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H0676.....................................................by WAYS AND MEANS MOTOR FUELS - SALES TAX - Amends existing law relating to sales and use taxes to provide a rate of the sales tax at two percent of motor fuels that are subject to the motor fuels tax; to provide a rate of the use tax at two percent on the purchase of motor fuels that are subject to the motor fuels tax; to provide a partial exception to the sales and use tax exemption for motor fuels; and to provide for distribution of the moneys to the highway distribution account. 03/20 House intro - 1st rdg - to printing 03/21 Rpt prt - Held at Desk 03/31 Ref'd to W/M
]]]] LEGISLATURE OF THE STATE OF IDAHO ]]]] Fifty-ninth Legislature Second Regular Session - 2008IN THE HOUSE OF REPRESENTATIVES HOUSE BILL NO. 676 BY WAYS AND MEANS COMMITTEE 1 AN ACT 2 RELATING TO SALES AND USE TAXES; AMENDING SECTION 63-3619, IDAHO CODE, TO PRO- 3 VIDE A RATE OF THE SALES TAX AT TWO PERCENT ON PURCHASES OF MOTOR FUELS 4 THAT ARE SUBJECT TO THE MOTOR FUELS TAX; AMENDING SECTION 63-3621, IDAHO 5 CODE, TO PROVIDE A RATE OF THE USE TAX AT TWO PERCENT ON PURCHASES OF 6 MOTOR FUELS THAT ARE SUBJECT TO THE MOTOR FUELS TAX; AMENDING SECTION 7 63-3622C, IDAHO CODE, TO PROVIDE A PARTIAL EXCEPTION TO THE SALES AND USE 8 TAX EXEMPTION FOR MOTOR FUELS; AND AMENDING SECTION 63-3638, IDAHO CODE, 9 TO PROVIDE FOR A DISTRIBUTION TO THE HIGHWAY DISTRIBUTION ACCOUNT OF SALES 10 AND USE TAX REVENUES COLLECTED FROM THE IMPOSITION OF A TWO PERCENT TAX ON 11 PURCHASES OF MOTOR FUELS THAT ARE SUBJECT TO THE MOTOR FUELS TAX. 12 Be It Enacted by the Legislature of the State of Idaho: 13 SECTION 1. That Section 63-3619, Idaho Code, be, and the same is hereby 14 amended to read as follows: 15 63-3619. IMPOSITION AND RATE OF THE SALES TAX. An excise tax is hereby 16 imposed upon each sale at retail at the rate of six percent (6%) of the sales 17 price of all retail sales subject to taxation under this chapterand such18amountwith the exception of purchases exempt from taxation pursuant to sec- 19 tion 63-3622C, Idaho Code, which shall be taxed at a rate of two percent (2%) 20 of the sales price beginning July 1, 2008, notwithstanding any other provision 21 of law to the contrary. The excise tax as set forth herein shall be computed 22 monthly on all sales at retail within the preceding month. 23 (a) The tax shall apply to, be computed on, and collected for all credit, 24 installment, conditional or similar sales at the time of the sale or, in the 25 case of rentals, at the time the rental is charged. 26 (b) The tax hereby imposed shall be collected by the retailer from the 27 consumer. 28 (c) The state tax commission shall provide schedules for collection of 29 the tax on sales which involve a fraction of a dollar. The retailer shall cal- 30 culate the tax upon the entire amount of the purchases of the consumer made at 31 a particular time and not separately upon each item purchased. The retailer 32 may retain any amount collected under the bracket system prescribed which is 33 in excess of the amount of tax for which he is liable to the state during the 34 period as compensation for the work of collecting the tax. 35 (d) It is unlawful for any retailer to advertise or hold out or state to 36 the public or to any customer, directly or indirectly, that the tax or any 37 part thereof will be assumed or absorbed by the retailer or that it will not 38 be added to the selling price of the property sold or that if added it or any 39 part thereof will be refunded. Any person violating any provision of this sec- 40 tion is guilty of a misdemeanor. 41 (e) The tax commission may by rule provide that the amount collected by 42 the retailer from the customer in reimbursement of the tax be displayed sepa- 43 rately from the list price, the price advertised on the premises, the marked 2 1 price, or other price on the sales slip or other proof of sale. 2 (f) The taxes imposed by this chapter shall apply to the sales to con- 3 tractors purchasing for use in the performance of contracts with the United 4 States. 