868     the seller, at the time of the transaction:
1869          (A) separately states the portion of the transaction that is not subject to taxation under
1870     this chapter on an invoice, bill of sale, or similar document provided to the purchaser; or
1871          (B) is able to identify by reasonable and verifiable standards, from the books and
1872     records the seller keeps in the seller's regular course of business, the portion of the transaction
1873     that is not subject to taxation under this chapter.
1874          (ii) A purchaser and a seller may correct the taxability of a transaction if:
1875          (A) after the transaction occurs, the purchaser and the seller discover that the portion of
1876     the transaction that is not subject to taxation under this chapter was not separately stated on an
1877     invoice, bill of sale, or similar document provided to the purchaser because of an error or
1878     ignorance of the law; and
1879          (B) the seller is able to identify by reasonable and verifiable standards, from the books
1880     and records the seller keeps in the seller's regular course of business, the portion of the
1881     transaction that is not subject to taxation under this chapter.
1882          (iii) For purposes of Subsections (2)(f)(i) and (ii), books and records that a seller keeps
1883     in the seller's regular course of business includes books and records the seller keeps in the
1884     regular course of business for nontax purposes.
1885          (g) (i) If the sales price of a transaction is attributable to two or more items of tangible
1886     personal property, products, or services that are subject to taxation under this chapter at
1887     different rates, the entire purchase is subject to taxation under this chapter at the higher tax rate

1888     unless the seller, at the time of the transaction:
1889          (A) separately states the items subject to taxation under this chapter at each of the
1890     different rates on an invoice, bill of sale, or similar document provided to the purchaser; or
1891          (B) is able to identify by reasonable and verifiable standards the tangible personal
1892     property, product, or service that is subject to taxation under this chapter at the lower tax rate
1893     from the books and records the seller keeps in the seller's regular course of business.
1894          (ii) For purposes of Subsection (2)(g)(i), books and records that a seller keeps in the
1895     seller's regular course of business includes books and records the seller keeps in the regular
1896     course of business for nontax purposes.
1897          (h) Subject to Subsections (2)(i) and (j), a tax rate repeal or tax rate change for a tax
1898     rate imposed under the following shall take effect on the first day of a calendar quarter:
1899          (i) Subsection (2)(a)(i)(A);
1900          (ii) Subsection (2)(b)(i); or
1901          [(iii) Subsection (2)(c)(i); or]
1902          [(iv)] (iii) Subsection (2)(e)(i)(A)(I).
1903          (i) (i) A tax rate increase takes effect on the first day of the first billing period that
1904     begins on or after the effective date of the tax rate increase if the billing period for the
1905     transaction begins before the effective date of a tax rate increase imposed under:
1906          (A) Subsection (2)(a)(i)(A);
1907          (B) Subsection (2)(b)(i); or
1908          [(C) Subsection (2)(c)(i); or]
1909          [(D)] (C) Subsection (2)(e)(i)(A)(I).
1910          (ii) The repeal of a tax or a tax rate decrease applies to a billing period if the billing
1911     statement for the billing period is rendered on or after the effective date of the repeal of the tax
1912     or the tax rate decrease imposed under:
1913          (A) Subsection (2)(a)(i)(A);
1914          (B) Subsection (2)(b)(i); or
1915          [(C) Subsection (2)(c)(i); or]
1916          [(D)] (C) Subsection (2)(e)(i)(A)(I).
1917          (j) (i) For a tax rate described in Subsection (2)(j)(ii), if a tax due on a catalogue sale is
1918     computed on the basis of sales and use tax rates published in the catalogue, a tax rate repeal or

1919     change in a tax rate takes effect:
1920          (A) on the first day of a calendar quarter; and
1921          (B) beginning 60 days after the effective date of the tax rate repeal or tax rate change.
1922          (ii) Subsection (2)(j)(i) applies to the tax rates described in the following:
1923          (A) Subsection (2)(a)(i)(A);
1924          (B) Subsection (2)(b)(i); or
1925          [(C) Subsection (2)(c)(i); or]
1926          [(D)] (C) Subsection (2)(e)(i)(A)(I).
1927          (iii) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act,
1928     the commission may by rule define the term "catalogue sale."
1929          (k) (i) For a location described in Subsection (2)(k)(ii), the commission shall determine
1930     the taxable status of a sale of gas, electricity, heat, coal, fuel oil, or other fuel based on the
1931     predominant use of the gas, electricity, heat, coal, fuel oil, or other fuel at the location.
1932          (ii) Subsection (2)(k)(i) applies to a location where gas, electricity, heat, coal, fuel oil,
1933     or other fuel is furnished through a single meter for two or more of the following uses:
1934          (A) a commercial use;
1935          (B) an industrial use; or
1936          (C) a residential use.
1937          (3) (a) The following state taxes shall be deposited into the General Fund:
1938          (i) the tax imposed by Subsection (2)(a)(i)(A);
1939          (ii) the tax imposed by Subsection (2)(b)(i); and
1940          [(iii) the tax imposed by Subsection (2)(c)(i); and]
1941          [(iv)] (iii) the tax imposed by Subsection (2)(e)(i)(A)(I).
1942          (b) The following local taxes shall be distributed to a county, city, or town as provided
1943     in this chapter:
1944          (i) the tax imposed by Subsection (2)(a)(ii);
1945          (ii) the tax imposed by Subsection (2)(b)(ii);
1946          (iii) the tax imposed by Subsection (2)(c)[(ii)]; and
1947          (iv) the tax imposed by Subsection (2)(e)(i)(B).
1948          (c) The state tax imposed by Subsection (2)(d) shall be deposited into the General
1949     Fund.

