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H0379..................................................by REVENUE AND TAXATION
SALES TAX - Amends, repeals and adds to existing law to increase the sales and
use tax by one and one-half percent from May 1, 2003, until June 30, 2006; and
to increase the annual permit fee on amusement devices from May 1, 2003, until
June 30, 2006.
03/19 House intro - 1st rdg - to printing
03/20 Rpt prt - to Rev/Tax
|||| LEGISLATURE OF THE STATE OF IDAHO ||||
Fifty-seventh Legislature First Regular Session - 2003
IN THE HOUSE OF REPRESENTATIVES
HOUSE BILL NO. 379
BY REVENUE AND TAXATION COMMITTEE
1 AN ACT
2 RELATING TO THE SALES AND USE TAX; AMENDING SECTION 63-3619, IDAHO CODE, TO
3 INCREASE THE RATE OF THE SALES TAX TO SIX AND ONE-HALF PERCENT AND TO MAKE
4 TECHNICAL CORRECTIONS; AMENDING SECTION 63-3621, IDAHO CODE, TO INCREASE
5 THE RATE OF THE USE TAX TO SIX AND ONE-HALF PERCENT FOR PROPERTY ACQUIRED
6 ON AND AFTER MAY 1, 2003; AMENDING SECTION 63-3638, IDAHO CODE, TO REVISE
7 THE DISTRIBUTION FORMULA FOR DISTRIBUTION OF SALES TAX REVENUES AND TO
8 MAKE A TECHNICAL CORRECTION; REPEALING SECTIONS 63-3619 AND 63-3621, IDAHO
9 CODE; REPEALING SECTION 63-3638, IDAHO CODE; AMENDING CHAPTER 36, TITLE
10 63, IDAHO CODE, BY THE ADDITION OF A NEW SECTION 63-3619, IDAHO CODE, TO
11 PROVIDE A SALES TAX OF FIVE PERCENT; AMENDING CHAPTER 36, TITLE 63, IDAHO
12 CODE, BY THE ADDITION OF A NEW SECTION 63-3621, IDAHO CODE, TO PROVIDE
13 IMPOSITION OF A USE TAX RATE OF FIVE PERCENT; AMENDING CHAPTER 36, TITLE
14 63, IDAHO CODE, BY THE ADDITION OF A NEW SECTION 63-3638, IDAHO CODE, TO
15 PROVIDE DISTRIBUTION OF SALES TAX REVENUES; AMENDING SECTION 63-3623B,
16 IDAHO CODE, TO PROVIDE AN INCREASE IN ANNUAL PERMIT FEE FOR AMUSEMENT
17 DEVICES FROM MAY 1, 2003, UNTIL JUNE 30, 2006 AND TO MAKE A TECHNICAL COR-
18 RECTION; DECLARING AN EMERGENCY AND PROVIDING EFFECTIVE DATES.
19 Be It Enacted by the Legislature of the State of Idaho:
20 SECTION 1. That Section 63-3619, Idaho Code, be, and the same is hereby
21 amended to read as follows:
22 63-3619. IMPOSITION AND RATE OF THE SALES TAX. An excise tax is hereby
23 imposed upon each sale at retail at the rate of five per cent six and one-half
24 percent (6.5%) of the sales price of all retail sales subject to taxation
25 under this chapter and such amount shall be computed monthly on all sales at
26 retail within the preceding month.
27 (a) The tax shall apply to, be computed on, and collected for all credit,
28 instalment installment, conditional or similar sales at the time of the sale
29 or, in the case of rentals, at the time the rental is charged.
30 (b) The tax hereby imposed shall be collected by the retailer from the
31 consumer.
32 (c) The state tax commission shall provide schedules for collection of
33 the tax on sales which involve a fraction of a dollar. The retailer shall cal-
34 culate the tax upon the entire amount of the purchases of the consumer made at
35 a particular time and not separately upon each item purchased. The retailer
36 may retain any amount collected under the bracket system prescribed which is
37 in excess of the amount of tax for which he is liable to the state during the
38 period as compensation for the work of collecting the tax.
39 (d) It is unlawful for any retailer to advertise or hold out or state to
40 the public or to any customer, directly or indirectly, that the tax or any
41 part thereof will be assumed or absorbed by the retailer or that it will not
42 be added to the selling price of the property sold or that if added it or any
43 part thereof will be refunded. Any person violating any provision of this sec-
2
1 tion is guilty of a misdemeanor.
2 (e) The tax commission may by rule provide that the amount collected by
3 the retailer from the customer in reimbursement of the tax be displayed sepa-
4 rately from the list price, the price advertised on the premises, the marked
5 price, or other price on the sales slip or other proof of sale.
6 (f) The taxes imposed by this chapter shall apply to the sales to con-
7 tractors purchasing for use in the performance of contracts with the United
8 States.
9 SECTION 2. That Section 63-3621, Idaho Code, be, and the same is hereby
10 amended to read as follows:
11 63-3621. IMPOSITION AND RATE OF THE USE TAX -- EXEMPTIONS. An excise tax
12 is hereby imposed on the storage, use, or other consumption in this state of
13 tangible personal property acquired on or after July May 1, 19652003, for
14 storage, use, or other consumption in this state at the rate of five six and
15 one-half percent (6.5%) of the value of the property, and a recent sales price
16 shall be presumptive evidence of the value of the property unless the property
17 is wireless telecommunications equipment, in which case a recent sales price
18 shall be conclusive evidence of the value of the property.
