2
3
4
5
6 Cosponsors:
7 Nelson T. Abbott
8 Carl R. Albrecht
9 Melissa G. Ballard
10 Brady Brammer
11 Walt Brooks
12 Kay J. Christofferson
13 Tyler Clancy
14 Paul A. Cutler
15 Jon Hawkins
16 Ken Ivory
17 Colin W. Jack
18 Dan N. Johnson
Jason B. Kyle
Karianne Lisonbee
Anthony E. Loubet
Steven J. Lund
Jefferson Moss
Calvin R. Musselman
Michael J. Petersen
Karen M. Peterson
Thomas W. Peterson
Val L. Peterson
Candice B. Pierucci
Susan Pulsipher
Judy Weeks Rohner
Mike Schultz
Rex P. Shipp
Casey Snider
Robert M. Spendlove
Keven J. Stratton
Mark A. Strong
Jordan D. Teuscher
Douglas R. Welton
Stephen L. Whyte
Ryan D. Wilcox
19
20 LONG TITLE
21 General Description:
22 This bill modifies state tax provisions.
23 Highlighted Provisions:
24 This bill:
25 ▸ amends the corporate franchise and income tax rates;
26 ▸ amends the individual income tax rate;
27 ▸ adds to the taxpayer tax credit an additional Utah personal exemption in the year of
28 a qualifying dependent's birth;
29 ▸ expands eligibility for the social security benefits tax credit by increasing the
30 thresholds for the income-based phaseout;
31 ▸ modifies the calculation of the earned income tax credit;
32 ▸ removes the state sales and use tax imposed on amounts paid or charged for food
33 and food ingredients; and
34 ▸ makes technical and conforming changes.
35 Money Appropriated in this Bill:
36 None
37 Other Special Clauses:
38 This bill provides a special effective date.
39 This bill provides retrospective operation.
40 Utah Code Sections Affected:
41 AMENDS:
42 59-7-104, as last amended by Laws of Utah 2022, Chapter 12
43 59-7-201, as last amended by Laws of Utah 2022, Chapter 12
44 59-10-104, as last amended by Laws of Utah 2022, Chapter 12
45 59-10-1018, as last amended by Laws of Utah 2021, Chapter 75
46 59-10-1042, as last amended by Laws of Utah 2022, Chapters 12, 258
47 59-10-1044, as enacted by Laws of Utah 2022, Chapter 12
48 59-12-102, as last amended by Laws of Utah 2021, Chapters 64, 367 and 414 and last
49 amended by Coordination Clause, Laws of Utah 2021, Chapter 367
50 59-12-103, as last amended by Laws of Utah 2022, Chapters 77, 106 and 433
51 59-12-108, as last amended by Laws of Utah 2020, Chapters 294, 407
52 63N-2-502, as last amended by Laws of Utah 2020, Chapter 407
53 63N-7-301, as last amended by Laws of Utah 2022, Chapters 274, 362 and last
54 amended by Coordination Clause, Laws of Utah 2022, Chapter 362
55
56 Be it enacted by the Legislature of the state of Utah:
57 Section 1. Section 59-7-104 is amended to read:
58 59-7-104. Tax -- Minimum tax.
59 (1) Each domestic and foreign corporation, except a corporation that is exempt under
60 Section 59-7-102, shall pay an annual tax to the state based on the corporation's Utah taxable
61 income for the taxable year for the privilege of exercising the corporation's corporate franchise
62 or for the privilege of doing business in the state.
63 (2) The tax shall be [
64 (3) The minimum tax a corporation shall pay under this chapter is $100.
65 Section 2. Section 59-7-201 is amended to read:
66 59-7-201. Tax -- Minimum tax.
67 (1) There is imposed upon each corporation, except a corporation that is exempt under
68 Section 59-7-102, a tax upon the corporation's Utah taxable income for the taxable year that is
69 derived from sources within this state other than income for any period that the corporation is
70 required to include in the corporation's tax base under Section 59-7-104.
71 (2) The tax imposed by Subsection (1) shall be [
72 taxable income.
73 (3) In no case shall the tax be less than $100.
74 Section 3. Section 59-10-104 is amended to read:
75 59-10-104. Tax basis -- Tax rate -- Exemption.
76 (1) A tax is imposed on the state taxable income of a resident individual as provided in
77 this section.
78 (2) For purposes of Subsection (1), for a taxable year, the tax is an amount equal to the
79 product of:
80 (a) the resident individual's state taxable income for that taxable year; and
81 (b) [
82 (3) This section does not apply to a resident individual exempt from taxation under
83 Section 59-10-104.1.
84 Section 4. Section 59-10-1018 is amended to read:
85 59-10-1018. Definitions -- Nonrefundable taxpayer tax credits.
86 (1) As used in this section:
87 (a) "Head of household filing status" means a head of household, as defined in Section
88 2(b), Internal Revenue Code, who files a single federal individual income tax return for the
89 taxable year.
90 (b) "Joint filing status" means:
91 (i) spouses who file a single return jointly under this chapter for a taxable year; or
92 (ii) a surviving spouse, as defined in Section 2(a), Internal Revenue Code, who files a
93 single federal individual income tax return for the taxable year.
94 (c) "Qualifying dependent" means an individual with respect to whom the claimant is
95 allowed to claim a tax credit under Section 24, Internal Revenue Code, on the claimant's
96 federal individual income tax return for the taxable year.
97 (d) "Single filing status" means:
98 (i) a single individual who files a single federal individual income tax return for the
99 taxable year; or
100 (ii) a married individual who:
101 (A) does not file a single federal individual income tax return jointly with that married
102 individual's spouse for the taxable year; and
103 (B) files a single federal individual income tax return for the taxable year.
104 (e) "State or local income tax" means the lesser of:
105 (i) the amount of state or local income tax that the claimant:
106 (A) pays for the taxable year; and
107 (B) reports on the claimant's federal individual income tax return for the taxable year,
108 regardless of whether the claimant is allowed an itemized deduction on the claimant's federal
109 individual income tax return for the taxable year for the full amount of state or local income tax
110 paid; and
111 (ii) $10,000.
112 (f) (i) "Utah itemized deduction" means the amount the claimant deducts as allowed as
113 an itemized deduction on the claimant's federal individual income tax return for that taxable
114 year minus any amount of state or local income tax for the taxable year.
115 (ii) "Utah itemized deduction" does not include any amount of qualified business
116 income that the claimant subtracts as allowed by Section 199A, Internal Revenue Code, on the
117 claimant's federal income tax return for that taxable year.
118 (g) "Utah personal exemption" means, subject to Subsection (6), $1,750 multiplied by
119 the number of the claimant's qualifying dependents plus an additional qualifying dependent in
120 the year of a qualifying dependent's birth.
121 (2) Except as provided in Section 59-10-1002.2, and subject to Subsections (3) through
122 (5), a claimant may claim a nonrefundable tax credit against taxes otherwise due under this part
123 equal to the sum of:
124 (a) (i) for a claimant that deducts the standard deduction on the claimant's federal
125 individual income tax return for the taxable year, 6% of the amount the claimant deducts as
126 allowed as the standard deduction on the claimant's federal individual income tax return for
127 that taxable year; or
128 (ii) for a claimant that itemizes deductions on the claimant's federal individual income
129 tax return for the taxable year, 6% of the amount of the claimant's Utah itemized deduction;
130 and
131 (b) 6% of the claimant's Utah personal exemption.
132 (3) A claimant may not carry forward or carry back a tax credit under this section.
133 (4) The tax credit allowed by Subsection (2) shall be reduced by $.013 for each dollar
134 by which a claimant's state taxable income exceeds:
135 (a) for a claimant who has a single filing status, $15,095;
136 (b) for a claimant who has a head of household filing status, $22,643; or
137 (c) for a claimant who has a joint filing status, $30,190.
138 (5) (a) For a taxable year beginning on or after January 1, 2022, the commission shall
139 increase or decrease annually the following dollar amounts by a percentage equal to the
140 percentage difference between the consumer price index for the preceding calendar year and
141 the consumer price index for calendar year 2020:
142 (i) the dollar amount listed in Subsection (4)(a); and
143 (ii) the dollar amount listed in Subsection (4)(b).
144 (b) After the commission increases or decreases the dollar amounts listed in Subsection
145 (5)(a), the commission shall round those dollar amounts listed in Subsection (5)(a) to the
146 nearest whole dollar.
147 (c) After the commission rounds the dollar amounts as required by Subsection (5)(b),
148 the commission shall increase or decrease the dollar amount listed in Subsection (4)(c) so that
149 the dollar amount listed in Subsection (4)(c) is equal to the product of:
150 (i) the dollar amount listed in Subsection (4)(a); and
151 (ii) two.
152 (d) For purposes of Subsection (5)(a), the commission shall calculate the consumer
153 price index as provided in Sections 1(f)(4) and 1(f)(5), Internal Revenue Code.
154 (6) (a) For a taxable year beginning on or after January 1, 2022, the commission shall
155 increase annually the Utah personal exemption amount listed in Subsection (1)(g) by a
156 percentage equal to the percentage by which the consumer price index for the preceding
157 calendar year exceeds the consumer price index for calendar year 2020.
158 (b) After the commission increases the Utah personal exemption amount as described
159 in Subsection (6)(a), the commission shall round the Utah personal exemption amount to the
160 nearest whole dollar.
161 (c) For purposes of Subsection (6)(a), the commission shall calculate the consumer
162 price index as provided in Sections 1(f)(4) and 1(f)(5), Internal Revenue Code.
163 Section 5. Section 59-10-1042 is amended to read:
164 59-10-1042. Nonrefundable tax credit for social security benefits.
165 (1) As used in this section:
166 (a) "Head of household filing status" means the same as that term is defined in Section
167 59-10-1018.
168 (b) "Joint filing status" means the same as that term is defined in Section 59-10-1018.
169 (c) "Married filing separately status" means a married individual who:
170 (i) does not file a single federal individual income tax return jointly with that married
171 individual's spouse for the taxable year; and
172 (ii) files a single federal individual income tax return for the taxable year.
173 (d) "Modified adjusted gross income" means the sum of the following for a claimant
174 or, if the claimant's return under this chapter is allowed a joint filing status, the claimant and
175 the claimant's spouse:
176 (i) adjusted gross income for the taxable year for which a tax credit is claimed under
177 this section;
178 (ii) any interest income that is not included in adjusted gross income for the taxable
179 year described in Subsection (1)(d)(i); and
180 (iii) any addition to adjusted gross income required by Section 59-10-114 for the
181 taxable year described in Subsection (1)(d)(i).
182 (e) "Single filing status" means a single individual who files a single federal individual
183 income tax return for the taxable year.
184 (f) "Social security benefit" means an amount received by a claimant as a monthly
185 benefit in accordance with the Social Security Act, 42 U.S.C. Sec. 401 et seq.
186 (2) Except as provided in Section 59-10-1002.2 and Subsections (3) and (4), each
187 claimant on a return that receives a social security benefit may claim a nonrefundable tax credit
188 against taxes otherwise due under this part equal to the product of:
189 (a) the percentage listed in Subsection 59-10-104(2); and
190 (b) the claimant's social security benefit that is included in adjusted gross income on
191 the claimant's federal income tax return for the taxable year.
192 (3) A claimant may not:
193 (a) carry forward or carry back the amount of a tax credit under this section that
194 exceeds the claimant's tax liability for the taxable year; or
195 (b) claim a tax credit under this section for a taxable year if a tax credit under Section
196 59-10-1019 is claimed on the claimant's return for the same taxable year.
197 (4) The tax credit allowed by Subsection (2) claimed on a return filed under this part
198 shall be reduced by $.025 for each dollar by which modified adjusted gross income for
199 purposes of the return exceeds:
200 (a) for a federal individual income tax return that is allowed a married filing separately
201 status, [
202 (b) for a federal individual income tax return that is allowed a single filing status,
203 [
204 (c) for a federal individual income tax return that is allowed a head of household filing
205 status, [
206 (d) for a return under this chapter that is allowed a joint filing status, [
207 $75,000.
208 (5) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
209 commission may make rules governing the calculation and method for claiming the tax credit
210 described in this section.
211 Section 6. Section 59-10-1044 is amended to read:
212 59-10-1044. Nonrefundable earned income tax credit.
213 (1) As used in this section:
214 (a) "Federal earned income tax credit" means the federal earned income tax credit
215 described in Section 32, Internal Revenue Code.
216 (b) "Qualifying claimant" means a resident or nonresident individual who:
217 (i) qualifies for and claims the federal earned income tax credit for the current taxable
218 year[
219 (ii) earns income in Utah that is reported on a W-2 form.
220 (2) Subject to Section 59-10-1002.2, a qualifying claimant may claim a nonrefundable
221 earned income tax credit equal to the lesser of:
222 (a) [
223 claimant was entitled to claim on a federal income tax return for the current taxable year[
224 (b) the total Utah wages reported on the qualifying claimant's W-2 form for the current
225 taxable year.
226 (3) A qualifying claimant may not carry forward or carry back the amount of the earned
227 income tax credit that exceeds the qualifying claimant's tax liability.
228 Section 7. Section 59-12-102 is amended to read:
229 59-12-102. Definitions.
230 As used in this chapter:
231 (1) "800 service" means a telecommunications service that:
232 (a) allows a caller to dial a toll-free number without incurring a charge for the call; and
233 (b) is typically marketed:
234 (i) under the name 800 toll-free calling;
235 (ii) under the name 855 toll-free calling;
236 (iii) under the name 866 toll-free calling;
237 (iv) under the name 877 toll-free calling;
238 (v) under the name 888 toll-free calling; or
239 (vi) under a name similar to Subsections (1)(b)(i) through (v) as designated by the
240 Federal Communications Commission.
241 (2) (a) "900 service" means an inbound toll telecommunications service that:
242 (i) a subscriber purchases;
243 (ii) allows a customer of the subscriber described in Subsection (2)(a)(i) to call in to
244 the subscriber's:
245 (A) prerecorded announcement; or
246 (B) live service; and
247 (iii) is typically marketed:
248 (A) under the name 900 service; or
249 (B) under a name similar to Subsection (2)(a)(iii)(A) as designated by the Federal
250 Communications Commission.
251 (b) "900 service" does not include a charge for:
252 (i) a collection service a seller of a telecommunications service provides to a
253 subscriber; or
254 (ii) the following a subscriber sells to the subscriber's customer:
255 (A) a product; or
256 (B) a service.
257 (3) (a) "Admission or user fees" includes season passes.
258 (b) "Admission or user fees" does not include:
259 (i) annual membership dues to private organizations; or
260 (ii) a lesson, including a lesson that involves as part of the lesson equipment or a
261 facility listed in Subsection 59-12-103(1)(f).
262 (4) "Affiliate" or "affiliated person" means a person that, with respect to another
263 person:
264 (a) has an ownership interest of more than 5%, whether direct or indirect, in that other
265 person; or
266 (b) is related to the other person because a third person, or a group of third persons who
267 are affiliated persons with respect to each other, holds an ownership interest of more than 5%,
268 whether direct or indirect, in the related persons.
269 (5) "Agreement" means the Streamlined Sales and Use Tax Agreement adopted on
270 November 12, 2002, including amendments made to the Streamlined Sales and Use Tax
271 Agreement after November 12, 2002.
272 (6) "Agreement combined tax rate" means the sum of the tax rates:
273 (a) listed under Subsection (7); and
274 (b) that are imposed within a local taxing jurisdiction.
275 (7) "Agreement sales and use tax" means a tax imposed under:
276 (a) Subsection 59-12-103(2)(a)(i)(A);
277 (b) Subsection 59-12-103(2)(b)(i);
278 [
279 [
280 [
281 [
282 [
283 [
284 [
285 [
286 [
287 [
288 [
289 [
290 [
291 [
292 [
293 [
294 [
295 [
296 [
297 [
298 [
299 [
300 [
301 [
302 (8) "Aircraft" means the same as that term is defined in Section 72-10-102.
303 (9) "Aircraft maintenance, repair, and overhaul provider" means a business entity:
304 (a) except for:
305 (i) an airline as defined in Section 59-2-102; or
306 (ii) an affiliated group, as defined in Section 59-7-101, except that "affiliated group"
307 includes a corporation that is qualified to do business but is not otherwise doing business in the
308 state, of an airline; and
309 (b) that has the workers, expertise, and facilities to perform the following, regardless of
310 whether the business entity performs the following in this state:
311 (i) check, diagnose, overhaul, and repair:
312 (A) an onboard system of a fixed wing turbine powered aircraft; and
313 (B) the parts that comprise an onboard system of a fixed wing turbine powered aircraft;
314 (ii) assemble, change, dismantle, inspect, and test a fixed wing turbine powered aircraft
315 engine;
316 (iii) perform at least the following maintenance on a fixed wing turbine powered
317 aircraft:
318 (A) an inspection;
319 (B) a repair, including a structural repair or modification;
320 (C) changing landing gear; and
321 (D) addressing issues related to an aging fixed wing turbine powered aircraft;
322 (iv) completely remove the existing paint of a fixed wing turbine powered aircraft and
323 completely apply new paint to the fixed wing turbine powered aircraft; and
324 (v) refurbish the interior of a fixed wing turbine powered aircraft in a manner that
325 results in a change in the fixed wing turbine powered aircraft's certification requirements by the
326 authority that certifies the fixed wing turbine powered aircraft.
327 (10) "Alcoholic beverage" means a beverage that:
328 (a) is suitable for human consumption; and
329 (b) contains .5% or more alcohol by volume.
330 (11) "Alternative energy" means:
331 (a) biomass energy;
332 (b) geothermal energy;
333 (c) hydroelectric energy;
334 (d) solar energy;
335 (e) wind energy; or
336 (f) energy that is derived from:
337 (i) coal-to-liquids;
338 (ii) nuclear fuel;
339 (iii) oil-impregnated diatomaceous earth;
340 (iv) oil sands;
341 (v) oil shale;
342 (vi) petroleum coke; or
343 (vii) waste heat from:
344 (A) an industrial facility; or
345 (B) a power station in which an electric generator is driven through a process in which
346 water is heated, turns into steam, and spins a steam turbine.
