House Amendment 1517
PAG LIN
1 1 Amend House File 683 as follows:
1 2 #1. Page 40, by inserting after line 35 the
1 3 following:
1 4 <DIVISION
1 5 STREAMLINED SALES AND USE TAXES
1 6 SUBCHAPTER I
1 7 DEFINITIONS
1 8 Sec. . NEW SECTION. 423.1 DEFINITIONS.
1 9 As used in this chapter the following words, terms,
1 10 and phrases have the meanings ascribed to them by this
1 11 section, except where the context clearly indicates
1 12 that a different meaning is intended:
1 13 1. "Agent" means a person appointed by a seller to
1 14 represent the seller before the member states.
1 15 2. "Agreement" means the streamlined sales and use
1 16 tax agreement authorized by subchapter IV of this
1 17 chapter to provide a mechanism for establishing and
1 18 maintaining a cooperative, simplified system for the
1 19 application and administration of sales and use taxes.
1 20 3. "Agricultural production" includes the
1 21 production of flowering, ornamental, or vegetable
1 22 plants in commercial greenhouses or otherwise, and
1 23 production from aquaculture. "Agricultural products"
1 24 includes flowering, ornamental, or vegetable plants
1 25 and those products of aquaculture.
1 26 4. "Business" includes any activity engaged in by
1 27 any person or caused to be engaged in by the person
1 28 with the object of gain, benefit, or advantage, either
1 29 direct or indirect.
1 30 5. "Certificate of title" means a certificate of
1 31 title issued for a vehicle or for manufactured housing
1 32 under chapter 321.
1 33 6. "Certified automated system" means software
1 34 certified under the agreement to calculate the tax
1 35 imposed by each jurisdiction on a transaction,
1 36 determine the amount of tax to remit to the
1 37 appropriate state, and maintain a record of the
1 38 transaction.
1 39 7. "Certified service provider" means an agent
1 40 certified under the agreement to perform all of a
1 41 seller's sales or use tax functions, other than the
1 42 seller's obligation to remit tax on its own purchases.
1 43 8. "Computer" means an electronic device that
1 44 accepts information in digital or similar form and
1 45 manipulates the information for a result based on a
1 46 sequence of instructions.
1 47 9. "Computer software" means a set of coded
1 48 instructions designed to cause a computer or automatic
1 49 data processing equipment to perform a task.
1 50 10. "Delivered electronically" means delivered to
2 1 the purchaser by means other than tangible storage
2 2 media.
2 3 11. "Delivery charges" means charges assessed by a
2 4 seller of personal property or services for
2 5 preparation and delivery to a location designated by
2 6 the purchaser of personal property or services
2 7 including, but not limited to, transportation,
2 8 shipping, postage, handling, crating, and packing
2 9 charges.
2 10 12. "Department" means the department of revenue
2 11 and finance.
2 12 13. "Direct mail" means printed material delivered
2 13 or distributed by United States mail or other delivery
2 14 service to a mass audience or to addressees on a
2 15 mailing list provided by the purchaser or at the
2 16 direction of the purchaser when the cost of the items
2 17 is not billed directly to the recipients. "Direct
2 18 mail" includes tangible personal property supplied
2 19 directly or indirectly by the purchaser to the direct
2 20 mail seller for inclusion in the package containing
2 21 the printed material. "Direct mail" does not include
2 22 multiple items of printed material delivered to a
2 23 single address.
2 24 14. "Director" means the director of revenue and
2 25 finance.
2 26 15. "Electronic" means relating to technology
2 27 having electrical, digital, magnetic, wireless,
2 28 optical, electromagnetic, or similar capabilities.
2 29 16. "Farm deer" means the same as defined in
2 30 section 189A.2.
2 31 17. "Farm machinery and equipment" means machinery
2 32 and equipment used in agricultural production.
2 33 18. "First use of a service". A "first use of a
2 34 service" occurs, for the purposes of this chapter,
2 35 when a service is rendered, furnished, or performed in
2 36 Iowa or if rendered, furnished, or performed outside
2 37 of Iowa, when the product or result of the service is
2 38 used in Iowa.
2 39 19. "Goods, wares, or merchandise" means the same
2 40 as tangible personal property.
2 41 20. "Governing board" means the group comprised of
2 42 representatives of the member states of the agreement
2 43 which is created by the agreement to be responsible
2 44 for the agreement's administration and operation.
2 45 21. "Installed purchase price" is the amount
2 46 charged, valued in money whether paid in money or
2 47 otherwise, by a building contractor to convert
2 48 manufactured housing from tangible personal property
2 49 into realty. "Installed purchase price" includes, but
2 50 is not limited to, amounts charged for installing a
3 1 foundation and electrical and plumbing hookups.
3 2 "Installed purchase price" excludes any amount charged
3 3 for landscaping in connection with the conversion.
3 4 22. "Lease or rental".
3 5 a. "Lease or rental" means any transfer of
3 6 possession or control of tangible personal property
3 7 for a fixed or indeterminate term for consideration.
3 8 A "lease or rental" may include future options to
3 9 purchase or extend.
3 10 b. "Lease or rental" includes agreements covering
3 11 motor vehicles and trailers when the amount of
3 12 consideration may be increased or decreased by
3 13 reference to the amount realized upon sale or
3 14 disposition of the property as defined in 26 U.S.C. }
3 15 7701(h)(1).
3 16 c. "Lease or rental" does not include any of the
3 17 following:
3 18 (1) A transfer of possession or control of
3 19 property under a security agreement or deferred
3 20 payment plan that requires the transfer of title upon
3 21 completion of the required payments.
3 22 (2) A transfer of possession or control of
3 23 property under an agreement that requires the transfer
3 24 of title upon completion of required payments, and
3 25 payment of any option price does not exceed the
3 26 greater of one hundred dollars or one percent of the
3 27 total required payments.
3 28 (3) Providing tangible personal property along
3 29 with an operator for a fixed or indeterminate period
3 30 of time. A condition of this exclusion is that the
3 31 operator is necessary for the equipment to perform as
3 32 designed. For the purpose of this subparagraph, an
3 33 operator must do more than maintain, inspect, or set
3 34 up the tangible personal property.
3 35 d. This definition shall be used for sales and use
3 36 tax purposes regardless of whether a transaction is
3 37 characterized as a lease or rental under generally
3 38 accepted accounting principles, the Internal Revenue
3 39 Code, the Uniform Commercial Code, or other provisions
3 40 of federal, state, or local law.
3 41 23. "Livestock" includes but is not limited to an
3 42 animal classified as an ostrich, rhea, emu, bison, or
3 43 farm deer.
3 44 24. "Manufactured housing" means "manufactured
3 45 home" as defined in section 321.1.
3 46 25. "Member state" is any state which has signed
3 47 the agreement.
3 48 26. "Mobile home" means "manufactured or mobile
3 49 home" as defined in section 321.1.
3 50 27. "Model 1 seller" is a seller that has selected
4 1 a certified service provider as its agent to perform
4 2 all the seller's sales and use tax functions, other
4 3 than the seller's obligation to remit tax on its own
4 4 purchases.
4 5 28. "Model 2 seller" is a seller that has selected
4 6 a certified automated system to perform part of its
4 7 sales and use tax functions, but retains
4 8 responsibility for remitting the tax.
4 9 29. "Model 3 seller" is a seller that has sales in
4 10 at least five member states, has total annual sales
4 11 revenue of at least five hundred million dollars, has
4 12 a proprietary system that calculates the amount of tax
4 13 due each jurisdiction, and has entered into a
4 14 performance agreement with the member states that
4 15 establishes a tax performance standard for the seller.
4 16 As used in this definition, a "seller" includes an
4 17 affiliated group of sellers using the same proprietary
4 18 system.
4 19 30. "Nonresidential commercial operations" means
4 20 industrial, commercial, mining, or agricultural
4 21 operations, whether for profit or not, but does not
4 22 include apartment complexes or mobile home parks.
4 23 31. "Not registered under the agreement" means
4 24 lack of registration by a seller with the member
4 25 states under the central registration system
4 26 referenced in section 423.11, subsection 4.
4 27 32. "Person" means an individual, trust, estate,
4 28 fiduciary, partnership, limited liability company,
4 29 limited liability partnership, corporation, or any
4 30 other legal entity.
4 31 33. "Place of business" means any warehouse,
4 32 store, place, office, building, or structure where
4 33 goods, wares, or merchandise are offered for sale at
4 34 retail or where any taxable amusement is conducted, or
4 35 each office where gas, water, heat, communication, or
4 36 electric services are offered for sale at retail.
4 37 When a retailer or amusement operator sells
4 38 merchandise by means of vending machines or operates
4 39 music or amusement devices by coin=operated machines
4 40 at more than one location within the state, the
4 41 office, building, or place where the books, papers,
4 42 and records of the taxpayer are kept shall be deemed
4 43 to be the taxpayer's place of business.
4 44 34. "Prewritten computer software" includes
4 45 software designed and developed by the author or other
4 46 creator to the specifications of a specific purchaser
4 47 when it is sold to a person other than the purchaser.
4 48 The combining of two or more prewritten computer
4 49 software programs or prewritten portions of prewritten
4 50 programs does not cause the combination to be other
5 1 than prewritten computer software. "Prewritten
5 2 computer software" also means computer software,
5 3 including prewritten upgrades, which is not designed
5 4 and developed by the author or other creator to the
5 5 specifications of a specific purchaser.
5 6 When a person modifies or enhances computer
5 7 software of which the person is not the author or
5 8 creator, the person shall be deemed to be the author
5 9 or creator only of such person's modifications or
5 10 enhancements. Prewritten computer software or a
5 11 prewritten portion of the prewritten software that is
5 12 modified or enhanced to any degree, when such
5 13 modification or enhancement is designed and developed
5 14 to the specifications of a specific purchaser, remains
5 15 prewritten computer software. However, when there is
5 16 a reasonable, separately stated charge or an invoice
5 17 or other statement of the price given to the purchaser
5 18 for such modification or enhancement, such
5 19 modification or enhancement shall not constitute
5 20 prewritten computer software.
5 21 35. "Property purchased for resale in connection
5 22 with the performance of a service" means property
5 23 which is purchased for resale in connection with the
5 24 rendition, furnishing, or performance of a service by
5 25 a person who renders, furnishes, or performs the
5 26 service if all of the following occur:
5 27 a. The provider and user of the service intend
5 28 that a sale of the property will occur.
5 29 b. The property is transferred to the user of the
5 30 service in connection with the performance of the
5 31 service in a form or quantity capable of a fixed or
5 32 definite price value.
5 33 c. The sale is evidenced by a separate charge for
5 34 the identifiable piece of property.
5 35 36. "Purchase" means any transfer, exchange, or
5 36 barter, conditional or otherwise, in any manner or by
5 37 any means whatsoever, for a consideration.
5 38 37. "Purchase price" means the same as "sales
5 39 price" as defined in this section.
5 40 38. "Purchaser" is a person to whom a sale of
5 41 personal property is made or to whom a service is
5 42 furnished.
5 43 39. "Receive" and "receipt" mean any of the
5 44 following:
5 45 a. Taking possession of tangible personal
5 46 property.
5 47 b. Making first use of a service.
5 48 c. Taking possession or making first use of
5 49 digital goods, whichever comes first.
5 50 "Receive" and "receipt" do not include possession
6 1 by a shipping company on behalf of a purchaser.
6 2 40. "Registered under the agreement" means
6 3 registration by a seller under the central
6 4 registration system referenced in section 423.11,
6 5 subsection 4.