19 (a) Every person storing, using, or otherwise consuming, in this state,
20 tangible personal property is liable for the tax. His liability is not extin-
21 guished until the tax has been paid to this state except that a receipt from a
22 retailer maintaining a place of business in this state or engaged in business
23 in this state given to the purchaser is sufficient to relieve the purchaser
24 from further liability for the tax to which the receipt refers. A retailer
25 shall not be considered to have stored, used or consumed wireless telecommuni-
26 cations equipment by virtue of giving, selling or otherwise transferring such
27 equipment at a discount as an inducement to a consumer to commence or continue
28 a contract for telecommunications service.
29 (b) Every retailer engaged in business in this state, and making sales of
30 tangible personal property for the storage, use, or other consumption in this
31 state, not exempted under section 63-3622, Idaho Code, shall, at the time of
32 making the sales or, if storage, use or other consumption of the tangible per-
33 sonal property is not then taxable hereunder, at the time the storage, use or
34 other consumption becomes taxable, collect the tax from the purchaser and give
35 to the purchaser a receipt therefor in the manner and form prescribed by the
36 state tax commission.
37 (c) The provisions of this section shall not apply when the retailer pays
38 sales tax on the transaction and collects reimbursement for such sales tax
39 from the customer.
40 (d) Every retailer engaged in business in this state or maintaining a
41 place of business in this state shall register with the state tax commission
42 and give the name and address of all agents operating in this state, the loca-
43 tion of all distributions or sales houses or offices or other places of busi-
44 ness in this state, and such other information as the state tax commission may
45 require.
46 (e) For the purpose of the proper administration of this act and to pre-
47 vent evasion of the use tax and the duty to collect the use tax, it shall be
48 presumed that tangible personal property sold by any person for delivery in
49 this state is sold for storage, use, or other consumption in this state. The
50 burden of proving the sale is tax exempt is upon the person who makes the sale
51 unless he obtains from the purchaser a resale certificate to the effect that
52 the property is purchased for resale or rental. It shall be presumed that
53 sales made to a person who has completed a resale certificate for the seller's
3
1 records are not taxable and the seller need not collect sales or use taxes
2 unless the tangible personal property purchased is taxable to the purchaser as
3 a matter of law in the particular instance claimed on the resale certificate.
4 A seller may accept a resale certificate from a purchaser prior to the
5 time of sale, at the time of sale, or at any reasonable time after the sale
6 when necessary to establish the privilege of the exemption. The resale certif-
7 icate relieves the person selling the property from the burden of proof only
8 if taken from a person who is engaged in the business of selling or renting
9 tangible personal property and who holds the permit provided for by section
10 63-3620, Idaho Code, or who is a retailer not engaged in business in this
11 state, and who, at the time of purchasing the tangible personal property,
12 intends to sell or rent it in the regular course of business or is unable to
13 ascertain at the time of purchase whether the property will be sold or will be
14 used for some other purpose. Other than as provided elsewhere in this section,
15 when a resale certificate, properly executed, is presented to the seller, the
16 seller has no duty or obligation to collect sales or use taxes in regard to
17 any sales transaction so documented regardless of whether the purchaser prop-
18 erly or improperly claimed an exemption. A seller so relieved of the obliga-
19 tion to collect tax is also relieved of any liability to the purchaser for
20 failure to collect tax or for making any report or disclosure of information
21 required or permitted under this chapter.
22 The resale certificate shall bear the name and address of the purchaser,
23 shall be signed by the purchaser or his agent, shall indicate the number of
24 the permit issued to the purchaser, or that the purchaser is an out-of-state
25 retailer, and shall indicate the general character of the tangible personal
26 property sold by the purchaser in the regular course of business. The certifi-
27 cate shall be substantially in such form as the state tax commission may pre-
28 scribe.
29 (f) If a purchaser who gives a resale certificate makes any storage or
30 use of the property other than retention, demonstration or display while hold-
31 ing it for sale in the regular course of business, the storage or use is tax-
32 able as of the time the property is first so stored or used.
33 (g) Any person violating any provision of this section is guilty of a
34 misdemeanor and punishable by a fine not in excess of one hundred dollars
35 ($100), and each violation shall constitute a separate offense.
36 (h) It shall be presumed that tangible personal property shipped or
37 brought to this state by the purchaser was purchased from a retailer, for
38 storage, use or other consumption in this state.
39 (i) It shall be presumed that tangible personal property delivered out-
40 side this state to a purchaser known by the retailer to be a resident of this
41 state was purchased from a retailer for storage, use, or other consumption in
42 this state. This presumption may be controverted by evidence satisfactory to
43 the state tax commission that the property was not purchased for storage, use,
44 or other consumption in this state.
45 (j) When the tangible personal property subject to use tax has been sub-
46 jected to a general retail sales or use tax by another state of the United
47 States in an amount equal to or greater than the amount of the Idaho tax, and
48 evidence can be given of such payment, the property will not be subject to
49 Idaho use tax. If the amount paid the other state was less, the property will
50 be subject to use tax to the extent that the Idaho tax exceeds the tax paid to
51 the other state. For the purposes of this subsection, a registration certifi-
52 cate or title issued by another state or subdivision thereof for a vehicle or
53 trailer or a vessel as defined in section 67-7003, Idaho Code, shall be suffi-
54 cient evidence of payment of a general retail sales or use tax.