1950          (4) (a) Notwithstanding Subsection (3)(a), for a fiscal year beginning on or after July 1,
1951     2003, the lesser of the following amounts shall be expended as provided in Subsections (4)(b)
1952     through (g):
1953          (i) for taxes listed under Subsection (3)(a), the amount of tax revenue generated:
1954          (A) by a 1/16% tax rate on the transactions described in Subsection (1); and
1955          (B) for the fiscal year; or
1956          (ii) $17,500,000.
1957          (b) (i) For a fiscal year beginning on or after July 1, 2003, 14% of the amount
1958     described in Subsection (4)(a) shall be transferred each year as dedicated credits to the
1959     Department of Natural Resources to:
1960          (A) implement the measures described in Subsections 79-2-303(3)(a) through (d) to
1961     protect sensitive plant and animal species; or
1962          (B) award grants, up to the amount authorized by the Legislature in an appropriations
1963     act, to political subdivisions of the state to implement the measures described in Subsections
1964     79-2-303(3)(a) through (d) to protect sensitive plant and animal species.
1965          (ii) Money transferred to the Department of Natural Resources under Subsection
1966     (4)(b)(i) may not be used to assist the United States Fish and Wildlife Service or any other
1967     person to list or attempt to have listed a species as threatened or endangered under the
1968     Endangered Species Act of 1973, 16 U.S.C. Sec. 1531 et seq.
1969          (iii) At the end of each fiscal year:
1970          (A) 50% of any unexpended dedicated credits shall lapse to the Water Resources
1971     Conservation and Development Fund created in Section 73-10-24;
1972          (B) 25% of any unexpended dedicated credits shall lapse to the Utah Wastewater Loan
1973     Program Subaccount created in Section 73-10c-5; and
1974          (C) 25% of any unexpended dedicated credits shall lapse to the Drinking Water Loan
1975     Program Subaccount created in Section 73-10c-5.
1976          (c) For a fiscal year beginning on or after July 1, 2003, 3% of the amount described in
1977     Subsection (4)(a) shall be deposited each year in the Agriculture Resource Development Fund
1978     created in Section 4-18-106.
1979          (d) (i) For a fiscal year beginning on or after July 1, 2003, 1% of the amount described
1980     in Subsection (4)(a) shall be transferred each year as dedicated credits to the Division of Water

1981     Rights to cover the costs incurred in hiring legal and technical staff for the adjudication of
1982     water rights.
1983          (ii) At the end of each fiscal year:
1984          (A) 50% of any unexpended dedicated credits shall lapse to the Water Resources
1985     Conservation and Development Fund created in Section 73-10-24;
1986          (B) 25% of any unexpended dedicated credits shall lapse to the Utah Wastewater Loan
1987     Program Subaccount created in Section 73-10c-5; and
1988          (C) 25% of any unexpended dedicated credits shall lapse to the Drinking Water Loan
1989     Program Subaccount created in Section 73-10c-5.
1990          (e) (i) For a fiscal year beginning on or after July 1, 2003, 41% of the amount described
1991     in Subsection (4)(a) shall be deposited into the Water Resources Conservation and
1992     Development Fund created in Section 73-10-24 for use by the Division of Water Resources.
1993          (ii) In addition to the uses allowed of the Water Resources Conservation and
1994     Development Fund under Section 73-10-24, the Water Resources Conservation and
1995     Development Fund may also be used to:
1996          (A) conduct hydrologic and geotechnical investigations by the Division of Water
1997     Resources in a cooperative effort with other state, federal, or local entities, for the purpose of
1998     quantifying surface and ground water resources and describing the hydrologic systems of an
1999     area in sufficient detail so as to enable local and state resource managers to plan for and
2000     accommodate growth in water use without jeopardizing the resource;
2001          (B) fund state required dam safety improvements; and
2002          (C) protect the state's interest in interstate water compact allocations, including the
2003     hiring of technical and legal staff.
2004          (f) For a fiscal year beginning on or after July 1, 2003, 20.5% of the amount described
2005     in Subsection (4)(a) shall be deposited into the Utah Wastewater Loan Program Subaccount
2006     created in Section 73-10c-5 for use by the Water Quality Board to fund wastewater projects.
2007          (g) For a fiscal year beginning on or after July 1, 2003, 20.5% of the amount described
2008     in Subsection (4)(a) shall be deposited into the Drinking Water Loan Program Subaccount
2009     created in Section 73-10c-5 for use by the Division of Drinking Water to:
2010          (i) provide for the installation and repair of collection, treatment, storage, and
2011     distribution facilities for any public water system, as defined in Section 19-4-102;

