2003 Legislation
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HOUSE BILL NO. 264 – Tax, cigarette, increased

HOUSE BILL NO. 264

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H0264aaS,aaS........................................by REVENUE AND TAXATION
TAX - CIGARETTE - Amends and adds to existing law to increase the rate of
the cigarette tax to fifty-seven cents per package of twenty cigarettes and
to revise distributions from June 1, 2003, through June 30, 2005; to reduce
the percentage that wholesalers are compensated for affixing stamps on
packages of cigarettes; to revise the distribution formula for certain
cigarette tax moneys; to provide a floor stocks tax for packages of
cigarettes held in stock by a wholesaler on June 1, 2003; to provide when
the floor stocks tax is due and payable; to create the Economic Recovery
Reserve Fund; to provide purposes of the Economic Recovery Reserve Fund;
and to provide procedures for appropriation or transfer of money from the
Economic Recovery Reserve Fund.
                                                                        
02/13    House intro - 1st rdg - to printing
02/14    Rpt prt - to Rev/Tax
03/03    Rpt out - rec d/p - to 2nd rdg
03/04    2nd rdg - to 3rd rdg
03/05    3rd rdg - PASSED - 66-0-4
      AYES -- Barraclough, Barrett, Bauer, Bedke, Bieter, Black, Block,
      Boe, Bolz, Bradford, Campbell, Cannon, Clark, Collins, Crow, Cuddy,
      Deal, Denney, Douglas, Eberle, Edmunson, Ellsworth, Eskridge,
      Field(18), Field(23), Gagner, Garrett, Harwood, Henbest, Jaquet,
      Jones, Kellogg, Kulczyk, Lake, Langford, Langhorst, Martinez,
      McGeachin, McKague, Meyer, Miller, Mitchell, Moyle, Naccarato,
      Nielsen, Raybould, Ridinger, Ringo, Robison, Rydalch, Sali, Sayler,
      Schaefer, Shepherd, Shirley, Skippen, Smith(30), Smith(24), Smylie,
      Snodgrass, Stevenson, Tilman, Trail, Wills, Wood, Mr. Speaker
      NAYS -- None
      Absent and excused -- Andersen, Bell, Ring, Roberts
    Floor Sponsor - Cuddy
    Title apvd - to Senate
03/06    Senate intro - 1st rdg - to Loc Gov
03/25    Rpt out - rec d/p - to 2nd rdg
03/26    2nd rdg - to 3rd rdg
04/24    To 14th Ord
04/25    Rpt out amen - to 1st rdg as amen
    1st rdg - to 2nd rdg as amen
    Rls susp - PASSED - 20-14-1
      AYES -- Andreason, Bailey, Brandt, Bunderson, Cameron, Compton,
      Darrington, Davis, Gannon, Geddes, Goedde, Hill, Ingram, Little,
      McWilliams, Noh, Schroeder, Sorensen, Stegner, Williams
      NAYS -- Burkett, Calabretta, Kennedy, Keough, Lodge, Malepeai,
      Marley, McKenzie, Noble, Pearce, Richardson, Stennett, Sweet, Werk
      Absent and excused -- Burtenshaw
    Floor Sponsors - Compton & Bunderson
    Title apvd - to House
04/28    House did not concur in Senate amens
    Ref'd to Conference Committee
04/30    Conference Committee report adopted
    Ret'd to Senate  - ref'd to 14th Ord
    Rpt out amen w/o rec - to 1st rdg as amen
    1st rdg - to 2nd rdg as amen
    Rls susp - PASSED - 21-14-0
      AYES -- Bailey, Brandt, Bunderson, Burtenshaw, Cameron, Compton,
      Darrington, Davis, Gannon, Geddes, Goedde, Hill(Hill), Ingram,
      Little, Lodge, McKenzie, McWilliams, Noh, Sorensen, Stegner, Williams
      NAYS -- Andreason, Burkett, Calabretta, Kennedy, Keough, Malepeai,
      Marley, Noble, Pearce, Richardson, Schroeder, Stennett, Sweet, Werk
      Absent and excused -- None
    Floor Sponsor - Bunderson
    Title apvd - to House
05/01    Ret'd from Senate amen - Held at Desk
05/02    House concurred in Senate amens
    Rls susp - PASSED - 44-26-0
      AYES -- Andersen(Guyon), Bauer, Bedke, Bell, Bieter, Black, Block,
      Boe, Cuddy, Deal, Denney, Douglas, Edmunson, Ellsworth, Eskridge,
      Field(18), Field(23), Gagner, Garrett, Henbest, Jaquet, Jones,
      Kellogg, Langhorst, Martinez(Echohawk), Miller, Mitchell, Naccarato,
      Ridinger, Ring, Ringo, Robison, Rydalch, Sayler, Shepherd(Buell),
      Shirley, Skippen, Smith(30), Smith(24), Smylie, Snodgrass, Trail,
      Wills, Mr. Speaker
      NAYS -- Barraclough(Schanz), Barrett, Bolz, Bradford, Campbell,
      Cannon, Clark, Collins, Crow, Eberle, Harwood, Kulczyk, Lake,
      Langford, McGeachin, McKague, Meyer, Moyle, Nielsen, Raybould,
      Roberts, Sali, Schaefer, Stevenson, Tilman, Wood
      Absent and excused -- None
    Floor Sponsor - Ellsworth
    Title apvd - To engros/enrol - Rpt engros/enrol
    Sp signed - Pres signed
05/05    To Governor
05/08    Governor signed
         Session Law Chapter 362
         Effective: 06/01/03 Secs 1, 2, 5 and 6;
         06/01/03 Sec 4 with 07/01/05 Sunset Clause;
         07/01/03 Section 3

Bill Text


                                                                        
                                                                        
  ||||              LEGISLATURE OF THE STATE OF IDAHO             ||||
 Fifty-seventh Legislature                 First Regular Session - 2003
                                                                        