55 (k) The use tax herein imposed shall not apply to the use by a nonresi-
4
1 dent of this state of a motor vehicle which is registered or licensed under
2 the laws of the state of his residence and is not used in this state more than
3 a cumulative period of time totaling ninety (90) days in any consecutive
4 twelve (12) months, and which is not required to be registered or licensed
5 under the laws of this state.
6 (l) The use tax herein imposed shall not apply to the use of household
7 goods, personal effects and personally owned motor vehicles by a resident of
8 this state, if such articles were acquired by such person in another state
9 while a resident of that state and primarily for use outside this state and if
10 such use was actual and substantial, but if an article was acquired less than
11 three (3) months prior to the time he entered this state, it will be presumed
12 that the article was acquired for use in this state and that its use outside
13 this state was not actual and substantial. For purposes of this subsection,
14 "resident" shall be as defined in section 63-3013 or 63-3013A, Idaho Code.
15 (m) The use tax herein imposed shall not apply to the storage, use or
16 other consumption of tangible personal property which is or will be incorpo-
17 rated into real property and which has been donated to and has become the
18 property of:
19 (1) A nonprofit organization as defined in section 63-3622O, Idaho Code;
20 or
21 (2) The state of Idaho; or
22 (3) Any political subdivision of the state.
23 This exemption applies whether the tangible personal property is incorporated
24 in real property by the donee, a contractor or subcontractor of the donee, or
25 any other person.
26 SECTION 3. That Section 63-3638, Idaho Code, be, and the same is hereby
27 amended to read as follows:
28 63-3638. SALES TAX -- DISTRIBUTION. All moneys collected under this chap-
29 ter, except as may otherwise be required in section 63-3203, Idaho Code, shall
30 be distributed by the tax commission as follows:
31 (1) An amount of money shall be distributed to the state refund account
32 sufficient to pay current refund claims. All refunds authorized under this
33 chapter by the commission shall be paid through the state refund account, and
34 those moneys are continuously appropriated.
35 (2) Five million dollars ($5,000,000) per year is continuously appropri-
36 ated and shall be distributed to the permanent building fund, provided by sec-
37 tion 57-1108, Idaho Code.
38 (3) Four million eight hundred thousand dollars ($4,800,000) per year is
39 continuously appropriated and shall be distributed to the water pollution con-
40 trol account established by section 39-3605, Idaho Code.
41 (4) An amount equal to the sum required to be certified by the chairman
42 of the Idaho housing and finance association to the state tax commission pur-
43 suant to section 67-6211, Idaho Code, in each year is continuously appropri-
44 ated and shall be paid to any capital reserve fund, established by the Idaho
45 housing and finance association pursuant to section 67-6211, Idaho Code. Such
46 amounts, if any, as may be appropriated hereunder to the capital reserve fund
47 of the Idaho housing and finance association shall be repaid for distribution
48 under the provisions of this section, subject to the provisions of section
49 67-6215, Idaho Code, by the Idaho housing and finance association, as soon as
50 possible, from any moneys available therefor and in excess of the amounts
51 which the association determines will keep it self-supporting.
52 (5) An amount equal to the sum required by the provisions of section
53 63-709, Idaho Code, is continuously appropriated and shall be paid as provided
5
1 by section 63-709, Idaho Code.
2 (6) An amount required by the provisions of chapter 53, title 33, Idaho
3 Code.
4 (7) An amount required by the provisions of chapter 87, title 67, Idaho
5 Code.
6 (8) One dollar ($1.00) on each application for certificate of title or
7 initial application for registration of a motor vehicle, snowmobile, all-
8 terrain vehicle or other vehicle processed by the county assessor or the Idaho
9 transportation department excepting those applications in which any sales or
10 use taxes due have been previously collected by a retailer, shall be a fee for
11 the services of the assessor of the county or the Idaho transportation depart-
12 ment in collecting such taxes, and shall be paid into the current expense fund
13 of the county or state highway account established in section 40-702, Idaho
14 Code.
15 (9) Thirteen and three-quarters Ten and six-tenths percent (13.7510.6%)
16 is continuously appropriated and shall be distributed to the revenue sharing
17 account which is created in the state treasury, and the moneys in the revenue
18 sharing account will be paid in installments each calendar quarter by the tax
19 commission as follows:
20 (a) Twenty-eight and two-tenths percent (28.2%) shall be paid to the var-
21 ious cities as follows:
22 (i) Fifty percent (50%) of such amount shall be paid to the various
23 cities, and each city shall be entitled to an amount in the propor-
24 tion that the population of that city bears to the population of all
25 cities within the state; and
26 (ii) Fifty percent (50%) of such amount shall be paid to the various
27 cities, and each city shall be entitled to an amount in the propor-
28 tion that the preceding year's market value for assessment purposes
29 for that city bears to the preceding year's market value for assess-
30 ment purposes for all cities within the state.