347 (12) (a) Subject to Subsection (12)(b), "alternative energy electricity production
348 facility" means a facility that:
349 (i) uses alternative energy to produce electricity; and
350 (ii) has a production capacity of two megawatts or greater.
351 (b) A facility is an alternative energy electricity production facility regardless of
352 whether the facility is:
353 (i) connected to an electric grid; or
354 (ii) located on the premises of an electricity consumer.
355 (13) (a) "Ancillary service" means a service associated with, or incidental to, the
356 provision of telecommunications service.
357 (b) "Ancillary service" includes:
358 (i) a conference bridging service;
359 (ii) a detailed communications billing service;
360 (iii) directory assistance;
361 (iv) a vertical service; or
362 (v) a voice mail service.
363 (14) "Area agency on aging" means the same as that term is defined in Section
364 62A-3-101.
365 (15) "Assisted amusement device" means an amusement device, skill device, or ride
366 device that is started and stopped by an individual:
367 (a) who is not the purchaser or renter of the right to use or operate the amusement
368 device, skill device, or ride device; and
369 (b) at the direction of the seller of the right to use the amusement device, skill device,
370 or ride device.
371 (16) "Assisted cleaning or washing of tangible personal property" means cleaning or
372 washing of tangible personal property if the cleaning or washing labor is primarily performed
373 by an individual:
374 (a) who is not the purchaser of the cleaning or washing of the tangible personal
375 property; and
376 (b) at the direction of the seller of the cleaning or washing of the tangible personal
377 property.
378 (17) "Authorized carrier" means:
379 (a) in the case of vehicles operated over public highways, the holder of credentials
380 indicating that the vehicle is or will be operated pursuant to both the International Registration
381 Plan and the International Fuel Tax Agreement;
382 (b) in the case of aircraft, the holder of a Federal Aviation Administration operating
383 certificate or air carrier's operating certificate; or
384 (c) in the case of locomotives, freight cars, railroad work equipment, or other rolling
385 stock, a person who uses locomotives, freight cars, railroad work equipment, or other rolling
386 stock in more than one state.
387 (18) (a) Except as provided in Subsection (18)(b), "biomass energy" means any of the
388 following that is used as the primary source of energy to produce fuel or electricity:
389 (i) material from a plant or tree; or
390 (ii) other organic matter that is available on a renewable basis, including:
391 (A) slash and brush from forests and woodlands;
392 (B) animal waste;
393 (C) waste vegetable oil;
394 (D) methane or synthetic gas produced at a landfill, as a byproduct of the treatment of
395 wastewater residuals, or through the conversion of a waste material through a nonincineration,
396 thermal conversion process;
397 (E) aquatic plants; and
398 (F) agricultural products.
399 (b) "Biomass energy" does not include:
400 (i) black liquor; or
401 (ii) treated woods.
402 (19) (a) "Bundled transaction" means the sale of two or more items of tangible personal
403 property, products, or services if the tangible personal property, products, or services are:
404 (i) distinct and identifiable; and
405 (ii) sold for one nonitemized price.
406 (b) "Bundled transaction" does not include:
407 (i) the sale of tangible personal property if the sales price varies, or is negotiable, on
408 the basis of the selection by the purchaser of the items of tangible personal property included in
409 the transaction;
410 (ii) the sale of real property;
411 (iii) the sale of services to real property;
412 (iv) the retail sale of tangible personal property and a service if:
413 (A) the tangible personal property:
414 (I) is essential to the use of the service; and
415 (II) is provided exclusively in connection with the service; and
416 (B) the service is the true object of the transaction;
417 (v) the retail sale of two services if:
418 (A) one service is provided that is essential to the use or receipt of a second service;
419 (B) the first service is provided exclusively in connection with the second service; and
420 (C) the second service is the true object of the transaction;
421 (vi) a transaction that includes tangible personal property or a product subject to
422 taxation under this chapter and tangible personal property or a product that is not subject to
423 taxation under this chapter if the:
424 (A) seller's purchase price of the tangible personal property or product subject to
425 taxation under this chapter is de minimis; or
426 (B) seller's sales price of the tangible personal property or product subject to taxation
427 under this chapter is de minimis; and
428 (vii) the retail sale of tangible personal property that is not subject to taxation under
429 this chapter and tangible personal property that is subject to taxation under this chapter if:
430 (A) that retail sale includes:
431 (I) food and food ingredients;
432 (II) a drug;
433 (III) durable medical equipment;
434 (IV) mobility enhancing equipment;
435 (V) an over-the-counter drug;
436 (VI) a prosthetic device; or
437 (VII) a medical supply; and
438 (B) subject to Subsection (19)(f):
439 (I) the seller's purchase price of the tangible personal property subject to taxation under
440 this chapter is 50% or less of the seller's total purchase price of that retail sale; or
441 (II) the seller's sales price of the tangible personal property subject to taxation under
442 this chapter is 50% or less of the seller's total sales price of that retail sale.
443 (c) (i) For purposes of Subsection (19)(a)(i), tangible personal property, a product, or a
444 service that is distinct and identifiable does not include:
445 (A) packaging that:
446 (I) accompanies the sale of the tangible personal property, product, or service; and
447 (II) is incidental or immaterial to the sale of the tangible personal property, product, or
448 service;
449 (B) tangible personal property, a product, or a service provided free of charge with the
450 purchase of another item of tangible personal property, a product, or a service; or
451 (C) an item of tangible personal property, a product, or a service included in the
452 definition of "purchase price."
453 (ii) For purposes of Subsection (19)(c)(i)(B), an item of tangible personal property, a
454 product, or a service is provided free of charge with the purchase of another item of tangible
455 personal property, a product, or a service if the sales price of the purchased item of tangible
456 personal property, product, or service does not vary depending on the inclusion of the tangible
457 personal property, product, or service provided free of charge.
458 (d) (i) For purposes of Subsection (19)(a)(ii), property sold for one nonitemized price
459 does not include a price that is separately identified by tangible personal property, product, or
460 service on the following, regardless of whether the following is in paper format or electronic
461 format:
462 (A) a binding sales document; or
463 (B) another supporting sales-related document that is available to a purchaser.
464 (ii) For purposes of Subsection (19)(d)(i), a binding sales document or another
465 supporting sales-related document that is available to a purchaser includes:
466 (A) a bill of sale;
467 (B) a contract;
468 (C) an invoice;
469 (D) a lease agreement;
470 (E) a periodic notice of rates and services;
471 (F) a price list;
472 (G) a rate card;
473 (H) a receipt; or
474 (I) a service agreement.
475 (e) (i) For purposes of Subsection (19)(b)(vi), the sales price of tangible personal
476 property or a product subject to taxation under this chapter is de minimis if:
477 (A) the seller's purchase price of the tangible personal property or product is 10% or
478 less of the seller's total purchase price of the bundled transaction; or
479 (B) the seller's sales price of the tangible personal property or product is 10% or less of
480 the seller's total sales price of the bundled transaction.
481 (ii) For purposes of Subsection (19)(b)(vi), a seller:
482 (A) shall use the seller's purchase price or the seller's sales price to determine if the
483 purchase price or sales price of the tangible personal property or product subject to taxation
484 under this chapter is de minimis; and
485 (B) may not use a combination of the seller's purchase price and the seller's sales price
486 to determine if the purchase price or sales price of the tangible personal property or product
487 subject to taxation under this chapter is de minimis.
488 (iii) For purposes of Subsection (19)(b)(vi), a seller shall use the full term of a service
489 contract to determine if the sales price of tangible personal property or a product is de minimis.
490 (f) For purposes of Subsection (19)(b)(vii)(B), a seller may not use a combination of
491 the seller's purchase price and the seller's sales price to determine if tangible personal property
492 subject to taxation under this chapter is 50% or less of the seller's total purchase price or sales
493 price of that retail sale.
494 (20) "Certified automated system" means software certified by the governing board of
495 the agreement that:
496 (a) calculates the agreement sales and use tax imposed within a local taxing
497 jurisdiction:
498 (i) on a transaction; and
499 (ii) in the states that are members of the agreement;
500 (b) determines the amount of agreement sales and use tax to remit to a state that is a
501 member of the agreement; and
502 (c) maintains a record of the transaction described in Subsection (20)(a)(i).
503 (21) "Certified service provider" means an agent certified:
504 (a) by the governing board of the agreement; and
505 (b) to perform a seller's sales and use tax functions for an agreement sales and use tax,
506 as outlined in the contract between the governing board of the agreement and the certified
507 service provider, other than the seller's obligation under Section 59-12-124 to remit a tax on the
508 seller's own purchases.
509 (22) (a) Subject to Subsection (22)(b), "clothing" means all human wearing apparel
510 suitable for general use.
511 (b) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
512 commission shall make rules:
513 (i) listing the items that constitute "clothing"; and
514 (ii) that are consistent with the list of items that constitute "clothing" under the
515 agreement.
516 (23) "Coal-to-liquid" means the process of converting coal into a liquid synthetic fuel.
517 (24) "Commercial use" means the use of gas, electricity, heat, coal, fuel oil, or other
518 fuels that does not constitute industrial use under Subsection (57) or residential use under
519 Subsection (112).
520 (25) (a) "Common carrier" means a person engaged in or transacting the business of
521 transporting passengers, freight, merchandise, or other property for hire within this state.
522 (b) (i) "Common carrier" does not include a person that, at the time the person is
523 traveling to or from that person's place of employment, transports a passenger to or from the
524 passenger's place of employment.
525 (ii) For purposes of Subsection (25)(b)(i), in accordance with Title 63G, Chapter 3,
526 Utah Administrative Rulemaking Act, the commission may make rules defining what
527 constitutes a person's place of employment.
528 (c) "Common carrier" does not include a person that provides transportation network
529 services, as defined in Section 13-51-102.
530 (26) "Component part" includes:
531 (a) poultry, dairy, and other livestock feed, and their components;
532 (b) baling ties and twine used in the baling of hay and straw;
533 (c) fuel used for providing temperature control of orchards and commercial
534 greenhouses doing a majority of their business in wholesale sales, and for providing power for
535 off-highway type farm machinery; and
536 (d) feed, seeds, and seedlings.
537 (27) "Computer" means an electronic device that accepts information:
538 (a) (i) in digital form; or
539 (ii) in a form similar to digital form; and
540 (b) manipulates that information for a result based on a sequence of instructions.
541 (28) "Computer software" means a set of coded instructions designed to cause:
542 (a) a computer to perform a task; or
543 (b) automatic data processing equipment to perform a task.
544 (29) "Computer software maintenance contract" means a contract that obligates a seller
545 of computer software to provide a customer with:
546 (a) future updates or upgrades to computer software;
547 (b) support services with respect to computer software; or
548 (c) a combination of Subsections (29)(a) and (b).
549 (30) (a) "Conference bridging service" means an ancillary service that links two or
550 more participants of an audio conference call or video conference call.
551 (b) "Conference bridging service" may include providing a telephone number as part of
552 the ancillary service described in Subsection (30)(a).
553 (c) "Conference bridging service" does not include a telecommunications service used
554 to reach the ancillary service described in Subsection (30)(a).
555 (31) "Construction materials" means any tangible personal property that will be
556 converted into real property.
557 (32) "Delivered electronically" means delivered to a purchaser by means other than
558 tangible storage media.
559 (33) (a) "Delivery charge" means a charge:
560 (i) by a seller of:
561 (A) tangible personal property;
562 (B) a product transferred electronically; or
563 (C) a service; and
564 (ii) for preparation and delivery of the tangible personal property, product transferred
565 electronically, or services described in Subsection (33)(a)(i) to a location designated by the
566 purchaser.
567 (b) "Delivery charge" includes a charge for the following:
568 (i) transportation;
569 (ii) shipping;
570 (iii) postage;
571 (iv) handling;
572 (v) crating; or
573 (vi) packing.
574 (34) "Detailed telecommunications billing service" means an ancillary service of
575 separately stating information pertaining to individual calls on a customer's billing statement.
576 (35) "Dietary supplement" means a product, other than tobacco, that:
577 (a) is intended to supplement the diet;
578 (b) contains one or more of the following dietary ingredients:
579 (i) a vitamin;
580 (ii) a mineral;
581 (iii) an herb or other botanical;
582 (iv) an amino acid;
583 (v) a dietary substance for use by humans to supplement the diet by increasing the total
584 dietary intake; or
585 (vi) a concentrate, metabolite, constituent, extract, or combination of any ingredient
586 described in Subsections (35)(b)(i) through (v);
587 (c) (i) except as provided in Subsection (35)(c)(ii), is intended for ingestion in:
588 (A) tablet form;
589 (B) capsule form;
590 (C) powder form;
591 (D) softgel form;
592 (E) gelcap form; or
593 (F) liquid form; or
594 (ii) if the product is not intended for ingestion in a form described in Subsections
595 (35)(c)(i)(A) through (F), is not represented:
596 (A) as conventional food; and
597 (B) for use as a sole item of:
598 (I) a meal; or
599 (II) the diet; and
600 (d) is required to be labeled as a dietary supplement:
601 (i) identifiable by the "Supplemental Facts" box found on the label; and
602 (ii) as required by 21 C.F.R. Sec. 101.36.
603 (36) (a) "Digital audio work" means a work that results from the fixation of a series of
604 musical, spoken, or other sounds.
605 (b) "Digital audio work" includes a ringtone.
606 (37) "Digital audio-visual work" means a series of related images which, when shown
607 in succession, imparts an impression of motion, together with accompanying sounds, if any.
608 (38) "Digital book" means a work that is generally recognized in the ordinary and usual
609 sense as a book.
610 (39) (a) "Direct mail" means printed material delivered or distributed by United States
611 mail or other delivery service:
612 (i) to:
613 (A) a mass audience; or
614 (B) addressees on a mailing list provided:
615 (I) by a purchaser of the mailing list; or
616 (II) at the discretion of the purchaser of the mailing list; and
617 (ii) if the cost of the printed material is not billed directly to the recipients.
618 (b) "Direct mail" includes tangible personal property supplied directly or indirectly by a
619 purchaser to a seller of direct mail for inclusion in a package containing the printed material.
620 (c) "Direct mail" does not include multiple items of printed material delivered to a
621 single address.
622 (40) "Directory assistance" means an ancillary service of providing:
623 (a) address information; or
624 (b) telephone number information.
625 (41) (a) "Disposable home medical equipment or supplies" means medical equipment
626 or supplies that:
627 (i) cannot withstand repeated use; and
628 (ii) are purchased by, for, or on behalf of a person other than:
629 (A) a health care facility as defined in Section 26-21-2;
630 (B) a health care provider as defined in Section 78B-3-403;
631 (C) an office of a health care provider described in Subsection (41)(a)(ii)(B); or
632 (D) a person similar to a person described in Subsections (41)(a)(ii)(A) through (C).
633 (b) "Disposable home medical equipment or supplies" does not include:
634 (i) a drug;
635 (ii) durable medical equipment;
636 (iii) a hearing aid;
637 (iv) a hearing aid accessory;
638 (v) mobility enhancing equipment; or
639 (vi) tangible personal property used to correct impaired vision, including:
640 (A) eyeglasses; or
641 (B) contact lenses.
642 (c) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
643 commission may by rule define what constitutes medical equipment or supplies.
644 (42) "Drilling equipment manufacturer" means a facility:
645 (a) located in the state;
646 (b) with respect to which 51% or more of the manufacturing activities of the facility
647 consist of manufacturing component parts of drilling equipment;
648 (c) that uses pressure of 800,000 or more pounds per square inch as part of the
649 manufacturing process; and
650 (d) that uses a temperature of 2,000 or more degrees Fahrenheit as part of the
651 manufacturing process.
652 (43) (a) "Drug" means a compound, substance, or preparation, or a component of a
653 compound, substance, or preparation that is:
654 (i) recognized in:
655 (A) the official United States Pharmacopoeia;
656 (B) the official Homeopathic Pharmacopoeia of the United States;
657 (C) the official National Formulary; or
658 (D) a supplement to a publication listed in Subsections (43)(a)(i)(A) through (C);
659 (ii) intended for use in the:
660 (A) diagnosis of disease;
661 (B) cure of disease;
662 (C) mitigation of disease;
663 (D) treatment of disease; or
664 (E) prevention of disease; or
665 (iii) intended to affect:
666 (A) the structure of the body; or
667 (B) any function of the body.
668 (b) "Drug" does not include:
669 (i) food and food ingredients;
670 (ii) a dietary supplement;
671 (iii) an alcoholic beverage; or
672 (iv) a prosthetic device.
673 (44) (a) Except as provided in Subsection (44)(c), "durable medical equipment" means
674 equipment that:
675 (i) can withstand repeated use;
676 (ii) is primarily and customarily used to serve a medical purpose;
677 (iii) generally is not useful to a person in the absence of illness or injury; and
678 (iv) is not worn in or on the body.
679 (b) "Durable medical equipment" includes parts used in the repair or replacement of the
680 equipment described in Subsection (44)(a).
681 (c) "Durable medical equipment" does not include mobility enhancing equipment.
682 (45) "Electronic" means:
683 (a) relating to technology; and
684 (b) having:
685 (i) electrical capabilities;
686 (ii) digital capabilities;
687 (iii) magnetic capabilities;
688 (iv) wireless capabilities;
689 (v) optical capabilities;
690 (vi) electromagnetic capabilities; or
691 (vii) capabilities similar to Subsections (45)(b)(i) through (vi).
692 (46) "Electronic financial payment service" means an establishment:
693 (a) within NAICS Code 522320, Financial Transactions Processing, Reserve, and
694 Clearinghouse Activities, of the 2012 North American Industry Classification System of the
695 federal Executive Office of the President, Office of Management and Budget; and
696 (b) that performs electronic financial payment services.
697 (47) "Employee" means the same as that term is defined in Section 59-10-401.
698 (48) "Fixed guideway" means a public transit facility that uses and occupies:
699 (a) rail for the use of public transit; or
700 (b) a separate right-of-way for the use of public transit.
701 (49) "Fixed wing turbine powered aircraft" means an aircraft that:
702 (a) is powered by turbine engines;
703 (b) operates on jet fuel; and
704 (c) has wings that are permanently attached to the fuselage of the aircraft.