                                                                        
                              IN THE HOUSE OF REPRESENTATIVES
                                                                        
                                     HOUSE BILL NO. 264
                                                                        
                             BY REVENUE AND TAXATION COMMITTEE
                                                                        
  1                                        AN ACT
  2    RELATING TO THE OCCUPANCY TAX; AMENDING SECTION 63-317, IDAHO CODE, TO INCLUDE
  3        OCCUPANCY OF IMPROVEMENTS OR USE IN STORAGE OF VEHICLES, BOATS  OR  HOUSE-
  4        HOLD  GOODS,  PROVIDED  SUCH  USE IS NOT SOLELY RELATED TO CONSTRUCTION OR
  5        SALE OF THE PROPERTY IN THE DEFINITION OF  "OCCUPIED"  FOR  OCCUPANCY  TAX
  6        PURPOSES; DECLARING AN EMERGENCY AND PROVIDING RETROACTIVE APPLICATION.
                                                                        
  7    Be It Enacted by the Legislature of the State of Idaho:
                                                                        
  8        SECTION  1.  That  Section  63-317, Idaho Code, be, and the same is hereby
  9    amended to read as follows:
                                                                        
 10        63-317.  OCCUPANCY TAX -- PROCEDURES. (1) All  real  property  subject  to
 11    property  taxation shall be valued and taxed based upon its status as of Janu-
 12    ary 1 of each  tax  year.  Improvements,  other  than  additions  to  existing
 13    improvements,  constructed upon real property shall not be subject to property
 14    taxation during the year of construction other than that portion  actually  in
 15    place as of January 1 of each calendar year.
 16        (2)  There  is  hereby  levied an occupancy tax upon all newly constructed
 17    and occupied residential and commercial structures, except additions to exist-
 18    ing improvements, prorated for the portion of the year for which the structure
 19    was occupied. The occupancy tax shall be upon those improvements for that por-
 20    tion of the calendar year in which first occupancy occurs. For the purposes of
 21    this section, the term "occupied" means:
 22        (a)  Use of the property by any person as a residence including  occupancy
 23        of  improvements  or use in storage of vehicles, boats or household goods,
 24        provided such use is not solely related to construction  or  sale  of  the
 25        property; or
 26        (b)  Use  of the property for any business or commercial purpose unrelated
 27        to the construction and sale of the property; or
 28        (c)  Any possessory use of the property for which the owner  received  any
 29        compensation or consideration.
 30        (3)  The  owner of any newly constructed improvement, as described in this
 31    section, upon which no occupancy tax has been  charged  shall  report  to  the
 32    county  assessor  that the improvement has been occupied. As soon as practical
 33    after receiving such a report, the county assessor shall appraise  and  deter-
 34    mine the market value for assessment purposes.
 35        (a)  At  the  time  the  county  assessor  determines the market value for
 36        assessment purposes of any  improvement,  he  shall  allow  as  an  offset
 37        against  the market value of the improvement, the market value of any por-
 38        tion of that improvement which was existing on January 1 and  placed  upon
 39        the property roll.
 40        (b)  Upon  completion  of  the appraisal, the county assessor shall notify
 41        the owner of the appraisal, and further shall notify the  owner  of  their
 42        right to apply for the exemption provided in sections 63-602G and 63-602X,
 43        Idaho  Code.  If the owner applies for and meets the requirements for such
                                                                        
                                           2
                                                                        
  1        exemption within thirty (30) days of the notification by the county asses-
  2        sor, the exemption shall be extended to the newly constructed and occupied
  3        residential structures in compliance with  section  63-602G,  Idaho  Code,
  4        notwithstanding  limitations  requiring   occupancy as of January 1 of the
  5        tax year.
  6        (c)  In the event that the owner fails to report to  the  county  assessor
  7        that  the  property  is ready for occupancy, the assessor shall notify the
  8        county board of equalization,  who may impose  as  penalty  an  additional
  9        amount  equal to five percent (5%) of the tax for each month following the
 10        date of first occupancy during which the report is not made, to a  maximum
 11        of twenty-five percent (25%) of the tax.
 12        (4)  Appeals of the market value for assessment purposes shall be resolved
 13    in the same manner as all other appeals of valuation by the board of equaliza-
 14    tion.
 15        (5)  The occupancy tax calculated upon the values set by the county asses-
 16    sor,  and  any penalty imposed by the board of equalization shall be collected
 17    in the same manner as all other property taxes.
 18        (6)  An occupancy tax lien shall be imposed in the manner provided in sec-
 19    tion 63-206, Idaho Code.
 20        (7)  Occupancy taxes shall be billed, collected  and  distributed  in  the
 21    same manner as all other property taxes.
                                                                        
 22        SECTION  2.  An  emergency  existing  therefor,  which emergency is hereby
 23    declared to exist, this act shall be in full force and effect on and after its
 24    passage and approval, and retroactively to January 1, 2003.

Amendment


                                                                        
                                                                        
  ||||              LEGISLATURE OF THE STATE OF IDAHO             ||||
 Fifty-seventh Legislature                 First Regular Session - 2003
                                                                        
                                                                        
                                                     Moved by    Bunderson           
                                                                        
                                                     Seconded by Davis               
                                                                        
                                                                        
                                       IN THE SENATE
                              SENATE AMENDMENT TO H.B. NO. 264
                                                                        
                                                                        
                                                                        
  1                                AMENDMENT TO THE BILL
  2        On page 2 of the printed bill, delete lines 22 through 24 and insert:
  3        "SECTION 2.  That Section 63-2506, Idaho Code, be, and the same is  hereby
  4    amended to read as follows:
                                                                        