31 (b) Twenty-eight and two-tenths percent (28.2%) shall be paid to the var-
32 ious counties as follows:
33 (i) One million three hundred twenty thousand dollars ($1,320,000)
34 annually shall be distributed one forty-fourth (1/44) to each of the
35 various counties; and
36 (ii) The balance of such amount shall be paid to the various coun-
37 ties, and each county shall be entitled to an amount in the propor-
38 tion that the population of that county bears to the population of
39 the state;
40 (c) Thirty-five and nine-tenths percent (35.9%) of the amount appropri-
41 ated in this subsection (9) shall be paid to the several counties for dis-
42 tribution to the cities and counties as follows:
43 (i) Each city and county which received a payment under the provi-
44 sions of section 63-3638(e), Idaho Code, during the fourth quarter of
45 calendar year 1999, shall be entitled to a like amount during suc-
46 ceeding calendar quarters.
47 (ii) If the dollar amount of money available under this subsection
48 (9)(c) in any quarter does not equal the amount paid in the fourth
49 quarter of calendar year 1999, each city's and county's payment shall
50 be reduced proportionately.
51 (iii) If the dollar amount of money available under this subsection
52 (9)(c) in any quarter exceeds the amount paid in the fourth quarter
53 of calendar year 1999, each city and county shall be entitled to a
54 proportionately increased payment, but such increase shall not exceed
55 one hundred five percent (105%) of the total payment made in the
6
1 fourth quarter of calendar year 1999.
2 (iv) If the dollar amount of money available under this subsection
3 (9)(c) in any quarter exceeds one hundred five percent (105%) of the
4 total payment made in the fourth quarter of calendar year 1999, any
5 amount over and above such one hundred five percent (105%) shall be
6 paid fifty percent (50%) to the various cities in the proportion that
7 the population of the city bears to the population of all cities
8 within the state, and fifty percent (50%) to the various counties in
9 the proportion that the population of a county bears to the popula-
10 tion of the state; and
11 (d) Seven and seven-tenths percent (7.7%) of the amount appropriated in
12 this subsection (9) shall be paid to the several counties for distribution
13 to special purpose taxing districts as follows:
14 (i) Each such district which received a payment under the provi-
15 sions of section 63-3638(e), Idaho Code, during the fourth quarter of
16 calendar year 1999, shall be entitled to a like amount during suc-
17 ceeding calendar quarters.
18 (ii) If the dollar amount of money available under this subsection
19 (89)(d) in any quarter does not equal the amount paid in the fourth
20 quarter of calendar year 1999, each special purpose taxing district's
21 payment shall be reduced proportionately.
22 (iii) If the dollar amount of money available under this subsection
23 (9)(d) in any quarter exceeds the amount distributed under paragraph
24 (i) of this subsection (9)(d), each special purpose taxing district
25 shall be entitled to a share of the excess based on the proportion
26 each such district's current property tax budget bears to the sum of
27 the current property tax budgets of all such districts in the state.
28 The state tax commission shall calculate district current property
29 tax budgets to include any unrecovered foregone amounts as determined
30 under section 63-802(1)(e), Idaho Code. When a special purpose taxing
31 district is situated in more than one (1) county, the tax commission
32 shall determine the portion attributable to the special purpose tax-
33 ing district from each county in which it is situated.
34 (iv) If special purpose taxing districts are consolidated, the
35 resulting district is entitled to a base amount equal to the sum of
36 the base amounts which were received in the last calendar quarter by
37 each district prior to the consolidation.
38 (v) If a special purpose taxing district is dissolved or
39 disincorporated, the state tax commission shall continuously distrib-
40 ute to the board of county commissioners an amount equal to the last
41 quarter's distribution prior to dissolution or disincorporation. The
42 board of county commissioners shall determine any redistribution of
43 moneys so received.
44 (vi) Taxing districts formed after January 1, 2001, are not entitled
45 to a payment under the provisions of this subsection (9)(d).
46 (vii) For purposes of this subsection (9)(d), a special purpose tax-
47 ing district is any taxing district which is not a city, a county or
48 a school district.
49 (10) Any moneys remaining over and above those necessary to meet and
50 reserve for payments under other subsections of this section shall be distrib-
51 uted to the general fund.
52 SECTION 4. That Sections 63-3619 and 63-3621 Idaho Code, be, and the same
53 are hereby repealed.
7
1 SECTION 5. That Section 63-3638, Idaho Code, be, and the same is hereby
2 repealed.
3 SECTION 6. That Chapter 36, Title 63, Idaho Code, be, and the same is
4 hereby amended by the addition thereto of a NEW SECTION, to be known and des-
5 ignated as Section 63-3619, Idaho Code, and to read as follows:
6 63-3619. IMPOSITION AND RATE OF THE SALES TAX. An excise tax is hereby
7 imposed upon each sale at retail at the rate of five percent (5%) of the sales
8 price of all retail sales subject to taxation under this chapter and such
9 amount shall be computed monthly on all sales at retail within the preceding
10 month.
11 (a) The tax shall apply to, be computed on, and collected for all credit,
12 installment, conditional or similar sales at the time of the sale or, in the
13 case of rentals, at the time the rental is charged.
14 (b) The tax hereby imposed shall be collected by the retailer from the
15 consumer.