6 6 41. "Relief agency" means the state, any county,
6 7 city and county, city, or district thereof, or any
6 8 agency engaged in actual relief work.
6 9 42. "Retailer" means and includes every person
6 10 engaged in the business of selling tangible personal
6 11 property or taxable services at retail, or the
6 12 furnishing of gas, electricity, water, or
6 13 communication service, and tickets or admissions to
6 14 places of amusement and athletic events or operating
6 15 amusement devices or other forms of commercial
6 16 amusement from which revenues are derived. However,
6 17 when in the opinion of the director it is necessary
6 18 for the efficient administration of this chapter to
6 19 regard any salespersons, representatives, truckers,
6 20 peddlers, or canvassers as agents of the dealers,
6 21 distributors, supervisors, employers, or persons under
6 22 whom they operate or from whom they obtain tangible
6 23 personal property sold by them irrespective of whether
6 24 or not they are making sales on their own behalf or on
6 25 behalf of such dealers, distributors, supervisors,
6 26 employers, or persons, the director may so regard
6 27 them, and may regard such dealers, distributors,
6 28 supervisors, employers, or persons as retailers for
6 29 the purposes of this chapter. "Retailer" includes a
6 30 seller obligated to collect sales or use tax.
6 31 43. "Retailer maintaining a place of business in
6 32 this state" or any like term includes any retailer
6 33 having or maintaining within this state, directly or
6 34 by a subsidiary, an office, distribution house, sales
6 35 house, warehouse, or other place of business, or any
6 36 representative operating within this state under the
6 37 authority of the retailer or its subsidiary,
6 38 irrespective of whether that place of business or
6 39 representative is located here permanently or
6 40 temporarily, or whether the retailer or subsidiary is
6 41 admitted to do business within this state pursuant to
6 42 chapter 490.
6 43 44. "Retailers who are not model sellers" means
6 44 all retailers other than model 1, model 2, or model 3
6 45 sellers.
6 46 45. "Retail sale" or "sale at retail" means any
6 47 sale, lease, or rental for any purpose other than
6 48 resale, sublease, or subrent.
6 49 46. "Sales" or "sale" means any transfer,
6 50 exchange, or barter, conditional or otherwise, in any
7 1 manner or by any means whatsoever, for consideration.
7 2 47. "Sales price" applies to the measure subject
7 3 to sales tax.
7 4 a. "Sales price" means the total amount of
7 5 consideration, including cash, credit, property, and
7 6 services, for which personal property or services are
7 7 sold, leased, or rented, valued in money, whether
7 8 received in money or otherwise, without any deduction
7 9 for any of the following:
7 10 (1) The seller's cost of the property sold.
7 11 (2) The cost of materials used, labor or service
7 12 cost, interest, losses, all costs of transportation to
7 13 the seller, all taxes imposed on the seller, and any
7 14 other expenses of the seller.
7 15 (3) Charges by the seller for any services
7 16 necessary to complete the sale, other than delivery
7 17 and installation charges.
7 18 (4) Delivery charges.
7 19 (5) Installation charges.
7 20 (6) The value of exempt personal property given to
7 21 the purchaser where taxable and exempt personal
7 22 property have been bundled together and sold by the
7 23 seller as a single product or piece of merchandise.
7 24 (7) Credit for any trade=in authorized by section
7 25 423.3, subsection 58.
7 26 b. "Sales price" does not include:
7 27 (1) Discounts, including cash, term, or coupons
7 28 that are not reimbursed by a third party that are
7 29 allowed by a seller and taken by a purchaser on a
7 30 sale.
7 31 (2) Interest, financing, and carrying charges from
7 32 credit extended on the sale of personal property or
7 33 services, if the amount is separately stated on the
7 34 invoice, bill of sale, or similar document given to
7 35 the purchaser.
7 36 (3) Any taxes legally imposed directly on the
7 37 consumer that are separately stated on the invoice,
7 38 bill of sale, or similar document given to the
7 39 purchaser.
7 40 (4) The amounts received for charges included in
7 41 paragraph "a", subparagraphs (3) through (7), if they
7 42 are separately contracted for and separately stated on
7 43 the invoice, billing, or similar document given to the
7 44 purchaser.
7 45 48. "Sales tax" means the tax levied under
7 46 subchapter II of this chapter.
7 47 49. "Seller" means any person making sales,
7 48 leases, or rentals of personal property or services.
7 49 50. "Services" means all acts or services
7 50 rendered, furnished, or performed, other than services
8 1 used in processing of tangible personal property for
8 2 use in retail sales or services, for an employer, as
8 3 defined in section 422.4, subsection 3, for a valuable
8 4 consideration by any person engaged in any business or
8 5 occupation specifically enumerated in section 423.2.
8 6 The tax shall be due and collectible when the service
8 7 is rendered, furnished, or performed for the ultimate
8 8 user of the service.
8 9 51. "Services used in the processing of tangible
8 10 personal property" includes the reconditioning or
8 11 repairing of tangible personal property of the type
8 12 normally sold in the regular course of the retailer's
8 13 business and which is held for sale.
8 14 52. "State" means any state of the United States
8 15 and the District of Columbia.
8 16 53. "System" means the central electronic
8 17 registration system maintained by Iowa and other
8 18 states which are signatories to the agreement.
8 19 54. "Tangible personal property" means personal
8 20 property that can be seen, weighed, measured, felt, or
8 21 touched, or that is in any other manner perceptible to
8 22 the senses. "Tangible personal property" includes
8 23 electricity, water, gas, steam, and prewritten
8 24 computer software.
8 25 55. "Taxpayer" includes any person who is subject
8 26 to a tax imposed by this chapter, whether acting on
8 27 the person's own behalf or as a fiduciary.
8 28 56. "Trailer" shall mean every trailer, as is now
8 29 or may be hereafter so defined by chapter 321, which
8 30 is required to be registered or is subject only to the
8 31 issuance of a certificate of title under chapter 321.
8 32 57. "Use" means and includes the exercise by any
8 33 person of any right or power over tangible personal
8 34 property incident to the ownership of that property.
8 35 A retailer's or building contractor's sale of
8 36 manufactured housing for use in this state, whether in
8 37 the form of tangible personal property or of realty,
8 38 is a use of that property for the purposes of this
8 39 chapter.
8 40 58. "Use tax" means the tax levied under
8 41 subchapter III of this chapter for which the retailer
8 42 collects and remits tax to the department.
8 43 59. "User" means the immediate recipient of the
8 44 services who is entitled to exercise a right of power
8 45 over the product of such services.
8 46 60. "Value of services" means the price to the
8 47 user exclusive of any direct tax imposed by the
8 48 federal government or by this chapter.
8 49 61. "Vehicles subject to registration" means any
8 50 vehicle subject to registration pursuant to section
9 1 321.18.
9 2 SUBCHAPTER II
9 3 SALES TAX
9 4 Sec. . NEW SECTION. 423.2 TAX IMPOSED.
9 5 1. There is imposed a tax of five percent upon the
9 6 sales price of all sales of tangible personal
9 7 property, consisting of goods, wares, or merchandise,
9 8 sold at retail in the state to consumers or users
9 9 except as otherwise provided in this subchapter.
9 10 a. For the purposes of this subchapter, sales of
9 11 the following services are treated as if they were
9 12 sales of tangible personal property:
9 13 (1) Sales of engraving, photography, retouching,
9 14 printing, and binding services.
9 15 (2) Sales of vulcanizing, recapping, and
9 16 retreading services.
9 17 (3) Sales of prepaid telephone calling cards and
9 18 prepaid authorization numbers.
9 19 (4) Sales of optional service or warranty
9 20 contracts, except residential service contracts
9 21 regulated under chapter 523C, which provide for the
9 22 furnishing of labor and materials and require the
9 23 furnishing of any taxable service enumerated under
9 24 this section. The sales price is subject to tax even
9 25 if some of the services furnished are not enumerated
9 26 under this section. Additional sales, services, or
9 27 use taxes shall not be levied on services, parts, or
9 28 labor provided under optional service or warranty
9 29 contracts which are subject to tax under this
9 30 subsection.
9 31 If the optional service or warranty contract is a
9 32 computer software maintenance or support service
9 33 contract and there is no separately stated fee for the
9 34 taxable personal property or for the nontaxable
9 35 service, the tax imposed by this subsection shall be
9 36 imposed on fifty percent of the sales price from the
9 37 sale of such contract. If the contract provides for
9 38 technical support services only, no tax shall be
9 39 imposed under this subsection. The provisions of this
9 40 subparagraph (4) also apply to the use tax.
9 41 (5) Renting of rooms, apartments, or sleeping
9 42 quarters in a hotel, motel, inn, public lodging house,
9 43 rooming house, mobile home which is tangible personal
9 44 property, or tourist court, or in any place where
9 45 sleeping accommodations are furnished to transient
9 46 guests for rent, whether with or without meals.
9 47 "Renting" and "rent" include any kind of direct or
9 48 indirect charge for such rooms, apartments, or
9 49 sleeping quarters, or their use. However, the tax
9 50 does not apply to the sales price from the renting of
10 1 a room, apartment, or sleeping quarters while rented
10 2 by the same person for a period of more than thirty=
10 3 one consecutive days.
10 4 b. Sales of building materials, supplies, and
10 5 equipment to owners, contractors, subcontractors, or
10 6 builders for the erection of buildings or the
10 7 alteration, repair, or improvement of real property
10 8 are retail sales of tangible personal property in
10 9 whatever quantity sold. Where the owner, contractor,
10 10 subcontractor, or builder is also a retailer holding a
10 11 retail sales tax permit and transacting retail sales
10 12 of building materials, supplies, and equipment, the
10 13 person shall purchase such items of tangible personal
10 14 property without liability for the tax if such
10 15 property will be subject to the tax at the time of
10 16 resale or at the time it is withdrawn from inventory
10 17 for construction purposes. The sales tax shall be due
10 18 in the reporting period when the materials, supplies,
10 19 and equipment are withdrawn from inventory for
10 20 construction purposes or when sold at retail. The tax
10 21 shall not be due when materials are withdrawn from
10 22 inventory for use in construction outside of Iowa and
10 23 the tax shall not apply to tangible personal property
10 24 purchased and consumed by the manufacturer as building
10 25 materials in the performance by the manufacturer or
10 26 its subcontractor of construction outside of Iowa.
10 27 The sale of carpeting is not a sale of building
10 28 materials. The sale of carpeting to owners,
10 29 contractors, subcontractors, or builders shall be
10 30 treated as the sale of ordinary tangible personal
10 31 property and subject to the tax imposed under this
10 32 subsection and the use tax.
10 33 c. The use within this state of tangible personal
10 34 property by the manufacturer thereof, as building
10 35 materials, supplies, or equipment, in the performance
10 36 of construction contracts in Iowa, shall, for the
10 37 purpose of this subchapter, be construed as a sale at
10 38 retail of tangible personal property by the
10 39 manufacturer who shall be deemed to be the consumer of
10 40 such tangible personal property. The tax shall be
10 41 computed upon the cost to the manufacturer of the
10 42 fabrication or production of the tangible personal
10 43 property.
10 44 2. A tax of five percent is imposed upon the sales
10 45 price of the sale or furnishing of gas, electricity,
10 46 water, heat, pay television service, and communication
10 47 service, including the sales price from such sales by
10 48 any municipal corporation or joint water utility
10 49 furnishing gas, electricity, water, heat, pay
10 50 television service, and communication service to the
11 1 public in its proprietary capacity, except as
11 2 otherwise provided in this subchapter, when sold at
11 3 retail in the state to consumers or users.