  5        63-2506.  IMPOSITION  OF  TAX. A tax upon the purchase, storage, use, con-
  6    sumption, handling, distribution or wholesale sale  of  cigarettes  is  hereby
  7    imposed  at  the rate of one and four-tenths cent (1.4) for each cigarette or
  8    twenty-eight fifty-six cents (2856) per package of  twenty  (20)  cigarettes,
  9    which tax shall be paid by the wholesaler, and collected by the state tax com-
 10    mission. Five  cents (5) of the tax collected per package of twenty (20) cig-
 11    arettes  shall be subject to appropriation to the public school income fund to
 12    be utilized to facilitate and provide substance abuse programs in  the  public
 13    school  system.  Five   cents  (5) of the tax collected per package of twenty
 14    (20) cigarettes shall be subject to appropriation to the department  of  juve-
 15    nile  corrections  for  distribution to the counties to be utilized for county
 16    juvenile probation services. Appropriated funds shall be distributed quarterly
 17    to the counties based upon the percentage the population of the  county  bears
 18    to  the population of the state as a whole. The remaining moneys collected and
 19    those moneys not appropriated under the provisions of this  section  shall  be
 20    distributed as specified in section  63-2520, Idaho Code.
                                                                        
 21        SECTION  3.  That  Section 63-2509, Idaho Code, be, and the same is hereby
 22    amended to read as follows:
                                                                        
 23        63-2509.  COMPENSATION FOR AFFIXING STAMPS. Wholesalers shall  be  allowed
 24    as compensation for affixing stamps, five per cent two and five-tenths percent
 25    (52.5%) of the face value of the stamps purchased by them.
                                                                        
 26        SECTION  4.  That  Section 63-2520, Idaho Code, be, and the same is hereby
 27    amended to read as follows:
                                                                        
 28        63-2520.  DISTRIBUTION OF MONEYS COLLECTED.  Revenues  received  from  the
 29    taxes  imposed  by this chapter, and any revenues received from licenses, per-
 30    mits, penalties, interest, or deficiency additions, shall  be  distributed  by
 31    the tax commission as follows:
 32        (a)  An  amount  of money shall be distributed to the state refund account
 33    sufficient to pay current refund claims. All  refunds  authorized  under  this
 34    chapter  by the commission shall be paid through the state refund account, and
 35    those moneys are continuously appropriated.
 36        (b)  The balance remaining with the state treasurer  after  deducting  the
 37    amount described in paragraph (a) above shall be distributed as follows:
                                                                        
                                          2
                                                                        
  1        (1)  43.3%  Twenty-one and sixty-five hundredths  percent (21.65%) of such
  2        balance shall be distributed to the permanent building account created  by
  3        section 57-1108, Idaho Code.
  4        (2)  1%  One-half  of one percent (0.5%) of such balance shall be distrib-
  5        uted to the central tumor registry account. The amount of  money  so  dis-
  6        tributed to the central tumor registry account shall not exceed the fiscal
  7        year's  appropriation, and at such time as the appropriation has been dis-
  8        tributed to the central tumor registry account during   any  fiscal  year,
  9        all  such  distributions  in  excess  of  the  appropriation shall be made
 10        instead to the general fund of the state of Idaho.
 11        (3)  2.5% One and twenty-five hundredths of one percent  (1.25%)  of  such
 12        balance shall be distributed to the cancer control account created by sec-
 13        tion  57-1702, Idaho Code. Revenues received in the cancer control account
 14        shall be paid over to the state treasurer by the state tax  commission  to
 15        be distributed as follows:
 16             (i)   Such amounts as are appropriated for purposes specified in sec-
 17             tion 57-1702, Idaho Code, shall be expended as appropriated;
 18             (ii)  Any  balance remaining in the cancer control account on June 30
 19             of any fiscal year after the amounts withdrawn by appropriation  have
 20             been  deducted, shall be reserved for transfer to the general fund on
 21             July 1 and the state controller shall order such transfer.
 22        (4)  All remaining moneys shall be distributed to the general fund of  the
 23        state of Idaho.
                                                                        
 24        SECTION  5.  That  Chapter  25,  Title 63, Idaho Code, be, and the same is
 25    hereby amended by the addition thereto of a NEW SECTION, to be known and  des-
 26    ignated as Section 63-2531, Idaho Code, and to read as follows:
                                                                        
 27        63-2531.  FLOOR  STOCKS TAX. (1) In addition to the tax imposed by section
 28    63-2506, Idaho Code, there is hereby imposed a one (1) time tax at the rate of
 29    twenty-eight cents (28) per package of twenty (20) cigarettes  on  all  ciga-
 30    rettes  to  which  stamps  have  been affixed and which are held in stock by a
 31    wholesaler at 12:01 a.m. on June 1, 2003.
 32        (2)  The tax imposed by this section shall be due and payable to the state
 33    tax commission on the due date of the cigarette  tax  return  due  under  this
 34    chapter  and shall be reported on such return. The tax shall be subject to all
 35    the collection, enforcement and administrative provisions of this chapter.
 36
 37        SECTION 6.  SEVERABILITY.  The provisions of this act are hereby  declared
 38    to  be  severable  and if any provision of this act or the application of such
 39    provision to any person or circumstance is declared invalid  for  any  reason,
 40    such  declaration  shall  not affect the validity of the remaining portions of
 41    this act.
                                                                        
 42        SECTION 7.  An emergency existing  therefor,  which  emergency  is  hereby
 43    declared  to  exist,  Sections  1 and 6 of this act shall be in full force and
 44    effect on and after passage and approval,  and  retroactively  to  January  1,
 45    2003; Sections 2, 3 and 5 of this act shall be in full force and effect on and
 46    after June 1, 2003. Section 4 of this act shall be in full force and effect on
 47    and after July 1, 2003.".
                                                                        
 48                                 CORRECTION TO TITLE
 49        On page 1, delete lines 2 through 6 and insert:
 50    "RELATING  TO  TAXATION; AMENDING SECTION 63-317, IDAHO CODE, TO INCLUDE OCCU-
 51        PANCY OF IMPROVEMENTS OR USE IN STORAGE OF VEHICLES,  BOATS  OR  HOUSEHOLD
                                                                        