2012          (ii) develop underground sources of water, including springs and wells; and
2013          (iii) develop surface water sources.
2014          (5) (a) Notwithstanding Subsection (3)(a), for a fiscal year beginning on or after July 1,
2015     2006, the difference between the following amounts shall be expended as provided in this
2016     Subsection (5), if that difference is greater than $1:
2017          (i) for taxes listed under Subsection (3)(a), the amount of tax revenue generated for the
2018     fiscal year by a 1/16% tax rate on the transactions described in Subsection (1); and
2019          (ii) $17,500,000.
2020          (b) (i) The first $500,000 of the difference described in Subsection (5)(a) shall be:
2021          (A) transferred each fiscal year to the Department of Natural Resources as dedicated
2022     credits; and
2023          (B) expended by the Department of Natural Resources for watershed rehabilitation or
2024     restoration.
2025          (ii) At the end of each fiscal year, 100% of any unexpended dedicated credits described
2026     in Subsection (5)(b)(i) shall lapse to the Water Resources Conservation and Development Fund
2027     created in Section 73-10-24.
2028          (c) (i) After making the transfer required by Subsection (5)(b)(i), $150,000 of the
2029     remaining difference described in Subsection (5)(a) shall be:
2030          (A) transferred each fiscal year to the Division of Water Resources as dedicated
2031     credits; and
2032          (B) expended by the Division of Water Resources for cloud-seeding projects
2033     authorized by Title 73, Chapter 15, Modification of Weather.
2034          (ii) At the end of each fiscal year, 100% of any unexpended dedicated credits described
2035     in Subsection (5)(c)(i) shall lapse to the Water Resources Conservation and Development Fund
2036     created in Section 73-10-24.
2037          (d) After making the transfers required by Subsections (5)(b) and (c), 85% of the
2038     remaining difference described in Subsection (5)(a) shall be deposited into the Water
2039     Resources Conservation and Development Fund created in Section 73-10-24 for use by the
2040     Division of Water Resources for:
2041          (i) preconstruction costs:
2042          (A) as defined in Subsection 73-26-103(6) for projects authorized by Title 73, Chapter

2043     26, Bear River Development Act; and
2044          (B) as defined in Subsection 73-28-103(8) for the Lake Powell Pipeline project
2045     authorized by Title 73, Chapter 28, Lake Powell Pipeline Development Act;
2046          (ii) the cost of employing a civil engineer to oversee any project authorized by Title 73,
2047     Chapter 26, Bear River Development Act;
2048          (iii) the cost of employing a civil engineer to oversee the Lake Powell Pipeline project
2049     authorized by Title 73, Chapter 28, Lake Powell Pipeline Development Act; and
2050          (iv) other uses authorized under Sections 73-10-24, 73-10-25.1, and 73-10-30, and
2051     Subsection (4)(e)(ii) after funding the uses specified in Subsections (5)(d)(i) through (iii).
2052          (e) After making the transfers required by Subsections (5)(b) and (c) and subject to
2053     Subsection (5)(f), 15% of the remaining difference described in Subsection (5)(a) shall be
2054     transferred each year as dedicated credits to the Division of Water Rights to cover the costs
2055     incurred for employing additional technical staff for the administration of water rights.
2056          (f) At the end of each fiscal year, any unexpended dedicated credits described in
2057     Subsection (5)(e) over $150,000 lapse to the Water Resources Conservation and Development
2058     Fund created in Section 73-10-24.
2059          (6) Notwithstanding Subsection (3)(a) and for taxes listed under Subsection (3)(a), the
2060     amount of revenue generated by a 1/16% tax rate on the transactions described in Subsection
2061     (1) for the fiscal year shall be deposited as follows:
2062          (a) for fiscal year 2020-21 only:
2063          (i) 20% of the revenue described in this Subsection (6) shall be deposited into the
2064     Transportation Investment Fund of 2005 created by Section 72-2-124; and
2065          (ii) 80% of the revenue described in this Subsection (6) shall be deposited into the
2066     Water Infrastructure Restricted Account created by Section 73-10g-103; and
2067          (b) for a fiscal year beginning on or after July 1, 2021, 100% of the revenue described
2068     in this Subsection (6) shall be deposited into the Water Infrastructure Restricted Account
2069     created by Section 73-10g-103.
2070          (7) (a) Notwithstanding Subsection (3)(a), in addition to the amounts deposited in
2071     Subsection (6), and subject to Subsection (7)(b), for a fiscal year beginning on or after July 1,
2072     2012, the Division of Finance shall deposit into the Transportation Investment Fund of 2005
2073     created by Section 72-2-124:

2074          (i) a portion of the taxes listed under Subsection (3)(a) in an amount equal to 8.3% of
2075     the revenues collected from the following taxes, which represents a portion of the
2076     approximately 17% of sales and use tax revenues generated annually by the sales and use tax
2077     on vehicles and vehicle-related products:
2078          (A) the tax imposed by Subsection (2)(a)(i)(A) at a 4.7% rate;
2079          (B) the tax imposed by Subsection (2)(b)(i); and
2080          [(C) the tax imposed by Subsection (2)(c)(i); and]
2081          [(D)] (C) the tax imposed by Subsection (2)(e)(i)(A)(I); plus
2082          (ii) an amount equal to 30% of the growth in the amount of revenues collected in the
2083     current fiscal year from the sales and use taxes described in Subsections (7)(a)(i)(A) through
2084     [(D)] (C) that exceeds the amount collected from the sales and use taxes described in
2085     Subsections (7)(a)(i)(A) through [(D)] (C) in the 2010-11 fiscal year.
2086          (b) (i) Subject to Subsections (7)(b)(ii) and (iii), in any fiscal year that the portion of
2087     the sales and use taxes deposited under Subsection (7)(a) represents an amount that is a total
2088     lower percentage of the sales and use taxes described in Subsections (7)(a)(i)(A) through [(D)]
2089     (C) generated in the current fiscal year than the total percentage of sales and use taxes
2090     deposited in the previous fiscal year, the Division of Finance shall deposit an amount under
2091     Subsection (7)(a) equal to the product of:
2092          (A) the total percentage of sales and use taxes deposited under Subsection (7)(a) in the
2093     previous fiscal year; and
2094          (B) the total sales and use tax revenue generated by the taxes described in Subsections
2095     (7)(a)(i)(A) through [(D)] (C) in the current fiscal year.
2096          (ii) In any fiscal year in which the portion of the sales and use taxes deposited under
2097     Subsection (7)(a) would exceed 17% of the revenues collected from the sales and use taxes
2098     described in Subsections (7)(a)(i)(A) through [(D)] (C) in the current fiscal year, the Division
2099     of Finance shall deposit 17% of the revenues collected from the sales and use taxes described
2100     in Subsections (7)(a)(i)(A) through [(D)] (C) for the current fiscal year under Subsection (7)(a).
2101          (iii) Subject to Subsection (7)(b)(iv)(E), in all subsequent fiscal years after a year in
2102     which 17% of the revenues collected from the sales and use taxes described in Subsections
2103     (7)(a)(i)(A) through [(D)] (C) was deposited under Subsection (7)(a), the Division of Finance
2104     shall annually deposit 17% of the revenues collected from the sales and use taxes described in

2105     Subsections (7)(a)(i)(A) through [(D)] (C) in the current fiscal year under Subsection (7)(a).
2106          (iv) (A) As used in this Subsection (7)(b)(iv), "additional growth revenue" means the
2107     amount of relevant revenue collected in the current fiscal year that exceeds by more than 3%
2108     the relevant revenue collected in the previous fiscal year.
2109          (B) As used in this Subsection (7)(b)(iv), "combined amount" means the combined
2110     total amount of money deposited into the Cottonwood Canyons fund under Subsections
2111     (7)(b)(iv)(F) and [(8)(c)(iv)(F)] (8)(d)(vi) in any single fiscal year.
2112          (C) As used in this Subsection (7)(b)(iv), "Cottonwood Canyons fund" means the
2113     Cottonwood Canyons Transportation Investment Fund created in Subsection 72-2-124(10).
2114          (D) As used in this Subsection (7)(b)(iv), "relevant revenue" means the portion of taxes
2115     listed under Subsection (3)(a) that equals 17% of the revenue collected from taxes described in
2116     Subsections (7)(a)(i)(A) through [(D)] (C).
2117          (E) For a fiscal year beginning on or after July 1, 2020, the commission shall annually
2118     reduce the deposit under Subsection [(7)(c)(iii)] (7)(a) into the Transportation Investment Fund
2119     of 2005 by an amount equal to the amount of the deposit under this Subsection (7)(b)(iv) to the
2120     Cottonwood Canyons fund in the previous fiscal year plus 25% of additional growth revenue,
2121     subject to the limit in Subsection (7)(b)(iv)(F).
2122          (F) The commission shall annually deposit the amount described in Subsection
2123     (7)(b)(iv)(E) into the Cottonwood Canyons fund, subject to an annual maximum combined
2124     amount for any single fiscal year of $20,000,000.
2125          (G) If the amount of relevant revenue declines in a fiscal year compared to the previous
2126     fiscal year, the commission shall decrease the amount of the contribution to the Cottonwood
2127     Canyons fund under this Subsection (7)(b)(iv) in the same proportion as the decline in relevant
2128     revenue.
2129          (8) (a) Notwithstanding Subsection (3)(a), in addition to the amounts deposited under
2130     Subsections (6) and (7), and subject to Subsections (8)(b) and (d)(v), for a fiscal year beginning
2131     on or after July 1, 2018, the commission shall annually deposit into the Transportation
2132     Investment Fund of 2005 created by Section 72-2-124 a portion of the taxes listed under
2133     Subsection (3)(a) in an amount equal to 3.68% of the revenues collected from the following
2134     taxes:
2135          (i) the tax imposed by Subsection (2)(a)(i)(A) at a 4.7% rate;