16 (c) The state tax commission shall provide schedules for collection of
17 the tax on sales which involve a fraction of a dollar. The retailer shall cal-
18 culate the tax upon the entire amount of the purchases of the consumer made at
19 a particular time and not separately upon each item purchased. The retailer
20 may retain any amount collected under the bracket system prescribed which is
21 in excess of the amount of tax for which he is liable to the state during the
22 period as compensation for the work of collecting the tax.
23 (d) It is unlawful for any retailer to advertise or hold out or state to
24 the public or to any customer, directly or indirectly, that the tax or any
25 part thereof will be assumed or absorbed by the retailer or that it will not
26 be added to the selling price of the property sold or that if added it or any
27 part thereof will be refunded. Any person violating any provision of this sec-
28 tion is guilty of a misdemeanor.
29 (e) The tax commission may by rule provide that the amount collected by
30 the retailer from the customer in reimbursement of the tax be displayed sepa-
31 rately from the list price, the price advertised on the premises, the marked
32 price, or other price on the sales slip or other proof of sale.
33 (f) The taxes imposed by this chapter shall apply to the sales to con-
34 tractors purchasing for use in the performance of contracts with the United
35 States.
36 SECTION 7. That Chapter 36, Title 63, Idaho Code, be, and the same is
37 hereby amended by the addition thereto of a NEW SECTION, to be known and des-
38 ignated as Section 63-3621, Idaho Code, and to read as follows:
39 63-3621. IMPOSITION AND RATE OF THE USE TAX -- EXEMPTIONS. An excise tax
40 is hereby imposed on the storage, use, or other consumption in this state of
41 tangible personal property acquired on or after July 1, 2006, for storage,
42 use, or other consumption in this state at the rate of five percent (5%) of
43 the value of the property, and a recent sales price shall be presumptive evi-
44 dence of the value of the property unless the property is wireless telecommu-
45 nications equipment, in which case a recent sales price shall be conclusive
46 evidence of the value of the property.
47 (a) Every person storing, using, or otherwise consuming, in this state,
48 tangible personal property is liable for the tax. His liability is not extin-
49 guished until the tax has been paid to this state except that a receipt from a
50 retailer maintaining a place of business in this state or engaged in business
51 in this state given to the purchaser is sufficient to relieve the purchaser
8
1 from further liability for the tax to which the receipt refers. A retailer
2 shall not be considered to have stored, used or consumed wireless telecommuni-
3 cations equipment by virtue of giving, selling or otherwise transferring such
4 equipment at a discount as an inducement to a consumer to commence or continue
5 a contract for telecommunications service.
6 (b) Every retailer engaged in business in this state, and making sales of
7 tangible personal property for the storage, use, or other consumption in this
8 state, not exempted under section 63-3622, Idaho Code, shall, at the time of
9 making the sales or, if storage, use or other consumption of the tangible per-
10 sonal property is not then taxable hereunder, at the time the storage, use or
11 other consumption becomes taxable, collect the tax from the purchaser and give
12 to the purchaser a receipt therefor in the manner and form prescribed by the
13 state tax commission.
14 (c) The provisions of this section shall not apply when the retailer pays
15 sales tax on the transaction and collects reimbursement for such sales tax
16 from the customer.
17 (d) Every retailer engaged in business in this state or maintaining a
18 place of business in this state shall register with the state tax commission
19 and give the name and address of all agents operating in this state, the loca-
20 tion of all distributions or sales houses or offices or other places of busi-
21 ness in this state, and such other information as the state tax commission may
22 require.
23 (e) For the purpose of the proper administration of this act and to pre-
24 vent evasion of the use tax and the duty to collect the use tax, it shall be
25 presumed that tangible personal property sold by any person for delivery in
26 this state is sold for storage, use, or other consumption in this state. The
27 burden of proving the sale is tax exempt is upon the person who makes the sale
28 unless he obtains from the purchaser a resale certificate to the effect that
29 the property is purchased for resale or rental. It shall be presumed that
30 sales made to a person who has completed a resale certificate for the seller's
31 records are not taxable and the seller need not collect sales or use taxes
32 unless the tangible personal property purchased is taxable to the purchaser as
33 a matter of law in the particular instance claimed on the resale certificate.
34 A seller may accept a resale certificate from a purchaser prior to the
35 time of sale, at the time of sale, or at any reasonable time after the sale
36 when necessary to establish the privilege of the exemption. The resale certif-
37 icate relieves the person selling the property from the burden of proof only
38 if taken from a person who is engaged in the business of selling or renting
39 tangible personal property and who holds the permit provided for by section
40 63-3620, Idaho Code, or who is a retailer not engaged in business in this
41 state, and who, at the time of purchasing the tangible personal property,
42 intends to sell or rent it in the regular course of business or is unable to
43 ascertain at the time of purchase whether the property will be sold or will be
44 used for some other purpose. Other than as provided elsewhere in this section,
45 when a resale certificate, properly executed, is presented to the seller, the
46 seller has no duty or obligation to collect sales or use taxes in regard to
47 any sales transaction so documented regardless of whether the purchaser prop-
48 erly or improperly claimed an exemption. A seller so relieved of the obliga-
49 tion to collect tax is also relieved of any liability to the purchaser for
50 failure to collect tax or for making any report or disclosure of information
51 required or permitted under this chapter.