                                          3
                                                                        
  1        GOODS,  PROVIDED SUCH USE IS NOT SOLELY RELATED TO CONSTRUCTION OR SALE OF
  2        THE PROPERTY IN THE DEFINITION OF  "OCCUPIED" FOR OCCUPANCY TAX  PURPOSES;
  3        AMENDING SECTION 63-2506, IDAHO CODE, TO INCREASE THE RATE  OF  THE  CIGA-
  4        RETTE  TAX; AMENDING SECTION 63-2509, IDAHO CODE, TO REDUCE THE PERCENTAGE
  5        THAT WHOLESALERS ARE COMPENSATED FOR AFFIXING STAMPS ON PACKAGES OF  CIGA-
  6        RETTES AND TO MAKE A TECHNICAL CORRECTION; AMENDING SECTION 63-2520, IDAHO
  7        CODE, TO REVISE THE DISTRIBUTION FORMULA FOR CERTAIN CIGARETTE TAX MONEYS;
  8        AMENDING  CHAPTER  25, TITLE 63, IDAHO CODE, BY THE ADDITION OF A NEW SEC-
  9        TION 63-2531, IDAHO CODE, TO PROVIDE A FLOOR STOCKS TAX  FOR  PACKAGES  OF
 10        CIGARETTES  HELD  IN STOCK BY A WHOLESALER ON JUNE 1, 2003, AND TO PROVIDE
 11        WHEN THE TAX IS DUE AND  PAYABLE;  PROVIDING  SEVERABILITY;  DECLARING  AN
 12        EMERGENCY,  PROVIDING  RETROACTIVE  APPLICATION  AND  PROVIDING  EFFECTIVE
 13        DATES.".
                                                     Moved by    Bunderson           
                                                                        
                                                     Seconded by Geddes              
                                                                        
                                                                        
                                       IN THE SENATE
                  SENATE AMENDMENT TO THE SENATE AMENDMENT TO H.B. NO. 264
                                                                        
 14                        AMENDMENT TO THE AMENDMENT TO THE BILL
 15        On  page 1 of the printed amendment, delete lines 2 through 37; on page 2,
 16    delete lines 1 through 47 and insert:
 17        "On page 1 of the printed bill, delete lines 8  through  43;  on  page  2,
 18    delete lines 1 through 24 and insert:
 19        "SECTION  1.  That Section 63-2506, Idaho Code, be, and the same is hereby
 20    amended to read as follows:
                                                                        
 21        63-2506.  IMPOSITION OF TAX. (1)  From June  1,  2003,  through  June  30,
 22    2005,  a tax upon the purchase, storage, use, consumption, handling, distribu-
 23    tion or wholesale sale of cigarettes is hereby imposed at the rate  of  fifty-
 24    seven  cents  (57)  per package of twenty (20) cigarettes, which tax shall be
 25    paid by the wholesaler, and collected by the state tax commission. 5.1746  of
 26    the  tax  collected  per package of twenty (20) cigarettes shall be subject to
 27    appropriation to the public school income fund to be  utilized  to  facilitate
 28    and  provide  substance abuse programs in the public school system. 5.1746 of
 29    the tax collected per package of twenty (20) cigarettes shall  be  subject  to
 30    appropriation  to  the  department of juvenile corrections for distribution to
 31    the counties to be utilized for county juvenile probation services.
 32        (2)  On and after July 1, 2005, aA tax upon the  purchase,  storage,  use,
 33    consumption,  handling, distribution or wholesale sale of cigarettes is hereby
 34    imposed at the rate of one and four-tenths cent (1.4) for each  cigarette  or
 35    twenty-eight  cents  (28)  per  package  of twenty (20) cigarettes, which tax
 36    shall be paid by the wholesaler, and collected by the  state  tax  commission.
 37    Five  cents  (5)  of  the tax collected per package of twenty (20) cigarettes
 38    shall be subject to appropriation to the public school income fund to be  uti-
 39    lized  to facilitate and provide substance abuse programs in the public school
 40    system. Five cents (5) of the tax collected per package of twenty (20)  ciga-
 41    rettes shall be subject to appropriation to the department of juvenile correc-
 42    tions for distribution to the counties to be utilized for county juvenile pro-
 43    bation services.
 44        (3)  Appropriated  funds  shall  be  distributed quarterly to the counties
 45    based upon the percentage the population of the county bears to the population
 46    of the state as a whole.
                                                                        
                                          4
                                                                        
  1        (4)  The remaining moneys collected  and  those  moneys  not  appropriated
  2    under the provisions of this section shall be distributed as specified in sec-
  3    tion 63-2520, Idaho Code.
                                                                        
  4        SECTION  2.  That  Section 63-2509, Idaho Code, be, and the same is hereby
  5    amended to read as follows:
                                                                        
  6        63-2509.  COMPENSATION FOR AFFIXING STAMPS. From  June  1,  2003,  through
  7    June  30,  2005,  wholesalers  shall  be  allowed as compensation for affixing
  8    stamps, two and sixty-one one hundredths percent (2.61%) of the face value  of
  9    the stamps purchased by them. On and after July 1, 2005, wWholesalers shall be
 10    allowed as compensation for affixing stamps, five per cent percent (5%) of the
 11    face value of the stamps purchased by them.
                                                                        