705 (50) "Fixed wireless service" means a telecommunications service that provides radio
706 communication between fixed points.
707 (51) (a) "Food and food ingredients" means substances:
708 (i) regardless of whether the substances are in:
709 (A) liquid form;
710 (B) concentrated form;
711 (C) solid form;
712 (D) frozen form;
713 (E) dried form; or
714 (F) dehydrated form; and
715 (ii) that are:
716 (A) sold for:
717 (I) ingestion by humans; or
718 (II) chewing by humans; and
719 (B) consumed for the substance's:
720 (I) taste; or
721 (II) nutritional value.
722 (b) "Food and food ingredients" includes an item described in Subsection (96)(b)(iii).
723 (c) "Food and food ingredients" does not include:
724 (i) an alcoholic beverage;
725 (ii) tobacco; or
726 (iii) prepared food.
727 (52) (a) "Fundraising sales" means sales:
728 (i) (A) made by a school; or
729 (B) made by a school student;
730 (ii) that are for the purpose of raising funds for the school to purchase equipment,
731 materials, or provide transportation; and
732 (iii) that are part of an officially sanctioned school activity.
733 (b) For purposes of Subsection (52)(a)(iii), "officially sanctioned school activity"
734 means a school activity:
735 (i) that is conducted in accordance with a formal policy adopted by the school or school
736 district governing the authorization and supervision of fundraising activities;
737 (ii) that does not directly or indirectly compensate an individual teacher or other
738 educational personnel by direct payment, commissions, or payment in kind; and
739 (iii) the net or gross revenues from which are deposited in a dedicated account
740 controlled by the school or school district.
741 (53) "Geothermal energy" means energy contained in heat that continuously flows
742 outward from the earth that is used as the sole source of energy to produce electricity.
743 (54) "Governing board of the agreement" means the governing board of the agreement
744 that is:
745 (a) authorized to administer the agreement; and
746 (b) established in accordance with the agreement.
747 (55) (a) For purposes of Subsection 59-12-104(41), "governmental entity" means:
748 (i) the executive branch of the state, including all departments, institutions, boards,
749 divisions, bureaus, offices, commissions, and committees;
750 (ii) the judicial branch of the state, including the courts, the Judicial Council, the
751 Administrative Office of the Courts, and similar administrative units in the judicial branch;
752 (iii) the legislative branch of the state, including the House of Representatives, the
753 Senate, the Legislative Printing Office, the Office of Legislative Research and General
754 Counsel, the Office of the Legislative Auditor General, and the Office of the Legislative Fiscal
755 Analyst;
756 (iv) the National Guard;
757 (v) an independent entity as defined in Section 63E-1-102; or
758 (vi) a political subdivision as defined in Section 17B-1-102.
759 (b) "Governmental entity" does not include the state systems of public and higher
760 education, including:
761 (i) a school;
762 (ii) the State Board of Education;
763 (iii) the Utah Board of Higher Education; or
764 (iv) an institution of higher education described in Section 53B-1-102.
765 (56) "Hydroelectric energy" means water used as the sole source of energy to produce
766 electricity.
767 (57) "Industrial use" means the use of natural gas, electricity, heat, coal, fuel oil, or
768 other fuels:
769 (a) in mining or extraction of minerals;
770 (b) in agricultural operations to produce an agricultural product up to the time of
771 harvest or placing the agricultural product into a storage facility, including:
772 (i) commercial greenhouses;
773 (ii) irrigation pumps;
774 (iii) farm machinery;
775 (iv) implements of husbandry as defined in Section 41-1a-102 that are not registered
776 under Title 41, Chapter 1a, Part 2, Registration; and
777 (v) other farming activities;
778 (c) in manufacturing tangible personal property at an establishment described in:
779 (i) SIC Codes 2000 to 3999 of the 1987 Standard Industrial Classification Manual of
780 the federal Executive Office of the President, Office of Management and Budget; or
781 (ii) a NAICS code within NAICS Sector 31-33, Manufacturing, of the 2017 North
782 American Industry Classification System of the federal Executive Office of the President,
783 Office of Management and Budget;
784 (d) by a scrap recycler if:
785 (i) from a fixed location, the scrap recycler utilizes machinery or equipment to process
786 one or more of the following items into prepared grades of processed materials for use in new
787 products:
788 (A) iron;
789 (B) steel;
790 (C) nonferrous metal;
791 (D) paper;
792 (E) glass;
793 (F) plastic;
794 (G) textile; or
795 (H) rubber; and
796 (ii) the new products under Subsection (57)(d)(i) would otherwise be made with
797 nonrecycled materials; or
798 (e) in producing a form of energy or steam described in Subsection 54-2-1(3)(a) by a
799 cogeneration facility as defined in Section 54-2-1.
800 (58) (a) Except as provided in Subsection (58)(b), "installation charge" means a charge
801 for installing:
802 (i) tangible personal property; or
803 (ii) a product transferred electronically.
804 (b) "Installation charge" does not include a charge for:
805 (i) repairs or renovations of:
806 (A) tangible personal property; or
807 (B) a product transferred electronically; or
808 (ii) attaching tangible personal property or a product transferred electronically:
809 (A) to other tangible personal property; and
810 (B) as part of a manufacturing or fabrication process.
811 (59) "Institution of higher education" means an institution of higher education listed in
812 Section 53B-2-101.
813 (60) (a) "Lease" or "rental" means a transfer of possession or control of tangible
814 personal property or a product transferred electronically for:
815 (i) (A) a fixed term; or
816 (B) an indeterminate term; and
817 (ii) consideration.
818 (b) "Lease" or "rental" includes an agreement covering a motor vehicle and trailer if the
819 amount of consideration may be increased or decreased by reference to the amount realized
820 upon sale or disposition of the property as defined in Section 7701(h)(1), Internal Revenue
821 Code.
822 (c) "Lease" or "rental" does not include:
823 (i) a transfer of possession or control of property under a security agreement or
824 deferred payment plan that requires the transfer of title upon completion of the required
825 payments;
826 (ii) a transfer of possession or control of property under an agreement that requires the
827 transfer of title:
828 (A) upon completion of required payments; and
829 (B) if the payment of an option price does not exceed the greater of:
830 (I) $100; or
831 (II) 1% of the total required payments; or
832 (iii) providing tangible personal property along with an operator for a fixed period of
833 time or an indeterminate period of time if the operator is necessary for equipment to perform as
834 designed.
835 (d) For purposes of Subsection (60)(c)(iii), an operator is necessary for equipment to
836 perform as designed if the operator's duties exceed the:
837 (i) set-up of tangible personal property;
838 (ii) maintenance of tangible personal property; or
839 (iii) inspection of tangible personal property.
840 (61) "Lesson" means a fixed period of time for the duration of which a trained
841 instructor:
842 (a) is present with a student in person or by video; and
843 (b) actively instructs the student, including by providing observation or feedback.
844 (62) "Life science establishment" means an establishment in this state that is classified
845 under the following NAICS codes of the 2007 North American Industry Classification System
846 of the federal Executive Office of the President, Office of Management and Budget:
847 (a) NAICS Code 33911, Medical Equipment and Supplies Manufacturing;
848 (b) NAICS Code 334510, Electromedical and Electrotherapeutic Apparatus
849 Manufacturing; or
850 (c) NAICS Code 334517, Irradiation Apparatus Manufacturing.
851 (63) "Life science research and development facility" means a facility owned, leased,
852 or rented by a life science establishment if research and development is performed in 51% or
853 more of the total area of the facility.
854 (64) "Load and leave" means delivery to a purchaser by use of a tangible storage media
855 if the tangible storage media is not physically transferred to the purchaser.
856 (65) "Local taxing jurisdiction" means a:
857 (a) county that is authorized to impose an agreement sales and use tax;
858 (b) city that is authorized to impose an agreement sales and use tax; or
859 (c) town that is authorized to impose an agreement sales and use tax.
860 (66) "Manufactured home" means the same as that term is defined in Section
861 15A-1-302.
862 (67) "Manufacturing facility" means:
863 (a) an establishment described in:
864 (i) SIC Codes 2000 to 3999 of the 1987 Standard Industrial Classification Manual of
865 the federal Executive Office of the President, Office of Management and Budget; or
866 (ii) a NAICS code within NAICS Sector 31-33, Manufacturing, of the 2017 North
867 American Industry Classification System of the federal Executive Office of the President,
868 Office of Management and Budget;
869 (b) a scrap recycler if:
870 (i) from a fixed location, the scrap recycler utilizes machinery or equipment to process
871 one or more of the following items into prepared grades of processed materials for use in new
872 products:
873 (A) iron;
874 (B) steel;
875 (C) nonferrous metal;
876 (D) paper;
877 (E) glass;
878 (F) plastic;
879 (G) textile; or
880 (H) rubber; and
881 (ii) the new products under Subsection (67)(b)(i) would otherwise be made with
882 nonrecycled materials; or
883 (c) a cogeneration facility as defined in Section 54-2-1 if the cogeneration facility is
884 placed in service on or after May 1, 2006.
885 (68) (a) "Marketplace" means a physical or electronic place, platform, or forum where
886 tangible personal property, a product transferred electronically, or a service is offered for sale.
887 (b) "Marketplace" includes a store, a booth, an Internet website, a catalog, or a
888 dedicated sales software application.
889 (69) (a) "Marketplace facilitator" means a person, including an affiliate of the person,
890 that enters into a contract, an agreement, or otherwise with sellers, for consideration, to
891 facilitate the sale of a seller's product through a marketplace that the person owns, operates, or
892 controls and that directly or indirectly:
893 (i) does any of the following:
894 (A) lists, makes available, or advertises tangible personal property, a product
895 transferred electronically, or a service for sale by a marketplace seller on a marketplace that the
896 person owns, operates, or controls;
897 (B) facilitates the sale of a marketplace seller's tangible personal property, product
898 transferred electronically, or service by transmitting or otherwise communicating an offer or
899 acceptance of a retail sale between the marketplace seller and a purchaser using the
900 marketplace;
901 (C) owns, rents, licenses, makes available, or operates any electronic or physical
902 infrastructure or any property, process, method, copyright, trademark, or patent that connects a
903 marketplace seller to a purchaser for the purpose of making a retail sale of tangible personal
904 property, a product transferred electronically, or a service;
905 (D) provides a marketplace for making, or otherwise facilitates, a retail sale of tangible
906 personal property, a product transferred electronically, or a service, regardless of ownership or
907 control of the tangible personal property, the product transferred electronically, or the service
908 that is the subject of the retail sale;
909 (E) provides software development or research and development activities related to
910 any activity described in this Subsection (69)(a)(i), if the software development or research and
911 development activity is directly related to the person's marketplace;
912 (F) provides or offers fulfillment or storage services for a marketplace seller;
913 (G) sets prices for the sale of tangible personal property, a product transferred
914 electronically, or a service by a marketplace seller;
915 (H) provides or offers customer service to a marketplace seller or a marketplace seller's
916 purchaser or accepts or assists with taking orders, returns, or exchanges of tangible personal
917 property, a product transferred electronically, or a service sold by a marketplace seller on the
918 person's marketplace; or
919 (I) brands or otherwise identifies sales as those of the person; and
920 (ii) does any of the following:
921 (A) collects the sales price or purchase price of a retail sale of tangible personal
922 property, a product transferred electronically, or a service;
923 (B) provides payment processing services for a retail sale of tangible personal property,
924 a product transferred electronically, or a service;
925 (C) charges, collects, or otherwise receives a selling fee, listing fee, referral fee, closing
926 fee, a fee for inserting or making available tangible personal property, a product transferred
927 electronically, or a service on the person's marketplace, or other consideration for the
928 facilitation of a retail sale of tangible personal property, a product transferred electronically, or
929 a service, regardless of ownership or control of the tangible personal property, the product
930 transferred electronically, or the service that is the subject of the retail sale;
931 (D) through terms and conditions, an agreement, or another arrangement with a third
932 person, collects payment from a purchase for a retail sale of tangible personal property, a
933 product transferred electronically, or a service and transmits that payment to the marketplace
934 seller, regardless of whether the third person receives compensation or other consideration in
935 exchange for the service; or
936 (E) provides a virtual currency for a purchaser to use to purchase tangible personal
937 property, a product transferred electronically, or service offered for sale.
938 (b) "Marketplace facilitator" does not include:
939 (i) a person that only provides payment processing services; or
940 (ii) a person described in Subsection (69)(a) to the extent the person is facilitating a
941 sale for a seller that is a restaurant as defined in Section 59-12-602.
942 (70) "Marketplace seller" means a seller that makes one or more retail sales through a
943 marketplace that a marketplace facilitator owns, operates, or controls, regardless of whether the
944 seller is required to be registered to collect and remit the tax under this part.
945 (71) "Member of the immediate family of the producer" means a person who is related
946 to a producer described in Subsection 59-12-104(20)(a) as a:
947 (a) child or stepchild, regardless of whether the child or stepchild is:
948 (i) an adopted child or adopted stepchild; or
949 (ii) a foster child or foster stepchild;
950 (b) grandchild or stepgrandchild;
951 (c) grandparent or stepgrandparent;
952 (d) nephew or stepnephew;
953 (e) niece or stepniece;
954 (f) parent or stepparent;
955 (g) sibling or stepsibling;
956 (h) spouse;
957 (i) person who is the spouse of a person described in Subsections (71)(a) through (g);
958 or
959 (j) person similar to a person described in Subsections (71)(a) through (i) as
960 determined by the commission by rule made in accordance with Title 63G, Chapter 3, Utah
961 Administrative Rulemaking Act.
962 (72) "Mobile home" means the same as that term is defined in Section 15A-1-302.
963 (73) "Mobile telecommunications service" means the same as that term is defined in
964 the Mobile Telecommunications Sourcing Act, 4 U.S.C. Sec. 124.
965 (74) (a) "Mobile wireless service" means a telecommunications service, regardless of
966 the technology used, if:
967 (i) the origination point of the conveyance, routing, or transmission is not fixed;
968 (ii) the termination point of the conveyance, routing, or transmission is not fixed; or
969 (iii) the origination point described in Subsection (74)(a)(i) and the termination point
970 described in Subsection (74)(a)(ii) are not fixed.
971 (b) "Mobile wireless service" includes a telecommunications service that is provided
972 by a commercial mobile radio service provider.
973 (c) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
974 commission may by rule define "commercial mobile radio service provider."
975 (75) (a) Except as provided in Subsection (75)(c), "mobility enhancing equipment"
976 means equipment that is:
977 (i) primarily and customarily used to provide or increase the ability to move from one
978 place to another;
979 (ii) appropriate for use in a:
980 (A) home; or
981 (B) motor vehicle; and
982 (iii) not generally used by persons with normal mobility.
983 (b) "Mobility enhancing equipment" includes parts used in the repair or replacement of
984 the equipment described in Subsection (75)(a).
985 (c) "Mobility enhancing equipment" does not include:
986 (i) a motor vehicle;
987 (ii) equipment on a motor vehicle if that equipment is normally provided by the motor
988 vehicle manufacturer;
989 (iii) durable medical equipment; or
990 (iv) a prosthetic device.
991 (76) "Model 1 seller" means a seller registered under the agreement that has selected a
992 certified service provider as the seller's agent to perform the seller's sales and use tax functions
993 for agreement sales and use taxes, as outlined in the contract between the governing board of
994 the agreement and the certified service provider, other than the seller's obligation under Section
995 59-12-124 to remit a tax on the seller's own purchases.
996 (77) "Model 2 seller" means a seller registered under the agreement that:
997 (a) except as provided in Subsection (77)(b), has selected a certified automated system
998 to perform the seller's sales tax functions for agreement sales and use taxes; and
999 (b) retains responsibility for remitting all of the sales tax:
1000 (i) collected by the seller; and
1001 (ii) to the appropriate local taxing jurisdiction.
1002 (78) (a) Subject to Subsection (78)(b), "model 3 seller" means a seller registered under
1003 the agreement that has:
1004 (i) sales in at least five states that are members of the agreement;
1005 (ii) total annual sales revenues of at least $500,000,000;
1006 (iii) a proprietary system that calculates the amount of tax:
1007 (A) for an agreement sales and use tax; and
1008 (B) due to each local taxing jurisdiction; and
1009 (iv) entered into a performance agreement with the governing board of the agreement.
1010 (b) For purposes of Subsection (78)(a), "model 3 seller" includes an affiliated group of
1011 sellers using the same proprietary system.
1012 (79) "Model 4 seller" means a seller that is registered under the agreement and is not a
1013 model 1 seller, model 2 seller, or model 3 seller.
1014 (80) "Modular home" means a modular unit as defined in Section 15A-1-302.
1015 (81) "Motor vehicle" means the same as that term is defined in Section 41-1a-102.
1016 (82) "Oil sands" means impregnated bituminous sands that:
1017 (a) contain a heavy, thick form of petroleum that is released when heated, mixed with
1018 other hydrocarbons, or otherwise treated;
1019 (b) yield mixtures of liquid hydrocarbon; and
1020 (c) require further processing other than mechanical blending before becoming finished
1021 petroleum products.
1022 (83) "Oil shale" means a group of fine black to dark brown shales containing kerogen
1023 material that yields petroleum upon heating and distillation.
1024 (84) "Optional computer software maintenance contract" means a computer software
1025 maintenance contract that a customer is not obligated to purchase as a condition to the retail
1026 sale of computer software.
1027 (85) (a) "Other fuels" means products that burn independently to produce heat or
1028 energy.
1029 (b) "Other fuels" includes oxygen when it is used in the manufacturing of tangible
1030 personal property.
1031 (86) (a) "Paging service" means a telecommunications service that provides
1032 transmission of a coded radio signal for the purpose of activating a specific pager.
1033 (b) For purposes of Subsection (86)(a), the transmission of a coded radio signal
1034 includes a transmission by message or sound.
1035 (87) "Pawn transaction" means the same as that term is defined in Section 13-32a-102.
1036 (88) "Pawnbroker" means the same as that term is defined in Section 13-32a-102.