2136          (ii) the tax imposed by Subsection (2)(b)(i); and
2137          [(iii) the tax imposed by Subsection (2)(c)(i); and]
2138          [(iv)] (iii) the tax imposed by Subsection (2)(e)(i)(A)(I).
2139          (b) For a fiscal year beginning on or after July 1, 2019, the commission shall annually
2140     reduce the deposit into the Transportation Investment Fund of 2005 under Subsection (8)(a) by
2141     an amount that is equal to 35% of the amount of revenue generated in the current fiscal year by
2142     the portion of the tax imposed on motor and special fuel that is sold, used, or received for sale
2143     or use in this state that exceeds 29.4 cents per gallon.
2144          (c) The commission shall annually deposit the amount described in Subsection (8)(b)
2145     into the Transit Transportation Investment Fund created in Section 72-2-124.
2146          (d) (i) As used in this Subsection (8)(d), "additional growth revenue" means the
2147     amount of relevant revenue collected in the current fiscal year that exceeds by more than 3%
2148     the relevant revenue collected in the previous fiscal year.
2149          (ii) As used in this Subsection (8)(d), "combined amount" means the combined total
2150     amount of money deposited into the Cottonwood Canyons fund under Subsections (7)(b)(iv)(F)
2151     and (8)(d)(vi) in any single fiscal year.
2152          (iii) As used in this Subsection (8)(d), "Cottonwood Canyons fund" means the
2153     Cottonwood Canyons Transportation Investment Fund created in Subsection 72-2-124(10).
2154          (iv) As used in this Subsection (8)(d), "relevant revenue" means the portion of taxes
2155     listed under Subsection (3)(a) that equals 3.68% of the revenue collected from taxes described
2156     in Subsections (8)(a)(i) through [(iv)] (iii).
2157          (v) For a fiscal year beginning on or after July 1, 2020, the commission shall annually
2158     reduce the deposit under Subsection (8)(a) into the Transportation Investment Fund of 2005 by
2159     an amount equal to the amount of the deposit under this Subsection (8)(d) to the Cottonwood
2160     Canyons fund in the previous fiscal year plus 25% of additional growth revenue, subject to the
2161     limit in Subsection (8)(d)(vi).
2162          (vi) The commission shall annually deposit the amount described in Subsection
2163     (8)(d)(v) into the Cottonwood Canyons fund, subject to an annual maximum combined amount
2164     for any single fiscal year of $20,000,000.
2165          (vii) If the amount of relevant revenue declines in a fiscal year compared to the
2166     previous fiscal year, the commission shall decrease the amount of the contribution to the

2167     Cottonwood Canyons fund under this Subsection (8)(d) in the same proportion as the decline in
2168     relevant revenue.
2169          (9) Notwithstanding Subsection (3)(a), for each fiscal year beginning with fiscal year
2170     2009-10, $533,750 shall be deposited into the Qualified Emergency Food Agencies Fund
2171     created by Section 35A-8-1009 and expended as provided in Section 35A-8-1009.
2172          (10) (a) Notwithstanding Subsection (3)(a), except as provided in Subsection (10)(b),
2173     and in addition to any amounts deposited under Subsections (6), (7), and (8), the Division of
2174     Finance shall deposit into the Transportation Investment Fund of 2005 created by Section
2175     72-2-124 the amount of revenue described as follows:
2176          (i) for fiscal year 2020-21 only, 33.33% of the amount of revenue generated by a .05%
2177     tax rate on the transactions described in Subsection (1); and
2178          (ii) for fiscal year 2021-22 only, 16.67% of the amount of revenue generated by a .05%
2179     tax rate on the transactions described in Subsection (1).
2180          (b) For purposes of Subsection (10)(a), the Division of Finance may not deposit into
2181     the Transportation Investment Fund of 2005 any tax revenue generated by amounts paid or
2182     charged for food and food ingredients, except for tax revenue generated by a bundled
2183     transaction attributable to food and food ingredients and tangible personal property other than
2184     food and food ingredients described in Subsection (2)(e).
2185          (11) Notwithstanding Subsection (3)(a), beginning the second fiscal year after the
2186     fiscal year during which the Division of Finance receives notice under Section 63N-2-510 that
2187     construction on a qualified hotel, as defined in Section 63N-2-502, has begun, the Division of
2188     Finance shall, for two consecutive fiscal years, annually deposit $1,900,000 of the revenue
2189     generated by the taxes listed under Subsection (3)(a) into the Hotel Impact Mitigation Fund,
2190     created in Section 63N-2-512.
2191          (12) (a) The rate specified in this subsection is 0.15%.
2192          (b) Notwithstanding Subsection (3)(a), the Division of Finance shall, for a fiscal year
2193     beginning on or after July 1, 2019, annually transfer the amount of revenue collected from the
2194     rate described in Subsection (12)(a) on the transactions that are subject to the sales and use tax
2195     under Subsection (2)(a)(i)(A) into the Medicaid Expansion Fund created in Section
2196     26-36b-208.
2197          (13) Notwithstanding Subsection (3)(a), for each fiscal year beginning with fiscal year