 12        SECTION  3.  That  Section 63-2520, Idaho Code, be, and the same is hereby
 13    amended to read as follows:
                                                                        
 14        63-2520.  DISTRIBUTION OF MONEYS COLLECTED.  Revenues  received  from  the
 15    taxes  imposed  by this chapter, and any revenues received from licenses, per-
 16    mits, penalties,  interest, or deficiency additions, shall be  distributed  by
 17    the tax commission as follows:
 18        (a)  An  amount  of money shall be distributed to the state refund account
 19    sufficient to pay current refund claims. All  refunds  authorized  under  this
 20    chapter  by the commission shall be paid through the state refund account, and
 21    those moneys are continuously appropriated.
 22        (b)  From July 1, 2003, through June 30, 2005, tThe balance remaining with
 23    the state treasurer after deducting the amount described in paragraph  subsec-
 24    tion (a) above of this section shall be distributed as follows:
 25        (1)  43.3%  17.3%  of  such  balance shall be distributed to the permanent
 26        building account created by section 57-1108, Idaho Code.
 27        (2)  1% .4% of such balance shall be distributed to the central tumor reg-
 28        istry account. The amount of money so distributed  to  the  central  tumor
 29        registry  account shall not exceed the fiscal year's appropriation, and at
 30        such time as the appropriation has been distributed to the  central  tumor
 31        registry  account during any fiscal year, all such distributions in excess
 32        of the appropriation shall be made instead to  the  general  fund  of  the
 33        state of Idaho.
 34        (3)  2.5%  1%  of  such balance shall be distributed to the cancer control
 35        account created by section 57-1702, Idaho Code. Revenues received  in  the
 36        cancer  control  account  shall be paid over to the state treasurer by the
 37        state tax commission to be distributed as follows:
 38             (i)   Such amounts as are appropriated for purposes specified in sec-
 39             tion 57-1702, Idaho Code, shall be expended as appropriated;
 40             (ii)  Any balance remaining in the cancer control account on June  30
 41             of  any fiscal year after the amounts withdrawn by appropriation have
 42             been deducted, shall be reserved for transfer to the general fund  on
 43             July 1 and the state controller shall order such transfer.
 44        (4)  21.25%  of  such  balance shall be distributed to the general fund of
 45        the state of Idaho.
 46        (5)  All remaining moneys shall be distributed as follows: For the  fiscal
 47        year  commencing July 1, 2003, and ending June 30, 2004, $23,500,000 shall
 48        be distributed to the general fund of the state of Idaho and the remainder
 49        shall be distributed to the economic recovery reserve fund created by sec-
 50        tion 67-3520, Idaho Code. For the fiscal year commencing July 1, 2004, and
 51        ending June 30, 2005, all remaining moneys shall  be  distributed  to  the
                                                                        
                                          5
                                                                        
  1        economic recovery reserve fund created by section 67-3520, Idaho Code.
  2        (c)  On and after July 1, 2005, the balance remaining with the state trea-
  3    surer  after  deducting the amount described in subsection (a) of this section
  4    shall be distributed as follows:
  5        (1)  43.3% of such balance shall be distributed to the permanent  building
  6        fund created by section 57-1108, Idaho Code.
  7        (2)  1% of such balance shall be distributed to the central tumor registry
  8        account.  The amount of money so distributed to the central tumor registry
  9        account shall not exceed the fiscal year's appropriation, and at such time
 10        as the appropriation has been distributed to the  central  tumor  registry
 11        account  during  any  fiscal year, all such distributions in excess of the
 12        appropriation shall be made instead to the general fund of  the  state  of
 13        Idaho.
 14        (3)  2.5%  of  such  balance  shall  be  distributed to the cancer control
 15        account created by section 57-1702, Idaho Code. Revenues received  in  the
 16        cancer  control  account  shall be paid over to the state treasurer by the
 17        state tax commission to be distributed as follows:
 18             (i)   Such amounts as are appropriated for purposes specified in sec-
 19             tion 57-1702, Idaho Code, shall be expended as appropriated;
 20             (ii)  Any balance remaining in the cancer control account on June  30
 21             of  any fiscal year after the amounts withdrawn by appropriation have
 22             been deducted, shall be reserved for transfer to the general fund  on
 23             July 1 and the state controller shall order such transfer.
 24        (4)  All  remaining moneys shall be distributed to the general fund of the
 25        state of Idaho.
                                                                        
 26        SECTION 4.  That Chapter 25, Title 63, Idaho Code, be,  and  the  same  is
 27    hereby  amended by the addition thereto of a NEW SECTION, to be known and des-
 28    ignated as Section 63-2531, Idaho Code, and to read as follows:
                                                                        
 29        63-2531.  FLOOR STOCKS TAX. (1) In addition to the tax imposed by  section
 30    63-2506, Idaho Code, there is hereby imposed a one (1) time tax at the rate of
 31    twenty-nine  cents  (29)  per  package of twenty (20) cigarettes on all ciga-
 32    rettes to which stamps have been affixed and which are  held  in  stock  by  a
 33    wholesaler at 12:01 a.m. on June 1, 2003.
 34        (2)  The tax imposed by this section shall be due and payable to the state
 35    tax  commission  on  the  due  date of the cigarette tax return due under this
 36    chapter and shall be reported on such return. The tax shall be subject to  all
 37    the collection, enforcement and administrative provisions of this chapter.
                                                                        
 38        SECTION  5.  That  Chapter  35,  Title 67, Idaho Code, be, and the same is
 39    hereby amended by the addition thereto of a NEW SECTION, to be known and  des-
 40    ignated as Section 67-3520, Idaho Code, and to read as follows:
                                                                        
 41        67-3520.  ECONOMIC  RECOVERY  RESERVE FUND. (1) There is hereby created in
 42    the state treasury the economic recovery  reserve  fund  for  the  purpose  of
 43    meeting  general  fund  revenue  shortfalls,  meeting expenses incurred as the
 44    result of a major disaster declared by the governor, or for providing one  (1)
 45    time  tax relief payments to the citizens of the state of Idaho. Moneys in the
 46    economic recovery reserve fund shall consist of moneys  remitted  pursuant  to
 47    section  63-2520,  Idaho Code. Interest earnings from the investment of moneys
 48    in this fund by the state treasurer shall be retained in the economic recovery
 49    reserve fund.
 50        (2)  No appropriations from the economic recovery  reserve  fund  nor  any
 51    transfers out of the fund shall be made without the consent of the legislature
                                                                        
                                          6
                                                                        
  1    by  at least a  majority of the members of each house concurring therein at an
  2    ordinary session or at an  extraordinary session of the legislature called  by
  3    the governor.
                                                                        
  4        SECTION  6.  SEVERABILITY.  The provisions of this act are hereby declared
  5    to be severable and if any provision of this act or the  application  of  such
  6    provision  to  any  person or circumstance is declared invalid for any reason,
  7    such declaration shall not affect the validity of the  remaining  portions  of
  8    this act.
                                                                        