1037 (89) (a) "Permanently attached to real property" means that for tangible personal
1038 property attached to real property:
1039 (i) the attachment of the tangible personal property to the real property:
1040 (A) is essential to the use of the tangible personal property; and
1041 (B) suggests that the tangible personal property will remain attached to the real
1042 property in the same place over the useful life of the tangible personal property; or
1043 (ii) if the tangible personal property is detached from the real property, the detachment
1044 would:
1045 (A) cause substantial damage to the tangible personal property; or
1046 (B) require substantial alteration or repair of the real property to which the tangible
1047 personal property is attached.
1048 (b) "Permanently attached to real property" includes:
1049 (i) the attachment of an accessory to the tangible personal property if the accessory is:
1050 (A) essential to the operation of the tangible personal property; and
1051 (B) attached only to facilitate the operation of the tangible personal property;
1052 (ii) a temporary detachment of tangible personal property from real property for a
1053 repair or renovation if the repair or renovation is performed where the tangible personal
1054 property and real property are located; or
1055 (iii) property attached to oil, gas, or water pipelines, except for the property listed in
1056 Subsection (89)(c)(iii) or (iv).
1057 (c) "Permanently attached to real property" does not include:
1058 (i) the attachment of portable or movable tangible personal property to real property if
1059 that portable or movable tangible personal property is attached to real property only for:
1060 (A) convenience;
1061 (B) stability; or
1062 (C) for an obvious temporary purpose;
1063 (ii) the detachment of tangible personal property from real property except for the
1064 detachment described in Subsection (89)(b)(ii);
1065 (iii) an attachment of the following tangible personal property to real property if the
1066 attachment to real property is only through a line that supplies water, electricity, gas,
1067 telecommunications, cable, or supplies a similar item as determined by the commission by rule
1068 made in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act:
1069 (A) a computer;
1070 (B) a telephone;
1071 (C) a television; or
1072 (D) tangible personal property similar to Subsections (89)(c)(iii)(A) through (C) as
1073 determined by the commission by rule made in accordance with Title 63G, Chapter 3, Utah
1074 Administrative Rulemaking Act; or
1075 (iv) an item listed in Subsection (130)(c).
1076 (90) "Person" includes any individual, firm, partnership, joint venture, association,
1077 corporation, estate, trust, business trust, receiver, syndicate, this state, any county, city,
1078 municipality, district, or other local governmental entity of the state, or any group or
1079 combination acting as a unit.
1080 (91) "Place of primary use":
1081 (a) for telecommunications service other than mobile telecommunications service,
1082 means the street address representative of where the customer's use of the telecommunications
1083 service primarily occurs, which shall be:
1084 (i) the residential street address of the customer; or
1085 (ii) the primary business street address of the customer; or
1086 (b) for mobile telecommunications service, means the same as that term is defined in
1087 the Mobile Telecommunications Sourcing Act, 4 U.S.C. Sec. 124.
1088 (92) (a) "Postpaid calling service" means a telecommunications service a person
1089 obtains by making a payment on a call-by-call basis:
1090 (i) through the use of a:
1091 (A) bank card;
1092 (B) credit card;
1093 (C) debit card; or
1094 (D) travel card; or
1095 (ii) by a charge made to a telephone number that is not associated with the origination
1096 or termination of the telecommunications service.
1097 (b) "Postpaid calling service" includes a service, except for a prepaid wireless calling
1098 service, that would be a prepaid wireless calling service if the service were exclusively a
1099 telecommunications service.
1100 (93) "Postproduction" means an activity related to the finishing or duplication of a
1101 medium described in Subsection 59-12-104(54)(a).
1102 (94) "Prepaid calling service" means a telecommunications service:
1103 (a) that allows a purchaser access to telecommunications service that is exclusively
1104 telecommunications service;
1105 (b) that:
1106 (i) is paid for in advance; and
1107 (ii) enables the origination of a call using an:
1108 (A) access number; or
1109 (B) authorization code;
1110 (c) that is dialed:
1111 (i) manually; or
1112 (ii) electronically; and
1113 (d) sold in predetermined units or dollars that decline:
1114 (i) by a known amount; and
1115 (ii) with use.
1116 (95) "Prepaid wireless calling service" means a telecommunications service:
1117 (a) that provides the right to utilize:
1118 (i) mobile wireless service; and
1119 (ii) other service that is not a telecommunications service, including:
1120 (A) the download of a product transferred electronically;
1121 (B) a content service; or
1122 (C) an ancillary service;
1123 (b) that:
1124 (i) is paid for in advance; and
1125 (ii) enables the origination of a call using an:
1126 (A) access number; or
1127 (B) authorization code;
1128 (c) that is dialed:
1129 (i) manually; or
1130 (ii) electronically; and
1131 (d) sold in predetermined units or dollars that decline:
1132 (i) by a known amount; and
1133 (ii) with use.
1134 (96) (a) "Prepared food" means:
1135 (i) food:
1136 (A) sold in a heated state; or
1137 (B) heated by a seller;
1138 (ii) two or more food ingredients mixed or combined by the seller for sale as a single
1139 item; or
1140 (iii) except as provided in Subsection (96)(c), food sold with an eating utensil provided
1141 by the seller, including a:
1142 (A) plate;
1143 (B) knife;
1144 (C) fork;
1145 (D) spoon;
1146 (E) glass;
1147 (F) cup;
1148 (G) napkin; or
1149 (H) straw.
1150 (b) "Prepared food" does not include:
1151 (i) food that a seller only:
1152 (A) cuts;
1153 (B) repackages; or
1154 (C) pasteurizes; or
1155 (ii) (A) the following:
1156 (I) raw egg;
1157 (II) raw fish;
1158 (III) raw meat;
1159 (IV) raw poultry; or
1160 (V) a food containing an item described in Subsections (96)(b)(ii)(A)(I) through (IV);
1161 and
1162 (B) if the Food and Drug Administration recommends in Chapter 3, Part 401.11 of the
1163 Food and Drug Administration's Food Code that a consumer cook the items described in
1164 Subsection (96)(b)(ii)(A) to prevent food borne illness; or
1165 (iii) the following if sold without eating utensils provided by the seller:
1166 (A) food and food ingredients sold by a seller if the seller's proper primary
1167 classification under the 2002 North American Industry Classification System of the federal
1168 Executive Office of the President, Office of Management and Budget, is manufacturing in
1169 Sector 311, Food Manufacturing, except for Subsector 3118, Bakeries and Tortilla
1170 Manufacturing;
1171 (B) food and food ingredients sold in an unheated state:
1172 (I) by weight or volume; and
1173 (II) as a single item; or
1174 (C) a bakery item, including:
1175 (I) a bagel;
1176 (II) a bar;
1177 (III) a biscuit;
1178 (IV) bread;
1179 (V) a bun;
1180 (VI) a cake;
1181 (VII) a cookie;
1182 (VIII) a croissant;
1183 (IX) a danish;
1184 (X) a donut;
1185 (XI) a muffin;
1186 (XII) a pastry;
1187 (XIII) a pie;
1188 (XIV) a roll;
1189 (XV) a tart;
1190 (XVI) a torte; or
1191 (XVII) a tortilla.
1192 (c) An eating utensil provided by the seller does not include the following used to
1193 transport the food:
1194 (i) a container; or
1195 (ii) packaging.
1196 (97) "Prescription" means an order, formula, or recipe that is issued:
1197 (a) (i) orally;
1198 (ii) in writing;
1199 (iii) electronically; or
1200 (iv) by any other manner of transmission; and
1201 (b) by a licensed practitioner authorized by the laws of a state.
1202 (98) (a) Except as provided in Subsection (98)(b)(ii) or (iii), "prewritten computer
1203 software" means computer software that is not designed and developed:
1204 (i) by the author or other creator of the computer software; and
1205 (ii) to the specifications of a specific purchaser.
1206 (b) "Prewritten computer software" includes:
1207 (i) a prewritten upgrade to computer software if the prewritten upgrade to the computer
1208 software is not designed and developed:
1209 (A) by the author or other creator of the computer software; and
1210 (B) to the specifications of a specific purchaser;
1211 (ii) computer software designed and developed by the author or other creator of the
1212 computer software to the specifications of a specific purchaser if the computer software is sold
1213 to a person other than the purchaser; or
1214 (iii) except as provided in Subsection (98)(c), prewritten computer software or a
1215 prewritten portion of prewritten computer software:
1216 (A) that is modified or enhanced to any degree; and
1217 (B) if the modification or enhancement described in Subsection (98)(b)(iii)(A) is
1218 designed and developed to the specifications of a specific purchaser.
1219 (c) "Prewritten computer software" does not include a modification or enhancement
1220 described in Subsection (98)(b)(iii) if the charges for the modification or enhancement are:
1221 (i) reasonable; and
1222 (ii) subject to Subsections 59-12-103(2)(f)(ii) and (2)(g)(i), separately stated on the
1223 invoice or other statement of price provided to the purchaser at the time of sale or later, as
1224 demonstrated by:
1225 (A) the books and records the seller keeps at the time of the transaction in the regular
1226 course of business, including books and records the seller keeps at the time of the transaction in
1227 the regular course of business for nontax purposes;
1228 (B) a preponderance of the facts and circumstances at the time of the transaction; and
1229 (C) the understanding of all of the parties to the transaction.
1230 (99) (a) "Private communications service" means a telecommunications service:
1231 (i) that entitles a customer to exclusive or priority use of one or more communications
1232 channels between or among termination points; and
1233 (ii) regardless of the manner in which the one or more communications channels are
1234 connected.
1235 (b) "Private communications service" includes the following provided in connection
1236 with the use of one or more communications channels:
1237 (i) an extension line;
1238 (ii) a station;
1239 (iii) switching capacity; or
1240 (iv) another associated service that is provided in connection with the use of one or
1241 more communications channels as defined in Section 59-12-215.
1242 (100) (a) Except as provided in Subsection (100)(b), "product transferred
1243 electronically" means a product transferred electronically that would be subject to a tax under
1244 this chapter if that product was transferred in a manner other than electronically.
1245 (b) "Product transferred electronically" does not include:
1246 (i) an ancillary service;
1247 (ii) computer software; or
1248 (iii) a telecommunications service.
1249 (101) (a) "Prosthetic device" means a device that is worn on or in the body to:
1250 (i) artificially replace a missing portion of the body;
1251 (ii) prevent or correct a physical deformity or physical malfunction; or
1252 (iii) support a weak or deformed portion of the body.
1253 (b) "Prosthetic device" includes:
1254 (i) parts used in the repairs or renovation of a prosthetic device;
1255 (ii) replacement parts for a prosthetic device;
1256 (iii) a dental prosthesis; or
1257 (iv) a hearing aid.
1258 (c) "Prosthetic device" does not include:
1259 (i) corrective eyeglasses; or
1260 (ii) contact lenses.
1261 (102) (a) "Protective equipment" means an item:
1262 (i) for human wear; and
1263 (ii) that is:
1264 (A) designed as protection:
1265 (I) to the wearer against injury or disease; or
1266 (II) against damage or injury of other persons or property; and
1267 (B) not suitable for general use.
1268 (b) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
1269 commission shall make rules:
1270 (i) listing the items that constitute "protective equipment"; and
1271 (ii) that are consistent with the list of items that constitute "protective equipment"
1272 under the agreement.
1273 (103) (a) For purposes of Subsection 59-12-104(41), "publication" means any written
1274 or printed matter, other than a photocopy:
1275 (i) regardless of:
1276 (A) characteristics;
1277 (B) copyright;
1278 (C) form;
1279 (D) format;
1280 (E) method of reproduction; or
1281 (F) source; and
1282 (ii) made available in printed or electronic format.
1283 (b) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
1284 commission may by rule define the term "photocopy."
1285 (104) (a) "Purchase price" and "sales price" mean the total amount of consideration:
1286 (i) valued in money; and
1287 (ii) for which tangible personal property, a product transferred electronically, or
1288 services are:
1289 (A) sold;
1290 (B) leased; or
1291 (C) rented.
1292 (b) "Purchase price" and "sales price" include:
1293 (i) the seller's cost of the tangible personal property, a product transferred
1294 electronically, or services sold;
1295 (ii) expenses of the seller, including:
1296 (A) the cost of materials used;
1297 (B) a labor cost;
1298 (C) a service cost;
1299 (D) interest;
1300 (E) a loss;
1301 (F) the cost of transportation to the seller; or
1302 (G) a tax imposed on the seller;
1303 (iii) a charge by the seller for any service necessary to complete the sale; or
1304 (iv) consideration a seller receives from a person other than the purchaser if:
1305 (A) (I) the seller actually receives consideration from a person other than the purchaser;
1306 and
1307 (II) the consideration described in Subsection (104)(b)(iv)(A)(I) is directly related to a
1308 price reduction or discount on the sale;
1309 (B) the seller has an obligation to pass the price reduction or discount through to the
1310 purchaser;
1311 (C) the amount of the consideration attributable to the sale is fixed and determinable by
1312 the seller at the time of the sale to the purchaser; and
1313 (D) (I) (Aa) the purchaser presents a certificate, coupon, or other documentation to the
1314 seller to claim a price reduction or discount; and
1315 (Bb) a person other than the seller authorizes, distributes, or grants the certificate,
1316 coupon, or other documentation with the understanding that the person other than the seller
1317 will reimburse any seller to whom the certificate, coupon, or other documentation is presented;
1318 (II) the purchaser identifies that purchaser to the seller as a member of a group or
1319 organization allowed a price reduction or discount, except that a preferred customer card that is
1320 available to any patron of a seller does not constitute membership in a group or organization
1321 allowed a price reduction or discount; or
1322 (III) the price reduction or discount is identified as a third party price reduction or
1323 discount on the:
1324 (Aa) invoice the purchaser receives; or
1325 (Bb) certificate, coupon, or other documentation the purchaser presents.
1326 (c) "Purchase price" and "sales price" do not include:
1327 (i) a discount:
1328 (A) in a form including:
1329 (I) cash;
1330 (II) term; or
1331 (III) coupon;
1332 (B) that is allowed by a seller;
1333 (C) taken by a purchaser on a sale; and
1334 (D) that is not reimbursed by a third party; or
1335 (ii) subject to Subsections 59-12-103(2)(f)(ii) and (2)(g)(i), the following if separately
1336 stated on an invoice, bill of sale, or similar document provided to the purchaser at the time of
1337 sale or later, as demonstrated by the books and records the seller keeps at the time of the
1338 transaction in the regular course of business, including books and records the seller keeps at the
1339 time of the transaction in the regular course of business for nontax purposes, by a
1340 preponderance of the facts and circumstances at the time of the transaction, and by the
1341 understanding of all of the parties to the transaction:
1342 (A) the following from credit extended on the sale of tangible personal property or
1343 services:
1344 (I) a carrying charge;
1345 (II) a financing charge; or
1346 (III) an interest charge;
1347 (B) a delivery charge;
1348 (C) an installation charge;
1349 (D) a manufacturer rebate on a motor vehicle; or
1350 (E) a tax or fee legally imposed directly on the consumer.
1351 (105) "Purchaser" means a person to whom:
1352 (a) a sale of tangible personal property is made;
1353 (b) a product is transferred electronically; or
1354 (c) a service is furnished.
1355 (106) "Qualifying data center" means a data center facility that:
1356 (a) houses a group of networked server computers in one physical location in order to
1357 disseminate, manage, and store data and information;
1358 (b) is located in the state;
1359 (c) is a new operation constructed on or after July 1, 2016;
1360 (d) consists of one or more buildings that total 150,000 or more square feet;
1361 (e) is owned or leased by:
1362 (i) the operator of the data center facility; or
1363 (ii) a person under common ownership, as defined in Section 59-7-101, of the operator
1364 of the data center facility; and
1365 (f) is located on one or more parcels of land that are owned or leased by:
1366 (i) the operator of the data center facility; or
1367 (ii) a person under common ownership, as defined in Section 59-7-101, of the operator
1368 of the data center facility.
1369 (107) "Regularly rented" means:
1370 (a) rented to a guest for value three or more times during a calendar year; or
1371 (b) advertised or held out to the public as a place that is regularly rented to guests for
1372 value.
1373 (108) "Rental" means the same as that term is defined in Subsection (60).
1374 (109) (a) Except as provided in Subsection (109)(b), "repairs or renovations of tangible
1375 personal property" means:
1376 (i) a repair or renovation of tangible personal property that is not permanently attached
1377 to real property; or
1378 (ii) attaching tangible personal property or a product transferred electronically to other
1379 tangible personal property or detaching tangible personal property or a product transferred
1380 electronically from other tangible personal property if:
1381 (A) the other tangible personal property to which the tangible personal property or
1382 product transferred electronically is attached or from which the tangible personal property or
1383 product transferred electronically is detached is not permanently attached to real property; and
1384 (B) the attachment of tangible personal property or a product transferred electronically
1385 to other tangible personal property or detachment of tangible personal property or a product
1386 transferred electronically from other tangible personal property is made in conjunction with a
1387 repair or replacement of tangible personal property or a product transferred electronically.
1388 (b) "Repairs or renovations of tangible personal property" does not include:
1389 (i) attaching prewritten computer software to other tangible personal property if the
1390 other tangible personal property to which the prewritten computer software is attached is not
1391 permanently attached to real property; or
1392 (ii) detaching prewritten computer software from other tangible personal property if the
1393 other tangible personal property from which the prewritten computer software is detached is
1394 not permanently attached to real property.
1395 (110) "Research and development" means the process of inquiry or experimentation
1396 aimed at the discovery of facts, devices, technologies, or applications and the process of
1397 preparing those devices, technologies, or applications for marketing.
1398 (111) (a) "Residential telecommunications services" means a telecommunications
1399 service or an ancillary service that is provided to an individual for personal use:
1400 (i) at a residential address; or
1401 (ii) at an institution, including a nursing home or a school, if the telecommunications
1402 service or ancillary service is provided to and paid for by the individual residing at the
1403 institution rather than the institution.
1404 (b) For purposes of Subsection (111)(a)(i), a residential address includes an:
1405 (i) apartment; or
1406 (ii) other individual dwelling unit.
1407 (112) "Residential use" means the use in or around a home, apartment building,
1408 sleeping quarters, and similar facilities or accommodations.
