HF 484 (LSB 2493YH (1) 86)

HOUSE FILE 484

BY  KELLEY

A BILL FOR

An Act relating to a sales tax holiday for instructional materials sold to college students.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:

    Section 1.  Section 423.3, Code 2015, is amended by adding the following new subsection:
   NEW SUBSECTION.  68A.  a.  The sales price of instructional materials sold to students for classroom use at a postsecondary educational institution, or for use in an extracurricular activity sponsored by the postsecondary educational institution, if all of the following apply:
   (1)  The sale is made to a person who is a student at a postsecondary educational institution in this state and who has verified that status to the retailer.
   (2)  The instructional materials have been uniquely identified and certified to a retailer by a postsecondary educational institution as required for classroom use or for use in a sponsored extracurricular activity.
   (3)  The sale takes place during one of the following:
   (a)  The period beginning at 12:01 a.m. on the third Monday in August and ending at midnight on the following Tuesday.
   (b)  The period beginning at 12:01 a.m. on the third Monday in January and ending at midnight on the following Tuesday.
   b.  For purposes of this subsection:
   (1)  “Extracurricular activity” includes a sporting event, musical or dramatic event, speech activity, or programs of a similar nature.
   (2)  “Instructional materials” means books, textbooks, printed materials, and equipment required for classroom use in attending a postsecondary educational institution in this state, or required for use in an extracurricular activity sponsored by a postsecondary educational institution in this state. “Instructional materials” does not include books, textbooks, printed materials, or equipment used in the teaching of religious tenets, doctrines, or worship, the purpose of which is to inculcate those tenets, doctrines, or worship.
   (3)  “Postsecondary educational institution” means an accredited higher education institution, as defined in section 261.92, an Iowa community college, or a postsecondary educational institution under the control of the state board of regents.
   c.  The department shall adopt rules pursuant to chapter 17A to administer this section, including but not limited to rules to establish the manner by which a person shall verify to a retailer the person’s status as a student, and the manner by which a postsecondary educational institution shall identify and certify required instructional materials to a retailer.
EXPLANATION
The inclusion of this explanation does not constitute agreement with

the explanation’s substance by the members of the general assembly.
   This bill provides a sales tax exemption for a limited time period for the sales price of instructional materials to students at postsecondary educational institutions in this state if the instructional materials are required for classroom use or for use in an extracurricular activity sponsored by the postsecondary educational institution. The exemption is available to sales in which the student verifies his or her status as a student to the retailer, the items being sold have been uniquely identified and certified to the retailer as required for classroom use or for use in a sponsored extracurricular activity, and the sale takes place during the calendar day on the third Monday in January or August.
   “Extracurricular activity”, “instructional materials”, and “postsecondary educational institution” are all defined in the bill.
   By operation of Code section 423.6, an item exempt from the imposition of the sales tax is also exempt from the use tax imposed in Code section 423.5.