11 4 3. A tax of five percent is imposed upon the sales
11 5 price of all sales of tickets or admissions to places
11 6 of amusement, fairs, and athletic events except those
11 7 of elementary and secondary educational institutions.
11 8 A tax of five percent is imposed on the sales price of
11 9 an entry fee or like charge imposed solely for the
11 10 privilege of participating in an activity at a place
11 11 of amusement, fair, or athletic event unless the sales
11 12 price of tickets or admissions charges for observing
11 13 the same activity are taxable under this subchapter.
11 14 A tax of five percent is imposed upon that part of
11 15 private club membership fees or charges paid for the
11 16 privilege of participating in any athletic sports
11 17 provided club members.
11 18 4. A tax of five percent is imposed upon the sales
11 19 price derived from the operation of all forms of
11 20 amusement devices and games of skill, games of chance,
11 21 raffles, and bingo games as defined in chapter 99B,
11 22 operated or conducted within the state, the tax to be
11 23 collected from the operator in the same manner as for
11 24 the collection of taxes upon the sales price of
11 25 tickets or admission as provided in this section. The
11 26 tax shall also be imposed upon the sales price derived
11 27 from the sale of lottery tickets or shares pursuant to
11 28 chapter 99E. The tax on the lottery tickets or shares
11 29 shall be included in the sales price and distributed
11 30 to the general fund of the state as provided in
11 31 section 99E.10. Nothing in this subsection shall
11 32 legalize any games of skill or chance or slot=operated
11 33 devices which are now prohibited by law.
11 34 The tax imposed under this subsection covers the
11 35 total amount from the operation of games of skill,
11 36 games of chance, raffles, and bingo games as defined
11 37 in chapter 99B, and musical devices, weighing
11 38 machines, shooting galleries, billiard and pool
11 39 tables, bowling alleys, pinball machines, slot=
11 40 operated devices selling merchandise not subject to
11 41 the general sales taxes and on the total amount from
11 42 devices or systems where prizes are in any manner
11 43 awarded to patrons and upon the receipts from fees
11 44 charged for participation in any game or other form of
11 45 amusement, and generally upon the sales price from any
11 46 source of amusement operated for profit, not specified
11 47 in this section, and upon the sales price from which
11 48 tax is not collected for tickets or admission, but tax
11 49 shall not be imposed upon any activity exempt from
11 50 sales tax under section 423.3, subsection 78. Every
12 1 person receiving any sales price from the sources
12 2 described in this section is subject to all provisions
12 3 of this subchapter relating to retail sales tax and
12 4 other provisions of this chapter as applicable.
12 5 5. There is imposed a tax of five percent upon the
12 6 sales price from the furnishing of services as defined
12 7 in section 423.1.
12 8 6. The sales price of any of the following
12 9 enumerated services is subject to the tax imposed by
12 10 subsection 5: alteration and garment repair; armored
12 11 car; vehicle repair; battery, tire, and allied;
12 12 investment counseling; service charges of all
12 13 financial institutions; barber and beauty; boat
12 14 repair; vehicle wash and wax; campgrounds; carpentry;
12 15 roof, shingle, and glass repair; dance schools and
12 16 dance studios; dating services; dry cleaning,
12 17 pressing, dyeing, and laundering; electrical and
12 18 electronic repair and installation; excavating and
12 19 grading; farm implement repair of all kinds; flying
12 20 service; furniture, rug, carpet, and upholstery repair
12 21 and cleaning; fur storage and repair; golf and country
12 22 clubs and all commercial recreation; gun and camera
12 23 repair; house and building moving; household
12 24 appliance, television, and radio repair; janitorial
12 25 and building maintenance or cleaning; jewelry and
12 26 watch repair; lawn care, landscaping, and tree
12 27 trimming and removal; limousine service, including
12 28 driver; machine operator; machine repair of all kinds;
12 29 motor repair; motorcycle, scooter, and bicycle repair;
12 30 oilers and lubricators; office and business machine
12 31 repair; painting, papering, and interior decorating;
12 32 parking facilities; pay television; pet grooming; pipe
12 33 fitting and plumbing; wood preparation; executive
12 34 search agencies; private employment agencies,
12 35 excluding services for placing a person in employment
12 36 where the principal place of employment of that person
12 37 is to be located outside of the state; reflexology;
12 38 security and detective services; sewage services for
12 39 nonresidential commercial operations; sewing and
12 40 stitching; shoe repair and shoeshine; sign
12 41 construction and installation; storage of household
12 42 goods, mini=storage, and warehousing of raw
12 43 agricultural products; swimming pool cleaning and
12 44 maintenance; tanning beds or salons; taxidermy
12 45 services; telephone answering service; test
12 46 laboratories, including mobile testing laboratories
12 47 and field testing by testing laboratories, and
12 48 excluding tests on humans or animals; termite, bug,
12 49 roach, and pest eradicators; tin and sheet metal
12 50 repair; Turkish baths, massage, and reducing salons,
13 1 excluding services provided by massage therapists
13 2 licensed under chapter 152C; water conditioning and
13 3 softening; weighing; welding; well drilling; wrapping,
13 4 packing, and packaging of merchandise other than
13 5 processed meat, fish, fowl, and vegetables; wrecking
13 6 service; wrecker and towing.
13 7 For the purposes of this subsection, the sales
13 8 price of a lease or rental includes rents, royalties,
13 9 and copyright and license fees. For the purposes of
13 10 this subsection, "financial institutions" means all
13 11 national banks, federally chartered savings and loan
13 12 associations, federally chartered savings banks,
13 13 federally chartered credit unions, banks organized
13 14 under chapter 524, savings and loan associations and
13 15 savings banks organized under chapter 534, and credit
13 16 unions organized under chapter 533.
13 17 7. a. A tax of five percent is imposed upon the
13 18 sales price from the sales, furnishing, or service of
13 19 solid waste collection and disposal service.
13 20 For purposes of this subsection, "solid waste"
13 21 means garbage, refuse, sludge from a water supply
13 22 treatment plant or air contaminant treatment facility,
13 23 and other discarded waste materials and sludges, in
13 24 solid, semisolid, liquid, or contained gaseous form,
13 25 resulting from nonresidential commercial operations,
13 26 but does not include auto hulks; street sweepings;
13 27 ash; construction debris; mining waste; trees; tires;
13 28 lead acid batteries; used oil; hazardous waste; animal
13 29 waste used as fertilizer; earthen fill, boulders, or
13 30 rock; foundry sand used for daily cover at a sanitary
13 31 landfill; sewage sludge; solid or dissolved material
13 32 in domestic sewage or other common pollutants in water
13 33 resources, such as silt, dissolved or suspended solids
13 34 in industrial waste water effluents or discharges
13 35 which are point sources subject to permits under
13 36 section 402 of the federal Water Pollution Control
13 37 Act, or dissolved materials in irrigation return
13 38 flows; or source, special nuclear, or by=product
13 39 material defined by the federal Atomic Energy Act of
13 40 1954.
13 41 A recycling facility that separates or processes
13 42 recyclable materials and that reduces the volume of
13 43 the waste by at least eighty=five percent is exempt
13 44 from the tax imposed by this subsection if the waste
13 45 exempted is collected and disposed of separately from
13 46 other solid waste.
13 47 b. A person who transports solid waste generated
13 48 by that person or another person without compensation
13 49 shall pay the tax imposed by this subsection at the
13 50 collection or disposal facility based on the disposal
14 1 charge or tipping fee. However, the costs of a
14 2 service or portion of a service to collect and manage
14 3 recyclable materials separated from solid waste by the
14 4 waste generator are exempt from the tax imposed by
14 5 this subsection.
14 6 8. a. A tax of five percent is imposed upon the
14 7 sales price from sales of bundled services contracts.
14 8 For purposes of this subsection, a "bundled services
14 9 contract" means an agreement providing for a
14 10 retailer's performance of services, one or more of
14 11 which is a taxable service enumerated in this section
14 12 and one or more of which is not, in return for a
14 13 consumer's or user's single payment for the
14 14 performance of the services, with no separate
14 15 statement to the consumer or user of what portion of
14 16 that payment is attributable to any one service which
14 17 is a part of the contract.
14 18 b. For purposes of the administration of the tax
14 19 on bundled services contracts, the director may enter
14 20 into agreements of limited duration with individual
14 21 retailers, groups of retailers, or organizations
14 22 representing retailers of bundled services contracts.
14 23 Such an agreement shall impose the tax rate only upon
14 24 that portion of the sales price from a bundled
14 25 services contract which is attributable to taxable
14 26 services provided under the contract.
14 27 9. A tax of five percent is imposed upon the sales
14 28 price from any mobile telecommunications service which
14 29 this state is allowed to tax by the provisions of the
14 30 federal Mobile Telecommunications Sourcing Act, Pub.
14 31 L. No. 106=252, 4 U.S.C. } 116 et seq. For purposes
14 32 of this subsection, taxes on mobile telecommunications
14 33 service, as defined under the federal Mobile
14 34 Telecommunications Sourcing Act that are deemed to be
14 35 provided by the customer's home service provider,
14 36 shall be paid to the taxing jurisdiction whose
14 37 territorial limits encompass the customer's place of
14 38 primary use, regardless of where the mobile
14 39 telecommunications service originates, terminates, or
14 40 passes through and shall in all other respects be
14 41 taxed in conformity with the federal Mobile
14 42 Telecommunications Sourcing Act. All other provisions
14 43 of the federal Mobile Telecommunications Sourcing Act
14 44 are adopted by the state of Iowa and incorporated into
14 45 this subsection by reference. With respect to mobile
14 46 telecommunications service under the federal Mobile
14 47 Telecommunications Sourcing Act, the director shall,
14 48 if requested, enter into agreements consistent with
14 49 the provisions of the federal Act.
14 50 10. All revenues arising under the operation of
15 1 the provisions of this section shall be deposited into
15 2 the general fund of the state.
15 3 Sec. . NEW SECTION. 423.3 EXEMPTIONS.
15 4 There is exempted from the provisions of this
15 5 subchapter and from the computation of the amount of
15 6 tax imposed by it the following:
15 7 1. The sales price from sales of tangible personal
15 8 property and services furnished which this state is
15 9 prohibited from taxing under the Constitution or laws
15 10 of the United States or under the Constitution of this
15 11 state.
15 12 2. The sales price of sales for resale of tangible
15 13 personal property or taxable services, or for resale
15 14 of tangible personal property in connection with the
15 15 furnishing of taxable services.
15 16 3. The sales price of agricultural breeding
15 17 livestock and domesticated fowl.
15 18 4. The sales price of commercial fertilizer.
15 19 5. The sales price of agricultural limestone,
15 20 herbicide, pesticide, insecticide, including
15 21 adjuvants, surfactants, and other products directly
15 22 related to the application enhancement of those
15 23 products, food, medication, or agricultural drain
15 24 tile, including installation of agricultural drain
15 25 tile, any of which are to be used in disease control,
15 26 weed control, insect control, or health promotion of
15 27 plants or livestock produced as part of agricultural
15 28 production for market.
15 29 6. The sales price of tangible personal property
15 30 which will be consumed as fuel in creating heat,
15 31 power, or steam for grain drying, or for providing
15 32 heat or cooling for livestock buildings or for
15 33 greenhouses or buildings or parts of buildings
15 34 dedicated to the production of flowering, ornamental,
15 35 or vegetable plants intended for sale in the ordinary
15 36 course of business, or for use in cultivation of
15 37 agricultural products by aquaculture, or in implements
15 38 of husbandry engaged in agricultural production.
15 39 7. The sales price of services furnished by
15 40 specialized flying implements of husbandry used for
15 41 agricultural aerial spraying.