1409 (113) "Retail sale" or "sale at retail" means a sale, lease, or rental for a purpose other
1410 than:
1411 (a) resale;
1412 (b) sublease; or
1413 (c) subrent.
1414 (114) (a) "Retailer" means any person, unless prohibited by the Constitution of the
1415 United States or federal law, that is engaged in a regularly organized business in tangible
1416 personal property or any other taxable transaction under Subsection 59-12-103(1), and who is
1417 selling to the user or consumer and not for resale.
1418 (b) "Retailer" includes commission merchants, auctioneers, and any person regularly
1419 engaged in the business of selling to users or consumers within the state.
1420 (115) (a) "Sale" means any transfer of title, exchange, or barter, conditional or
1421 otherwise, in any manner, of tangible personal property or any other taxable transaction under
1422 Subsection 59-12-103(1), for consideration.
1423 (b) "Sale" includes:
1424 (i) installment and credit sales;
1425 (ii) any closed transaction constituting a sale;
1426 (iii) any sale of electrical energy, gas, services, or entertainment taxable under this
1427 chapter;
1428 (iv) any transaction if the possession of property is transferred but the seller retains the
1429 title as security for the payment of the price; and
1430 (v) any transaction under which right to possession, operation, or use of any article of
1431 tangible personal property is granted under a lease or contract and the transfer of possession
1432 would be taxable if an outright sale were made.
1433 (116) "Sale at retail" means the same as that term is defined in Subsection (113).
1434 (117) "Sale-leaseback transaction" means a transaction by which title to tangible
1435 personal property or a product transferred electronically that is subject to a tax under this
1436 chapter is transferred:
1437 (a) by a purchaser-lessee;
1438 (b) to a lessor;
1439 (c) for consideration; and
1440 (d) if:
1441 (i) the purchaser-lessee paid sales and use tax on the purchaser-lessee's initial purchase
1442 of the tangible personal property or product transferred electronically;
1443 (ii) the sale of the tangible personal property or product transferred electronically to the
1444 lessor is intended as a form of financing:
1445 (A) for the tangible personal property or product transferred electronically; and
1446 (B) to the purchaser-lessee; and
1447 (iii) in accordance with generally accepted accounting principles, the purchaser-lessee
1448 is required to:
1449 (A) capitalize the tangible personal property or product transferred electronically for
1450 financial reporting purposes; and
1451 (B) account for the lease payments as payments made under a financing arrangement.
1452 (118) "Sales price" means the same as that term is defined in Subsection (104).
1453 (119) (a) "Sales relating to schools" means the following sales by, amounts paid to, or
1454 amounts charged by a school:
1455 (i) sales that are directly related to the school's educational functions or activities
1456 including:
1457 (A) the sale of:
1458 (I) textbooks;
1459 (II) textbook fees;
1460 (III) laboratory fees;
1461 (IV) laboratory supplies; or
1462 (V) safety equipment;
1463 (B) the sale of a uniform, protective equipment, or sports or recreational equipment
1464 that:
1465 (I) a student is specifically required to wear as a condition of participation in a
1466 school-related event or school-related activity; and
1467 (II) is not readily adaptable to general or continued usage to the extent that it takes the
1468 place of ordinary clothing;
1469 (C) sales of the following if the net or gross revenues generated by the sales are
1470 deposited into a school district fund or school fund dedicated to school meals:
1471 (I) food and food ingredients; or
1472 (II) prepared food; or
1473 (D) transportation charges for official school activities; or
1474 (ii) amounts paid to or amounts charged by a school for admission to a school-related
1475 event or school-related activity.
1476 (b) "Sales relating to schools" does not include:
1477 (i) bookstore sales of items that are not educational materials or supplies;
1478 (ii) except as provided in Subsection (119)(a)(i)(B):
1479 (A) clothing;
1480 (B) clothing accessories or equipment;
1481 (C) protective equipment; or
1482 (D) sports or recreational equipment; or
1483 (iii) amounts paid to or amounts charged by a school for admission to a school-related
1484 event or school-related activity if the amounts paid or charged are passed through to a person:
1485 (A) other than a:
1486 (I) school;
1487 (II) nonprofit organization authorized by a school board or a governing body of a
1488 private school to organize and direct a competitive secondary school activity; or
1489 (III) nonprofit association authorized by a school board or a governing body of a
1490 private school to organize and direct a competitive secondary school activity; and
1491 (B) that is required to collect sales and use taxes under this chapter.
1492 (c) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
1493 commission may make rules defining the term "passed through."
1494 (120) For purposes of this section and Section 59-12-104, "school" means:
1495 (a) an elementary school or a secondary school that:
1496 (i) is a:
1497 (A) public school; or
1498 (B) private school; and
1499 (ii) provides instruction for one or more grades kindergarten through 12; or
1500 (b) a public school district.
1501 (121) (a) "Seller" means a person that makes a sale, lease, or rental of:
1502 (i) tangible personal property;
1503 (ii) a product transferred electronically; or
1504 (iii) a service.
1505 (b) "Seller" includes a marketplace facilitator.
1506 (122) (a) "Semiconductor fabricating, processing, research, or development materials"
1507 means tangible personal property or a product transferred electronically if the tangible personal
1508 property or product transferred electronically is:
1509 (i) used primarily in the process of:
1510 (A) (I) manufacturing a semiconductor;
1511 (II) fabricating a semiconductor; or
1512 (III) research or development of a:
1513 (Aa) semiconductor; or
1514 (Bb) semiconductor manufacturing process; or
1515 (B) maintaining an environment suitable for a semiconductor; or
1516 (ii) consumed primarily in the process of:
1517 (A) (I) manufacturing a semiconductor;
1518 (II) fabricating a semiconductor; or
1519 (III) research or development of a:
1520 (Aa) semiconductor; or
1521 (Bb) semiconductor manufacturing process; or
1522 (B) maintaining an environment suitable for a semiconductor.
1523 (b) "Semiconductor fabricating, processing, research, or development materials"
1524 includes:
1525 (i) parts used in the repairs or renovations of tangible personal property or a product
1526 transferred electronically described in Subsection (122)(a); or
1527 (ii) a chemical, catalyst, or other material used to:
1528 (A) produce or induce in a semiconductor a:
1529 (I) chemical change; or
1530 (II) physical change;
1531 (B) remove impurities from a semiconductor; or
1532 (C) improve the marketable condition of a semiconductor.
1533 (123) "Senior citizen center" means a facility having the primary purpose of providing
1534 services to the aged as defined in Section 62A-3-101.
1535 (124) (a) Subject to Subsections (124)(b) and (c), "short-term lodging consumable"
1536 means tangible personal property that:
1537 (i) a business that provides accommodations and services described in Subsection
1538 59-12-103(1)(i) purchases as part of a transaction to provide the accommodations and services
1539 to a purchaser;
1540 (ii) is intended to be consumed by the purchaser; and
1541 (iii) is:
1542 (A) included in the purchase price of the accommodations and services; and
1543 (B) not separately stated on an invoice, bill of sale, or other similar document provided
1544 to the purchaser.
1545 (b) "Short-term lodging consumable" includes:
1546 (i) a beverage;
1547 (ii) a brush or comb;
1548 (iii) a cosmetic;
1549 (iv) a hair care product;
1550 (v) lotion;
1551 (vi) a magazine;
1552 (vii) makeup;
1553 (viii) a meal;
1554 (ix) mouthwash;
1555 (x) nail polish remover;
1556 (xi) a newspaper;
1557 (xii) a notepad;
1558 (xiii) a pen;
1559 (xiv) a pencil;
1560 (xv) a razor;
1561 (xvi) saline solution;
1562 (xvii) a sewing kit;
1563 (xviii) shaving cream;
1564 (xix) a shoe shine kit;
1565 (xx) a shower cap;
1566 (xxi) a snack item;
1567 (xxii) soap;
1568 (xxiii) toilet paper;
1569 (xxiv) a toothbrush;
1570 (xxv) toothpaste; or
1571 (xxvi) an item similar to Subsections (124)(b)(i) through (xxv) as the commission may
1572 provide by rule made in accordance with Title 63G, Chapter 3, Utah Administrative
1573 Rulemaking Act.
1574 (c) "Short-term lodging consumable" does not include:
1575 (i) tangible personal property that is cleaned or washed to allow the tangible personal
1576 property to be reused; or
1577 (ii) a product transferred electronically.
1578 (125) "Simplified electronic return" means the electronic return:
1579 (a) described in Section 318(C) of the agreement; and
1580 (b) approved by the governing board of the agreement.
1581 (126) "Solar energy" means the sun used as the sole source of energy for producing
1582 electricity.
1583 (127) (a) "Sports or recreational equipment" means an item:
1584 (i) designed for human use; and
1585 (ii) that is:
1586 (A) worn in conjunction with:
1587 (I) an athletic activity; or
1588 (II) a recreational activity; and
1589 (B) not suitable for general use.
1590 (b) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
1591 commission shall make rules:
1592 (i) listing the items that constitute "sports or recreational equipment"; and
1593 (ii) that are consistent with the list of items that constitute "sports or recreational
1594 equipment" under the agreement.
1595 (128) "State" means the state of Utah, its departments, and agencies.
1596 (129) "Storage" means any keeping or retention of tangible personal property or any
1597 other taxable transaction under Subsection 59-12-103(1), in this state for any purpose except
1598 sale in the regular course of business.
1599 (130) (a) Except as provided in Subsection (130)(d) or (e), "tangible personal property"
1600 means personal property that:
1601 (i) may be:
1602 (A) seen;
1603 (B) weighed;
1604 (C) measured;
1605 (D) felt; or
1606 (E) touched; or
1607 (ii) is in any manner perceptible to the senses.
1608 (b) "Tangible personal property" includes:
1609 (i) electricity;
1610 (ii) water;
1611 (iii) gas;
1612 (iv) steam; or
1613 (v) prewritten computer software, regardless of the manner in which the prewritten
1614 computer software is transferred.
1615 (c) "Tangible personal property" includes the following regardless of whether the item
1616 is attached to real property:
1617 (i) a dishwasher;
1618 (ii) a dryer;
1619 (iii) a freezer;
1620 (iv) a microwave;
1621 (v) a refrigerator;
1622 (vi) a stove;
1623 (vii) a washer; or
1624 (viii) an item similar to Subsections (130)(c)(i) through (vii) as determined by the
1625 commission by rule made in accordance with Title 63G, Chapter 3, Utah Administrative
1626 Rulemaking Act.
1627 (d) "Tangible personal property" does not include a product that is transferred
1628 electronically.
1629 (e) "Tangible personal property" does not include the following if attached to real
1630 property, regardless of whether the attachment to real property is only through a line that
1631 supplies water, electricity, gas, telephone, cable, or supplies a similar item as determined by the
1632 commission by rule made in accordance with Title 63G, Chapter 3, Utah Administrative
1633 Rulemaking Act:
1634 (i) a hot water heater;
1635 (ii) a water filtration system; or
1636 (iii) a water softener system.
1637 (131) (a) "Telecommunications enabling or facilitating equipment, machinery, or
1638 software" means an item listed in Subsection (131)(b) if that item is purchased or leased
1639 primarily to enable or facilitate one or more of the following to function:
1640 (i) telecommunications switching or routing equipment, machinery, or software; or
1641 (ii) telecommunications transmission equipment, machinery, or software.
1642 (b) The following apply to Subsection (131)(a):
1643 (i) a pole;
1644 (ii) software;
1645 (iii) a supplementary power supply;
1646 (iv) temperature or environmental equipment or machinery;
1647 (v) test equipment;
1648 (vi) a tower; or
1649 (vii) equipment, machinery, or software that functions similarly to an item listed in
1650 Subsections (131)(b)(i) through (vi) as determined by the commission by rule made in
1651 accordance with Subsection (131)(c).
1652 (c) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
1653 commission may by rule define what constitutes equipment, machinery, or software that
1654 functions similarly to an item listed in Subsections (131)(b)(i) through (vi).
1655 (132) "Telecommunications equipment, machinery, or software required for 911
1656 service" means equipment, machinery, or software that is required to comply with 47 C.F.R.
1657 Sec. 20.18.
1658 (133) "Telecommunications maintenance or repair equipment, machinery, or software"
1659 means equipment, machinery, or software purchased or leased primarily to maintain or repair
1660 one or more of the following, regardless of whether the equipment, machinery, or software is
1661 purchased or leased as a spare part or as an upgrade or modification to one or more of the
1662 following:
1663 (a) telecommunications enabling or facilitating equipment, machinery, or software;
1664 (b) telecommunications switching or routing equipment, machinery, or software; or
1665 (c) telecommunications transmission equipment, machinery, or software.
1666 (134) (a) "Telecommunications service" means the electronic conveyance, routing, or
1667 transmission of audio, data, video, voice, or any other information or signal to a point, or
1668 among or between points.
1669 (b) "Telecommunications service" includes:
1670 (i) an electronic conveyance, routing, or transmission with respect to which a computer
1671 processing application is used to act:
1672 (A) on the code, form, or protocol of the content;
1673 (B) for the purpose of electronic conveyance, routing, or transmission; and
1674 (C) regardless of whether the service:
1675 (I) is referred to as voice over Internet protocol service; or
1676 (II) is classified by the Federal Communications Commission as enhanced or value
1677 added;
1678 (ii) an 800 service;
1679 (iii) a 900 service;
1680 (iv) a fixed wireless service;
1681 (v) a mobile wireless service;
1682 (vi) a postpaid calling service;
1683 (vii) a prepaid calling service;
1684 (viii) a prepaid wireless calling service; or
1685 (ix) a private communications service.
1686 (c) "Telecommunications service" does not include:
1687 (i) advertising, including directory advertising;
1688 (ii) an ancillary service;
1689 (iii) a billing and collection service provided to a third party;
1690 (iv) a data processing and information service if:
1691 (A) the data processing and information service allows data to be:
1692 (I) (Aa) acquired;
1693 (Bb) generated;
1694 (Cc) processed;
1695 (Dd) retrieved; or
1696 (Ee) stored; and
1697 (II) delivered by an electronic transmission to a purchaser; and
1698 (B) the purchaser's primary purpose for the underlying transaction is the processed data
1699 or information;
1700 (v) installation or maintenance of the following on a customer's premises:
1701 (A) equipment; or
1702 (B) wiring;
1703 (vi) Internet access service;
1704 (vii) a paging service;
1705 (viii) a product transferred electronically, including:
1706 (A) music;
1707 (B) reading material;
1708 (C) a ring tone;
1709 (D) software; or
1710 (E) video;
1711 (ix) a radio and television audio and video programming service:
1712 (A) regardless of the medium; and
1713 (B) including:
1714 (I) furnishing conveyance, routing, or transmission of a television audio and video
1715 programming service by a programming service provider;
1716 (II) cable service as defined in 47 U.S.C. Sec. 522(6); or
1717 (III) audio and video programming services delivered by a commercial mobile radio
1718 service provider as defined in 47 C.F.R. Sec. 20.3;
1719 (x) a value-added nonvoice data service; or
1720 (xi) tangible personal property.
1721 (135) (a) "Telecommunications service provider" means a person that:
1722 (i) owns, controls, operates, or manages a telecommunications service; and
1723 (ii) engages in an activity described in Subsection (135)(a)(i) for the shared use with or
1724 resale to any person of the telecommunications service.
1725 (b) A person described in Subsection (135)(a) is a telecommunications service provider
1726 whether or not the Public Service Commission of Utah regulates:
1727 (i) that person; or
1728 (ii) the telecommunications service that the person owns, controls, operates, or
1729 manages.
1730 (136) (a) "Telecommunications switching or routing equipment, machinery, or
1731 software" means an item listed in Subsection (136)(b) if that item is purchased or leased
1732 primarily for switching or routing:
1733 (i) an ancillary service;
1734 (ii) data communications;
1735 (iii) voice communications; or
1736 (iv) telecommunications service.
1737 (b) The following apply to Subsection (136)(a):
1738 (i) a bridge;
1739 (ii) a computer;
1740 (iii) a cross connect;
1741 (iv) a modem;
1742 (v) a multiplexer;
1743 (vi) plug in circuitry;
1744 (vii) a router;
1745 (viii) software;
1746 (ix) a switch; or
1747 (x) equipment, machinery, or software that functions similarly to an item listed in
1748 Subsections (136)(b)(i) through (ix) as determined by the commission by rule made in
1749 accordance with Subsection (136)(c).
1750 (c) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
1751 commission may by rule define what constitutes equipment, machinery, or software that
1752 functions similarly to an item listed in Subsections (136)(b)(i) through (ix).
1753 (137) (a) "Telecommunications transmission equipment, machinery, or software"
1754 means an item listed in Subsection (137)(b) if that item is purchased or leased primarily for
1755 sending, receiving, or transporting:
1756 (i) an ancillary service;
1757 (ii) data communications;
1758 (iii) voice communications; or
1759 (iv) telecommunications service.
1760 (b) The following apply to Subsection (137)(a):
1761 (i) an amplifier;
1762 (ii) a cable;
1763 (iii) a closure;
1764 (iv) a conduit;
1765 (v) a controller;
1766 (vi) a duplexer;
1767 (vii) a filter;
1768 (viii) an input device;
1769 (ix) an input/output device;
1770 (x) an insulator;
1771 (xi) microwave machinery or equipment;
1772 (xii) an oscillator;
1773 (xiii) an output device;
1774 (xiv) a pedestal;
1775 (xv) a power converter;
1776 (xvi) a power supply;
1777 (xvii) a radio channel;
1778 (xviii) a radio receiver;
1779 (xix) a radio transmitter;
1780 (xx) a repeater;
1781 (xxi) software;
1782 (xxii) a terminal;
1783 (xxiii) a timing unit;
1784 (xxiv) a transformer;
1785 (xxv) a wire; or
1786 (xxvi) equipment, machinery, or software that functions similarly to an item listed in
1787 Subsections (137)(b)(i) through (xxv) as determined by the commission by rule made in
1788 accordance with Subsection (137)(c).