5 SECTION 2. That Section 63-3621, Idaho Code, be, and the same is hereby 6 amended to read as follows: 7 63-3621. IMPOSITION AND RATE OF THE USE TAX -- EXEMPTIONS. An excise tax 8 is hereby imposed on the storage, use, or other consumption in this state of 9 tangible personal property acquired on or after October 1, 2006, for storage, 10 use, or other consumption in this state at the rate of six percent (6%) of the 11 value of the property,and awith the exception of purchases exempt from taxa- 12 tion pursuant to section 63-3622C, Idaho Code, which shall be taxed at a rate 13 of two percent (2%) of the sales price beginning July 1, 2008, notwithstanding 14 any other provision of law to the contrary. A recent sales price shall be pre- 15 sumptive evidence of the value of the property unless the property is wireless 16 telecommunications equipment, in which case a recent sales price shall be con- 17 clusive evidence of the value of the property. 18 (a) Every person storing, using, or otherwise consuming, in this state, 19 tangible personal property is liable for the tax. His liability is not extin- 20 guished until the tax has been paid to this state except that a receipt from a 21 retailer maintaining a place of business in this state or engaged in business 22 in this state given to the purchaser is sufficient to relieve the purchaser 23 from further liability for the tax to which the receipt refers. A retailer 24 shall not be considered to have stored, used or consumed wireless telecommuni- 25 cations equipment by virtue of giving, selling or otherwise transferring such 26 equipment at a discount as an inducement to a consumer to commence or continue 27 a contract for telecommunications service. 28 (b) Every retailer engaged in business in this state, and making sales of 29 tangible personal property for the storage, use, or other consumption in this 30 state, not exempted under section 63-3622, Idaho Code, shall, at the time of 31 making the sales or, if storage, use or other consumption of the tangible per- 32 sonal property is not then taxable hereunder, at the time the storage, use or 33 other consumption becomes taxable, collect the tax from the purchaser and give 34 to the purchaser a receipt therefor in the manner and form prescribed by the 35 state tax commission. 36 (c) The provisions of this section shall not apply when the retailer pays 37 sales tax on the transaction and collects reimbursement for such sales tax 38 from the customer. 39 (d) Every retailer engaged in business in this state or maintaining a 40 place of business in this state shall register with the state tax commission 41 and give the name and address of all agents operating in this state, the loca- 42 tion of all distributions or sales houses or offices or other places of busi- 43 ness in this state, and such other information as the state tax commission may 44 require. 45 (e) For the purpose of the proper administration of this act and to pre- 46 vent evasion of the use tax and the duty to collect the use tax, it shall be 47 presumed that tangible personal property sold by any person for delivery in 48 this state is sold for storage, use, or other consumption in this state. The 49 burden of proving the sale is tax exempt is upon the person who makes the sale 50 unless he obtains from the purchaser a resale certificate to the effect that 51 the property is purchased for resale or rental. It shall be presumed that 52 sales made to a person who has completed a resale certificate for the seller's 53 records are not taxable and the seller need not collect sales or use taxes 3 1 unless the tangible personal property purchased is taxable to the purchaser as 2 a matter of law in the particular instance claimed on the resale certificate. 3 A seller may accept a resale certificate from a purchaser prior to the 4 time of sale, at the time of sale, or at any reasonable time after the sale 5 when necessary to establish the privilege of the exemption. The resale certif- 6 icate relieves the person selling the property from the burden of proof only 7 if taken from a person who is engaged in the business of selling or renting 8 tangible personal property and who holds the permit provided for by section 9 63-3620, Idaho Code, or who is a retailer not engaged in business in this 10 state, and who, at the time of purchasing the tangible personal property, 11 intends to sell or rent it in the regular course of business or is unable to 12 ascertain at the time of purchase whether the property will be sold or will be 13 used for some other purpose. Other than as provided elsewhere in this section, 14 when a resale certificate, properly executed, is presented to the seller, the 15 seller has no duty or obligation to collect sales or use taxes in regard to 16 any sales transaction so documented regardless of whether the purchaser prop- 17 erly or improperly claimed an exemption. A seller so relieved of the obliga- 18 tion to collect tax is also relieved of any liability to the purchaser for 19 failure to collect tax or for making any report or disclosure of information 20 required or permitted under this chapter. 