15 42 8. The sales price exclusive of services of farm
15 43 machinery and equipment, including auxiliary
15 44 attachments which improve the performance, safety,
15 45 operation, or efficiency of the machinery and
15 46 equipment and replacement parts, if the following
15 47 conditions are met:
15 48 a. The farm machinery and equipment shall be
15 49 directly and primarily used in production of
15 50 agricultural products.
16 1 b. The farm machinery and equipment shall
16 2 constitute self=propelled implements or implements
16 3 customarily drawn or attached to self=propelled
16 4 implements or the farm machinery or equipment is a
16 5 grain dryer.
16 6 c. The replacement part is essential to any repair
16 7 or reconstruction necessary to the farm machinery's or
16 8 equipment's exempt use in the production of
16 9 agricultural products.
16 10 Vehicles subject to registration, as defined in
16 11 section 423.1, or replacement parts for such vehicles,
16 12 are not eligible for this exemption.
16 13 9. The sales price of wood chips, sawdust, hay,
16 14 straw, paper, or other materials used for bedding in
16 15 the production of agricultural livestock or fowl.
16 16 10. The sales price of gas, electricity, water, or
16 17 heat to be used in implements of husbandry engaged in
16 18 agricultural production.
16 19 11. The sales price exclusive of services of farm
16 20 machinery and equipment, including auxiliary
16 21 attachments which improve the performance, safety,
16 22 operation, or efficiency of the machinery and
16 23 equipment and replacement parts, if all of the
16 24 following conditions are met:
16 25 a. The implement, machinery, or equipment is
16 26 directly and primarily used in livestock or dairy
16 27 production, aquaculture production, or the production
16 28 of flowering, ornamental, or vegetable plants.
16 29 b. The implement is not a self=propelled implement
16 30 or implement customarily drawn or attached to self=
16 31 propelled implements.
16 32 c. The replacement part is essential to any repair
16 33 or reconstruction necessary to the farm machinery's or
16 34 equipment's exempt use in livestock or dairy
16 35 production, aquaculture production, or the production
16 36 of flowering, ornamental, or vegetable plants.
16 37 12. The sales price, exclusive of services, from
16 38 sales of irrigation equipment used in farming
16 39 operations.
16 40 13. The sales price from the sale or rental of
16 41 irrigation equipment, whether installed above or below
16 42 ground, to a contractor or farmer if the equipment
16 43 will be primarily used in agricultural operations.
16 44 14. The sales price from the sales of horses,
16 45 commonly known as draft horses, when purchased for use
16 46 and so used as draft horses.
16 47 15. The sales price from the sale of property
16 48 which is a container, label, carton, pallet, packing
16 49 case, wrapping, baling wire, twine, bag, bottle,
16 50 shipping case, or other similar article or receptacle
17 1 sold for use in agricultural, livestock, or dairy
17 2 production.
17 3 16. The sales price from the sale of feed and feed
17 4 supplements and additives when used for consumption by
17 5 farm deer or bison.
17 6 17. The sales price of all goods, wares, or
17 7 merchandise, or services, used for educational
17 8 purposes sold to any private nonprofit educational
17 9 institution in this state. For the purpose of this
17 10 subsection, "educational institution" means an
17 11 institution which primarily functions as a school,
17 12 college, or university with students, faculty, and an
17 13 established curriculum. The faculty of an educational
17 14 institution must be associated with the institution
17 15 and the curriculum must include basic courses which
17 16 are offered every year. "Educational institution"
17 17 includes an institution primarily functioning as a
17 18 library.
17 19 18. The sales price of tangible personal property
17 20 sold, or of services furnished, to the following
17 21 nonprofit corporations:
17 22 a. Residential care facilities and intermediate
17 23 care facilities for persons with mental retardation
17 24 and residential care facilities for persons with
17 25 mental illness licensed by the department of
17 26 inspections and appeals under chapter 135C.
17 27 b. Residential facilities licensed by the
17 28 department of human services pursuant to chapter 237,
17 29 other than those maintained by individuals as defined
17 30 in section 237.1, subsection 7.
17 31 c. Rehabilitation facilities that provide
17 32 accredited rehabilitation services to persons with
17 33 disabilities which are accredited by the commission on
17 34 accreditation of rehabilitation facilities or the
17 35 accreditation council for services for persons with
17 36 mental retardation and other persons with
17 37 developmental disabilities and adult day care services
17 38 approved for reimbursement by the state department of
17 39 human services.
17 40 d. Community mental health centers accredited by
17 41 the department of human services pursuant to chapter
17 42 225C.
17 43 e. Community health centers as defined in 42
17 44 U.S.C. } 254(c) and migrant health centers as defined
17 45 in 42 U.S.C. } 254(b).
17 46 19. The sales price of tangible personal property
17 47 sold to a nonprofit organization which was organized
17 48 for the purpose of lending the tangible personal
17 49 property to the general public for use by them for
17 50 nonprofit purposes.
18 1 20. The sales price of tangible personal property
18 2 sold, or of services furnished, to nonprofit legal aid
18 3 organizations.
18 4 21. The sales price of goods, wares, or
18 5 merchandise, or of services, used for educational,
18 6 scientific, historic preservation, or aesthetic
18 7 purpose sold to a nonprofit private museum.
18 8 22. The sales price from sales of goods, wares, or
18 9 merchandise, or from services furnished, to a
18 10 nonprofit private art center to be used in the
18 11 operation of the art center.
18 12 23. The sales price of tangible personal property
18 13 sold, or of services furnished, by a fair society
18 14 organized under chapter 174.
18 15 24. The sales price from services furnished by the
18 16 notification center established pursuant to section
18 17 480.3, and the vendor selected pursuant to section
18 18 480.3 to provide the notification service.
18 19 25. The sales price of food and beverages sold for
18 20 human consumption by a nonprofit organization which
18 21 principally promotes a food or beverage product for
18 22 human consumption produced, grown, or raised in this
18 23 state and whose income is exempt from federal taxation
18 24 under section 501(c) of the Internal Revenue Code.
18 25 26. The sales price of tangible personal property
18 26 sold, or of services furnished, to a statewide
18 27 nonprofit organ procurement organization, as defined
18 28 in section 142C.2.
18 29 27. The sales price of tangible personal property
18 30 sold, or of services furnished, to a nonprofit
18 31 hospital licensed pursuant to chapter 135B to be used
18 32 in the operation of the hospital.
18 33 28. The sales price of tangible personal property
18 34 sold, or of services furnished, to a freestanding
18 35 nonprofit hospice facility which operates a hospice
18 36 program as defined in 42 C.F.R., ch. IV, } 418.3,
18 37 which property or services are to be used in the
18 38 hospice program.
18 39 29. The sales price of all goods, wares, or
18 40 merchandise sold, or of services furnished, which are
18 41 used in the fulfillment of a written construction
18 42 contract with a nonprofit hospital licensed pursuant
18 43 to chapter 135B if all of the following apply:
18 44 a. The sales and delivery of the goods, wares, or
18 45 merchandise, or the services furnished occurred
18 46 between July 1, 1998, and December 31, 2001.
18 47 b. The written construction contract was entered
18 48 into prior to December 31, 1999, or bonds to fund the
18 49 construction were issued prior to December 31, 1999.
18 50 c. The sales or services were purchased by a
19 1 contractor as the agent for the hospital or were
19 2 purchased directly by the hospital.
19 3 30. The sales price of livestock ear tags sold by
19 4 a nonprofit organization whose income is exempt from
19 5 federal taxation under section 501(c)(6) of the
19 6 Internal Revenue Code where the proceeds are used in
19 7 bovine research programs selected or approved by such
19 8 organization.
19 9 31. The sales price of goods, wares, or
19 10 merchandise sold to and of services furnished, and
19 11 used for public purposes sold to a tax=certifying or
19 12 tax=levying body of the state or a governmental
19 13 subdivision of the state, including regional transit
19 14 systems, as defined in section 324A.1, the state board
19 15 of regents, department of human services, state
19 16 department of transportation, any municipally owned
19 17 solid waste facility which sells all or part of its
19 18 processed waste as fuel to a municipally owned public
19 19 utility, and all divisions, boards, commissions,
19 20 agencies, or instrumentalities of state, federal,
19 21 county, or municipal government which have no earnings
19 22 going to the benefit of an equity investor or
19 23 stockholder, except any of the following:
19 24 a. The sales price of goods, wares, or merchandise
19 25 sold to, or of services furnished, and used by or in
19 26 connection with the operation of any municipally owned
19 27 public utility engaged in selling gas, electricity,
19 28 heat, or pay television service to the general public.
19 29 b. The sales price of furnishing of sewage
19 30 services to a county or municipality on behalf of
19 31 nonresidential commercial operations.
19 32 c. The furnishing of solid waste collection and
19 33 disposal service to a county or municipality on behalf
19 34 of nonresidential commercial operations located within
19 35 the county or municipality.
19 36 The exemption provided by this subsection shall
19 37 also apply to all such sales of goods, wares, or
19 38 merchandise or of services furnished and subject to
19 39 use tax.
19 40 32. The sales price of tangible personal property
19 41 sold, or of services furnished, by a county or city.
19 42 This exemption does not apply to any of the following:
19 43 a. The tax specifically imposed under section
19 44 423.2 on the sales price from sales or furnishing of
19 45 gas, electricity, water, heat, pay television service,
19 46 or communication service to the public by a municipal
19 47 corporation in its proprietary capacity.
19 48 b. The sale or furnishing of solid waste
19 49 collection and disposal service to nonresidential
19 50 commercial operations.
20 1 c. The sale or furnishing of sewage service for
20 2 nonresidential commercial operations.
20 3 d. Fees paid to cities and counties for the
20 4 privilege of participating in any athletic sports.
20 5 33. The sales price of mementos and other items
20 6 relating to Iowa history and historic sites, the
20 7 general assembly, and the state capitol, sold by the
20 8 legislative service bureau and its legislative
20 9 information office on the premises of property under
20 10 the control of the legislative council, at the state
20 11 capitol, and on other state property.
20 12 34. The sales price from sales of mementos and
20 13 other items relating to Iowa history and historic
20 14 sites by the department of cultural affairs on the
20 15 premises of property under its control and at the
20 16 state capitol.
20 17 35. The sales price from sales or services
20 18 furnished by the state fair organized under chapter
20 19 173.
20 20 36. The sales price from sales of tangible
20 21 personal property or of the sale or furnishing of
20 22 electrical energy, natural or artificial gas, or
20 23 communication service to another state or political
20 24 subdivision of another state if the other state
20 25 provides a similar reciprocal exemption for this state
20 26 and political subdivision of this state.
20 27 37. The sales price of services on or connected
20 28 with new construction, reconstruction, alteration,
20 29 expansion, remodeling, or the services of a general
20 30 building contractor, architect, or engineer.
20 31 38. The sales price from the sale of building
20 32 materials, supplies, or equipment sold to rural water
20 33 districts organized under chapter 504A as provided in
20 34 chapter 357A and used for the construction of
20 35 facilities of a rural water district.
20 36 39. The sales price from "casual sales".
20 37 "Casual sales" means:
20 38 a. Sales of tangible personal property, or the
20 39 furnishing of services, of a nonrecurring nature, by
20 40 the owner, if the seller, at the time of the sale, is
20 41 not engaged for profit in the business of selling
20 42 tangible personal property or services taxed under
20 43 section 423.2.
20 44 b. The sale of all or substantially all of the
20 45 tangible personal property or services held or used by
20 46 a seller in the course of the seller's trade or
20 47 business for which the seller is required to hold a
20 48 sales tax permit when the seller sells or otherwise
20 49 transfers the trade or business to another person who
20 50 shall engage in a similar trade or business.
