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H0522...............................................by REVENUE AND TAXATION
SALES TAX - Amends existing law to clarify portions of the Sales Tax Act
relating to the definition of "retail sale," to impose the tax on certain
sales to United States government contractors, to provide for the issuance
of temporary seller's and wholesaler's permits, and to prohibit certain
enforcement actions by the State Tax Commission until all appeal rights
have become final.
01/27 House intro - 1st rdg - to printing
01/28 Rpt prt - to Rev/Tax
02/10 Rpt out - rec d/p - to 2nd rdg
02/11 2nd rdg - to 3rd rdg
02/16 3rd rdg - PASSED - 67-0-3
AYES -- Alltus, Barraclough, Bell, Bieter, Bivens, Black(15),
Black(23), Boe, Bruneel, Callister, Campbell, Chase, Clark, Crane,
Crow, Cuddy, Deal, Denney, Ellsworth, Field(13), Field(20), Gagner,
Geddes, Hadley, Hansen, Henbest, Hornbeck, Jaquet, Jones(9),
Jones(22), Jones(20), Judd, Kellogg, Kempton, Kendell, Kjellander,
Kunz, Lake, Linford, Loertscher, Mader, Marley, McKague, Meyer,
Miller, Mortensen, Newcomb, Pischner, Pomeroy, Reynolds, Richman,
Ridinger, Robison, Sali, Schaefer, Stevenson, Stoicheff, Stubbs,
Taylor, Tilman, Tippets, Trail, Watson, Wheeler, Wood, Zimmermann,
Mr Speaker
NAYS -- None
Absent and excused -- Barrett, Gould, Stone
Floor Sponsor - Watson
Title apvd - to Senate
02/17 Senate intro - 1st rdg - to Loc Gov
02/19 Rpt out - rec d/p - to 2nd rdg
02/20 2nd rdg - to 3rd rdg
03/10 3rd rdg - PASSED - 34-0-1
AYES--Andreason, Boatright, Branch, Bunderson, Burtenshaw, Cameron,
Crow, Danielson, Darrington, Deide, Dunklin, Frasure, Geddes, Hansen,
Hawkins, Ingram, Ipsen, Keough, King, Lee, McLaughlin, Noh, Parry,
Richardson, Riggs, Risch, Sandy, Schroeder, Stennett, Sweeney,
Thorne, Twiggs, Wheeler, Whitworth
NAYS--None
Absent and excused--Sorensen
Floor Sponsor - Thorne
Title apvd - to House
03/11 To enrol
03/12 Rpt enrol - Sp signed
03/13 Pres signed
03/16 To Governor
03/17 Governor signed
Session Law Chapter 48
Effective: 07/01/98
H0522|||| LEGISLATURE OF THE STATE OF IDAHO |||| Fifty-fourth Legislature Second Regular Session - 1998IN THE HOUSE OF REPRESENTATIVES HOUSE BILL NO. 522 BY REVENUE AND TAXATION COMMITTEE 1 AN ACT 2 RELATING TO SALES AND USE TAXES; AMENDING SECTION 63-3609, IDAHO CODE, TO RE- 3 DEFINE "RETAIL SALE"; AMENDING SECTION 63-3619, IDAHO CODE, TO CLARIFY THE 4 IMPOSITION OF THE TAX ON RETAIL SALES AND TO DELETE PROVISION FOR IMPOSING 5 TAX ON CERTAIN SALES TO UNITED STATES GOVERNMENT CONTRACTORS; AMENDING 6 SECTION 63-3620, IDAHO CODE, TO AUTHORIZE THE STATE TAX COMMISSION TO 7 ISSUE TEMPORARY SELLER'S PERMITS AND TEMPORARY WHOLESALER'S PERMITS; 8 AMENDING SECTION 63-3622BB, IDAHO CODE, TO PROVIDE A CORRECT REFERENCE TO 9 THE IDAHO NATIONAL ENGINEERING AND ENVIRONMENTAL LABORATORY; AND AMENDING 10 SECTION 63-3633, IDAHO CODE, TO PROHIBIT THE STATE TAX COMMISSION FROM 11 CERTAIN ENFORCEMENT ACTIONS UNTIL ALL APPEAL RIGHTS HAVE BECOME FINAL. 12 Be It Enacted by the Legislature of the State of Idaho: 13 SECTION 1. That Section 63-3609, Idaho Code, be, and the same is hereby 14 amended to read as follows: 15 63-3609. RETAIL SALE -- SALE AT RETAIL. The terms "retail sale" or "sale 16 at retail" means a saleof tangible personal propertyfor any 17 purpose other than resaleof that propertyin the regular course 18 of business or lease or rental ofthatproperty in the regular 19 course of business where such rental or lease is taxable under section 20 63-3612(h), Idaho Code. 21 (a) All persons engaged in constructing, altering, repairing or improving 22 real estate, are consumers of the material used by them; all sales to or use 23 by such persons of tangible personal property are taxable whether or not such 24 persons intend resale of the improved property. 25 (b) For the purpose of this chapter, the sale or purchase of personal 26 property incidental to the sale of real property or used mobile homes is 27 deemed a sale of real property. 28 SECTION 2. That Section 63-3619, Idaho Code, be, and the same is hereby 29 amended to read as follows: 30 63-3619. IMPOSITION AND RATE OF THE SALES TAX. An excise tax is hereby 31 imposed upon each sale at retail at the rate of five per cent (5%) of the 32 sales price of allpropertyretail sales subject to 33 taxation under thisactchapter and such amount 34 shall be computed monthly on all sales at retail within the preceding month. 35 (a) The tax shall apply to, be computed on, and collected for all credit, 36 instalment, conditional or similar sales at the time of the sale or, in the 37 case of rentals, at the time the rental is charged. 38 (b) The tax hereby imposed shall be collected by the retailer from the 39 consumer. 