52 The resale certificate shall bear the name and address of the purchaser,
53 shall be signed by the purchaser or his agent, shall indicate the number of
54 the permit issued to the purchaser, or that the purchaser is an out-of-state
55 retailer, and shall indicate the general character of the tangible personal
9
1 property sold by the purchaser in the regular course of business. The certifi-
2 cate shall be substantially in such form as the state tax commission may pre-
3 scribe.
4 (f) If a purchaser who gives a resale certificate makes any storage or
5 use of the property other than retention, demonstration or display while hold-
6 ing it for sale in the regular course of business, the storage or use is tax-
7 able as of the time the property is first so stored or used.
8 (g) Any person violating any provision of this section is guilty of a
9 misdemeanor and punishable by a fine not in excess of one hundred dollars
10 ($100), and each violation shall constitute a separate offense.
11 (h) It shall be presumed that tangible personal property shipped or
12 brought to this state by the purchaser was purchased from a retailer, for
13 storage, use or other consumption in this state.
14 (i) It shall be presumed that tangible personal property delivered out-
15 side this state to a purchaser known by the retailer to be a resident of this
16 state was purchased from a retailer for storage, use, or other consumption in
17 this state. This presumption may be controverted by evidence satisfactory to
18 the state tax commission that the property was not purchased for storage, use,
19 or other consumption in this state.
20 (j) When the tangible personal property subject to use tax has been sub-
21 jected to a general retail sales or use tax by another state of the United
22 States in an amount equal to or greater than the amount of the Idaho tax, and
23 evidence can be given of such payment, the property will not be subject to
24 Idaho use tax. If the amount paid the other state was less, the property will
25 be subject to use tax to the extent that the Idaho tax exceeds the tax paid to
26 the other state. For the purposes of this subsection, a registration certifi-
27 cate or title issued by another state or subdivision thereof for a vehicle or
28 trailer or a vessel as defined in section 67-7003, Idaho Code, shall be suffi-
29 cient evidence of payment of a general retail sales or use tax.
30 (k) The use tax herein imposed shall not apply to the use by a nonresi-
31 dent of this state of a motor vehicle which is registered or licensed under
32 the laws of the state of his residence and is not used in this state more than
33 a cumulative period of time totaling ninety (90) days in any consecutive
34 twelve (12) months, and which is not required to be registered or licensed
35 under the laws of this state.
36 (l) The use tax herein imposed shall not apply to the use of household
37 goods, personal effects and personally owned motor vehicles by a resident of
38 this state, if such articles were acquired by such person in another state
39 while a resident of that state and primarily for use outside this state and if
40 such use was actual and substantial, but if an article was acquired less than
41 three (3) months prior to the time he entered this state, it will be presumed
42 that the article was acquired for use in this state and that its use outside
43 this state was not actual and substantial. For purposes of this subsection,
44 "resident" shall be as defined in section 63-3013 or 63-3013A, Idaho Code.
45 (m) The use tax herein imposed shall not apply to the storage, use or
46 other consumption of tangible personal property which is or will be incorpo-
47 rated into real property and which has been donated to and has become the
48 property of:
49 (1) A nonprofit organization as defined in section 63-3622O, Idaho Code;
50 or
51 (2) The state of Idaho; or
52 (3) Any political subdivision of the state.
53 This exemption applies whether the tangible personal property is incorporated
54 in real property by the donee, a contractor or subcontractor of the donee, or
55 any other person.
10
1 SECTION 8. That Chapter 36, Title 63, Idaho Code, be, and the same is
2 hereby amended by the addition thereto of a NEW SECTION, to be known and des-
3 ignated as Section 63-3638, Idaho Code, and to read as follows:
4 63-3638. SALES TAX -- DISTRIBUTION. All moneys collected under this chap-
5 ter, except as may otherwise be required in section 63-3203, Idaho Code, shall
6 be distributed by the tax commission as follows:
7 (1) An amount of money shall be distributed to the state refund account
8 sufficient to pay current refund claims. All refunds authorized under this
9 chapter by the commission shall be paid through the state refund account, and
10 those moneys are continuously appropriated.
11 (2) Five million dollars ($5,000,000) per year is continuously appropri-
12 ated and shall be distributed to the permanent building fund, provided by sec-
13 tion 57-1108, Idaho Code.
14 (3) Four million eight hundred thousand dollars ($4,800,000) per year is
15 continuously appropriated and shall be distributed to the water pollution con-
16 trol account established by section 39-3605, Idaho Code.
17 (4) An amount equal to the sum required to be certified by the chairman
18 of the Idaho housing and finance association to the state tax commission pur-
19 suant to section 67-6211, Idaho Code, in each year is continuously appropri-
20 ated and shall be paid to any capital reserve fund, established by the Idaho
21 housing and finance association pursuant to section 67-6211, Idaho Code. Such
22 amounts, if any, as may be appropriated hereunder to the capital reserve fund
23 of the Idaho housing and finance association shall be repaid for distribution
24 under the provisions of this section, subject to the provisions of section
25 67-6215, Idaho Code, by the Idaho housing and finance association, as soon as
26 possible, from any moneys available therefor and in excess of the amounts
27 which the association determines will keep it self-supporting.