21 1 40. The sales price from the sale of automotive
21 2 fluids to a retailer to be used either in providing a
21 3 service which includes the installation or application
21 4 of the fluids in or on a motor vehicle, which service
21 5 is subject to section 423.2, subsection 6, or to be
21 6 installed in or applied to a motor vehicle which the
21 7 retailer intends to sell, which sale is subject to
21 8 section 423.26. For purposes of this subsection,
21 9 automotive fluids are all those which are refined,
21 10 manufactured, or otherwise processed and packaged for
21 11 sale prior to their installation in or application to
21 12 a motor vehicle. They include but are not limited to
21 13 motor oil and other lubricants, hydraulic fluids,
21 14 brake fluid, transmission fluid, sealants,
21 15 undercoatings, antifreeze, and gasoline additives.
21 16 41. The sales price from the rental of motion
21 17 picture films, video and audio tapes, video and audio
21 18 discs, records, photos, copy, scripts, or other media
21 19 used for the purpose of transmitting that which can be
21 20 seen, heard, or read, if either of the following
21 21 conditions are met:
21 22 a. The lessee imposes a charge for the viewing of
21 23 such media and the charge for the viewing is subject
21 24 to taxation under this subchapter or is subject to use
21 25 tax.
21 26 b. The lessee broadcasts the contents of such
21 27 media for public viewing or listening.
21 28 42. The sales price from the sale of tangible
21 29 personal property consisting of advertising material
21 30 including paper to a person in Iowa if that person or
21 31 that person's agent will, subsequent to the sale, send
21 32 that advertising material outside this state and the
21 33 material is subsequently used solely outside of Iowa.
21 34 For the purpose of this subsection, "advertising
21 35 material" means any brochure, catalog, leaflet, flyer,
21 36 order form, return envelope, or similar item used to
21 37 promote sales of property or services.
21 38 43. The sales price from the sale of property or
21 39 of services performed on property which the retailer
21 40 transfers to a carrier for shipment to a point outside
21 41 of Iowa, places in the United States mail or parcel
21 42 post directed to a point outside of Iowa, or
21 43 transports to a point outside of Iowa by means of the
21 44 retailer's own vehicles, and which is not thereafter
21 45 returned to a point within Iowa, except solely in the
21 46 course of interstate commerce or transportation. This
21 47 exemption shall not apply if the purchaser, consumer,
21 48 or their agent, other than a carrier, takes physical
21 49 possession of the property in Iowa.
21 50 44. The sales price from the sale of property
22 1 which is a container, label, carton, pallet, packing
22 2 case, wrapping paper, twine, bag, bottle, shipping
22 3 case, or other similar article or receptacle sold to
22 4 retailers or manufacturers for the purpose of
22 5 packaging or facilitating the transportation of
22 6 tangible personal property sold at retail or
22 7 transferred in association with the maintenance or
22 8 repair of fabric or clothing.
22 9 45. The sales price from sales or rentals to a
22 10 printer or publisher of the following: acetate; anti=
22 11 halation backing; antistatic spray; back lining; base
22 12 material used as a carrier for light sensitive
22 13 emulsions; blankets; blow=ups; bronze powder; carbon
22 14 tissue; codas; color filters; color separations;
22 15 contacts; continuous tone separations; creative art;
22 16 custom dies and die cutting materials; dampener
22 17 sleeves; dampening solution; design and styling; diazo
22 18 coating; dot etching; dot etching solutions; drawings;
22 19 drawsheets; driers; duplicate films or prints;
22 20 electronically digitized images; electrotypes; end
22 21 product of image modulation; engravings; etch
22 22 solutions; film; finished art or final art; fix;
22 23 fixative spray; flats; flying pasters; foils;
22 24 goldenrod paper; gum; halftones; illustrations; ink;
22 25 ink paste; keylines; lacquer; lasering images;
22 26 layouts; lettering; line negatives and positives;
22 27 linotypes; lithographic offset plates; magnesium and
22 28 zinc etchings; masking paper; masks; masters; mats;
22 29 mat service; metal toner; models and modeling; mylar;
22 30 negatives; nonoffset spray; opaque film process paper;
22 31 opaquing; padding compound; paper stock; photographic
22 32 materials: acids, plastic film, desensitizer
22 33 emulsion, exposure chemicals, fix, developers, and
22 34 paper; photography, day rate; photopolymer coating;
22 35 photographs; photostats; photo=display tape;
22 36 phototypesetter materials; ph=indicator sticks;
22 37 positives; press pack; printing cylinders; printing
22 38 plates, all types; process lettering; proof paper;
22 39 proofs and proof processes, all types; pumice powder;
22 40 purchased author alterations; purchased composition;
22 41 purchased phototypesetting; purchased stripping and
22 42 pasteups; red litho tape; reducers; roller covering;
22 43 screen tints; sketches; stepped plates; stereotypes;
22 44 strip types; substrate; tints; tissue overlays;
22 45 toners; transparencies; tympan; typesetting;
22 46 typography; varnishes; veloxes; wood mounts; and any
22 47 other items used in a like capacity to any of the
22 48 above enumerated items by the printer or publisher to
22 49 complete a finished product for sale at retail.
22 50 Expendable tools and supplies which are not enumerated
23 1 in this subsection are excluded from the exemption.
23 2 "Printer" means that portion of a person's business
23 3 engaged in printing that completes a finished product
23 4 for ultimate sale at retail or means that portion of a
23 5 person's business used to complete a finished printed
23 6 packaging material used to package a product for
23 7 ultimate sale at retail. "Printer" does not mean an
23 8 in=house printer who prints or copyrights its own
23 9 materials.
23 10 46. a. The sales price from the sale or rental of
23 11 computers, machinery, and equipment, including
23 12 replacement parts, and materials used to construct or
23 13 self=construct computers, machinery, and equipment if
23 14 such items are any of the following:
23 15 (1) Directly and primarily used in processing by a
23 16 manufacturer.
23 17 (2) Directly and primarily used to maintain the
23 18 integrity of the product or to maintain unique
23 19 environmental conditions required for either the
23 20 product or the computers, machinery, and equipment
23 21 used in processing by a manufacturer, including test
23 22 equipment used to control quality and specifications
23 23 of the product.
23 24 (3) Directly and primarily used in research and
23 25 development of new products or processes of
23 26 processing.
23 27 (4) Computers used in processing or storage of
23 28 data or information by an insurance company, financial
23 29 institution, or commercial enterprise.
23 30 (5) Directly and primarily used in recycling or
23 31 reprocessing of waste products.
23 32 (6) Pollution=control equipment used by a
23 33 manufacturer, including but not limited to that
23 34 required or certified by an agency of this state or of
23 35 the United States government.
23 36 b. The sales price from the sale of fuel used in
23 37 creating heat, power, steam, or for generating
23 38 electrical current, or from the sale of electricity,
23 39 consumed by computers, machinery, or equipment used in
23 40 an exempt manner described in paragraph "a",
23 41 subparagraph (1), (2), (3), (5), or (6).
23 42 c. The sales price from the sale or rental of the
23 43 following shall not be exempt from the tax imposed by
23 44 this subchapter:
23 45 (1) Hand tools.
23 46 (2) Point=of=sale equipment and computers.
23 47 (3) Industrial machinery, equipment, and
23 48 computers, including pollution=control equipment
23 49 within the scope of section 427A.1, subsection 1,
23 50 paragraphs "h" and "i".
24 1 (4) Vehicles subject to registration, except
24 2 vehicles subject to registration which are directly
24 3 and primarily used in recycling or reprocessing of
24 4 waste products.
24 5 d. As used in this subsection:
24 6 (1) "Commercial enterprise" includes businesses
24 7 and manufacturers conducted for profit and centers for
24 8 data processing services to insurance companies,
24 9 financial institutions, businesses, and manufacturers,
24 10 but excludes professions and occupations and nonprofit
24 11 organizations.
24 12 (2) "Financial institution" means as defined in
24 13 section 527.2.
24 14 (3) "Insurance company" means an insurer organized
24 15 or operating under chapter 508, 514, 515, 518, 518A,
24 16 519, or 520, or authorized to do business in Iowa as
24 17 an insurer or an insurance producer under chapter
24 18 522B.
24 19 (4) "Manufacturer" means as defined in section
24 20 428.20, but also includes contract manufacturers. A
24 21 contract manufacturer is a manufacturer that otherwise
24 22 falls within the definition of manufacturer under
24 23 section 428.20, except that a contract manufacturer
24 24 does not sell the tangible personal property the
24 25 contract manufacturer processes on behalf of other
24 26 manufacturers. A business engaged in activities
24 27 subsequent to the extractive process of quarrying or
24 28 mining, such as crushing, washing, sizing, or blending
24 29 of aggregate materials, is a manufacturer with respect
24 30 to these activities.
24 31 (5) "Processing" means a series of operations in
24 32 which materials are manufactured, refined, purified,
24 33 created, combined, or transformed by a manufacturer,
24 34 ultimately into tangible personal property.
24 35 Processing encompasses all activities commencing with
24 36 the receipt or producing of raw materials by the
24 37 manufacturer and ending at the point products are
24 38 delivered for shipment or transferred from the
24 39 manufacturer. Processing includes but is not limited
24 40 to refinement or purification of materials; treatment
24 41 of materials to change their form, context, or
24 42 condition; maintenance of the quality or integrity of
24 43 materials, components, or products; maintenance of
24 44 environmental conditions necessary for materials,
24 45 components, or products; quality control activities;
24 46 and construction of packaging and shipping devices,
24 47 placement into shipping containers or any type of
24 48 shipping devices or medium, and the movement of
24 49 materials, components, or products until shipment from
24 50 the processor.
25 1 (6) "Receipt or producing of raw materials" means
25 2 activities performed upon tangible personal property
25 3 only. With respect to raw materials produced from or
25 4 upon real estate, the receipt or producing of raw
25 5 materials is deemed to occur immediately following the
25 6 severance of the raw materials from the real estate.
25 7 47. The sales price from the furnishing of the
25 8 design and installation of new industrial machinery or
25 9 equipment, including electrical and electronic
25 10 installation.
25 11 48. The sales price from the sale of carbon
25 12 dioxide in a liquid, solid, or gaseous form,
25 13 electricity, steam, and other taxable services when
25 14 used by a manufacturer of food products to produce
25 15 marketable food products for human consumption,
25 16 including but not limited to treatment of material to
25 17 change its form, context, or condition, in order to
25 18 produce the food product, maintenance of quality or
25 19 integrity of the food product, changing or maintenance
25 20 of temperature levels necessary to avoid spoilage or
25 21 to hold the food product in marketable condition,
25 22 maintenance of environmental conditions necessary for
25 23 the safe or efficient use of machinery and material
25 24 used to produce the food product, sanitation and
25 25 quality control activities, formation of packaging,
25 26 placement into shipping containers, and movement of
25 27 the material or food product until shipment from the
25 28 building of manufacture.
25 29 49. The sales price of sales of electricity,
25 30 steam, or any taxable service when purchased and used
25 31 in the processing of tangible personal property
25 32 intended to be sold ultimately at retail.
