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Text: HF00158                           Text: HF00160
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House File 159

Partial Bill History

Bill Text

PAG LIN
  1  1    Section 1.  Section 422.42, Code 1995, is amended by adding
  1  2 the following new subsections and renumbering current
  1  3 subsections as necessary:
  1  4    NEW SUBSECTION.  1.  "Agricultural production" includes the
  1  5 production of flowering, ornamental, or vegetable plants in
  1  6 commercial greenhouses or otherwise.  "Agricultural products"
  1  7 include flowering, ornamental, or vegetable plants.
  1  8    NEW SUBSECTION.  2A.  "Farm machinery and equipment" means
  1  9 machinery and equipment used in agricultural production.
  1 10    Sec. 2.  Section 422.42, subsection 11, Code 1995, is
  1 11 amended to read as follows:
  1 12    11.  "Retail sale" or "sale at retail" means the sale to a
  1 13 consumer or to any person for any purpose, other than for
  1 14 processing, for resale of tangible personal property or
  1 15 taxable services, or for resale of tangible personal property
  1 16 in connection with taxable services; and includes the sale of
  1 17 gas, electricity, water, and communication service to retail
  1 18 consumers or users; but does not include agricultural breeding
  1 19 livestock and domesticated fowl; and does not include
  1 20 commercial fertilizer, agricultural limestone, herbicide,
  1 21 pesticide, insecticide, food, medication, or agricultural
  1 22 drain tile, including installation of agricultural drain tile,
  1 23 any of which are to be used in disease control, weed control,
  1 24 insect control, or health promotion of plants or livestock
  1 25 produced as part of agricultural production for market; and
  1 26 does not include electricity, steam, or any taxable service
  1 27 when purchased and used in the processing of tangible personal
  1 28 property intended to be sold ultimately at retail.  When used
  1 29 by a manufacturer of food products, carbon dioxide in a
  1 30 liquid, solid, or gaseous form, electricity, steam, and other
  1 31 taxable services are sold for processing when used to produce
  1 32 marketable food products for human consumption, including but
  1 33 not limited to, treatment of material to change its form,
  1 34 context, or condition, in order to produce the food product,
  1 35 maintenance of quality or integrity of the food product,
  2  1 changing or maintenance of temperature levels necessary to
  2  2 avoid spoilage or to hold the food product in marketable
  2  3 condition, maintenance of environmental conditions necessary
  2  4 for the safe or efficient use of machinery and material used
  2  5 to produce the food product, sanitation and quality control
  2  6 activities, formation of packaging, placement into shipping
  2  7 containers, and movement of the material or food product until
  2  8 shipment from the building of manufacture.  Tangible personal
  2  9 property is sold for processing within the meaning of this
  2 10 subsection only when it is intended that the property will, by
  2 11 means of fabrication, compounding, manufacturing, or
  2 12 germination become an integral part of other tangible personal
  2 13 property intended to be sold ultimately at retail; or will be
  2 14 consumed as fuel in creating heat, power, or steam for
  2 15 processing including grain drying, or for providing heat or
  2 16 cooling for livestock buildings or for greenhouses or
  2 17 buildings or parts of buildings dedicated to the production of
  2 18 flowering, ornamental, or vegetable plants intended for sale
  2 19 in the ordinary course of business, or for generating electric
  2 20 current, or in implements of husbandry engaged in agricultural
  2 21 production; or the property is a chemical, solvent, sorbent,
  2 22 or reagent, which is directly used and is consumed,
  2 23 dissipated, or depleted, in processing personal property which
  2 24 is intended to be sold ultimately at retail or consumed in the
  2 25 maintenance or repair of fabric or clothing, and which may not
  2 26 become a component or integral part of the finished product.
  2 27 The distribution to the public of free newspapers or shoppers
  2 28 guides is a retail sale for purposes of the processing
  2 29 exemption.
  2 30    Sec. 3.  Section 422.45, subsection 39, paragraphs a and c,
  2 31 Code 1995, are amended to read as follows:
  2 32    a.  The implement, machinery, or equipment is directly and
  2 33 primarily used in livestock or dairy production or in the
  2 34 production of flowering, ornamental, or vegetable plants.
  2 35    c.  The replacement part is essential to any repair or
  3  1 reconstruction necessary to the farm machinery's or
  3  2 equipment's exempt use in livestock or dairy production or in
  3  3 the production of flowering, ornamental, or vegetable plants.
  3  4    Sec. 4.  Section 422.47, subsection 4, paragraph f, Code
  3  5 1995, is amended to read as follows:
  3  6    f.  In this section, "fuel" includes gas, electricity,
  3  7 water, heat, steam, and any other tangible personal property
  3  8 consumed in creating heat, power, or steam.  In this section,
  3  9 "fuel consumed in processing" means fuel used or disposed of
  3 10 for processing including grain drying, for providing heat or
  3 11 cooling for livestock buildings or for greenhouses or
  3 12 buildings or parts of buildings dedicated to the production of
  3 13 flowering, ornamental, or vegetable plants intended for sale
  3 14 in the ordinary course of business, or for generating electric
  3 15 current, or in implements of husbandry engaged in agricultural
  3 16 production.  In this subsection, "fuel exemption certificate"
  3 17 means an exemption certificate given by the purchaser under
  3 18 penalty of perjury to assist retailers in properly accounting
  3 19 for nontaxable sales of fuel consumed in processing.  In this
  3 20 subsection, "substantial change" means a change in the use or
  3 21 disposition of tangible personal property and services by the
  3 22 purchaser such that the purchaser pays less than ninety
  3 23 percent of the purchaser's actual sales tax liability.  A
  3 24 change includes a misstatement of facts in an application made
  3 25 pursuant to paragraph "c" or in a fuel exemption certificate.  
  3 26                           EXPLANATION
  3 27    This bill defines "agricultural production" and
  3 28 "agricultural products" to include the production of
  3 29 flowering, ornamental, or vegetable plants for the purpose of
  3 30 the state sales tax.  The bill defines "farm machinery and
  3 31 equipment" as machinery and equipment used in agricultural
  3 32 production.  The bill exempts from sales taxation fuel used to
  3 33 provide heat or cooling for greenhouses and buildings
  3 34 dedicated to the production of flowering, ornamental, or
  3 35 vegetable plants intended to be sold in the regular course of
  4  1 business and non-self-propelled machinery and equipment used
  4  2 in the production of flowering, ornamental, or vegetable
  4  3 plants.  Present law exempts only fuel used to heat or cool
  4  4 livestock buildings and non-self-propelled machinery and
  4  5 equipment used in livestock or dairy production.  
  4  6 LSB 1576HV 76
  4  7 sc/cf/24
     

Text: HF00158                           Text: HF00160
Text: HF00100 - HF00199                 Text: HF Index
Bills and Amendments: General Index     Bill History: General Index

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