28 (5) An amount equal to the sum required by the provisions of section
29 63-709, Idaho Code, is continuously appropriated and shall be paid as provided
30 by section 63-709, Idaho Code.
31 (6) An amount required by the provisions of chapter 53, title 33, Idaho
32 Code.
33 (7) An amount required by the provisions of chapter 87, title 67, Idaho
34 Code.
35 (8) One dollar ($1.00) on each application for certificate of title or
36 initial application for registration of a motor vehicle, snowmobile, all-
37 terrain vehicle or other vehicle processed by the county assessor or the Idaho
38 transportation department excepting those applications in which any sales or
39 use taxes due have been previously collected by a retailer, shall be a fee for
40 the services of the assessor of the county or the Idaho transportation depart-
41 ment in collecting such taxes, and shall be paid into the current expense fund
42 of the county or state highway account established in section 40-702, Idaho
43 Code.
44 (9) Thirteen and three-quarters percent (13.75%) is continuously appro-
45 priated and shall be distributed to the revenue sharing account which is cre-
46 ated in the state treasury, and the moneys in the revenue sharing account will
47 be paid in installments each calendar quarter by the tax commission as fol-
48 lows:
49 (a) Twenty-eight and two-tenths percent (28.2%) shall be paid to the var-
50 ious cities as follows:
51 (i) Fifty percent (50%) of such amount shall be paid to the various
52 cities, and each city shall be entitled to an amount in the propor-
53 tion that the population of that city bears to the population of all
54 cities within the state; and
11
1 (ii) Fifty percent (50%) of such amount shall be paid to the various
2 cities, and each city shall be entitled to an amount in the propor-
3 tion that the preceding year's market value for assessment purposes
4 for that city bears to the preceding year's market value for assess-
5 ment purposes for all cities within the state.
6 (b) Twenty-eight and two-tenths percent (28.2%) shall be paid to the var-
7 ious counties as follows:
8 (i) One million three hundred twenty thousand dollars ($1,320,000)
9 annually shall be distributed one forty-fourth (1/44) to each of the
10 various counties; and
11 (ii) The balance of such amount shall be paid to the various coun-
12 ties, and each county shall be entitled to an amount in the propor-
13 tion that the population of that county bears to the population of
14 the state;
15 (c) Thirty-five and nine-tenths percent (35.9%) of the amount appropri-
16 ated in this subsection (9) shall be paid to the several counties for dis-
17 tribution to the cities and counties as follows:
18 (i) Each city and county which received a payment under the provi-
19 sions of section 63-3638(e), Idaho Code, during the fourth quarter of
20 calendar year 1999, shall be entitled to a like amount during suc-
21 ceeding calendar quarters.
22 (ii) If the dollar amount of money available under this subsection
23 (9)(c) in any quarter does not equal the amount paid in the fourth
24 quarter of calendar year 1999, each city's and county's payment shall
25 be reduced proportionately.
26 (iii) If the dollar amount of money available under this subsection
27 (9)(c) in any quarter exceeds the amount paid in the fourth quarter
28 of calendar year 1999, each city and county shall be entitled to a
29 proportionately increased payment, but such increase shall not exceed
30 one hundred five percent (105%) of the total payment made in the
31 fourth quarter of calendar year 1999.
32 (iv) If the dollar amount of money available under this subsection
33 (9)(c) in any quarter exceeds one hundred five percent (105%) of the
34 total payment made in the fourth quarter of calendar year 1999, any
35 amount over and above such one hundred five percent (105%) shall be
36 paid fifty percent (50%) to the various cities in the proportion that
37 the population of the city bears to the population of all cities
38 within the state, and fifty percent (50%) to the various counties in
39 the proportion that the population of a county bears to the popula-
40 tion of the state; and
41 (d) Seven and seven-tenths percent (7.7%) of the amount appropriated in
42 this subsection (9) shall be paid to the several counties for distribution
43 to special purpose taxing districts as follows:
44 (i) Each such district which received a payment under the provi-
45 sions of section 63-3638(e), Idaho Code, during the fourth quarter of
46 calendar year 1999, shall be entitled to a like amount during suc-
47 ceeding calendar quarters.
48 (ii) If the dollar amount of money available under this subsection
49 (9)(d) in any quarter does not equal the amount paid in the fourth
50 quarter of calendar year 1999, each special purpose taxing district's
51 payment shall be reduced proportionately.
52 (iii) If the dollar amount of money available under this subsection
53 (9)(d) in any quarter exceeds the amount distributed under paragraph
54 (i) of this subsection (9)(d), each special purpose taxing district
55 shall be entitled to a share of the excess based on the proportion
12
1 each such district's current property tax budget bears to the sum of
2 the current property tax budgets of all such districts in the state.
3 The state tax commission shall calculate district current property
4 tax budgets to include any unrecovered foregone amounts as determined
5 under section 63-802(1)(e), Idaho Code. When a special purpose taxing
6 district is situated in more than one (1) county, the tax commission
7 shall determine the portion attributable to the special purpose tax-
8 ing district from each county in which it is situated.
9 (iv) If special purpose taxing districts are consolidated, the
10 resulting district is entitled to a base amount equal to the sum of
11 the base amounts which were received in the last calendar quarter by
12 each district prior to the consolidation.