25 33 50. The sales price of tangible personal property
25 34 sold for processing. Tangible personal property is
25 35 sold for processing within the meaning of this
25 36 subsection only when it is intended that the property
25 37 will, by means of fabrication, compounding,
25 38 manufacturing, or germination, become an integral part
25 39 of other tangible personal property intended to be
25 40 sold ultimately at retail; or for generating electric
25 41 current; or the property is a chemical, solvent,
25 42 sorbent, or reagent, which is directly used and is
25 43 consumed, dissipated, or depleted, in processing
25 44 tangible personal property which is intended to be
25 45 sold ultimately at retail or consumed in the
25 46 maintenance or repair of fabric or clothing, and which
25 47 may not become a component or integral part of the
25 48 finished product. The distribution to the public of
25 49 free newspapers or shoppers guides is a retail sale
25 50 for purposes of the processing exemption set out in
26 1 this subsection and in subsection 49.
26 2 51. The sales price from the sale of argon and
26 3 other similar gases to be used in the manufacturing
26 4 process.
26 5 52. The sales price from the sale of electricity
26 6 to water companies assessed for property tax pursuant
26 7 to sections 428.24, 428.26, and 428.28 which is used
26 8 solely for the purpose of pumping water from a river
26 9 or well.
26 10 53. The sales price from the sale of wind energy
26 11 conversion property to be used as an electric power
26 12 source and the sale of the materials used to
26 13 manufacture, install, or construct wind energy
26 14 conversion property used or to be used as an electric
26 15 power source.
26 16 For purposes of this subsection, "wind energy
26 17 conversion property" means any device, including, but
26 18 not limited to, a wind charger, windmill, wind
26 19 turbine, tower and electrical equipment, pad mount
26 20 transformers, power lines, and substation, which
26 21 converts wind energy to a form of usable energy.
26 22 54. The sales price from the sales of newspapers,
26 23 free newspapers, or shoppers guides and the printing
26 24 and publishing of such newspapers and shoppers guides,
26 25 and envelopes for advertising.
26 26 55. The sales price from the sale of motor fuel
26 27 and special fuel consumed for highway use or in
26 28 watercraft or aircraft where the fuel tax has been
26 29 imposed and paid and no refund has been or will be
26 30 allowed and the sales price from the sales of ethanol
26 31 blended gasoline, as defined in section 452A.2.
26 32 56. The sales price from all sales of food and
26 33 food ingredients. However, as used in this
26 34 subsection, "food" does not include alcoholic
26 35 beverages, candy, dietary supplements, food sold
26 36 through vending machines, prepared food, soft drinks,
26 37 and tobacco.
26 38 For the purposes of this subsection:
26 39 a. "Alcoholic beverages" means beverages that are
26 40 suitable for human consumption and contain one=half of
26 41 one percent or more of alcohol by volume.
26 42 b. "Candy" means a preparation of sugar, honey, or
26 43 other natural or artificial sweeteners in combination
26 44 with chocolate, fruits, nuts, or other ingredients or
26 45 flavorings in the form of bars, drops, or pieces.
26 46 Candy shall not include any preparation containing
26 47 flour and shall require no refrigeration.
26 48 c. "Dietary supplement" means any product, other
26 49 than tobacco, intended to supplement the diet that
26 50 contains one or more of the following dietary
27 1 ingredients:
27 2 (1) A vitamin.
27 3 (2) A mineral.
27 4 (3) An herb or other botanical.
27 5 (4) An amino acid.
27 6 (5) A dietary substance for use by humans to
27 7 supplement the diet by increasing the total dietary
27 8 intake.
27 9 (6) A concentrate, metabolite, constituent,
27 10 extract, or combination of any of the ingredients in
27 11 subparagraphs (1) through (5) that is intended for
27 12 ingestion in tablet, capsule, powder, softgel, gelcap,
27 13 or liquid form, or if not intended for ingestion in
27 14 such a form, is not represented as conventional food
27 15 and is not represented for use as a sole item of a
27 16 meal or of the diet; and is required to be labeled as
27 17 a dietary supplement, identifiable by the "supplement
27 18 facts" box found on the label and as required pursuant
27 19 to 21 C.F.R. } 101.36.
27 20 d. "Food and food ingredients" means substances,
27 21 whether in liquid, concentrated, solid, frozen, dried,
27 22 or dehydrated form, that are sold for ingestion or
27 23 chewing by humans and are consumed for their taste or
27 24 nutritional value.
27 25 e. "Food sold through vending machines" means food
27 26 dispensed from a machine or other mechanical device
27 27 that accepts payment.
27 28 f. "Prepared food" means any of following:
27 29 (1) Food sold in a heated state or heated by the
27 30 seller.
27 31 (2) Two or more food ingredients mixed or combined
27 32 by the seller for sale as a single item. "Prepared
27 33 food", for the purposes of this subparagraph, does not
27 34 include food that is only cut, repackaged, or
27 35 pasteurized by the seller, and eggs, fish, meat,
27 36 poultry, and foods containing these raw animal foods
27 37 requiring cooking by the consumer as recommended by
27 38 the United States food and drug administration in
27 39 chapter 3, part 401.11 of its food code so as to
27 40 prevent food borne illnesses.
27 41 (3) Food sold with eating utensils provided by the
27 42 seller, including plates, knives, forks, spoons,
27 43 glasses, cups, napkins, or straws. A plate does not
27 44 include a container or packaging used to transport
27 45 food.
27 46 g. "Soft drinks" means nonalcoholic beverages that
27 47 contain natural or artificial sweeteners. "Soft
27 48 drinks" does not include beverages that contain milk
27 49 or milk products; soy, rice, or similar milk
27 50 substitutes; or greater than fifty percent of
28 1 vegetable or fruit juice by volume.
28 2 f. "Tobacco" means cigarettes, cigars, chewing or
28 3 pipe tobacco, or any other item that contains tobacco.
28 4 57. The sales price from the sale of items
28 5 purchased with coupons issued under the federal Food
28 6 Stamp Act of 1977, 7 U.S.C. } 2011 et seq.
28 7 58. In transactions in which tangible personal
28 8 property is traded toward the sales price of other
28 9 tangible personal property, that portion of the sales
28 10 price which is not payable in money to the retailer is
28 11 exempted from the taxable amount if the following
28 12 conditions are met:
28 13 a. The tangible personal property traded to the
28 14 retailer is the type of property normally sold in the
28 15 regular course of the retailer's business.
28 16 b. The tangible personal property traded to the
28 17 retailer is intended by the retailer to be ultimately
28 18 sold at retail or is intended to be used by the
28 19 retailer or another in the remanufacturing of a like
28 20 item.
28 21 59. The sales price from the sale or rental of
28 22 prescription drugs or medical devices intended for
28 23 human use or consumption.
28 24 For the purposes of this subsection:
28 25 a. "Drug" means a compound, substance, or
28 26 preparation, and any component of a compound,
28 27 substance, or preparation, other than food and food
28 28 ingredients, dietary supplements, or alcoholic
28 29 beverages which is any of the following:
28 30 (1) Recognized in the official United States
28 31 pharmacopoeia, official homeopathic pharmacopoeia of
28 32 the United States, or official national formulary, and
28 33 supplement to any of them.
28 34 (2) Intended for use in the diagnosis, cure,
28 35 mitigation, treatment, or prevention of disease.
28 36 (3) Intended to affect the structure or any
28 37 function of the body.
28 38 b. "Medical device" means equipment or a supply,
28 39 intended to be prescribed by a practitioner, including
28 40 orthopedic or orthotic devices. However, "medical
28 41 device" also includes prosthetic devices, ostomy,
28 42 urological, and tracheostomy equipment and supplies,
28 43 and diabetic testing materials, hypodermic syringes
28 44 and needles, anesthesia trays, biopsy trays and biopsy
28 45 needles, cannula systems, catheter trays and invasive
28 46 catheters, dialyzers, drug infusion devices, fistula
28 47 sets, hemodialysis devices, insulin infusion devices,
28 48 intraocular lenses, irrigation solutions, intravenous
28 49 administering sets, solutions and stopcocks, myelogram
28 50 trays, nebulizers, small vein infusion kits, spinal
29 1 puncture trays, transfusion sets, venous blood sets,
29 2 and oxygen equipment, intended to be dispensed for
29 3 human use with or without a prescription to an
29 4 ultimate user.
29 5 c. "Practitioner" means a practitioner as defined
29 6 in section 155A.3, or a person licensed to prescribe
29 7 drugs.
29 8 d. "Prescription drug" means a drug intended to be
29 9 dispensed to an ultimate user pursuant to a
29 10 prescription drug order, formula, or recipe issued in
29 11 any form of oral, written, electronic, or other means
29 12 of transmission by a duly licensed practitioner, or
29 13 oxygen or insulin dispensed for human consumption with
29 14 or without a prescription drug order or medication
29 15 order.
29 16 e. "Prosthetic device" means a replacement,
29 17 corrective, or supportive device including repair and
29 18 replacement parts for the same worn on or in the body
29 19 to do any of the following:
29 20 (1) Artificially replace a missing portion of the
29 21 body.
29 22 (2) Prevent or correct physical deformity or
29 23 malfunction.
29 24 (3) Support a weak or deformed portion of the
29 25 body.
29 26 f. "Ultimate user" means an individual who has
29 27 lawfully obtained and possesses a prescription drug or
29 28 medical device for the individual's own use or for the
29 29 use of a member of the individual's household, or an
29 30 individual to whom a prescription drug or medical
29 31 device has been lawfully supplied, administered,
29 32 dispensed, or prescribed.
29 33 60. The sales price from services furnished by
29 34 aerial commercial and charter transportation services.
29 35 61. The sales price from the sale of raffle
29 36 tickets for a raffle licensed pursuant to section
29 37 99B.5.
29 38 62. The sales price from the sale of tangible
29 39 personal property which will be given as prizes to
29 40 players in games of skill, games of chance, raffles,
29 41 and bingo games as defined in chapter 99B.
29 42 63. The sales price from the sale of a modular
29 43 home, as defined in section 435.1, to the extent of
29 44 the portion of the purchase price of the modular home
29 45 which is not attributable to the cost of the tangible
29 46 personal property used in the processing of the
29 47 modular home. For purposes of this exemption, the
29 48 portion of the purchase price which is not
29 49 attributable to the cost of the tangible personal
29 50 property used in the processing of the modular home is
30 1 forty percent.
30 2 64. The sales price from charges paid to a
30 3 provider for access to on=line computer services. For
30 4 purposes of this subsection, "on=line computer
30 5 service" means a service that provides or enables
30 6 computer access by multiple users to the internet or
30 7 to other information made available through a computer
30 8 server.
30 9 65. The sales price from the sale or rental of
30 10 information services. "Information services" means
30 11 every business activity, process, or function by which
30 12 a seller or its agent accumulates, prepares,
30 13 organizes, or conveys data, facts, knowledge,
30 14 procedures, and like services to a buyer or its agent
30 15 of such information through any tangible or intangible
30 16 medium. Information accumulated, prepared, or
30 17 organized for a buyer or its agent is an information
30 18 service even though it may incorporate preexisting
30 19 components of data or other information. "Information
30 20 services" includes, but is not limited to, database
30 21 files, mailing lists, subscription files, market
30 22 research, credit reports, surveys, real estate
30 23 listings, bond rating reports, abstracts of title, bad
30 24 check lists, broadcasting rating services, wire
30 25 services, and scouting reports, or other similar
30 26 items.
30 27 66. The sales price of a sale at retail if the
30 28 substance of the transaction is delivered to the
30 29 purchaser digitally, electronically, or utilizing
30 30 cable, or by radio waves, microwaves, satellites, or
30 31 fiber optics.
30 32 67. a. The sales price from the sale of an
30 33 article of clothing designed to be worn on or about
30 34 the human body if all of the following apply:
30 35 (1) The sales price of the article is less than
30 36 one hundred dollars.
30 37 (2) The sale takes place during a period beginning
30 38 at 12:01 a.m. on the first Friday in August and ending
30 39 at midnight on the following Saturday.