2198     2020-21, the Division of Finance shall deposit $200,000 into the General Fund as a dedicated
2199     credit solely for use of the Search and Rescue Financial Assistance Program created in, and
2200     expended in accordance with, Title 53, Chapter 2a, Part 11, Search and Rescue Act.
2201          (14) (a) For each fiscal year beginning with fiscal year 2020-21, the Division of
2202     Finance shall annually transfer $1,813,400 of the revenue deposited into the Transportation
2203     Investment Fund of 2005 under Subsections (6) through (8) to the General Fund.
2204          (b) If the total revenue deposited into the Transportation Investment Fund of 2005
2205     under Subsections (6) through (8) is less than $1,813,400 for a fiscal year, the Division of
2206     Finance shall transfer the total revenue deposited into the Transportation Investment Fund of
2207     2005 under Subsections (6) through (8) during the fiscal year to the General Fund.
2208          (15) Notwithstanding Subsection (3)(a), and as described in Section 63N-3-610,
2209     beginning one year after the sales and use tax boundary for a housing and transit reinvestment
2210     zone is established, the commission, at least annually, shall transfer an amount equal to 15% of
2211     the sales and use tax increment within an established sales and use tax boundary, as defined in
2212     Section 63N-3-602, into the Transit Transportation Investment Fund created in Section
2213     72-2-124
.
2214          Section 4. Section 59-12-108 is amended to read:
2215          59-12-108. Monthly payment -- Amount of tax a seller may retain -- Penalty --
2216     Certain amounts allocated to local taxing jurisdictions.
2217          (1) (a) Notwithstanding Section 59-12-107, a seller that has a tax liability under this
2218     chapter of $50,000 or more for the previous calendar year shall:
2219          (i) file a return with the commission:
2220          (A) monthly on or before the last day of the month immediately following the month
2221     for which the seller collects a tax under this chapter; and
2222          (B) for the month for which the seller collects a tax under this chapter; and
2223          (ii) except as provided in Subsection (1)(b), remit with the return required by
2224     Subsection (1)(a)(i) the amount the person is required to remit to the commission for each tax,
2225     fee, or charge described in Subsection (1)(c):
2226          (A) if that seller's tax liability under this chapter for the previous calendar year is less
2227     than $96,000, by any method permitted by the commission; or
2228          (B) if that seller's tax liability under this chapter for the previous calendar year is

2229     $96,000 or more, by electronic funds transfer.
2230          (b) A seller shall remit electronically with the return required by Subsection (1)(a)(i)
2231     the amount the seller is required to remit to the commission for each tax, fee, or charge
2232     described in Subsection (1)(c) if that seller:
2233          (i) is required by Section 59-12-107 to file the return electronically; or
2234          (ii) (A) is required to collect and remit a tax under Section 59-12-107; and
2235          (B) files a simplified electronic return.
2236          (c) Subsections (1)(a) and (b) apply to the following taxes, fees, or charges:
2237          (i) a tax under Title 10, Chapter 1, Part 3, Municipal Energy Sales and Use Tax Act;
2238          (ii) a fee under Section 19-6-714;
2239          (iii) a fee under Section 19-6-805;
2240          (iv) a charge under Title 69, Chapter 2, Part 4, Prepaid Wireless Telecommunications
2241     Service Charges; or
2242          (v) a tax under this chapter.
2243          (d) Notwithstanding Subsection (1)(a)(ii) and in accordance with Title 63G, Chapter 3,
2244     Utah Administrative Rulemaking Act, the commission shall make rules providing for a method
2245     for making same-day payments other than by electronic funds transfer if making payments by
2246     electronic funds transfer fails.
2247          (e) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
2248     commission shall establish by rule procedures and requirements for determining the amount a
2249     seller is required to remit to the commission under this Subsection (1).
2250          (2) (a) Except as provided in Subsection (3), a seller subject to Subsection (1) or a
2251     seller described in Subsection (4) may retain each month the amount allowed by this
2252     Subsection (2).
2253          (b) A seller subject to Subsection (1) or a seller described in Subsection (4) may retain
2254     each month 1.31% of any amounts the seller is required to remit to the commission:
2255          (i) for a transaction described in Subsection 59-12-103(1) that is subject to a state tax
2256     and a local tax imposed in accordance with the following, for the month for which the seller is
2257     filing a return in accordance with Subsection (1):
2258          (A) Subsection 59-12-103(2)(a);
2259          (B) Subsection 59-12-103(2)(b); and

2260          (C) Subsection 59-12-103(2)(d); and
2261          (ii) for an agreement sales and use tax.
2262          (c) (i) A seller subject to Subsection (1) or a seller described in Subsection (4) may
2263     retain each month the amount calculated under Subsection (2)(c)(ii) for a transaction described
2264     in Subsection 59-12-103(1) that is subject to the [state tax and the local] tax imposed in
2265     accordance with Subsection 59-12-103(2)(c).
2266          (ii) For purposes of Subsection (2)(c)(i), the amount a seller may retain is an amount
2267     equal to the sum of:
2268          (A) 1.31% of any amounts the seller is required to remit to the commission for:
2269          (I) the [state tax and the local] tax imposed in accordance with Subsection
2270     59-12-103(2)(c);
2271          (II) the month for which the seller is filing a return in accordance with Subsection (1);
2272     and
2273          (III) an agreement sales and use tax; and
2274          (B) 1.31% of the difference between:
2275          (I) the amounts the seller would have been required to remit to the commission:
2276          (Aa) in accordance with Subsection 59-12-103(2)(a) if the transaction had been subject
2277     to the state tax and the local tax imposed in accordance with Subsection 59-12-103(2)(a);
2278          (Bb) for the month for which the seller is filing a return in accordance with Subsection
2279     (1); and
2280          (Cc) for an agreement sales and use tax; and
2281          (II) the amounts the seller is required to remit to the commission for:
2282          (Aa) the [state tax and the local] tax imposed in accordance with Subsection
2283     59-12-103(2)(c);
2284          (Bb) the month for which the seller is filing a return in accordance with Subsection (1);
2285     and
2286          (Cc) an agreement sales and use tax.
2287          (d) A seller subject to Subsection (1) or a seller described in Subsection (4) may retain
2288     each month 1% of any amounts the seller is required to remit to the commission:
2289          (i) for the month for which the seller is filing a return in accordance with Subsection
2290     (1); and