1789 (c) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
1790 commission may by rule define what constitutes equipment, machinery, or software that
1791 functions similarly to an item listed in Subsections (137)(b)(i) through (xxv).
1792 (138) (a) "Textbook for a higher education course" means a textbook or other printed
1793 material that is required for a course:
1794 (i) offered by an institution of higher education; and
1795 (ii) that the purchaser of the textbook or other printed material attends or will attend.
1796 (b) "Textbook for a higher education course" includes a textbook in electronic format.
1797 (139) "Tobacco" means:
1798 (a) a cigarette;
1799 (b) a cigar;
1800 (c) chewing tobacco;
1801 (d) pipe tobacco; or
1802 (e) any other item that contains tobacco.
1803 (140) "Unassisted amusement device" means an amusement device, skill device, or
1804 ride device that is started and stopped by the purchaser or renter of the right to use or operate
1805 the amusement device, skill device, or ride device.
1806 (141) (a) "Use" means the exercise of any right or power over tangible personal
1807 property, a product transferred electronically, or a service under Subsection 59-12-103(1),
1808 incident to the ownership or the leasing of that tangible personal property, product transferred
1809 electronically, or service.
1810 (b) "Use" does not include the sale, display, demonstration, or trial of tangible personal
1811 property, a product transferred electronically, or a service in the regular course of business and
1812 held for resale.
1813 (142) "Value-added nonvoice data service" means a service:
1814 (a) that otherwise meets the definition of a telecommunications service except that a
1815 computer processing application is used to act primarily for a purpose other than conveyance,
1816 routing, or transmission; and
1817 (b) with respect to which a computer processing application is used to act on data or
1818 information:
1819 (i) code;
1820 (ii) content;
1821 (iii) form; or
1822 (iv) protocol.
1823 (143) (a) Subject to Subsection (143)(b), "vehicle" means the following that are
1824 required to be titled, registered, or titled and registered:
1825 (i) an aircraft as defined in Section 72-10-102;
1826 (ii) a vehicle as defined in Section 41-1a-102;
1827 (iii) an off-highway vehicle as defined in Section 41-22-2; or
1828 (iv) a vessel as defined in Section 41-1a-102.
1829 (b) For purposes of Subsection 59-12-104(33) only, "vehicle" includes:
1830 (i) a vehicle described in Subsection (143)(a); or
1831 (ii) (A) a locomotive;
1832 (B) a freight car;
1833 (C) railroad work equipment; or
1834 (D) other railroad rolling stock.
1835 (144) "Vehicle dealer" means a person engaged in the business of buying, selling, or
1836 exchanging a vehicle as defined in Subsection (143).
1837 (145) (a) "Vertical service" means an ancillary service that:
1838 (i) is offered in connection with one or more telecommunications services; and
1839 (ii) offers an advanced calling feature that allows a customer to:
1840 (A) identify a caller; and
1841 (B) manage multiple calls and call connections.
1842 (b) "Vertical service" includes an ancillary service that allows a customer to manage a
1843 conference bridging service.
1844 (146) (a) "Voice mail service" means an ancillary service that enables a customer to
1845 receive, send, or store a recorded message.
1846 (b) "Voice mail service" does not include a vertical service that a customer is required
1847 to have in order to utilize a voice mail service.
1848 (147) (a) Except as provided in Subsection (147)(b), "waste energy facility" means a
1849 facility that generates electricity:
1850 (i) using as the primary source of energy waste materials that would be placed in a
1851 landfill or refuse pit if it were not used to generate electricity, including:
1852 (A) tires;
1853 (B) waste coal;
1854 (C) oil shale; or
1855 (D) municipal solid waste; and
1856 (ii) in amounts greater than actually required for the operation of the facility.
1857 (b) "Waste energy facility" does not include a facility that incinerates:
1858 (i) hospital waste as defined in 40 C.F.R. 60.51c; or
1859 (ii) medical/infectious waste as defined in 40 C.F.R. 60.51c.
1860 (148) "Watercraft" means a vessel as defined in Section 73-18-2.
1861 (149) "Wind energy" means wind used as the sole source of energy to produce
1862 electricity.
1863 (150) "ZIP Code" means a Zoning Improvement Plan Code assigned to a geographic
1864 location by the United States Postal Service.
1865 Section 8. Section 59-12-103 is amended to read:
1866 59-12-103. Sales and use tax base -- Rates -- Effective dates -- Use of sales and use
1867 tax revenues.
1868 (1) A tax is imposed on the purchaser as provided in this part on the purchase price or
1869 sales price for amounts paid or charged for the following transactions:
1870 (a) retail sales of tangible personal property made within the state;
1871 (b) amounts paid for:
1872 (i) telecommunications service, other than mobile telecommunications service, that
1873 originates and terminates within the boundaries of this state;
1874 (ii) mobile telecommunications service that originates and terminates within the
1875 boundaries of one state only to the extent permitted by the Mobile Telecommunications
1876 Sourcing Act, 4 U.S.C. Sec. 116 et seq.; or
1877 (iii) an ancillary service associated with a:
1878 (A) telecommunications service described in Subsection (1)(b)(i); or
1879 (B) mobile telecommunications service described in Subsection (1)(b)(ii);
1880 (c) sales of the following for commercial use:
1881 (i) gas;
1882 (ii) electricity;
1883 (iii) heat;
1884 (iv) coal;
1885 (v) fuel oil; or
1886 (vi) other fuels;
1887 (d) sales of the following for residential use:
1888 (i) gas;
1889 (ii) electricity;
1890 (iii) heat;
1891 (iv) coal;
1892 (v) fuel oil; or
1893 (vi) other fuels;
1894 (e) sales of prepared food;
1895 (f) except as provided in Section 59-12-104, amounts paid or charged as admission or
1896 user fees for theaters, movies, operas, museums, planetariums, shows of any type or nature,
1897 exhibitions, concerts, carnivals, amusement parks, amusement rides, circuses, menageries,
1898 fairs, races, contests, sporting events, dances, boxing matches, wrestling matches, closed circuit
1899 television broadcasts, billiard parlors, pool parlors, bowling lanes, golf, miniature golf, golf
1900 driving ranges, batting cages, skating rinks, ski lifts, ski runs, ski trails, snowmobile trails,
1901 tennis courts, swimming pools, water slides, river runs, jeep tours, boat tours, scenic cruises,
1902 horseback rides, sports activities, or any other amusement, entertainment, recreation,
1903 exhibition, cultural, or athletic activity;
1904 (g) amounts paid or charged for services for repairs or renovations of tangible personal
1905 property, unless Section 59-12-104 provides for an exemption from sales and use tax for:
1906 (i) the tangible personal property; and
1907 (ii) parts used in the repairs or renovations of the tangible personal property described
1908 in Subsection (1)(g)(i), regardless of whether:
1909 (A) any parts are actually used in the repairs or renovations of that tangible personal
1910 property; or
1911 (B) the particular parts used in the repairs or renovations of that tangible personal
1912 property are exempt from a tax under this chapter;
1913 (h) except as provided in Subsection 59-12-104(7), amounts paid or charged for
1914 assisted cleaning or washing of tangible personal property;
1915 (i) amounts paid or charged for tourist home, hotel, motel, or trailer court
1916 accommodations and services that are regularly rented for less than 30 consecutive days;
1917 (j) amounts paid or charged for laundry or dry cleaning services;
1918 (k) amounts paid or charged for leases or rentals of tangible personal property if within
1919 this state the tangible personal property is:
1920 (i) stored;
1921 (ii) used; or
1922 (iii) otherwise consumed;
1923 (l) amounts paid or charged for tangible personal property if within this state the
1924 tangible personal property is:
1925 (i) stored;
1926 (ii) used; or
1927 (iii) consumed; and
1928 (m) amounts paid or charged for a sale:
1929 (i) (A) of a product transferred electronically; or
1930 (B) of a repair or renovation of a product transferred electronically; and
1931 (ii) regardless of whether the sale provides:
1932 (A) a right of permanent use of the product; or
1933 (B) a right to use the product that is less than a permanent use, including a right:
1934 (I) for a definite or specified length of time; and
1935 (II) that terminates upon the occurrence of a condition.
1936 (2) (a) Except as provided in Subsections (2)(b) through (f), a state tax and a local tax
1937 are imposed on a transaction described in Subsection (1) equal to the sum of:
1938 (i) a state tax imposed on the transaction at a tax rate equal to the sum of:
1939 (A) 4.70% plus the rate specified in Subsection (12)(a); and
1940 (B) (I) the tax rate the state imposes in accordance with Part 18, Additional State Sales
1941 and Use Tax Act, if the location of the transaction as determined under Sections 59-12-211
1942 through 59-12-215 is in a county in which the state imposes the tax under Part 18, Additional
1943 State Sales and Use Tax Act; and
1944 (II) the tax rate the state imposes in accordance with Part 20, Supplemental State Sales
1945 and Use Tax Act, if the location of the transaction as determined under Sections 59-12-211
1946 through 59-12-215 is in a city, town, or the unincorporated area of a county in which the state
1947 imposes the tax under Part 20, Supplemental State Sales and Use Tax Act; and
1948 (ii) a local tax equal to the sum of the tax rates a county, city, or town imposes on the
1949 transaction under this chapter other than this part.
1950 (b) Except as provided in Subsection (2)(e) or (f) and subject to Subsection (2)(k), a
1951 state tax and a local tax are imposed on a transaction described in Subsection (1)(d) equal to
1952 the sum of:
1953 (i) a state tax imposed on the transaction at a tax rate of 2%; and
1954 (ii) a local tax equal to the sum of the tax rates a county, city, or town imposes on the
1955 transaction under this chapter other than this part.
1956 (c) (i) Except as provided in Subsection (2)(e) or (f), a local tax is imposed on amounts
1957 paid or charged for food and food ingredients equal to the sum of the tax rates a county, city, or
1958 town imposes under this chapter on the amounts paid or charged for food or food ingredients.
1959 (ii) There is no state tax imposed on amounts paid or charged for food and food
1960 ingredients.
1961 [
1962
1963 [
1964
1965 [
1966
1967 (d) Except as provided in Subsection (2)(e) or (f), a state tax is imposed on amounts
1968 paid or charged for fuel to a common carrier that is a railroad for use in a locomotive engine at
1969 a rate of 4.85%.
1970 (e) (i) For a bundled transaction that is attributable to food and food ingredients and
1971 tangible personal property other than food and food ingredients, a state tax and a local tax is
1972 imposed on the entire bundled transaction equal to the sum of:
1973 (A) a state tax imposed on the entire bundled transaction equal to the sum of:
1974 (I) the tax rate described in Subsection (2)(a)(i)(A); and
1975 (II) (Aa) the tax rate the state imposes in accordance with Part 18, Additional State
1976 Sales and Use Tax Act, if the location of the transaction as determined under Sections
1977 59-12-211 through 59-12-215 is in a county in which the state imposes the tax under Part 18,
1978 Additional State Sales and Use Tax Act; and
1979 (Bb) the tax rate the state imposes in accordance with Part 20, Supplemental State
1980 Sales and Use Tax Act, if the location of the transaction as determined under Sections
1981 59-12-211 through 59-12-215 is in a city, town, or the unincorporated area of a county in which
1982 the state imposes the tax under Part 20, Supplemental State Sales and Use Tax Act; and
1983 (B) a local tax imposed on the entire bundled transaction at the sum of the tax rates
1984 described in Subsection (2)(a)(ii).
1985 (ii) If an optional computer software maintenance contract is a bundled transaction that
1986 consists of taxable and nontaxable products that are not separately itemized on an invoice or
1987 similar billing document, the purchase of the optional computer software maintenance contract
1988 is 40% taxable under this chapter and 60% nontaxable under this chapter.
1989 (iii) Subject to Subsection (2)(e)(iv), for a bundled transaction other than a bundled
1990 transaction described in Subsection (2)(e)(i) or (ii):
1991 (A) if the sales price of the bundled transaction is attributable to tangible personal
1992 property, a product, or a service that is subject to taxation under this chapter and tangible
1993 personal property, a product, or service that is not subject to taxation under this chapter, the
1994 entire bundled transaction is subject to taxation under this chapter unless:
1995 (I) the seller is able to identify by reasonable and verifiable standards the tangible
1996 personal property, product, or service that is not subject to taxation under this chapter from the
1997 books and records the seller keeps in the seller's regular course of business; or
1998 (II) state or federal law provides otherwise; or
1999 (B) if the sales price of a bundled transaction is attributable to two or more items of
2000 tangible personal property, products, or services that are subject to taxation under this chapter
2001 at different rates, the entire bundled transaction is subject to taxation under this chapter at the
2002 higher tax rate unless:
2003 (I) the seller is able to identify by reasonable and verifiable standards the tangible
2004 personal property, product, or service that is subject to taxation under this chapter at the lower
2005 tax rate from the books and records the seller keeps in the seller's regular course of business; or
2006 (II) state or federal law provides otherwise.
2007 (iv) For purposes of Subsection (2)(e)(iii), books and records that a seller keeps in the
2008 seller's regular course of business includes books and records the seller keeps in the regular
2009 course of business for nontax purposes.
2010 (f) (i) Except as otherwise provided in this chapter and subject to Subsections (2)(f)(ii)
2011 and (iii), if a transaction consists of the sale, lease, or rental of tangible personal property, a
2012 product, or a service that is subject to taxation under this chapter, and the sale, lease, or rental
2013 of tangible personal property, other property, a product, or a service that is not subject to
2014 taxation under this chapter, the entire transaction is subject to taxation under this chapter unless
2015 the seller, at the time of the transaction:
2016 (A) separately states the portion of the transaction that is not subject to taxation under
2017 this chapter on an invoice, bill of sale, or similar document provided to the purchaser; or
2018 (B) is able to identify by reasonable and verifiable standards, from the books and
2019 records the seller keeps in the seller's regular course of business, the portion of the transaction
2020 that is not subject to taxation under this chapter.
2021 (ii) A purchaser and a seller may correct the taxability of a transaction if:
2022 (A) after the transaction occurs, the purchaser and the seller discover that the portion of
2023 the transaction that is not subject to taxation under this chapter was not separately stated on an
2024 invoice, bill of sale, or similar document provided to the purchaser because of an error or
2025 ignorance of the law; and
2026 (B) the seller is able to identify by reasonable and verifiable standards, from the books
2027 and records the seller keeps in the seller's regular course of business, the portion of the
2028 transaction that is not subject to taxation under this chapter.
2029 (iii) For purposes of Subsections (2)(f)(i) and (ii), books and records that a seller keeps
2030 in the seller's regular course of business includes books and records the seller keeps in the
2031 regular course of business for nontax purposes.
2032 (g) (i) If the sales price of a transaction is attributable to two or more items of tangible
2033 personal property, products, or services that are subject to taxation under this chapter at
2034 different rates, the entire purchase is subject to taxation under this chapter at the higher tax rate
2035 unless the seller, at the time of the transaction:
2036 (A) separately states the items subject to taxation under this chapter at each of the
2037 different rates on an invoice, bill of sale, or similar document provided to the purchaser; or
2038 (B) is able to identify by reasonable and verifiable standards the tangible personal
2039 property, product, or service that is subject to taxation under this chapter at the lower tax rate
2040 from the books and records the seller keeps in the seller's regular course of business.
2041 (ii) For purposes of Subsection (2)(g)(i), books and records that a seller keeps in the
2042 seller's regular course of business includes books and records the seller keeps in the regular
2043 course of business for nontax purposes.
2044 (h) Subject to Subsections (2)(i) and (j), a tax rate repeal or tax rate change for a tax
2045 rate imposed under the following shall take effect on the first day of a calendar quarter:
2046 (i) Subsection (2)(a)(i)(A);
2047 (ii) Subsection (2)(b)(i); or
2048 [
2049 [
2050 (i) (i) A tax rate increase takes effect on the first day of the first billing period that
2051 begins on or after the effective date of the tax rate increase if the billing period for the
2052 transaction begins before the effective date of a tax rate increase imposed under:
2053 (A) Subsection (2)(a)(i)(A);
2054 (B) Subsection (2)(b)(i); or
2055 [
2056 [
2057 (ii) The repeal of a tax or a tax rate decrease applies to a billing period if the billing
2058 statement for the billing period is rendered on or after the effective date of the repeal of the tax
2059 or the tax rate decrease imposed under:
2060 (A) Subsection (2)(a)(i)(A);
2061 (B) Subsection (2)(b)(i); or
2062 [
2063 [
2064 (j) (i) For a tax rate described in Subsection (2)(j)(ii), if a tax due on a catalogue sale is
2065 computed on the basis of sales and use tax rates published in the catalogue, a tax rate repeal or
2066 change in a tax rate takes effect:
2067 (A) on the first day of a calendar quarter; and
2068 (B) beginning 60 days after the effective date of the tax rate repeal or tax rate change.
2069 (ii) Subsection (2)(j)(i) applies to the tax rates described in the following:
2070 (A) Subsection (2)(a)(i)(A);
2071 (B) Subsection (2)(b)(i); or
2072 [
2073 [
2074 (iii) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act,
2075 the commission may by rule define the term "catalogue sale."
2076 (k) (i) For a location described in Subsection (2)(k)(ii), the commission shall determine
2077 the taxable status of a sale of gas, electricity, heat, coal, fuel oil, or other fuel based on the
2078 predominant use of the gas, electricity, heat, coal, fuel oil, or other fuel at the location.
2079 (ii) Subsection (2)(k)(i) applies to a location where gas, electricity, heat, coal, fuel oil,
2080 or other fuel is furnished through a single meter for two or more of the following uses:
2081 (A) a commercial use;
2082 (B) an industrial use; or
2083 (C) a residential use.
2084 (3) (a) The following state taxes shall be deposited into the General Fund:
2085 (i) the tax imposed by Subsection (2)(a)(i)(A);
2086 (ii) the tax imposed by Subsection (2)(b)(i); and
2087 [
2088 [
2089 (b) The following local taxes shall be distributed to a county, city, or town as provided
2090 in this chapter:
2091 (i) the tax imposed by Subsection (2)(a)(ii);
2092 (ii) the tax imposed by Subsection (2)(b)(ii);
2093 (iii) the tax imposed by Subsection [
2094 (iv) the tax imposed by Subsection (2)(e)(i)(B).