30 40 b. This subsection does not apply to any of the
30 41 following:
30 42 (1) Sport or recreational equipment and protective
30 43 equipment.
30 44 (2) Clothing accessories or equipment.
30 45 (3) The rental of clothing.
30 46 c. For purposes of this subsection:
30 47 (1) "Clothing" means all human wearing apparel
30 48 suitable for general use. "Clothing" includes, but is
30 49 not limited to the following: aprons, household and
30 50 shop; athletic supporters; baby receiving blankets;
31 1 bathing suits and caps; beach capes and coats; belts
31 2 and suspenders; boots; coats and jackets; costumes;
31 3 diapers (children and adults, including disposable
31 4 diapers); earmuffs; footlets; formal wear; garters and
31 5 garter belts; girdles; gloves and mittens for general
31 6 use; hats and caps; hosiery; insoles for shoes; lab
31 7 coats; neckties; overshoes; pantyhose; rainwear;
31 8 rubber pants; sandals; scarves; shoes and shoelaces;
31 9 slippers; sneakers; socks and stockings; steel=toed
31 10 shoes; underwear; uniforms, athletic and nonathletic;
31 11 and wedding apparel.
31 12 "Clothing" does not include the following: belt
31 13 buckles sold separately; costume masks sold
31 14 separately; patches and emblems sold separately;
31 15 sewing equipment and supplies (including, but not
31 16 limited to, knitting needles, patterns, pins,
31 17 scissors, sewing machines, sewing needles, tape
31 18 measures, and thimbles); and sewing materials that
31 19 become part of clothing (including, but not limited
31 20 to, buttons, fabric, lace, thread, yarn, and zippers).
31 21 (2) "Clothing accessories or equipment" means
31 22 incidental items worn on the person or in conjunction
31 23 with clothing. "Clothing accessories or equipment"
31 24 includes, but is not limited to, the following:
31 25 briefcases; cosmetics; hair notions (including, but
31 26 not limited to, barrettes, hair bows, and hair nets);
31 27 handbags; handkerchiefs; jewelry; sunglasses,
31 28 nonprescription; umbrellas; wallets; watches; and wigs
31 29 and hairpieces.
31 30 (3) "Protective equipment" means items for human
31 31 wear and designed as protection for the wearer against
31 32 injury or disease or as protection against damage or
31 33 injury of other persons or property but not suitable
31 34 for general use. "Protective equipment" includes, but
31 35 is not limited to, the following: breathing masks;
31 36 clean room apparel and equipment; ear and hearing
31 37 protectors; face shields; hard hats; helmets; paint or
31 38 dust respirators; protective gloves; safety glasses
31 39 and goggles; safety belts; tool belts; and welders
31 40 gloves and masks.
31 41 (4) "Sport or recreational equipment" means items
31 42 designed for human use and worn in conjunction with an
31 43 athletic or recreational activity that are not
31 44 suitable for general use. "Sport or recreational
31 45 equipment" includes, but is not limited to, the
31 46 following: ballet and tap shoes; cleated or spiked
31 47 athletic shoes; gloves (including, but not limited to,
31 48 baseball, bowling, boxing, hockey, and golf); goggles;
31 49 hand and elbow guards; life preservers and vests;
31 50 mouth guards; roller and ice skates; shin guards;
32 1 shoulder pads; ski boots; waders; and wetsuits and
32 2 fins.
32 3 68. a. Subject to paragraph "b", the sales price
32 4 from the sale or furnishing of metered gas,
32 5 electricity, and fuel, including propane and heating
32 6 oil, to residential customers which is used to provide
32 7 energy for residential dwellings and units of
32 8 apartment and condominium complexes used for human
32 9 occupancy.
32 10 b. The exemption in this subsection shall be
32 11 phased in by means of a reduction in the tax rate as
32 12 follows:
32 13 (1) If the date of the utility billing or meter
32 14 reading cycle of the residential customer for the sale
32 15 or furnishing of metered gas and electricity is on or
32 16 after January 1, 2002, through December 31, 2002, or
32 17 if the sale or furnishing of fuel for purposes of
32 18 residential energy and the delivery of the fuel occurs
32 19 on or after January 1, 2002, through December 31,
32 20 2002, the rate of tax is four percent of the sales
32 21 price.
32 22 (2) If the date of the utility billing or meter
32 23 reading cycle of the residential customer for the sale
32 24 or furnishing of metered gas and electricity is on or
32 25 after January 1, 2003, through December 31, 2003, or
32 26 if the sale or furnishing of fuel for purposes of
32 27 residential energy and the delivery of the fuel occurs
32 28 on or after January 1, 2003, through December 31,
32 29 2003, the rate of tax is three percent of the sales
32 30 price.
32 31 (3) If the date of the utility billing or meter
32 32 reading cycle of the residential customer for the sale
32 33 or furnishing of metered gas and electricity is on or
32 34 after January 1, 2004, through December 31, 2004, or
32 35 if the sale or furnishing of fuel for purposes of
32 36 residential energy and the delivery of the fuel occurs
32 37 on or after January 1, 2004, through December 31,
32 38 2004, the rate of tax is two percent of the sales
32 39 price.
32 40 (4) If the date of the utility billing or meter
32 41 reading cycle of the residential customer for the sale
32 42 or furnishing of metered gas and electricity is on or
32 43 after January 1, 2005, through December 31, 2005, or
32 44 if the sale or furnishing of fuel for purposes of
32 45 residential energy and the delivery of the fuel occurs
32 46 on or after January 1, 2005, through December 31,
32 47 2005, the rate of tax is one percent of the sales
32 48 price.
32 49 (5) If the date of the utility billing or meter
32 50 reading cycle of the residential customer for the sale
33 1 or furnishing of metered gas and electricity is on or
33 2 after January 1, 2006, or if the sale, furnishing, or
33 3 service of fuel for purposes of residential energy and
33 4 the delivery of the fuel occurs on or after January 1,
33 5 2006, the rate of tax is zero percent of the sales
33 6 price.
33 7 c. The exemption in this subsection does not apply
33 8 to local option sales and services tax imposed
33 9 pursuant to chapters 423B and 423E.
33 10 69. The sales price from charges paid for the
33 11 delivery of electricity or natural gas if the sale or
33 12 furnishing of the electricity or natural gas or its
33 13 use is exempt from the tax on sales prices imposed
33 14 under this subchapter or from the use tax imposed
33 15 under subchapter III.
33 16 70. The sales price from the sales, furnishing, or
33 17 service of transportation service except the rental of
33 18 recreational vehicles or recreational boats, except
33 19 the rental of motor vehicles subject to registration
33 20 which are registered for a gross weight of thirteen
33 21 tons or less for a period of sixty days or less, and
33 22 except the rental of aircraft for a period of sixty
33 23 days or less. This exemption does not apply to the
33 24 transportation of electric energy or natural gas.
33 25 71. The sales price from sales of tangible
33 26 personal property used or to be used as railroad
33 27 rolling stock for transporting persons or property, or
33 28 as materials or parts therefor.
33 29 72. The sales price from the sales of special fuel
33 30 for diesel engines consumed or used in the operation
33 31 of ships, barges, or waterborne vessels which are used
33 32 primarily in or for the transportation of property or
33 33 cargo, or the conveyance of persons for hire on rivers
33 34 bordering on the state if the fuel is delivered by the
33 35 seller to the purchaser's barge, ship, or waterborne
33 36 vessel while it is afloat upon such a river.
33 37 73. The sales price from sales of vehicles subject
33 38 to registration or subject only to the issuance of a
33 39 certificate of title and sales of aircraft subject to
33 40 registration under section 328.20.
33 41 74. The sales price from the sale of aircraft for
33 42 use in a scheduled interstate federal aviation
33 43 administration certificated air carrier operation.
33 44 75. The sales price from the sale or rental of
33 45 aircraft; the sale or rental of tangible personal
33 46 property permanently affixed or attached as a
33 47 component part of the aircraft, including but not
33 48 limited to repair or replacement materials or parts;
33 49 and the sales price of all services used for aircraft
33 50 repair, remodeling, and maintenance services when such
34 1 services are performed on aircraft, aircraft engines,
34 2 or aircraft component materials or parts. For the
34 3 purposes of this exemption, "aircraft" means aircraft
34 4 used in a scheduled interstate federal aviation
34 5 administration certificated air carrier operation.
34 6 76. The sales price from the sale or rental of
34 7 tangible personal property permanently affixed or
34 8 attached as a component part of the aircraft,
34 9 including but not limited to repair or replacement
34 10 materials or parts; and the sales price of all
34 11 services used for aircraft repair, remodeling, and
34 12 maintenance services when such services are performed
34 13 on aircraft, aircraft engines, or aircraft component
34 14 materials or parts. For the purposes of this
34 15 exemption, "aircraft" means aircraft used in
34 16 nonscheduled interstate federal aviation
34 17 administration certificated air carrier operation
34 18 operating under 14 C.F.R. ch. 1, pt. 135.
34 19 77. The sales price from the sale of aircraft to
34 20 an aircraft dealer who in turn rents or leases the
34 21 aircraft if all of the following apply:
34 22 a. The aircraft is kept in the inventory of the
34 23 dealer for sale at all times.
34 24 b. The dealer reserves the right to immediately
34 25 take the aircraft from the renter or lessee when a
34 26 buyer is found.
34 27 c. The renter or lessee is aware that the dealer
34 28 will immediately take the aircraft when a buyer is
34 29 found.
34 30 If an aircraft exempt under this subsection is used
34 31 for any purpose other than leasing or renting, or the
34 32 conditions in paragraphs "a", "b", and "c" are not
34 33 continuously met, the dealer claiming the exemption
34 34 under this subsection is liable for the tax that would
34 35 have been due except for this subsection. The tax
34 36 shall be computed upon the original purchase price.
34 37 78. The sales price from sales or rental of
34 38 tangible personal property, or services rendered by
34 39 any entity where the profits from the sales or rental
34 40 of the tangible personal property, or services
34 41 rendered are used by or donated to a nonprofit entity
34 42 which is exempt from federal income taxation pursuant
34 43 to section 501(c)(3) of the Internal Revenue Code, a
34 44 government entity, or a nonprofit private educational
34 45 institution, and where the entire proceeds from the
34 46 sales, rental, or services are expended for any of the
34 47 following purposes:
34 48 a. Educational.
34 49 b. Religious.
34 50 c. Charitable. A charitable act is an act done
35 1 out of goodwill, benevolence, and a desire to add to
35 2 or to improve the good of humankind in general or any
35 3 class or portion of humankind, with no pecuniary
35 4 profit inuring to the person performing the service or
35 5 giving the gift.
35 6 This exemption does not apply to the sales price
35 7 from games of skill, games of chance, raffles, and
35 8 bingo games as defined in chapter 99B. This exemption
35 9 is disallowed on the amount of the sales price only to
35 10 the extent the profits from the sales, rental, or
35 11 services are not used by or donated to the appropriate
35 12 entity and expended for educational, religious, or
35 13 charitable purposes.
35 14 79. The sales price from the sale or rental of
35 15 tangible personal property or from services furnished
35 16 to a recognized community action agency as provided in
35 17 section 216A.93 to be used for the purposes of the
35 18 agency.
35 19 80. a. For purposes of this subsection,
35 20 "designated exempt entity" means an entity which is
35 21 designated in section 423.4, subsection 1.