2291          (ii) under:
2292          (A) Title 10, Chapter 1, Part 3, Municipal Energy Sales and Use Tax Act;
2293          (B) Subsection 59-12-603(1)(a)(i)(A);
2294          (C) Subsection 59-12-603(1)(a)(i)(B); or
2295          (D) Subsection 59-12-603(1)(a)(ii).
2296          (3) A state government entity that is required to remit taxes monthly in accordance
2297     with Subsection (1) may not retain any amount under Subsection (2).
2298          (4) A seller that has a tax liability under this chapter for the previous calendar year of
2299     less than $50,000 may:
2300          (a) voluntarily meet the requirements of Subsection (1); and
2301          (b) if the seller voluntarily meets the requirements of Subsection (1), retain the
2302     amounts allowed by Subsection (2).
2303          (5) Penalties for late payment shall be as provided in Section 59-1-401.
2304          (6) (a) Except as provided in Subsection (6)(c), for any amounts required to be remitted
2305     to the commission under this part, the commission shall each month calculate an amount equal
2306     to the difference between:
2307          (i) the total amount retained for that month by all sellers had the percentages listed
2308     under Subsections (2)(b) and (2)(c)(ii) been 1.5%; and
2309          (ii) the total amount retained for that month by all sellers at the percentages listed
2310     under Subsections (2)(b) and (2)(c)(ii).
2311          (b) The commission shall each month allocate the amount calculated under Subsection
2312     (6)(a) to each county, city, and town on the basis of the proportion of agreement sales and use
2313     tax that the commission distributes to each county, city, and town for that month compared to
2314     the total agreement sales and use tax that the commission distributes for that month to all
2315     counties, cities, and towns.
2316          (c) The amount the commission calculates under Subsection (6)(a) may not include an
2317     amount collected from a tax that:
2318          (i) the state imposes within a county, city, or town, including the unincorporated area
2319     of a county; and
2320          (ii) is not imposed within the entire state.
2321          Section 5. Section 63N-7-301 is amended to read:

2322          63N-7-301. Tourism Marketing Performance Account.
2323          (1) There is created within the General Fund a restricted account known as the Tourism
2324     Marketing Performance Account.
2325          (2) The account shall be administered by [GOED] the office for the purposes listed in
2326     Subsection (5).
2327          (3) (a) The account shall earn interest.
2328          (b) All interest earned on account money shall be deposited into the account.
2329          (4) The account shall be funded by appropriations made to the account by the
2330     Legislature in accordance with this section.
2331          (5) The [executive] managing director of [GOED's] the office's Office of Tourism shall
2332     use account money appropriated to [GOED] the office to pay for the statewide advertising,
2333     marketing, and branding campaign for promotion of the state as conducted by [GOED] the
2334     office.
2335          (6) (a) For each fiscal year beginning on or after July 1, 2007, [GOED] the office shall
2336     annually allocate 10% of the account money appropriated to [GOED] the office to a sports
2337     organization for advertising, marketing, branding, and promoting Utah in attracting sporting
2338     events into the state.
2339          (b) The sports organization shall:
2340          (i) provide an annual written report to [GOED] the office that gives an accounting of
2341     the use of funds the sports organization receives under this Subsection (6); and
2342          (ii) promote the state and encourage economic growth in the state.
2343          (c) For purposes of this Subsection (6), "sports organization" means an organization
2344     that:
2345          (i) is exempt from federal income taxation in accordance with Section 501(c)(3),
2346     Internal Revenue Code;
2347          (ii) maintains its principal location in the state;
2348          (iii) has a minimum of 15 years experience in the state hosting, fostering, and attracting
2349     major summer and winter sporting events statewide; and
2350          (iv) was created to foster state, regional, national, and international sports competitions
2351     in the state, to drive the state's Olympic and sports legacy, including competitions related to
2352     Olympic sports, and to promote and encourage sports tourism throughout the state, including