21 The resale certificate shall bear the name and address of the purchaser, 22 shall be signed by the purchaser or his agent, shall indicate the number of 23 the permit issued to the purchaser, or that the purchaser is an out-of-state 24 retailer, and shall indicate the general character of the tangible personal 25 property sold by the purchaser in the regular course of business. The certifi- 26 cate shall be substantially in such form as the state tax commission may pre- 27 scribe. 28 (f) If a purchaser who gives a resale certificate makes any storage or 29 use of the property other than retention, demonstration or display while hold- 30 ing it for sale in the regular course of business, the storage or use is tax- 31 able as of the time the property is first so stored or used. 32 (g) Any person violating any provision of this section is guilty of a 33 misdemeanor and punishable by a fine not in excess of one hundred dollars 34 ($100), and each violation shall constitute a separate offense. 35 (h) It shall be presumed that tangible personal property shipped or 36 brought to this state by the purchaser was purchased from a retailer, for 37 storage, use or other consumption in this state. 38 (i) It shall be presumed that tangible personal property delivered out- 39 side this state to a purchaser known by the retailer to be a resident of this 40 state was purchased from a retailer for storage, use, or other consumption in 41 this state. This presumption may be controverted by evidence satisfactory to 42 the state tax commission that the property was not purchased for storage, use, 43 or other consumption in this state. 44 (j) When the tangible personal property subject to use tax has been sub- 45 jected to a general retail sales or use tax by another state of the United 46 States in an amount equal to or greater than the amount of the Idaho tax, and 47 evidence can be given of such payment, the property will not be subject to 48 Idaho use tax. If the amount paid the other state was less, the property will 49 be subject to use tax to the extent that the Idaho tax exceeds the tax paid to 50 the other state. For the purposes of this subsection, a registration certifi- 51 cate or title issued by another state or subdivision thereof for a vehicle or 52 trailer or a vessel as defined in section 67-7003, Idaho Code, shall be suffi- 53 cient evidence of payment of a general retail sales or use tax. 54 (k) The use tax herein imposed shall not apply to the use by a nonresi- 55 dent of this state of a motor vehicle which is registered or licensed under 4 1 the laws of the state of his residence and is not used in this state more than 2 a cumulative period of time totaling ninety (90) days in any consecutive 3 twelve (12) months, and which is not required to be registered or licensed 4 under the laws of this state. 5 (l) The use tax herein imposed shall not apply to the use of household 6 goods, personal effects and personally owned motor vehicles by a resident of 7 this state, if such articles were acquired by such person in another state 8 while a resident of that state and primarily for use outside this state and if 9 such use was actual and substantial, but if an article was acquired less than 10 three (3) months prior to the time he entered this state, it will be presumed 11 that the article was acquired for use in this state and that its use outside 12 this state was not actual and substantial. For purposes of this subsection, 13 "resident" shall be as defined in section 63-3013 or 63-3013A, Idaho Code. 14 (m) The use tax herein imposed shall not apply to the storage, use or 15 other consumption of tangible personal property which is or will be incorpo- 16 rated into real property and which has been donated to and has become the 17 property of: 18 (1) A nonprofit organization as defined in section 63-3622O, Idaho Code; 19 or 20 (2) The state of Idaho; or 21 (3) Any political subdivision of the state. 22 This exemption applies whether the tangible personal property is incorporated 23 in real property by the donee, a contractor or subcontractor of the donee, or 24 any other person. 