  9        SECTION  7.  An  emergency  existing  therefor,  which emergency is hereby
 10    declared to exist, Sections 1, 2, 5 and 6  of this act shall be in full  force
 11    and  effect  on and after June 1, 2003; Section 4 of this act shall be in full
 12    force and effect on and after June 1, 2003, and shall be null, void and of  no
 13    force  and effect on and after July 1, 2005; Section 3 of this act shall be in
 14    full force and effect on and after July 1, 2003.".".
                                                                        
 15                          CORRECTION TO CORRECTION TO TITLE
 16        On page 2, delete lines 50 and 51; and on page 3, delete lines  1  through
 17    13 and insert:
 18    "RELATING  TO  CIGARETTE  TAXES;  AMENDING  SECTION  63-2506,  IDAHO  CODE, TO
 19        INCREASE THE RATE OF THE CIGARETTE TAX AND TO  REVISE  DISTRIBUTIONS  FROM
 20        JUNE 1, 2003, THROUGH JUNE 30, 2005; AMENDING SECTION 63-2509, IDAHO CODE,
 21        TO  REVISE  THE  PERCENTAGE  THAT WHOLESALERS ARE COMPENSATED FOR AFFIXING
 22        STAMPS ON PACKAGES OF CIGARETTES  AND  TO  MAKE  A  TECHNICAL  CORRECTION;
 23        AMENDING  SECTION  63-2520, IDAHO CODE, TO REVISE THE DISTRIBUTION FORMULA
 24        FOR CERTAIN CIGARETTE TAX MONEYS AND TO MAKE TECHNICAL CORRECTIONS; AMEND-
 25        ING CHAPTER 25, TITLE 63, IDAHO CODE, BY THE ADDITION  OF  A  NEW  SECTION
 26        63-2531,  IDAHO  CODE, TO PROVIDE A FLOOR STOCKS TAX FOR PACKAGES OF CIGA-
 27        RETTES HELD IN STOCK BY A WHOLESALER ON JUNE 1, 2003, AND TO PROVIDE  WHEN
 28        THE  TAX IS DUE AND PAYABLE; AMENDING CHAPTER 35, TITLE 67, IDAHO CODE, BY
 29        THE ADDITION OF A NEW SECTION 67-3520, IDAHO CODE, TO CREATE THE  ECONOMIC
 30        RECOVERY  RESERVE  FUND  IN THE STATE TREASURY, TO PROVIDE PURPOSES OF THE
 31        FUND, TO PROVIDE FOR MONEYS REMITTED TO THE FUND, TO PROVIDE FOR  INTEREST
 32        EARNINGS  TO  BE RETAINED IN THE FUND AND TO PROVIDE PROCEDURES FOR APPRO-
 33        PRIATION OR TRANSFER OF MONEYS  FROM  THE  FUND;  PROVIDING  SEVERABILITY;
 34        DECLARING  AN  EMERGENCY,  PROVIDING A SUNSET DATE AND PROVIDING EFFECTIVE
 35        DATES.".

Engrossed Bill (Original Bill with Amendment(s) Incorporated)


                                                                        
                                                                        
  ||||              LEGISLATURE OF THE STATE OF IDAHO             ||||
 Fifty-seventh Legislature                 First Regular Session - 2003
                                                                        
                                                                        
                              IN THE HOUSE OF REPRESENTATIVES
                                                                        
           HOUSE BILL NO. 264, As Amended in the Senate, As Amended in the Senate
                                                                        
                             BY REVENUE AND TAXATION COMMITTEE
                                                                        
  1                                        AN ACT
  2    RELATING TO CIGARETTE TAXES; AMENDING SECTION 63-2506, IDAHO CODE, TO INCREASE
  3        THE RATE OF THE CIGARETTE TAX AND TO REVISE  DISTRIBUTIONS  FROM  JUNE  1,
  4        2003,  THROUGH  JUNE  30,  2005;  AMENDING SECTION 63-2509, IDAHO CODE, TO
  5        REVISE THE PERCENTAGE THAT WHOLESALERS ARE COMPENSATED FOR AFFIXING STAMPS
  6        ON PACKAGES OF CIGARETTES AND TO MAKE  A  TECHNICAL  CORRECTION;  AMENDING
  7        SECTION  63-2520,  IDAHO CODE, TO REVISE THE DISTRIBUTION FORMULA FOR CER-
  8        TAIN CIGARETTE TAX MONEYS AND  TO  MAKE  TECHNICAL  CORRECTIONS;  AMENDING
  9        CHAPTER  25,  TITLE  63,  IDAHO  CODE,  BY  THE  ADDITION OF A NEW SECTION
 10        63-2531, IDAHO CODE, TO PROVIDE A FLOOR STOCKS TAX FOR PACKAGES  OF  CIGA-
 11        RETTES  HELD IN STOCK BY A WHOLESALER ON JUNE 1, 2003, AND TO PROVIDE WHEN
 12        THE TAX IS DUE AND PAYABLE; AMENDING CHAPTER 35, TITLE 67, IDAHO CODE,  BY
 13        THE  ADDITION OF A NEW SECTION 67-3520, IDAHO CODE, TO CREATE THE ECONOMIC
 14        RECOVERY RESERVE FUND IN THE STATE TREASURY, TO PROVIDE  PURPOSES  OF  THE
 15        FUND,  TO PROVIDE FOR MONEYS REMITTED TO THE FUND, TO PROVIDE FOR INTEREST
 16        EARNINGS TO BE RETAINED IN THE FUND AND TO PROVIDE PROCEDURES  FOR  APPRO-
 17        PRIATION  OR  TRANSFER  OF  MONEYS  FROM THE FUND; PROVIDING SEVERABILITY;
 18        DECLARING AN EMERGENCY, PROVIDING A SUNSET DATE  AND  PROVIDING  EFFECTIVE
 19        DATES.
                                                                        