2353     advertising, marketing, branding, and promoting the state for the purpose of attracting sporting
2354     events in the state.
2355          [(7) Money deposited into the account shall include a legislative appropriation from the
2356     cumulative sales and use tax revenue increases described in Subsection (8), plus any additional
2357     appropriation made by the Legislature.]
2358          [(8) (a) In fiscal years 2006 through 2019, a portion of the state sales and use tax
2359     revenues determined under this Subsection (8) shall be certified by the State Tax Commission
2360     as a set-aside for the account, and the State Tax Commission shall report the amount of the
2361     set-aside to the office, the Office of Legislative Fiscal Analyst, and the Division of Finance,
2362     which shall set aside the certified amount for appropriation to the account.]
2363          [(b) For fiscal years 2016 through 2019, the State Tax Commission shall calculate the
2364     set-aside under this Subsection (8) in each fiscal year by applying one of the following
2365     formulas: if the annual percentage change in the Consumer Price Index for All Urban
2366     Consumers, as published by the Bureau of Labor Statistics of the United States Department of
2367     Labor, for the fiscal year two years before the fiscal year in which the set-aside is to be made
2368     is:]
2369          [(i) greater than 3%, and if the annual percentage change in the state sales and use tax
2370     revenues attributable to the retail sales of tourist-oriented goods and services from the fiscal
2371     year three years before the fiscal year in which the set-aside is to be made to the fiscal year two
2372     years before the fiscal year in which the set-aside is to be made is greater than the annual
2373     percentage change in the Consumer Price Index for the fiscal year two years before the fiscal
2374     year in which the set-aside is to be made, then the difference between the annual percentage
2375     change in the state sales and use tax revenues attributable to the retail sales of tourist-oriented
2376     goods and services and the annual percentage change in the Consumer Price Index shall be
2377     multiplied by an amount equal to the state sales and use tax revenues attributable to the retail
2378     sales of tourist-oriented goods and services from the fiscal year three years before the fiscal
2379     year in which the set-aside is to be made; or]
2380          [(ii) 3% or less, and if the annual percentage change in the state sales and use tax
2381     revenues attributable to the retail sales of tourist-oriented goods and services from the fiscal
2382     year three years before the fiscal year in which the set-aside is to be made to the fiscal year two
2383     years before the fiscal year in which the set-aside is to be made is greater than 3%, then the

2384     difference between the annual percentage change in the state sales and use tax revenues
2385     attributable to the retail sales of tourist-oriented goods and services and 3% shall be multiplied
2386     by an amount equal to the state sales and use tax revenues attributable to the retail sales of
2387     tourist-oriented goods and services from the fiscal year three years before the fiscal year in
2388     which the set-aside is to be made.]
2389          [(c) The total money appropriated to the account in a fiscal year under Subsections
2390     (8)(a) and (b) may not exceed the amount appropriated to the account in the preceding fiscal
2391     year by more than $3,000,000.]
2392          [(d) As used in this Subsection (8), "state sales and use tax revenues" are revenues
2393     collected under Subsections 59-12-103(2)(a)(i)(A) and 59-12-103(2)(c)(i).]
2394          [(e) As used in this Subsection (8), "retail sales of tourist-oriented goods and services"
2395     are calculated by adding the following percentages of sales from each business registered with
2396     the State Tax Commission under one of the following codes of the 2012 North American
2397     Industry Classification System of the federal Executive Office of the President, Office of
2398     Management and Budget:]
2399          [(i) 80% of the sales from each business under NAICS Codes:]
2400          [(A) 532111 Passenger Car Rental;]
2401          [(B) 53212 Truck, Utility Trailer, and RV (Recreational Vehicle) Rental and Leasing;]
2402          [(C) 5615 Travel Arrangement and Reservation Services;]
2403          [(D) 7211 Traveler Accommodation; and]
2404          [(E) 7212 RV (Recreational Vehicle) Parks and Recreational Camps;]
2405          [(ii) 25% of the sales from each business under NAICS Codes:]
2406          [(A) 51213 Motion Picture and Video Exhibition;]
2407          [(B) 532292 Recreational Goods Rental;]
2408          [(C) 711 Performing Arts, Spectator Sports, and Related Industries;]
2409          [(D) 712 Museums, Historical Sites, and Similar Institutions; and]
2410          [(E) 713 Amusement, Gambling, and Recreation Industries;]
2411          [(iii) 20% of the sales from each business under NAICS Code 722 Food Services and
2412     Drinking Places;]
2413          [(iv) 18% of the sales from each business under NAICS Codes:]
2414          [(A) 447 Gasoline Stations; and]

2415          [(B) 81293 Parking Lots and Garages;]
2416          [(v) 14% of the sales from each business under NAICS Code 8111 Automotive Repair
2417     and Maintenance; and]
2418          [(vi) 5% of the sales from each business under NAICS Codes:]
2419          [(A) 445 Food and Beverage Stores;]
2420          [(B) 446 Health and Personal Care Stores;]
2421          [(C) 448 Clothing and Clothing Accessories Stores;]
2422          [(D) 451 Sporting Goods, Hobby, Musical Instrument, and Book Stores;]
2423          [(E) 452 General Merchandise Stores; and]
2424          [(F) 453 Miscellaneous Store Retailers.]
2425          [(9)] (7) (a) For each fiscal year, the office shall allocate 20% of the funds appropriated
2426     to the Tourism Marketing and Performance Account to the cooperative program described in
2427     this Subsection [(9)] (7).
2428          (b) Money allocated to the cooperative program may be awarded to cities, counties,
2429     nonprofit destination marketing organizations, and similar public entities for the purpose of
2430     supplementing money committed by these entities for advertising and promoting sites and
2431     events in the state.
2432          (c) The office shall establish:
2433          (i) an application and approval process for an entity to receive a cooperative program
2434     award, including an application deadline;
2435          (ii) the criteria for awarding a cooperative program award, which shall emphasize
2436     attracting out-of-state visitors, and may include attracting in-state visitors, to sites and events in
2437     the state; and
2438          (iii) eligibility, advertising, timing, and reporting requirements of an entity that
2439     receives a cooperative program award.
2440          (d) Money allocated to the cooperative program that is not used in each fiscal year shall
2441     be returned to the Tourism Marketing Performance Account.
2442          Section 6. Effective date.
2443          This bill takes effect on July 1, 2022.