13 (v) If a special purpose taxing district is dissolved or
14 disincorporated, the state tax commission shall continuously distrib-
15 ute to the board of county commissioners an amount equal to the last
16 quarter's distribution prior to dissolution or disincorporation. The
17 board of county commissioners shall determine any redistribution of
18 moneys so received.
19 (vi) Taxing districts formed after January 1, 2001, are not entitled
20 to a payment under the provisions of this subsection (9)(d).
21 (vii) For purposes of this subsection (9)(d), a special purpose tax-
22 ing district is any taxing district which is not a city, a county or
23 a school district.
24 (10) Any moneys remaining over and above those necessary to meet and
25 reserve for payments under other subsections of this section shall be distrib-
26 uted to the general fund.
27 SECTION 9. That Section 63-3623B, Idaho Code, be, and the same is hereby
28 amended to read as follows:
29 63-3623B. AMUSEMENT DEVICES. (a) For purposes of this section the term
30 "amusement device" shall mean all coin, currency, or token operated machines
31 and devices which are used for amusement including, but not limited to, game
32 machines, pool tables, juke boxes jukeboxes, electronic games and similar
33 devices.
34 (b) In lieu of the imposition of sales tax upon the use of the amusement
35 device, the owner or lessee or person having the right to impose a charge for
36 use of the amusement device must pay an annual permit fee of forty-five dol-
37 lars and fifty cents ($45.50) from May 1, 2003, until June 30, 2006, for each
38 such device and on and after July 1, 2006, thirty-five dollars ($35.00) for
39 each such device.
40 (c) Upon payment of the permit fees, the state tax commission shall issue
41 the permit(s) to the owner or lessee or person having the right to impose a
42 charge for use of the amusement device. Such permit fee may be increased in a
43 proportionate amount by the commission if the state sales tax rate increases.
44 (d) All applications for a permit renewal must be made to the state tax
45 commission on or before July 1 of each year. Such application shall contain
46 the same information required on an application to secure a seller's permit
47 under this chapter and shall be accompanied by the annual permit fee due for
48 each device.
49 (e) The state tax commission shall adopt a uniform system of providing,
50 affixing and displaying official decals, labels or other official indicia evi-
51 dencing that the owner, lessee, or person having the right to impose a charge
52 for the use of the amusement device has paid the annual permit fee for such
53 amusement device. No person subject to a permit fee under this chapter may
13
1 impose a charge or collect any consideration for use of such amusement device
2 unless such official decal, label, or other official indicia, as required
3 herein, is affixed to such amusement device.
4 (f) In addition to the penalties set forth above and in section 63-3634,
5 Idaho Code, the state tax commission may assess the following penalties:
6 (1) If any owner, lessee, or person having the right to impose a charge
7 for the use of any coin, currency or token operated amusement device in
8 this state shall violate any provision of this section or any rule pro-
9 mulgated under this section, the commission may assess penalties, of fifty
10 dollars ($50.00) for each device for failure to pay timely permit sticker
11 fees.
12 (2) A person who knowingly secures or attempts to secure an amusement
13 device permit sticker under this section by fraud, misrepresentation, or
14 subterfuge or uses any permit issued under this section in a fraudulent
15 manner shall be subject to a penalty of up to twenty-five thousand dollars
16 ($25,000).
17 (g) The state tax commission shall impose the penalties provided in this
18 section by a notice of deficiency determination in the manner provided in sec-
19 tion 63-3629, Idaho Code, which shall be subject to review as provided in sec-
20 tion 63-3631, Idaho Code.
21 (h) The commission may revoke all permits of any person who operates any
22 amusement device without complying with the provisions of this section. Notice
23 of revocation shall be given in the manner provided for deficiencies in taxes
24 in section 63-3629, Idaho Code, which shall be subject to review as provided
25 in section 63-3631, Idaho Code.
26 (i) Permits issued under this section are transferable to another person
27 only after written notice of the transfer is given to the state tax commis-
28 sion.
29 SECTION 10. An emergency existing therefor, which emergency is hereby
30 declared to exist, Sections 1, 2 and 9 of this act shall be in full force and
31 effect on and after May 1, 2003. Section 3 of this act shall be in full force
32 and effect on and after June 1, 2003. Sections 4, 6 and 7 of this act shall be
33 in full force and effect on and after July 1, 2006. Sections 5 and 8 of this
34 act shall be in full force and effect on and after August 1, 2006.
STATEMENT OF PURPOSE
RS 13183
This legislation increases the sales tax from 5% to 6.5% for the
period May 1, 2003 through June 30, 2006. It modifies the sales tax
distribution formula for the period June 1, 2003 through July 31,
2006 so that the percentage of sales tax distributed to revenue
sharing is decreased from 13.75% to 10.6%, thereby distributing all
of the additional revenue expected from the rate increase to the
General Fund. It increases the annual permit fee for amusement
devices from $35.00 to $45.00 for the period May 1, 2003 through
June 30, 2006. This fee is in lieu of sales tax.
FISCAL IMPACT
This bill would increase General Fund revenue by $18.4 million in
FY 2003 and $240.3 million in FY 2004.
CONTACT
Name: Brian Whitlock
Agency: Office of the Governor
Phone: 334-2100
Statement of Purpose/Fiscal Impact H 379