Text: SF00110 Text: SF00112 Text: SF00100 - SF00199 Text: SF Index Bills and Amendments: General Index Bill History: General Index
PAG LIN 1 1 Section 1. Section 422.45, subsection 27, Code 1997, is 1 2 amended by striking the subsection and inserting in lieu 1 3 thereof the following: 1 4 27. a. The gross receipts from the sale or rental of 1 5 computers, machinery, and equipment, including replacement 1 6 parts, and materials used to construct or self-construct 1 7 computers, machinery, and equipment if such items are any of 1 8 the following: 1 9 (1) Directly and primarily used in processing by a 1 10 manufacturer. 1 11 (2) Directly and primarily used to maintain the integrity 1 12 of the product or to maintain unique environmental conditions 1 13 required for either the product or the computers, machinery, 1 14 and equipment used in processing by a manufacturer, including 1 15 test equipment used to control quality and specifications of 1 16 the product. 1 17 (3) Directly and primarily used in research and 1 18 development of new products or processes of processing. 1 19 (4) Computers used in processing or storage of data or 1 20 information by an insurance company, financial institution, or 1 21 commercial enterprise. 1 22 (5) Directly and primarily used in recycling or 1 23 reprocessing of waste products. 1 24 (6) Pollution control equipment used by a manufacturer, 1 25 including but not limited to that required or certified by an 1 26 agency of this state or of the United States government. 1 27 b. The gross receipts from the sale of fuel used in 1 28 creating heat, power, steam, or for generating electrical 1 29 current, or from the sale of electricity, directly and 1 30 primarily used in processing by a manufacturer. 1 31 c. However, the gross receipts from the sale or rental of 1 32 the following shall not be exempt from the tax imposed by this 1 33 division: 1 34 (1) Hand tools. 1 35 (2) Point-of-sale equipment and computers. 2 1 (3) Industrial machinery, equipment and computers, 2 2 including pollution control equipment, within the scope of 2 3 section 427A.1, subsection 1, paragraphs "h" and "i". 2 4 d. As used in this subsection: 2 5 (1) "Commercial enterprise" includes businesses and 2 6 manufacturers conducted for profit and includes centers for 2 7 data processing services to insurance companies, financial 2 8 institutions, businesses, and manufacturers but excludes 2 9 professions and occupations and nonprofit organizations. 2 10 (2) "Financial institution" means as defined in section 2 11 527.2. 2 12 (3) "Insurance company" means an insurer organized or 2 13 operating under chapter 508, 514, 515, 518, 518A, 519, or 520, 2 14 or authorized to do business in Iowa as an insurer or a 2 15 licensed insurance agent under chapter 522. 2 16 (4) "Manufacturer" means as defined in section 428.20, but 2 17 also includes contract manufacturers. A contract manufacturer 2 18 is a manufacturer that otherwise falls within the definition 2 19 of manufacturer under section 428.20, except that a contract 2 20 manufacturer does not sell the tangible personal property the 2 21 contract manufacturer processes on behalf of other 2 22 manufacturers. 2 23 (5) "Processing" means a series of operations in which 2 24 materials are manufactured, refined, purified, created, 2 25 combined, or transformed by a manufacturer, ultimately into 2 26 tangible personal property. Processing encompasses all 2 27 activities commencing with the receipt or producing of raw 2 28 materials by the manufacturer and ending at the point products 2 29 are delivered for shipment or transferred from the 2 30 manufacturer. Processing includes but is not limited to 2 31 refinement or purification of materials; treatment of 2 32 materials to change their form, context, or condition; 2 33 maintenance of the quality or integrity of materials, 2 34 components, or products; maintenance of environmental 2 35 conditions necessary for materials, components, or products; 3 1 quality control activities; and construction of packaging and 3 2 shipping devices, placement into shipping containers or any 3 3 type of shipping devices or medium, and the movement of 3 4 materials, components, or products until shipment from the 3 5 processor. 3 6 EXPLANATION 3 7 This bill rewrites the Code provision exempting certain 3 8 computers, machinery, equipment, electricity, and other items 3 9 related to the manufacturing process from the state sales and 3 10 use tax by defining those manufacturing activities which give 3 11 rise to the exemption. 3 12 LSB 2026SS 77 3 13 sc/sc/14
Text: SF00110 Text: SF00112 Text: SF00100 - SF00199 Text: SF Index Bills and Amendments: General Index Bill History: General Index
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