25 SECTION 3. That Section 63-3622C, Idaho Code, be, and the same is hereby 26 amended to read as follows: 27 63-3622C. MOTOR FUELS SUBJECT TO TAX. Except as provided in sections 28 63-3619 and 63-3621, Idaho Code, tThere are exempted from the taxes imposed by 29 this chapter purchases which are subject to the motor fuels tax imposed by 30 chapter 24, title 63, Idaho Code, and purchases upon which motor fuels taxes 31 have actually been paid and the sale or use of any fuel which is subsequently 32 transported outside the state for use thereafter outside the state. Nothing in 33 this chapter shall be construed to authorize the imposition of a tax on fuel 34 brought into this state in the fuel tanks of motor vehicles or railroad loco- 35 motives in interstate commerce. 36 SECTION 4. That Section 63-3638, Idaho Code, be, and the same is hereby 37 amended to read as follows: 38 63-3638. SALES TAX -- DISTRIBUTION. All moneys collected under this chap- 39 ter, except as may otherwise be required in sections 63-3203 and 63-3709, 40 Idaho Code, shall be distributed by the tax commission as follows: 41 (1) An amount of money shall be distributed to the state refund account 42 sufficient to pay current refund claims. All refunds authorized under this 43 chapter by the commission shall be paid through the state refund account, and 44 those moneys are continuously appropriated. 45 (2) Five million dollars ($5,000,000) per year is continuously appropri- 46 ated and shall be distributed to the permanent building fund, provided by sec- 47 tion 57-1108, Idaho Code. 48 (3) Four million eight hundred thousand dollars ($4,800,000) per year is 49 continuously appropriated and shall be distributed to the water pollution con- 50 trol account established by section 39-3605, Idaho Code. 51 (4) An amount equal to the sum required to be certified by the chairman 5 1 of the Idaho housing and finance association to the state tax commission pur- 2 suant to section 67-6211, Idaho Code, in each year is continuously appropri- 3 ated and shall be paid to any capital reserve fund, established by the Idaho 4 housing and finance association pursuant to section 67-6211, Idaho Code. Such 5 amounts, if any, as may be appropriated hereunder to the capital reserve fund 6 of the Idaho housing and finance association shall be repaid for distribution 7 under the provisions of this section, subject to the provisions of section 8 67-6215, Idaho Code, by the Idaho housing and finance association, as soon as 9 possible, from any moneys available therefor and in excess of the amounts 10 which the association determines will keep it self-supporting. 11 (5) An amount equal to the sum required by the provisions of sections 12 63-709 and 63-717, Idaho Code, after allowance for the amount appropriated by 13 section 63-718(3), Idaho Code, is continuously appropriated and shall be 14 paid as provided by sections 63-709 and 63-717, Idaho Code. 15 (6) An amount required by the provisions of chapter 53, title 33, Idaho 16 Code. 17 (7) An amount required by the provisions of chapter 87, title 67, Idaho 18 Code. 19 (8) One dollar ($1.00) on each application for certificate of title or 20 initial application for registration of a motor vehicle, snowmobile, all- 21 terrain vehicle or other vehicle processed by the county assessor or the Idaho 22 transportation department excepting those applications in which any sales or 23 use taxes due have been previously collected by a retailer, shall be a fee for 24 the services of the assessor of the county or the Idaho transportation depart- 25 ment in collecting such taxes, and shall be paid into the current expense fund 26 of the county or state highway account established in section 40-702, Idaho 27 Code. 28 (9) Eleven and five-tenths percent (11.5%) is continuously appropriated 29 and shall be distributed to the revenue sharing account which is created in 30 the state treasury, and the moneys in the revenue sharing account will be paid 31 in installments each calendar quarter by the tax commission as follows: 32 (a) Twenty-eight and two-tenths percent (28.2%) shall be paid to the var- 33 ious cities as follows: 34 (i) Fifty percent (50%) of such amount shall be paid to the various 35 cities, and each city shall be entitled to an amount in the propor- 36 tion that the population of that city bears to the population of all 37 cities within the state; and 38 (ii) Fifty percent (50%) of such amount shall be paid to the various 39 cities, and each city shall be entitled to an amount in the propor- 40 tion that the preceding year's market value for assessment purposes 41 for that city bears to the preceding year's market value for assess- 42 ment purposes for all cities within the state. 