 20    Be It Enacted by the Legislature of the State of Idaho:
                                                                        
 21        SECTION  1.  That  Section 63-2506, Idaho Code, be, and the same is hereby
 22    amended to read as follows:
                                                                        
 23        63-2506.  IMPOSITION OF TAX. (1)  From June  1,  2003,  through  June  30,
 24    2005,  a tax upon the purchase, storage, use, consumption, handling, distribu-
 25    tion or wholesale sale of cigarettes is hereby imposed at the rate  of  fifty-
 26    seven  cents  (57)  per package of twenty (20) cigarettes, which tax shall be
 27    paid by the wholesaler, and collected by the state tax commission. 5.1746  of
 28    the  tax  collected  per package of twenty (20) cigarettes shall be subject to
 29    appropriation to the public school income fund to be  utilized  to  facilitate
 30    and  provide  substance abuse programs in the public school system. 5.1746 of
 31    the tax collected per package of twenty (20) cigarettes shall  be  subject  to
 32    appropriation  to  the  department of juvenile corrections for distribution to
 33    the counties to be utilized for county juvenile probation services.
 34        (2)  On and after July 1, 2005, aA tax upon the  purchase,  storage,  use,
 35    consumption,  handling, distribution or wholesale sale of cigarettes is hereby
 36    imposed at the rate of one and four-tenths cent (1.4) for each  cigarette  or
 37    twenty-eight  cents  (28)  per  package  of twenty (20) cigarettes, which tax
 38    shall be paid by the wholesaler, and collected by the  state  tax  commission.
 39    Five  cents  (5)  of  the tax collected per package of twenty (20) cigarettes
 40    shall be subject to appropriation to the public school income fund to be  uti-
 41    lized  to facilitate and provide substance abuse programs in the public school
 42    system. Five cents (5) of the tax collected per package of twenty (20)  ciga-
 43    rettes shall be subject to appropriation to the department of juvenile correc-
                                                                        
                                           2
                                                                        
  1    tions for distribution to the counties to be utilized for county juvenile pro-
  2    bation services.
  3        (3)  Appropriated  funds  shall  be  distributed quarterly to the counties
  4    based upon the percentage the population of the county bears to the population
  5    of the state as a whole.
  6        (4)  The remaining moneys collected  and  those  moneys  not  appropriated
  7    under the provisions of this section shall be distributed as specified in sec-
  8    tion 63-2520, Idaho Code.
                                                                        
  9        SECTION  2.  That  Section 63-2509, Idaho Code, be, and the same is hereby
 10    amended to read as follows:
                                                                        
 11        63-2509.  COMPENSATION FOR AFFIXING STAMPS. From  June  1,  2003,  through
 12    June  30,  2005,  wholesalers  shall  be  allowed as compensation for affixing
 13    stamps, two and sixty-one one hundredths percent (2.61%) of the face value  of
 14    the stamps purchased by them. On and after July 1, 2005, wWholesalers shall be
 15    allowed as compensation for affixing stamps, five per cent percent (5%) of the
 16    face value of the stamps purchased by them.
                                                                        
 17        SECTION  3.  That  Section 63-2520, Idaho Code, be, and the same is hereby
 18    amended to read as follows:
                                                                        
 19        63-2520.  DISTRIBUTION OF MONEYS COLLECTED.  Revenues  received  from  the
 20    taxes  imposed  by this chapter, and any revenues received from licenses, per-
 21    mits, penalties, interest, or deficiency additions, shall  be  distributed  by
 22    the tax commission as follows:
 23        (a)  An  amount  of money shall be distributed to the state refund account
 24    sufficient to pay current refund claims. All  refunds  authorized  under  this
 25    chapter  by the commission shall be paid through the state refund account, and
 26    those moneys are continuously appropriated.
 27        (b)  From July 1, 2003, through June 30, 2005, tThe balance remaining with
 28    the state treasurer after deducting the amount described in paragraph  subsec-
 29    tion (a) above of this section shall be distributed as follows:
 30        (1)  43.3%  17.3%  of  such  balance shall be distributed to the permanent
 31        building account created by section 57-1108, Idaho Code.
 32        (2)  1% .4% of such balance shall be distributed to the central tumor reg-
 33        istry account. The amount of money so distributed  to  the  central  tumor
 34        registry  account shall not exceed the fiscal year's appropriation, and at
 35        such time as the appropriation has been distributed to the  central  tumor
 36        registry  account during any fiscal year, all such distributions in excess
 37        of the appropriation shall be made instead to  the  general  fund  of  the
 38        state of Idaho.
 39        (3)  2.5%  1%  of  such balance shall be distributed to the cancer control
 40        account created by section 57-1702, Idaho Code. Revenues received  in  the
 41        cancer  control  account  shall be paid over to the state treasurer by the
 42        state tax commission to be distributed as follows:
 43             (i)   Such amounts as are appropriated for purposes specified in sec-
 44             tion 57-1702, Idaho Code, shall be expended as appropriated;
 45             (ii)  Any balance remaining in the cancer control account on June  30
 46             of  any fiscal year after the amounts withdrawn by appropriation have
 47             been deducted, shall be reserved for transfer to the general fund  on
 48             July 1 and the state controller shall order such transfer.
 49        (4)  21.25%  of  such  balance shall be distributed to the general fund of
 50        the state of Idaho.
 51        (5)  All remaining moneys shall be distributed as follows: For the  fiscal
                                                                        