2095 (c) The state tax imposed by Subsection (2)(d) shall be deposited into the General
2096 Fund.
2097 (4) (a) Notwithstanding Subsection (3)(a), for a fiscal year beginning on or after July 1,
2098 2003, the lesser of the following amounts shall be expended as provided in Subsections (4)(b)
2099 through (g):
2100 (i) for taxes listed under Subsection (3)(a), the amount of tax revenue generated:
2101 (A) by a 1/16% tax rate on the transactions described in Subsection (1); and
2102 (B) for the fiscal year; or
2103 (ii) $17,500,000.
2104 (b) (i) For a fiscal year beginning on or after July 1, 2003, 14% of the amount
2105 described in Subsection (4)(a) shall be transferred each year as designated sales and use tax
2106 revenue to the Department of Natural Resources to:
2107 (A) implement the measures described in Subsections 79-2-303(3)(a) through (d) to
2108 protect sensitive plant and animal species; or
2109 (B) award grants, up to the amount authorized by the Legislature in an appropriations
2110 act, to political subdivisions of the state to implement the measures described in Subsections
2111 79-2-303(3)(a) through (d) to protect sensitive plant and animal species.
2112 (ii) Money transferred to the Department of Natural Resources under Subsection
2113 (4)(b)(i) may not be used to assist the United States Fish and Wildlife Service or any other
2114 person to list or attempt to have listed a species as threatened or endangered under the
2115 Endangered Species Act of 1973, 16 U.S.C. Sec. 1531 et seq.
2116 (iii) At the end of each fiscal year:
2117 (A) 50% of any unexpended designated sales and use tax revenue shall lapse to the
2118 Water Resources Conservation and Development Fund created in Section 73-10-24;
2119 (B) 25% of any unexpended designated sales and use tax revenue shall lapse to the
2120 Utah Wastewater Loan Program Subaccount created in Section 73-10c-5; and
2121 (C) 25% of any unexpended designated sales and use tax revenue shall lapse to the
2122 Drinking Water Loan Program Subaccount created in Section 73-10c-5.
2123 (c) For a fiscal year beginning on or after July 1, 2003, 3% of the amount described in
2124 Subsection (4)(a) shall be deposited each year in the Agriculture Resource Development Fund
2125 created in Section 4-18-106.
2126 (d) (i) For a fiscal year beginning on or after July 1, 2003, 1% of the amount described
2127 in Subsection (4)(a) shall be transferred each year as designated sales and use tax revenue to
2128 the Division of Water Rights to cover the costs incurred in hiring legal and technical staff for
2129 the adjudication of water rights.
2130 (ii) At the end of each fiscal year:
2131 (A) 50% of any unexpended designated sales and use tax revenue shall lapse to the
2132 Water Resources Conservation and Development Fund created in Section 73-10-24;
2133 (B) 25% of any unexpended designated sales and use tax revenue shall lapse to the
2134 Utah Wastewater Loan Program Subaccount created in Section 73-10c-5; and
2135 (C) 25% of any unexpended designated sales and use tax revenue shall lapse to the
2136 Drinking Water Loan Program Subaccount created in Section 73-10c-5.
2137 (e) (i) For a fiscal year beginning on or after July 1, 2003, 41% of the amount described
2138 in Subsection (4)(a) shall be deposited into the Water Resources Conservation and
2139 Development Fund created in Section 73-10-24 for use by the Division of Water Resources.
2140 (ii) In addition to the uses allowed of the Water Resources Conservation and
2141 Development Fund under Section 73-10-24, the Water Resources Conservation and
2142 Development Fund may also be used to:
2143 (A) conduct hydrologic and geotechnical investigations by the Division of Water
2144 Resources in a cooperative effort with other state, federal, or local entities, for the purpose of
2145 quantifying surface and ground water resources and describing the hydrologic systems of an
2146 area in sufficient detail so as to enable local and state resource managers to plan for and
2147 accommodate growth in water use without jeopardizing the resource;
2148 (B) fund state required dam safety improvements; and
2149 (C) protect the state's interest in interstate water compact allocations, including the
2150 hiring of technical and legal staff.
2151 (f) For a fiscal year beginning on or after July 1, 2003, 20.5% of the amount described
2152 in Subsection (4)(a) shall be deposited into the Utah Wastewater Loan Program Subaccount
2153 created in Section 73-10c-5 for use by the Water Quality Board to fund wastewater projects.
2154 (g) For a fiscal year beginning on or after July 1, 2003, 20.5% of the amount described
2155 in Subsection (4)(a) shall be deposited into the Drinking Water Loan Program Subaccount
2156 created in Section 73-10c-5 for use by the Division of Drinking Water to:
2157 (i) provide for the installation and repair of collection, treatment, storage, and
2158 distribution facilities for any public water system, as defined in Section 19-4-102;
2159 (ii) develop underground sources of water, including springs and wells; and
2160 (iii) develop surface water sources.
2161 (5) (a) Notwithstanding Subsection (3)(a), for a fiscal year beginning on or after July 1,
2162 2006, the difference between the following amounts shall be expended as provided in this
2163 Subsection (5), if that difference is greater than $1:
2164 (i) for taxes listed under Subsection (3)(a), the amount of tax revenue generated for the
2165 fiscal year by a 1/16% tax rate on the transactions described in Subsection (1); and
2166 (ii) $17,500,000.
2167 (b) (i) The first $500,000 of the difference described in Subsection (5)(a) shall be:
2168 (A) transferred each fiscal year to the Department of Natural Resources as designated
2169 sales and use tax revenue; and
2170 (B) expended by the Department of Natural Resources for watershed rehabilitation or
2171 restoration.
2172 (ii) At the end of each fiscal year, 100% of any unexpended designated sales and use
2173 tax revenue described in Subsection (5)(b)(i) shall lapse to the Water Resources Conservation
2174 and Development Fund created in Section 73-10-24.
2175 (c) (i) After making the transfer required by Subsection (5)(b)(i), $150,000 of the
2176 remaining difference described in Subsection (5)(a) shall be:
2177 (A) transferred each fiscal year to the Division of Water Resources as designated sales
2178 and use tax revenue; and
2179 (B) expended by the Division of Water Resources for cloud-seeding projects
2180 authorized by Title 73, Chapter 15, Modification of Weather.
2181 (ii) At the end of each fiscal year, 100% of any unexpended designated sales and use
2182 tax revenue described in Subsection (5)(c)(i) shall lapse to the Water Resources Conservation
2183 and Development Fund created in Section 73-10-24.
2184 (d) After making the transfers required by Subsections (5)(b) and (c), 85% of the
2185 remaining difference described in Subsection (5)(a) shall be deposited into the Water
2186 Resources Conservation and Development Fund created in Section 73-10-24 for use by the
2187 Division of Water Resources for:
2188 (i) preconstruction costs:
2189 (A) as defined in Subsection 73-26-103(6) for projects authorized by Title 73, Chapter
2190 26, Bear River Development Act; and
2191 (B) as defined in Subsection 73-28-103(8) for the Lake Powell Pipeline project
2192 authorized by Title 73, Chapter 28, Lake Powell Pipeline Development Act;
2193 (ii) the cost of employing a civil engineer to oversee any project authorized by Title 73,
2194 Chapter 26, Bear River Development Act;
2195 (iii) the cost of employing a civil engineer to oversee the Lake Powell Pipeline project
2196 authorized by Title 73, Chapter 28, Lake Powell Pipeline Development Act; and
2197 (iv) other uses authorized under Sections 73-10-24, 73-10-25.1, and 73-10-30, and
2198 Subsection (4)(e)(ii) after funding the uses specified in Subsections (5)(d)(i) through (iii).
2199 (e) After making the transfers required by Subsections (5)(b) and (c), 15% of the
2200 remaining difference described in Subsection (5)(a) shall be deposited each year into the Water
2201 Rights Restricted Account created by Section 73-2-1.6.
2202 (6) Notwithstanding Subsection (3)(a) and for taxes listed under Subsection (3)(a), the
2203 amount of revenue generated by a 1/16% tax rate on the transactions described in Subsection
2204 (1) for the fiscal year shall be deposited as follows:
2205 (a) for fiscal year 2020-21 only:
2206 (i) 20% of the revenue described in this Subsection (6) shall be deposited into the
2207 Transportation Investment Fund of 2005 created by Section 72-2-124; and
2208 (ii) 80% of the revenue described in this Subsection (6) shall be deposited into the
2209 Water Infrastructure Restricted Account created by Section 73-10g-103; and
2210 (b) for a fiscal year beginning on or after July 1, 2021, 100% of the revenue described
2211 in this Subsection (6) shall be deposited into the Water Infrastructure Restricted Account
2212 created by Section 73-10g-103.
2213 (7) (a) Notwithstanding Subsection (3)(a), in addition to the amounts deposited in
2214 Subsection (6), and subject to Subsection (7)(b), for a fiscal year beginning on or after July 1,
2215 2012, the Division of Finance shall deposit into the Transportation Investment Fund of 2005
2216 created by Section 72-2-124:
2217 (i) a portion of the taxes listed under Subsection (3)(a) in an amount equal to 8.3% of
2218 the revenues collected from the following taxes, which represents a portion of the
2219 approximately 17% of sales and use tax revenues generated annually by the sales and use tax
2220 on vehicles and vehicle-related products:
2221 (A) the tax imposed by Subsection (2)(a)(i)(A) at a 4.7% rate;
2222 (B) the tax imposed by Subsection (2)(b)(i); and
2223 [
2224 [
2225 (ii) an amount equal to 30% of the growth in the amount of revenues collected in the
2226 current fiscal year from the sales and use taxes described in Subsections (7)(a)(i)(A) through
2227 [
2228 Subsections (7)(a)(i)(A) through [
2229 (b) (i) Subject to Subsections (7)(b)(ii) and (iii), in any fiscal year that the portion of
2230 the sales and use taxes deposited under Subsection (7)(a) represents an amount that is a total
2231 lower percentage of the sales and use taxes described in Subsections (7)(a)(i)(A) through [
2232 (C) generated in the current fiscal year than the total percentage of sales and use taxes
2233 deposited in the previous fiscal year, the Division of Finance shall deposit an amount under
2234 Subsection (7)(a) equal to the product of:
2235 (A) the total percentage of sales and use taxes deposited under Subsection (7)(a) in the
2236 previous fiscal year; and
2237 (B) the total sales and use tax revenue generated by the taxes described in Subsections
2238 (7)(a)(i)(A) through [
2239 (ii) In any fiscal year in which the portion of the sales and use taxes deposited under
2240 Subsection (7)(a) would exceed 17% of the revenues collected from the sales and use taxes
2241 described in Subsections (7)(a)(i)(A) through [
2242 of Finance shall deposit 17% of the revenues collected from the sales and use taxes described
2243 in Subsections (7)(a)(i)(A) through [
2244 (iii) Subject to Subsection (7)(b)(iv)(E), in all subsequent fiscal years after a year in
2245 which 17% of the revenues collected from the sales and use taxes described in Subsections
2246 (7)(a)(i)(A) through [
2247 shall annually deposit 17% of the revenues collected from the sales and use taxes described in
2248 Subsections (7)(a)(i)(A) through [
2249 (iv) (A) As used in this Subsection (7)(b)(iv), "additional growth revenue" means the
2250 amount of relevant revenue collected in the current fiscal year that exceeds by more than 3%
2251 the relevant revenue collected in the previous fiscal year.
2252 (B) As used in this Subsection (7)(b)(iv), "combined amount" means the combined
2253 total amount of money deposited into the Cottonwood Canyons fund under Subsections
2254 (7)(b)(iv)(F) and (8)(d)(vi) in any single fiscal year.
2255 (C) As used in this Subsection (7)(b)(iv), "Cottonwood Canyons fund" means the
2256 Cottonwood Canyons Transportation Investment Fund created in Subsection 72-2-124(10).
2257 (D) As used in this Subsection (7)(b)(iv), "relevant revenue" means the portion of taxes
2258 listed under Subsection (3)(a) that equals 17% of the revenue collected from taxes described in
2259 Subsections (7)(a)(i)(A) through [
2260 (E) For a fiscal year beginning on or after July 1, 2020, the commission shall annually
2261 reduce the deposit under Subsection (7)(b)(iii) into the Transportation Investment Fund of 2005
2262 by an amount equal to the amount of the deposit under this Subsection (7)(b)(iv) to the
2263 Cottonwood Canyons fund in the previous fiscal year plus 25% of additional growth revenue,
2264 subject to the limit in Subsection (7)(b)(iv)(F).
2265 (F) The commission shall annually deposit the amount described in Subsection
2266 (7)(b)(iv)(E) into the Cottonwood Canyons fund, subject to an annual maximum combined
2267 amount for any single fiscal year of $20,000,000.
2268 (G) If the amount of relevant revenue declines in a fiscal year compared to the previous
2269 fiscal year, the commission shall decrease the amount of the contribution to the Cottonwood
2270 Canyons fund under this Subsection (7)(b)(iv) in the same proportion as the decline in relevant
2271 revenue.
2272 (8) (a) Notwithstanding Subsection (3)(a), in addition to the amounts deposited under
2273 Subsections (6) and (7), and subject to Subsections (8)(b) and (d)(v), for a fiscal year beginning
2274 on or after July 1, 2018, the commission shall annually deposit into the Transportation
2275 Investment Fund of 2005 created by Section 72-2-124 a portion of the taxes listed under
2276 Subsection (3)(a) in an amount equal to 3.68% of the revenues collected from the following
2277 taxes:
2278 (i) the tax imposed by Subsection (2)(a)(i)(A) at a 4.7% rate;
2279 (ii) the tax imposed by Subsection (2)(b)(i); and
2280 [
2281 [
2282 (b) For a fiscal year beginning on or after July 1, 2019, the commission shall annually
2283 reduce the deposit into the Transportation Investment Fund of 2005 under Subsection (8)(a) by
2284 an amount that is equal to 35% of the amount of revenue generated in the current fiscal year by
2285 the portion of the tax imposed on motor and special fuel that is sold, used, or received for sale
2286 or use in this state that exceeds 29.4 cents per gallon.
2287 (c) The commission shall annually deposit the amount described in Subsection (8)(b)
2288 into the Transit Transportation Investment Fund created in Section 72-2-124.
2289 (d) (i) As used in this Subsection (8)(d), "additional growth revenue" means the
2290 amount of relevant revenue collected in the current fiscal year that exceeds by more than 3%
2291 the relevant revenue collected in the previous fiscal year.
2292 (ii) As used in this Subsection (8)(d), "combined amount" means the combined total
2293 amount of money deposited into the Cottonwood Canyons fund under Subsections (7)(b)(iv)(F)
2294 and (8)(d)(vi) in any single fiscal year.
2295 (iii) As used in this Subsection (8)(d), "Cottonwood Canyons fund" means the
2296 Cottonwood Canyons Transportation Investment Fund created in Subsection 72-2-124(10).
2297 (iv) As used in this Subsection (8)(d), "relevant revenue" means the portion of taxes
2298 listed under Subsection (3)(a) that equals 3.68% of the revenue collected from taxes described
2299 in Subsections (8)(a)(i) through [
2300 (v) For a fiscal year beginning on or after July 1, 2020, the commission shall annually
2301 reduce the deposit under Subsection (8)(a) into the Transportation Investment Fund of 2005 by
2302 an amount equal to the amount of the deposit under this Subsection (8)(d) to the Cottonwood
2303 Canyons fund in the previous fiscal year plus 25% of additional growth revenue, subject to the
2304 limit in Subsection (8)(d)(vi).
2305 (vi) The commission shall annually deposit the amount described in Subsection
2306 (8)(d)(v) into the Cottonwood Canyons fund, subject to an annual maximum combined amount
2307 for any single fiscal year of $20,000,000.
2308 (vii) If the amount of relevant revenue declines in a fiscal year compared to the
2309 previous fiscal year, the commission shall decrease the amount of the contribution to the
2310 Cottonwood Canyons fund under this Subsection (8)(d) in the same proportion as the decline in
2311 relevant revenue.
2312 (9) Notwithstanding Subsection (3)(a), for each fiscal year beginning with fiscal year
2313 2009-10, $533,750 shall be deposited into the Qualified Emergency Food Agencies Fund
2314 created by Section 35A-8-1009 and expended as provided in Section 35A-8-1009.
2315 (10) (a) Notwithstanding Subsection (3)(a), except as provided in Subsection (10)(b),
2316 and in addition to any amounts deposited under Subsections (6), (7), and (8), the Division of
2317 Finance shall deposit into the Transportation Investment Fund of 2005 created by Section
2318 72-2-124 the amount of revenue described as follows:
2319 (i) for fiscal year 2020-21 only, 33.33% of the amount of revenue generated by a .05%
2320 tax rate on the transactions described in Subsection (1); and
2321 (ii) for fiscal year 2021-22 only, 16.67% of the amount of revenue generated by a .05%
2322 tax rate on the transactions described in Subsection (1).
2323 (b) For purposes of Subsection (10)(a), the Division of Finance may not deposit into
2324 the Transportation Investment Fund of 2005 any tax revenue generated by amounts paid or
2325 charged for food and food ingredients, except for tax revenue generated by a bundled
2326 transaction attributable to food and food ingredients and tangible personal property other than
2327 food and food ingredients described in Subsection (2)(e).
2328 (11) Notwithstanding Subsection (3)(a), beginning the second fiscal year after the
2329 fiscal year during which the Division of Finance receives notice under Section 63N-2-510 that
2330 construction on a qualified hotel, as defined in Section 63N-2-502, has begun, the Division of
2331 Finance shall, for two consecutive fiscal years, annually deposit $1,900,000 of the revenue
2332 generated by the taxes listed under Subsection (3)(a) into the Hotel Impact Mitigation Fund,
2333 created in Section 63N-2-512.
2334 (12) (a) The rate specified in this subsection is 0.15%.
2335 (b) Notwithstanding Subsection (3)(a), the Division of Finance shall, for a fiscal year
2336 beginning on or after July 1, 2019, annually transfer the amount of revenue collected from the
2337 rate described in Subsection (12)(a) on the transactions that are subject to the sales and use tax
2338 under Subsection (2)(a)(i)(A) into the Medicaid Expansion Fund created in Section
2339 26-36b-208.