43 (b) Twenty-eight and two-tenths percent (28.2%) shall be paid to the var- 44 ious counties as follows: 45 (i) One million three hundred twenty thousand dollars ($1,320,000) 46 annually shall be distributed one forty-fourth (1/44) to each of the 47 various counties; and 48 (ii) The balance of such amount shall be paid to the various coun- 49 ties, and each county shall be entitled to an amount in the propor- 50 tion that the population of that county bears to the population of 51 the state; 52 (c) Thirty-five and nine-tenths percent (35.9%) of the amount appropri- 53 ated in this subsection (9) shall be paid to the several counties for dis- 54 tribution to the cities and counties as follows: 55 (i) Each city and county which received a payment under the provi- 6 1 sions of section 63-3638(e), Idaho Code, during the fourth quarter of 2 calendar year 1999, shall be entitled to a like amount during suc- 3 ceeding calendar quarters. 4 (ii) If the dollar amount of money available under this subsection 5 (9)(c) in any quarter does not equal the amount paid in the fourth 6 quarter of calendar year 1999, each city's and county's payment shall 7 be reduced proportionately. 8 (iii) If the dollar amount of money available under this subsection 9 (9)(c) in any quarter exceeds the amount paid in the fourth quarter 10 of calendar year 1999, each city and county shall be entitled to a 11 proportionately increased payment, but such increase shall not exceed 12 one hundred five percent (105%) of the total payment made in the 13 fourth quarter of calendar year 1999. 14 (iv) If the dollar amount of money available under this subsection 15 (9)(c) in any quarter exceeds one hundred five percent (105%) of the 16 total payment made in the fourth quarter of calendar year 1999, any 17 amount over and above such one hundred five percent (105%) shall be 18 paid fifty percent (50%) to the various cities in the proportion that 19 the population of the city bears to the population of all cities 20 within the state, and fifty percent (50%) to the various counties in 21 the proportion that the population of a county bears to the popula- 22 tion of the state; and 23 (d) Seven and seven-tenths percent (7.7%) of the amount appropriated in 24 this subsection (9) shall be paid to the several counties for distribution 25 to special purpose taxing districts as follows: 26 (i) Each such district which received a payment under the provi- 27 sions of section 63-3638(e), Idaho Code, during the fourth quarter of 28 calendar year 1999, shall be entitled to a like amount during suc- 29 ceeding calendar quarters. 30 (ii) If the dollar amount of money available under this subsection 31 (9)(d) in any quarter does not equal the amount paid in the fourth 32 quarter of calendar year 1999, each special purpose taxing district's 33 payment shall be reduced proportionately. 34 (iii) If the dollar amount of money available under this subsection 35 (9)(d) in any quarter exceeds the amount distributed under paragraph 36 (i) of this subsection (9)(d), each special purpose taxing district 37 shall be entitled to a share of the excess based on the proportion 38 each such district's current property tax budget bears to the sum of 39 the current property tax budgets of all such districts in the state. 40 The state tax commission shall calculate district current property 41 tax budgets to include any unrecovered foregone amounts as determined 42 under section 63-802(1)(e), Idaho Code. When a special purpose taxing 43 district is situated in more than one (1) county, the tax commission 44 shall determine the portion attributable to the special purpose tax- 45 ing district from each county in which it is situated. 46 (iv) If special purpose taxing districts are consolidated, the 47 resulting district is entitled to a base amount equal to the sum of 48 the base amounts which were received in the last calendar quarter by 49 each district prior to the consolidation. 50 (v) If a special purpose taxing district is dissolved or 51 disincorporated, the state tax commission shall continuously distrib- 52 ute to the board of county commissioners an amount equal to the last 53 quarter's distribution prior to dissolution or disincorporation. The 54 board of county commissioners shall determine any redistribution of 55 moneys so received. 7 1 (vi) Taxing districts formed after January 1, 2001, are not entitled 2 to a payment under the provisions of this subsection (9)(d). 3 (vii) For purposes of this subsection (9)(d), a special purpose tax- 4 ing district is any taxing district which is not a city, a county or 5 a school district. 