                                           3
                                                                        
  1        year  commencing July 1, 2003, and ending June 30, 2004, $23,500,000 shall
  2        be distributed to the general fund of the state of Idaho and the remainder
  3        shall be distributed to the economic recovery reserve fund created by sec-
  4        tion 67-3520, Idaho Code. For the fiscal year commencing July 1, 2004, and
  5        ending June 30, 2005, all remaining moneys shall  be  distributed  to  the
  6        economic recovery reserve fund created by section 67-3520, Idaho Code.
  7        (c)  On and after July 1, 2005, the balance remaining with the state trea-
  8    surer  after  deducting the amount described in subsection (a) of this section
  9    shall be distributed as follows:
 10        (1)  43.3% of such balance shall be distributed to the permanent  building
 11        fund created by section 57-1108, Idaho Code.
 12        (2)  1% of such balance shall be distributed to the central tumor registry
 13        account.  The amount of money so distributed to the central tumor registry
 14        account shall not exceed the fiscal year's appropriation, and at such time
 15        as the appropriation has been distributed to the  central  tumor  registry
 16        account  during  any  fiscal year, all such distributions in excess of the
 17        appropriation shall be made instead to the general fund of  the  state  of
 18        Idaho.
 19        (3)  2.5%  of  such  balance  shall  be  distributed to the cancer control
 20        account created by section 57-1702, Idaho Code. Revenues received  in  the
 21        cancer  control  account  shall be paid over to the state treasurer by the
 22        state tax commission to be distributed as follows:
 23             (i)   Such amounts as are appropriated for purposes specified in sec-
 24             tion 57-1702, Idaho Code, shall be expended as appropriated;
 25             (ii)  Any balance remaining in the cancer control account on June  30
 26             of  any fiscal year after the amounts withdrawn by appropriation have
 27             been deducted, shall be reserved for transfer to the general fund  on
 28             July 1 and the state controller shall order such transfer.
 29        (4)  All  remaining moneys shall be distributed to the general fund of the
 30        state of Idaho.
                                                                        
 31        SECTION 4.  That Chapter 25, Title 63, Idaho Code, be,  and  the  same  is
 32    hereby  amended by the addition thereto of a NEW SECTION, to be known and des-
 33    ignated as Section 63-2531, Idaho Code, and to read as follows:
                                                                        
 34        63-2531.  FLOOR STOCKS TAX. (1) In addition to the tax imposed by  section
 35    63-2506, Idaho Code, there is hereby imposed a one (1) time tax at the rate of
 36    twenty-nine  cents  (29)  per  package of twenty (20) cigarettes on all ciga-
 37    rettes to which stamps have been affixed and which are  held  in  stock  by  a
 38    wholesaler at 12:01 a.m. on June 1, 2003.
 39        (2)  The tax imposed by this section shall be due and payable to the state
 40    tax  commission  on  the  due  date of the cigarette tax return due under this
 41    chapter and shall be reported on such return. The tax shall be subject to  all
 42    the collection, enforcement and administrative provisions of this chapter.
                                                                        
 43        SECTION  5.  That  Chapter  35,  Title 67, Idaho Code, be, and the same is
 44    hereby amended by the addition thereto of a NEW SECTION, to be known and  des-
 45    ignated as Section 67-3520, Idaho Code, and to read as follows:
                                                                        
 46        67-3520.  ECONOMIC  RECOVERY  RESERVE FUND. (1) There is hereby created in
 47    the state treasury the economic recovery  reserve  fund  for  the  purpose  of
 48    meeting  general  fund  revenue  shortfalls,  meeting expenses incurred as the
 49    result of a major disaster declared by the governor, or for providing one  (1)
 50    time  tax relief payments to the citizens of the state of Idaho. Moneys in the
 51    economic recovery reserve fund shall consist of moneys  remitted  pursuant  to
                                                                        
                                           4
                                                                        
  1    section  63-2520,  Idaho Code. Interest earnings from the investment of moneys
  2    in this fund by the state treasurer shall be retained in the economic recovery
  3    reserve fund.
  4        (2)  No appropriations from the economic recovery  reserve  fund  nor  any
  5    transfers out of the fund shall be made without the consent of the legislature
  6    by  at least a  majority of the members of each house concurring therein at an
  7    ordinary session or at an  extraordinary session of the legislature called  by
  8    the governor.
                                                                        
  9        SECTION  6.  SEVERABILITY.  The provisions of this act are hereby declared
 10    to be severable and if any provision of this act or the  application  of  such
 11    provision  to  any  person or circumstance is declared invalid for any reason,
 12    such declaration shall not affect the validity of the  remaining  portions  of
 13    this act.
                                                                        
 14        SECTION  7.  An  emergency  existing  therefor,  which emergency is hereby
 15    declared to exist, Sections 1, 2, 5 and 6 of this act shall be in  full  force
 16    and  effect  on and after June 1, 2003; Section 4 of this act shall be in full
 17    force and effect on and after June 1, 2003, and shall be null, void and of  no
 18    force  and effect on and after July 1, 2005; Section 3 of this act shall be in
 19    full force and effect on and after July 1, 2003.

Statement of Purpose / Fiscal Impact


                     STATEMENT OF PURPOSE
                               
    SENATE AMENDMENT TO SENATE AMENDMENT TO HOUSE BILL 264
                               
The purpose of this legislation is to increase the tax upon
cigarettes by twenty-nine cents to a rate of fifty-seven cents per
package of twenty cigarettes for the period June 1, 2003, through
June 30, 2005. The distribution of moneys collected from the
cigarette tax shall be revised as follows:
                    1.   For fiscal year 2004, $23.5 million of the moneys
                    collected from the twenty-nine cent increase shall be
                    distributed to the General Fund, and all remaining moneys
                    shall be distributed to the Economic Recovery Reserve
                    Fund.
                              2.   For fiscal year 2005, all moneys collected from the
                    twenty-nine cent increase shall be distributed to the
                    Economic Recovery Reserve Fund.
                              3.   For the period July 1, 2003, through June 30, 2005,
                    distributions of moneys collected from the cigarette tax
                    shall be revised to reflect the twenty-nine cent tax
                    increase in order to maintain current statutory monetary
                    distribution levels.
          



                         FISCAL IMPACT
                               
The estimated fiscal impact is expected to range between $24 million
and $26 million per year for fiscal years 2004 and 2005.



                    Contact:  Senator Hal Bunderson
                              Phone:    (208) 332-1330
          






STATEMENT OF PURPOSE/FISCAL NOTE
SENATE AMENDMENT TO SENATE AMENDMENT TO HOUSE BILL 264