40 (c) The state tax commission shall provide schedules for collection of 41 the tax on sales which involve a fraction of a dollar. The retailer shall cal- 2 1 culate the tax upon the entire amount of the purchases of the consumer made at 2 a particular time and not separately upon each item purchased. The retailer 3 may retain any amount collected under the bracket system prescribed which is 4 in excess of the amount of tax for which he is liable to the state during the 5 period as compensation for the work of collecting the tax. 6 (d) It is unlawful for any retailer to advertise or hold out or state to 7 the public or to any customer, directly or indirectly, that the tax or any 8 part thereof will be assumed or absorbed by the retailer or that it will not 9 be added to the selling price of the property sold or that if added it or any 10 part thereof will be refunded. Any person violating any provision of this sec- 11 tion is guilty of a misdemeanor. 12 (e) The tax commission may by rule provide that the amount collected by 13 the retailer from the customer in reimbursement of the tax be displayed sepa- 14 rately from the list price, the price advertised on the premises, the marked 15 price, or other price on the sales slip or other proof of sale. 16 (f) The tax es imposed by thisactchapter 17 shall apply to the salesof any tangible personal property18 to contractors purchasingsuch property for resale to the United States19orfor use in the performance of contracts with the United States. 20 SECTION 3. That Section 63-3620, Idaho Code, be, and the same is hereby 21 amended to read as follows: 22 63-3620. PERMITS -- ISSUANCE -- REVOCATION --RESALE CERTIFICATES23--PENALTIES. (a) Every retailer engaged in business in this state, 24 before conducting business within this state, shall file with the state tax 25 commission an application for a seller's permit. Every application for a per- 26 mit shall be made upon a form prescribed by the state tax commission and shall 27 set forth the name under which the applicant transacts or intends to transact 28 business, the location of his place or places of business, and such other 29 information as the state tax commission may require. The applications, or any 30 information contained thereon, may be made available by the tax commission to 31 authorized representatives of state or federal agencies. The application shall 32 be signed by the owner if he is a natural person or by an individual autho- 33 rized by the seller to sign the application. Except as provided in subsection 34 (ef ) of this section, permits shall be issued with- 35 out charge. 36 (b) The state tax commission, for the efficient administration of 37 this chapter, may issue: 38 (1) Temporary seller's permits. No retailer shall be issued more than 39 three (3) temporary permits in one (1) calendar year. A temporary permit 40 shall be valid only for the period of time shown on the face thereof. 41 (2) Wholesaler's permits to persons who are not retailers but who pur- 42 chase tangible personal property for resale. A wholesaler's permit shall 43 be valid for no more than twelve (12) consecutive months and may be 44 renewed by the commission. 45 (c) The person signing the application shall certify that the 46 applicant will actively engage in or conduct a business making sales subject 47 to tax under this chapter. 48 (cd ) After compliance by the applicant with the 49 requirements set out above and in section 63-3625, Idaho Code, the state tax 50 commission shall grant and issue to each applicant a permit. A permit shall 51 not be assignable, and shall be valid only for the person in whose name it is 52 issued. The permit or a copy thereof shall at all times be conspicuously dis- 53 played at each place where the person to whom it is issued conducts business. 3 1 (de ) A seller whose permit has been previously 2 suspended or revoked shall pay the state tax commission a fee of ten dollars 3 ($10.00) for the renewal or issuance of a permit in the event of a first revo- 4 cation and twenty-five dollars ($25.00) for renewal after each successive 5 revocation unless the suspension or revocation is for inactivity pursuant to 6 section 63-3620A, Idaho Code. 7 (ef ) Whenever any person fails to comply with 8 any provision of this chapter relating to the sales tax or any rules of the 9 state tax commission relating to the sales tax prescribed and adopted under 10 this chapter, the state tax commission may revoke or suspend any one or more 11 of the permits held by the person. Notice of revocation shall be given in the 12 manner provided for deficiencies in taxes in section 63-3629, Idaho Code, 13 which shall be subject to review as provided in section 63-3631, Idaho Code. 14 The state tax commission shall not issue a new permit after the revocation of 15 a permit unless the commission is satisfied that the former holder of the per- 16 mit will comply with the provisions of this chapter relating to the sales tax 17 and the rules of the state tax commission. 18 (fg ) A person who engages in business as a 19 seller in this state without a permit or permits, or after a permit has been 20 suspended, and each officer of any corporation which so engages in business is 21 guilty of a misdemeanor punishable by a fine not in excess of one hundred dol- 22 lars ($100), and each day shall constitute a separate offense. 