6 (10) Amounts calculated in accordance with section 2, chapter 356, laws of 7 2001, for annual distribution to counties and other taxing districts beginning 8 in October 2001 for replacement of property tax on farm machinery and equip- 9 ment exempted pursuant to section 63-602EE, Idaho Code. For nonschool dis- 10 tricts, the state tax commission shall distribute one-fourth (1/4) of this 11 amount certified quarterly to each county. For school districts, the state tax 12 commission shall distribute one-fourth (1/4) of the amount certified quarterly 13 to each school district. For nonschool districts, the county auditor shall 14 distribute to each district within thirty (30) calendar days from receipt of 15 moneys from the tax commission. Moneys received by each taxing district for 16 replacement shall be utilized in the same manner and in the same proportions 17 as revenues from property taxation. The moneys remitted to the county trea- 18 surer for replacement of property exempt from taxation pursuant to section 19 63-602EE, Idaho Code, may be considered by the counties and other taxing dis- 20 tricts and budgeted at the same time, in the same manner and in the same year 21 as revenues from taxation on personal property which these moneys replace. If 22 taxing districts are consolidated, the resulting district is entitled to an 23 amount equal to the sum of the amounts which were received in the last calen- 24 dar quarter by each district pursuant to this subsection prior to the consoli- 25 dation. If a taxing district is dissolved or disincorporated, the state tax 26 commission shall continuously distribute to the board of county commissioners 27 an amount equal to the last quarter's distribution prior to dissolution or 28 disincorporation. The board of county commissioners shall determine any redis- 29 tribution of moneys so received. If a taxing district annexes territory, the 30 distribution of moneys received pursuant to this subsection shall be unaf- 31 fected. Taxing districts formed after January 1, 2001, are not entitled to a 32 payment under the provisions of this subsection. School districts shall 33 receive an amount determined by multiplying the sum of the year 2000 school 34 district levy minus .004 times the market value on December 31, 2000, in the 35 district of the property exempt from taxation pursuant to section 63-602EE, 36 Idaho Code, provided that the result of these calculations shall not be less 37 than zero (0). The result of these school district calculations shall be fur- 38 ther increased by six percent (6%). For purposes of the limitation provided by 39 section 63-802, Idaho Code, moneys received pursuant to this section as prop- 40 erty tax replacement for property exempt from taxation pursuant to section 41 63-602EE, Idaho Code, shall be treated as property tax revenues. 42 (11) Amounts necessary to pay refunds as provided in subsection (3) of 43 section 63-3641, Idaho Code, to a developer of a retail commercial complex 44 whose stores sell tangible personal property or taxable services subject to 45 the sales and use tax up to an aggregate total of thirty-five million dollars 46 ($35,000,000) per project shall be remitted to the demonstration pilot project 47 fund created in subsection (3) of section 63-3641, Idaho Code, and shall be 48 specific to and accounted for by each project. 49 (12) An amount equal to the sales and use tax revenues collected from 50 imposition of a two percent (2%) tax on purchases of motor fuels that are sub- 51 ject to the motor fuels tax shall be deposited to the highway distribution 52 account established in section 40-701, Idaho Code. 53 (13) Any moneys remaining over and above those necessary to meet and 54 reserve for payments under other subsections of this section shall be distrib- 55 uted to the general fund.
STATEMENT OF PURPOSE
RS 18136
The purpose of this legislation is to provide a rate of the sales
tax of two percent (2%) of the retail price of motor fuels that
are subject to the motor fuels tax and to provide a rate of the
use tax at two percent (2%) on purchases of motor fuels that are
subject to the motor fuels tax. The legislation provides a
partial exception for motor fuels and provides for a distribution
to the highway distribution account of sales and use tax revenues
thus collected.
FISCAL NOTE
Based upon assumed per gallon costs of $3.00 for gasoline and
$3.50 for diesel, approximately $50,000,000 will be added to the
highway distribution account.
Contact
Name: Representative Shirley Ringo
Representative Bill Killen
Representative Phylis King
Representative Nicole LeFavour
Representative James Ruchti
Phone: (208) 332-1000
STATEMENT OF PURPOSE/FISCAL NOTE H 676