2340 (13) Notwithstanding Subsection (3)(a), for each fiscal year beginning with fiscal year
2341 2020-21, the Division of Finance shall deposit $200,000 into the General Fund as a dedicated
2342 credit solely for use of the Search and Rescue Financial Assistance Program created in, and
2343 expended in accordance with, Title 53, Chapter 2a, Part 11, Search and Rescue Act.
2344 (14) (a) For each fiscal year beginning with fiscal year 2020-21, the Division of
2345 Finance shall annually transfer $1,813,400 of the revenue deposited into the Transportation
2346 Investment Fund of 2005 under Subsections (6) through (8) to the General Fund.
2347 (b) If the total revenue deposited into the Transportation Investment Fund of 2005
2348 under Subsections (6) through (8) is less than $1,813,400 for a fiscal year, the Division of
2349 Finance shall transfer the total revenue deposited into the Transportation Investment Fund of
2350 2005 under Subsections (6) through (8) during the fiscal year to the General Fund.
2351 (15) Notwithstanding Subsection (3)(a), and as described in Section 63N-3-610,
2352 beginning the first day of the calendar quarter one year after the sales and use tax boundary for
2353 a housing and transit reinvestment zone is established, the commission, at least annually, shall
2354 transfer an amount equal to 15% of the sales and use tax increment within an established sales
2355 and use tax boundary, as defined in Section 63N-3-602, into the Transit Transportation
2356 Investment Fund created in Section 72-2-124.
2357 (16) Notwithstanding Subsection (3)(a), the Division of Finance shall, for a fiscal year
2358 beginning on or after July 1, 2022, transfer into the Outdoor Adventure Infrastructure
2359 Restricted Account, created in Section 51-9-902, a portion of the taxes listed under Subsection
2360 (3)(a) equal to 1% of the revenues collected from the following sales and use taxes:
2361 (a) the tax imposed by Subsection (2)(a)(i)(A) at a 4.7% rate;
2362 (b) the tax imposed by Subsection (2)(b)(i); and
2363 [
2364 [
2365 Section 9. Section 59-12-108 is amended to read:
2366 59-12-108. Monthly payment -- Amount of tax a seller may retain -- Penalty --
2367 Certain amounts allocated to local taxing jurisdictions.
2368 (1) (a) Notwithstanding Section 59-12-107, a seller that has a tax liability under this
2369 chapter of $50,000 or more for the previous calendar year shall:
2370 (i) file a return with the commission:
2371 (A) monthly on or before the last day of the month immediately following the month
2372 for which the seller collects a tax under this chapter; and
2373 (B) for the month for which the seller collects a tax under this chapter; and
2374 (ii) except as provided in Subsection (1)(b), remit with the return required by
2375 Subsection (1)(a)(i) the amount the person is required to remit to the commission for each tax,
2376 fee, or charge described in Subsection (1)(c):
2377 (A) if that seller's tax liability under this chapter for the previous calendar year is less
2378 than $96,000, by any method permitted by the commission; or
2379 (B) if that seller's tax liability under this chapter for the previous calendar year is
2380 $96,000 or more, by electronic funds transfer.
2381 (b) A seller shall remit electronically with the return required by Subsection (1)(a)(i)
2382 the amount the seller is required to remit to the commission for each tax, fee, or charge
2383 described in Subsection (1)(c) if that seller:
2384 (i) is required by Section 59-12-107 to file the return electronically; or
2385 (ii) (A) is required to collect and remit a tax under Section 59-12-107; and
2386 (B) files a simplified electronic return.
2387 (c) Subsections (1)(a) and (b) apply to the following taxes, fees, or charges:
2388 (i) a tax under Title 10, Chapter 1, Part 3, Municipal Energy Sales and Use Tax Act;
2389 (ii) a fee under Section 19-6-714;
2390 (iii) a fee under Section 19-6-805;
2391 (iv) a charge under Title 69, Chapter 2, Part 4, Prepaid Wireless Telecommunications
2392 Service Charges; or
2393 (v) a tax under this chapter.
2394 (d) Notwithstanding Subsection (1)(a)(ii) and in accordance with Title 63G, Chapter 3,
2395 Utah Administrative Rulemaking Act, the commission shall make rules providing for a method
2396 for making same-day payments other than by electronic funds transfer if making payments by
2397 electronic funds transfer fails.
2398 (e) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
2399 commission shall establish by rule procedures and requirements for determining the amount a
2400 seller is required to remit to the commission under this Subsection (1).
2401 (2) (a) Except as provided in Subsection (3), a seller subject to Subsection (1) or a
2402 seller described in Subsection (4) may retain each month the amount allowed by this
2403 Subsection (2).
2404 (b) A seller subject to Subsection (1) or a seller described in Subsection (4) may retain
2405 each month 1.31% of any amounts the seller is required to remit to the commission:
2406 (i) for a transaction described in Subsection 59-12-103(1) that is subject to a state tax
2407 and a local tax imposed in accordance with the following, for the month for which the seller is
2408 filing a return in accordance with Subsection (1):
2409 (A) Subsection 59-12-103(2)(a);
2410 (B) Subsection 59-12-103(2)(b); and
2411 (C) Subsection 59-12-103(2)(d); and
2412 (ii) for an agreement sales and use tax.
2413 (c) (i) A seller subject to Subsection (1) or a seller described in Subsection (4) may
2414 retain each month the amount calculated under Subsection (2)(c)(ii) for a transaction described
2415 in Subsection 59-12-103(1) that is subject to the [
2416 accordance with Subsection 59-12-103(2)(c).
2417 (ii) For purposes of Subsection (2)(c)(i), the amount a seller may retain is an amount
2418 equal to the sum of:
2419 (A) 1.31% of any amounts the seller is required to remit to the commission for:
2420 (I) the [
2421 59-12-103(2)(c);
2422 (II) the month for which the seller is filing a return in accordance with Subsection (1);
2423 and
2424 (III) an agreement sales and use tax; and
2425 (B) 1.31% of the difference between:
2426 (I) the amounts the seller would have been required to remit to the commission:
2427 (Aa) in accordance with Subsection 59-12-103(2)(a) if the transaction had been subject
2428 to the state tax and the local tax imposed in accordance with Subsection 59-12-103(2)(a);
2429 (Bb) for the month for which the seller is filing a return in accordance with Subsection
2430 (1); and
2431 (Cc) for an agreement sales and use tax; and
2432 (II) the amounts the seller is required to remit to the commission for:
2433 (Aa) the [
2434 59-12-103(2)(c);
2435 (Bb) the month for which the seller is filing a return in accordance with Subsection (1);
2436 and
2437 (Cc) an agreement sales and use tax.
2438 (d) A seller subject to Subsection (1) or a seller described in Subsection (4) may retain
2439 each month 1% of any amounts the seller is required to remit to the commission:
2440 (i) for the month for which the seller is filing a return in accordance with Subsection
2441 (1); and
2442 (ii) under:
2443 (A) Title 10, Chapter 1, Part 3, Municipal Energy Sales and Use Tax Act;
2444 (B) Subsection 59-12-603(1)(a)(i)(A);
2445 (C) Subsection 59-12-603(1)(a)(i)(B); or
2446 (D) Subsection 59-12-603(1)(a)(ii).
2447 (3) A state government entity that is required to remit taxes monthly in accordance
2448 with Subsection (1) may not retain any amount under Subsection (2).
2449 (4) A seller that has a tax liability under this chapter for the previous calendar year of
2450 less than $50,000 may:
2451 (a) voluntarily meet the requirements of Subsection (1); and
2452 (b) if the seller voluntarily meets the requirements of Subsection (1), retain the
2453 amounts allowed by Subsection (2).
2454 (5) Penalties for late payment shall be as provided in Section 59-1-401.
2455 (6) (a) Except as provided in Subsection (6)(c), for any amounts required to be remitted
2456 to the commission under this part, the commission shall each month calculate an amount equal
2457 to the difference between:
2458 (i) the total amount retained for that month by all sellers had the percentages listed
2459 under Subsections (2)(b) and (2)(c)(ii) been 1.5%; and
2460 (ii) the total amount retained for that month by all sellers at the percentages listed
2461 under Subsections (2)(b) and (2)(c)(ii).
2462 (b) The commission shall each month allocate the amount calculated under Subsection
2463 (6)(a) to each county, city, and town on the basis of the proportion of agreement sales and use
2464 tax that the commission distributes to each county, city, and town for that month compared to
2465 the total agreement sales and use tax that the commission distributes for that month to all
2466 counties, cities, and towns.
2467 (c) The amount the commission calculates under Subsection (6)(a) may not include an
2468 amount collected from a tax that:
2469 (i) the state imposes within a county, city, or town, including the unincorporated area
2470 of a county; and
2471 (ii) is not imposed within the entire state.
2472 Section 10. Section 63N-2-502 is amended to read:
2473 63N-2-502. Definitions.
2474 As used in this part:
2475 (1) "Agreement" means an agreement described in Section 63N-2-503.
2476 (2) "Base taxable value" means the value of hotel property before the construction on a
2477 qualified hotel begins, as that value is established by the county in which the hotel property is
2478 located, using a reasonable valuation method that may include the value of the hotel property
2479 on the county assessment rolls the year before the year during which construction on the
2480 qualified hotel begins.
2481 (3) "Certified claim" means a claim that the office has approved and certified as
2482 provided in Section 63N-2-505.
2483 (4) "Claim" means a written document submitted by a qualified hotel owner or host
2484 local government to request a convention incentive.
2485 (5) "Claimant" means the qualified hotel owner or host local government that submits a
2486 claim under Subsection 63N-2-505(1)(a) for a convention incentive.
2487 (6) "Commission" means the Utah State Tax Commission.
2488 (7) "Community reinvestment agency" means the same as that term is defined in
2489 Section 17C-1-102.
2490 (8) "Construction revenue" means revenue generated from state taxes and local taxes
2491 imposed on transactions occurring during the eligibility period as a result of the construction of
2492 the hotel property, including purchases made by a qualified hotel owner and its subcontractors.
2493 (9) "Convention incentive" means an incentive for the development of a qualified
2494 hotel, in the form of payment from the incentive fund as provided in this part, as authorized in
2495 an agreement.
2496 (10) "Eligibility period" means:
2497 (a) the period that:
2498 (i) begins the date construction of a qualified hotel begins; and
2499 (ii) ends:
2500 (A) for purposes of the state portion, 20 years after the date of initial occupancy of that
2501 qualified hotel; or
2502 (B) for purposes of the local portion and incremental property tax revenue, 25 years
2503 after the date of initial occupancy of that hotel; or
2504 (b) as provided in an agreement between the office and a qualified hotel owner or host
2505 local government, a period that:
2506 (i) begins no earlier than the date construction of a qualified hotel begins; and
2507 (ii) is shorter than the period described in Subsection (10)(a).
2508 (11) "Endorsement letter" means a letter:
2509 (a) from the county in which a qualified hotel is located or is proposed to be located;
2510 (b) signed by the county executive; and
2511 (c) expressing the county's endorsement of a developer of a qualified hotel as meeting
2512 all the county's criteria for receiving the county's endorsement.
2513 (12) "Host agency" means the community reinvestment agency of the host local
2514 government.
2515 (13) "Host local government" means:
2516 (a) a county that enters into an agreement with the office for the construction of a
2517 qualified hotel within the unincorporated area of the county; or
2518 (b) a city or town that enters into an agreement with the office for the construction of a
2519 qualified hotel within the boundary of the city or town.
2520 (14) "Hotel property" means a qualified hotel and any property that is included in the
2521 same development as the qualified hotel, including convention, exhibit, and meeting space,
2522 retail shops, restaurants, parking, and other ancillary facilities and amenities.
2523 (15) "Incentive fund" means the Convention Incentive Fund created in Section
2524 63N-2-503.5.
2525 (16) "Incremental property tax revenue" means the amount of property tax revenue
2526 generated from hotel property that equals the difference between:
2527 (a) the amount of property tax revenue generated in any tax year by all taxing entities
2528 from hotel property, using the current assessed value of the hotel property; and
2529 (b) the amount of property tax revenue that would be generated that tax year by all
2530 taxing entities from hotel property, using the hotel property's base taxable value.
2531 (17) "Local portion" means the portion of new tax revenue that is generated by local
2532 taxes.
2533 (18) "Local taxes" means a tax imposed under:
2534 (a) Section 59-12-204;
2535 (b) Section 59-12-301;
2536 (c) Sections 59-12-352 and 59-12-353;
2537 (d) Subsection 59-12-603(1)(a); or
2538 (e) Section 59-12-1102.
2539 (19) "New tax revenue" means construction revenue, offsite revenue, and onsite
2540 revenue.
2541 (20) "Offsite revenue" means revenue generated from state taxes and local taxes
2542 imposed on transactions by a third-party seller occurring other than on hotel property during the
2543 eligibility period, if:
2544 (a) the transaction is subject to a tax under Title 59, Chapter 12, Sales and Use Tax
2545 Act; and
2546 (b) the third-party seller voluntarily consents to the disclosure of information to the
2547 office, as provided in Subsection 63N-2-505(2)(b)(i)(E).
2548 (21) "Onsite revenue" means revenue generated from state taxes and local taxes
2549 imposed on transactions occurring on hotel property during the eligibility period.
2550 (22) "Public infrastructure" means:
2551 (a) water, sewer, storm drainage, electrical, telecommunications, and other similar
2552 systems and lines;
2553 (b) streets, roads, curbs, gutters, sidewalks, walkways, parking facilities, and public
2554 transportation facilities; and
2555 (c) other buildings, facilities, infrastructure, and improvements that benefit the public.
2556 (23) "Qualified hotel" means a full-service hotel development constructed in the state
2557 on or after July 1, 2014 that:
2558 (a) requires a significant capital investment;
2559 (b) includes at least 85 square feet of convention, exhibit, and meeting space per guest
2560 room; and
2561 (c) is located within 1,000 feet of a convention center that contains at least 500,000
2562 square feet of convention, exhibit, and meeting space.
2563 (24) "Qualified hotel owner" means a person who owns a qualified hotel.
2564 (25) "Review committee" means the independent review committee established under
2565 Section 63N-2-504.
2566 (26) "Significant capital investment" means an amount of at least $200,000,000.
2567 (27) "State portion" means the portion of new tax revenue that is generated by state
2568 taxes.
2569 (28) "State taxes" means a tax imposed under Subsection 59-12-103(2)(a)(i), (2)(b)(i),
2570 [
2571 (29) "Third-party seller" means a person who is a seller in a transaction:
2572 (a) occurring other than on hotel property;
2573 (b) that is:
2574 (i) the sale, rental, or lease of a room or of convention or exhibit space or other
2575 facilities on hotel property; or
2576 (ii) the sale of tangible personal property or a service that is part of a bundled
2577 transaction, as defined in Section 59-12-102, with a sale, rental, or lease described in
2578 Subsection (29)(b)(i); and
2579 (c) that is subject to a tax under Title 59, Chapter 12, Sales and Use Tax Act.
2580 Section 11. Section 63N-7-301 is amended to read:
2581 63N-7-301. Tourism Marketing Performance Account.
2582 (1) There is created within the General Fund a restricted account known as the Tourism
2583 Marketing Performance Account.
2584 (2) The account shall be administered by the tourism office for the purposes listed in
2585 Subsections (6) [
2586 (3) (a) The account shall earn interest.
2587 (b) All interest earned on account money shall be deposited into the account.
2588 (4) The account shall be funded by appropriations made to the account by the
2589 Legislature in accordance with this section.
2590 (5) The managing director shall use account money appropriated to the tourism office
2591 to pay for the statewide advertising, marketing, and branding campaign for promotion of the
2592 state as conducted by the tourism office.
2593 (6) (a) For each fiscal year, the tourism office shall annually allocate 10% of the
2594 account money appropriated to the tourism office to a sports organization for advertising,
2595 marketing, branding, and promoting Utah in attracting sporting events into the state.
2596 (b) The sports organization shall:
2597 (i) provide an annual written report to the tourism office that gives an accounting of the
2598 use of funds the sports organization receives under this Subsection (6); and
2599 (ii) promote the state and encourage economic growth in the state.
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2671 appropriated to the Tourism Marketing and Performance Account to the cooperative program
2672 described in this Subsection [
2673 (b) Money allocated to the cooperative program may be awarded to cities, counties,
2674 nonprofit destination marketing organizations, and similar public entities for the purpose of
2675 supplementing money committed by these entities for advertising and promoting sites and
2676 events in the state.
2677 (c) The tourism office shall establish:
2678 (i) an application and approval process for an entity to receive a cooperative program
2679 award, including an application deadline;
2680 (ii) the criteria for awarding a cooperative program award, which shall emphasize
2681 attracting out-of-state visitors, and may include attracting in-state visitors, to sites and events in
2682 the state; and
2683 (iii) eligibility, advertising, timing, and reporting requirements of an entity that
2684 receives a cooperative program award.
2685 (d) Money allocated to the cooperative program that is not used in each fiscal year shall
2686 be returned to the Tourism Marketing Performance Account.
2687 Section 12. Effective date.
2688 (1) Except as provided in Subsection (2), this bill takes effect May 3, 2023.
2689 (2) The changes to Sections 59-12-102, 59-12-103, 59-12-108, 63N-2-502, and
2690 63N-7-301 take effect January 1, 2025, if the amendment to the Utah Constitution proposed by
2691 S.J.R. 10, Proposal to Amend Utah Constitution - Income Tax, 2023 General Session, passes
2692 the Legislature and is approved by a majority of those voting on it at the next regular general
2693 election.
2694 Section 13. Retrospective operation.
2695 The following sections have retrospective operation for a taxable year beginning on or
2696 after January 1, 2023:
2697 (1) Section 59-7-104;
2698 (2) Section 59-7-201;
2699 (3) Section 59-10-104;
2700 (4) Section 59-10-1018;
2701 (5) Section 59-10-1042; and
2702 (6) Section 59-10-1044.