23 SECTION 4. That Section 63-3622BB, Idaho Code, be, and the same is hereby 24 amended to read as follows: 25 63-3622BB. RESEARCH AND DEVELOPMENT AT THE INE E L. There is 26 exempted from the taxes imposed by this chapter, the sale or use of that prop- 27 erty primarily or directly used or consumed in connection with research, 28 development, experimental and testing activities, when exclusively financed by 29 the United States in connection with the Idaho national engineering and 30 environmental laboratory and any successor thereto . 31 SECTION 5. That Section 63-3633, Idaho Code, be, and the same is hereby 32 amended to read as follows: 33 63-3633. PERIOD OF LIMITATION UPON ASSESSMENT AND COLLECTION. Except as 34 otherwise provided in this section: 35 (a) The amount of taxes imposed by thisactchapter 36 shall be assessed within three (3) years after the due date of the 37 return or the date the return was filed, whichever is the later, and no pro- 38 ceeding in court without assessment for the collection of such taxes shall be 39 begun after the expiration of such period; provided, however, if an assessment 40 has been made within the prescribed time, such tax may be collected by levy or 41 by a proceeding in court within a period of six (6) years after assessment of 42 the tax and, provided further, that this shall not be in derogation of any of 43 the remedies elsewhere herein provided. The running of the period of limita- 44 tions provided by this section shall be suspended for the period during which 45 the state tax commission is prohibited from making the assessment or from col- 46 lecting by levy or a proceeding in court, and for thirty (30) days thereafter. 47 (b) In the case of a false or fraudulent return with the intent to evade 48 tax, or a willful attempt in any manner to defeat or evade tax, the tax may be 49 assessed, or a proceeding in court for collection of such tax may be begun 50 without assessment, at any time. 51 (c) In the case of taxes owed by a person who has failed to file a return 4 1 as provided in section 63-3623, Idaho Code, the amount of taxes imposed in 2 this chapter shall be assessed within seven (7) years of the time the return 3 upon which the tax asserted to be due should have been filed. 4 (d) The periods of limitation upon assessment and collection provided in 5 this section shall not apply: 6 (1) In cases where the facts disclose a false or fraudulent act with the 7 intent to evade tax, or 8 (2) To taxes collected by a retailer, seller or any other person who has 9 failed to pay over such taxes to the state tax commission. 10 (e) In the case of taxes due during the lifetime of a decedent, or by his 11 estate during the period of administration, a notice of deficiency shall be 12 issued, a claim shall be made, the tax shall be assessed, or any proceeding in 13 court without assessment for the collection of such tax shall be begun, within 14 twelve (12) months after written request for prompt action is filed with the 15 state tax commission by the executor, administrator, or other fiduciary repre- 16 senting the estate of such decedent. This subsection shall not apply if the 17 return for which the request for prompt action relates has not been filed with 18 the state tax commission. 19 (f) No assessment of a deficiency with respect to the tax imposed 20 by this chapter, and no distraint or proceedings in court for its collection 21 shall be made, begun, or prosecuted until a notice under section 63-3629, 22 Idaho Code, has been mailed to the taxpayer, nor until all appeal rights 23 relating to the deficiency have become final. 24 (g) Where, before the expiration of the time prescribed in this 25 section for the assessment of any tax imposed by this act, both the state tax 26 commission or its delegate or deputy and the taxpayer have consented in writ- 27 ing to its assessment after such time, the tax may be assessed at any time 28 prior to the expiration of the period agreed upon. The period so agreed upon 29 may be extended by subsequent agreements in writing made before the expiration 30 of the period previously agreed upon.
STATEMENT OF PURPOSE
RS07355
This bill makes several changes to the Idaho Sales Tax Act. These are:
Clarifying the definition of "retail sale" or "sale at retail" and the imposition of sales tax
on retail sales.
Striking an obsolete reference to imposing tax on certain sales to the United States
government contractors.
Authorizing the State Tax Commission to issue temporary seller's permits and
wholesaler's permits.
Correcting references to the Idaho National Engineering and Environmental
Laboratory.
Prohibiting the State Tax Commission from assessing or collecting tax by levy or a
proceeding in court until all appeal rights have become final.
FISCAL IMPACT
No fiscal effect.
CONTACT
Name: Dan John/Ted Spangler
Agency: State Tax Commission
Phone: 334-7530
H 522