35 22 b. If a contractor, subcontractor, or builder is
35 23 to use building materials, supplies, and equipment in
35 24 the performance of a construction contract with a
35 25 designated exempt entity, the person shall purchase
35 26 such items of tangible personal property without
35 27 liability for the tax if such property will be used in
35 28 the performance of the construction contract and a
35 29 purchasing agent authorization letter and an exemption
35 30 certificate, issued by the designated exempt entity,
35 31 are presented to the retailer.
35 32 c. Where the owner, contractor, subcontractor, or
35 33 builder is also a retailer holding a retail sales tax
35 34 permit and transacting retail sales of building
35 35 materials, supplies, and equipment, the tax shall not
35 36 be due when materials are withdrawn from inventory for
35 37 use in construction performed for a designated exempt
35 38 entity if an exemption certificate is received from
35 39 such entity.
35 40 d. Tax shall not apply to tangible personal
35 41 property purchased and consumed by a manufacturer as
35 42 building materials, supplies, or equipment in the
35 43 performance of a construction contract for a
35 44 designated exempt entity, if a purchasing agent
35 45 authorization letter and an exemption certificate are
35 46 received from such entity and presented to a retailer.
35 47 Sec. . NEW SECTION. 423.4 REFUNDS.
35 48 1. A private nonprofit educational institution in
35 49 this state, nonprofit private museum in this state,
35 50 tax=certifying or tax=levying body or governmental
36 1 subdivision of the state, including the state board of
36 2 regents, state department of human services, state
36 3 department of transportation, a municipally owned
36 4 solid waste facility which sells all or part of its
36 5 processed waste as fuel to a municipally owned public
36 6 utility, and all divisions, boards, commissions,
36 7 agencies, or instrumentalities of state, federal,
36 8 county, or municipal government which do not have
36 9 earnings going to the benefit of an equity investor or
36 10 stockholder, may make application to the department
36 11 for the refund of the sales or use tax upon the sales
36 12 price of all sales of goods, wares, or merchandise, or
36 13 from services furnished to a contractor, used in the
36 14 fulfillment of a written contract with the state of
36 15 Iowa, any political subdivision of the state, or a
36 16 division, board, commission, agency, or
36 17 instrumentality of the state or a political
36 18 subdivision, a private nonprofit educational
36 19 institution in this state, or a nonprofit private
36 20 museum in this state if the property becomes an
36 21 integral part of the project under contract and at the
36 22 completion of the project becomes public property, is
36 23 devoted to educational uses, or becomes a nonprofit
36 24 private museum; except goods, wares, or merchandise,
36 25 or services furnished which are used in the
36 26 performance of any contract in connection with the
36 27 operation of any municipal utility engaged in selling
36 28 gas, electricity, or heat to the general public or in
36 29 connection with the operation of a municipal pay
36 30 television system; and except goods, wares, and
36 31 merchandise used in the performance of a contract for
36 32 a "project" under chapter 419 as defined in that
36 33 chapter other than goods, wares, or merchandise used
36 34 in the performance of a contract for a "project" under
36 35 chapter 419 for which a bond issue was approved by a
36 36 municipality prior to July 1, 1968, or for which the
36 37 goods, wares, or merchandise becomes an integral part
36 38 of the project under contract and at the completion of
36 39 the project becomes public property or is devoted to
36 40 educational uses.
36 41 a. Such contractor shall state under oath, on
36 42 forms provided by the department, the amount of such
36 43 sales of goods, wares, or merchandise, or services
36 44 furnished and used in the performance of such
36 45 contract, and upon which sales or use tax has been
36 46 paid, and shall file such forms with the governmental
36 47 unit, private nonprofit educational institution, or
36 48 nonprofit private museum which has made any written
36 49 contract for performance by the contractor. The forms
36 50 shall be filed by the contractor with the governmental
37 1 unit, educational institution, or nonprofit private
37 2 museum before final settlement is made.
37 3 b. Such governmental unit, educational
37 4 institution, or nonprofit private museum shall, not
37 5 more than one year after the final settlement has been
37 6 made, make application to the department for any
37 7 refund of the amount of the sales or use tax which
37 8 shall have been paid upon any goods, wares, or
37 9 merchandise, or services furnished, the application to
37 10 be made in the manner and upon forms to be provided by
37 11 the department, and the department shall forthwith
37 12 audit the claim and, if approved, issue a warrant to
37 13 the governmental unit, educational institution, or
37 14 nonprofit private museum in the amount of the sales or
37 15 use tax which has been paid to the state of Iowa under
37 16 the contract.
37 17 Refunds authorized under this subsection shall
37 18 accrue interest at the rate in effect under section
37 19 421.7 from the first day of the second calendar month
37 20 following the date the refund claim is received by the
37 21 department.
37 22 c. Any contractor who willfully makes a false
37 23 report of tax paid under the provisions of this
37 24 subsection is guilty of a simple misdemeanor and in
37 25 addition shall be liable for the payment of the tax
37 26 and any applicable penalty and interest.
37 27 2. The refund of sales and use tax paid on
37 28 transportation construction projects let by the state
37 29 department of transportation is subject to the special
37 30 provisions of this subsection.
37 31 a. A contractor awarded a contract for a
37 32 transportation construction project is considered the
37 33 consumer of all building materials, building supplies,
37 34 and equipment and shall pay sales tax to the supplier
37 35 or remit consumer use tax directly to the department.
37 36 b. The contractor is not required to file
37 37 information with the state department of
37 38 transportation stating the amount of goods, wares, or
37 39 merchandise, or services rendered, furnished, or
37 40 performed and used in the performance of the contract
37 41 or the amount of sales or use tax paid.
37 42 c. The state department of transportation shall
37 43 file a refund claim based on a formula that considers
37 44 the following:
37 45 (1) The quantity of material to complete the
37 46 contract, and quantities of items of work.
37 47 (2) The estimated cost of these materials included
37 48 in the items of work, and the state sales or use tax
37 49 to be paid on the tax rate in effect in section 423.2.
37 50 The quantity of materials shall be determined after
38 1 each letting based on the contract quantities of all
38 2 items of work let to contract. The quantity of
38 3 individual component materials required for each item
38 4 shall be determined and maintained in a database. The
38 5 total quantities of materials shall be determined by
38 6 multiplying the quantities of component materials for
38 7 each contract item of work by the total quantities of
38 8 each contract item for each letting. Where variances
38 9 exist in the cost of materials, the lowest cost shall
38 10 be used as the base cost.
38 11 d. Only the state sales or use tax is refundable.
38 12 Local option taxes paid by the contractor are not
38 13 refundable.
38 14 3. A relief agency may apply to the director for
38 15 refund of the amount of sales or use tax imposed and
38 16 paid upon sales to it of any goods, wares,
38 17 merchandise, or services furnished, used for free
38 18 distribution to the poor and needy.
38 19 a. The refunds may be obtained only in the
38 20 following amounts and manner and only under the
38 21 following conditions:
38 22 (1) On forms furnished by the department, and
38 23 filed within the time as the director shall provide by
38 24 rule, the relief agency shall report to the department
38 25 the total amount or amounts, valued in money, expended
38 26 directly or indirectly for goods, wares, merchandise,
38 27 or services furnished, used for free distribution to
38 28 the poor and needy.
38 29 (2) On these forms the relief agency shall
38 30 separately list the persons making the sales to it or
38 31 to its order, together with the dates of the sales,
38 32 and the total amount so expended by the relief agency.
38 33 (3) The relief agency must prove to the
38 34 satisfaction of the director that the person making
38 35 the sales has included the amount thereof in the
38 36 computation of the sales price of such person and that
38 37 such person has paid the tax levied by this subchapter
38 38 or subchapter III, based upon such computation of the
38 39 sales price.
38 40 b. If satisfied that the foregoing conditions and
38 41 requirements have been complied with, the director
38 42 shall refund the amount claimed by the relief agency.
38 43 SUBCHAPTER III
38 44 USE TAX
38 45 Sec. . NEW SECTION. 423.5 IMPOSITION OF TAX.
38 46 An excise tax at the rate of five percent of the
38 47 purchase price or installed purchase price is imposed
38 48 on the following:
38 49 1. The use in this state of tangible personal
38 50 property as defined in section 423.1, including
39 1 aircraft subject to registration under section 328.20,
39 2 purchased for use in this state. For the purposes of
39 3 this subchapter, the furnishing or use of the
39 4 following services is also treated as the use of
39 5 tangible personal property: optional service or
39 6 warranty contracts, except residential service
39 7 contracts regulated under chapter 523C, vulcanizing,
39 8 recapping, or retreading services, engraving,
39 9 photography, retouching, printing, or binding
39 10 services, and communication service when furnished or
39 11 delivered to consumers or users within this state.
39 12 2. The use of manufactured housing in this state,
39 13 on the purchase price if the manufactured housing is
39 14 sold in the form of tangible personal property or on
39 15 the installed purchase price if the manufactured
39 16 housing is sold in the form of realty.
39 17 3. The use of leased vehicles, on the amount
39 18 subject to tax as calculated pursuant to section
39 19 423.27.
39 20 4. Purchases of tangible personal property made
39 21 from the government of the United States or any of its
39 22 agencies by ultimate consumers shall be subject to the
39 23 tax imposed by this section. Services purchased from
39 24 the same source or sources shall be subject to the
39 25 service tax imposed by this subchapter and apply to
39 26 the user of the services.
39 27 5. The use in this state of services enumerated in
39 28 section 423.2. This tax is applicable where services
39 29 are furnished in this state or where the product or
39 30 result of the service is used in this state.
39 31 6. The excise tax is imposed upon every person
39 32 using the property within this state until the tax has
39 33 been paid directly to the county treasurer, the state
39 34 department of transportation, a retailer, or the
39 35 department. This tax is imposed on every person using
39 36 the services or the product of the services in this
39 37 state until the user has paid the tax either to an
39 38 Iowa use tax permit holder or to the department.
39 39 7. For the purpose of the proper administration of
39 40 the use tax and to prevent its evasion, evidence that
39 41 tangible personal property was sold by any person for
39 42 delivery in this state shall be prima facie evidence
39 43 that such tangible personal property was sold for use
39 44 in this state.
39 45 Sec. . NEW SECTION. 423.6 EXEMPTIONS.
39 46 The use in this state of the following tangible
39 47 personal property and services is exempted from the
39 48 tax imposed by this subchapter:
39 49 1. Tangible personal property and enumerated
39 50 services, the sales price from the sale of which are
40 1 required to be included in the measure of the sales
40 2 tax, if that tax has been paid to the department or
40 3 the retailer. This exemption does not include
40 4 vehicles subject to registration or subject only to
40 5 the issuance of a certificate of title.
40 6 2. The sale of tangible personal property or the
40 7 furnishing of services in the regular course of
40 8 business.
40 9 3. Property used in processing. The use of
40 10 property in processing within the meaning of this
40 11 subsection shall mean and include any of the
40 12 following:
40 13 a. Any tangible personal property including
40 14 containers which it is intended shall, by means of
40 15 fabrication, compounding, manufacturing, or
40 16 germination, become an integral part of other tangible
40 17 personal property intended to be sold ultimately at
40 18 retail, and containers used in the collection,
40 19 recovery, or return of empty beverage containers
40 20 subject to chapter 455C.
40 21 b. Fuel which is consumed in creating power, heat,
40 22 or steam for processing or for generating electric
40 23 current.
40 24 c. Chemicals, solvents, sorbents, or reagents,
40 25 which are directly used and are consumed, dissipated,
40 26 or depleted in processing tangible personal property
40 27 which is intended to be sold ultimately at retail, and
40 28 which may not become a component or integral part of
40 29 the finished product.
40 30 d. The distribution to the public of free
40 31 newspapers or shoppers guides shall be deemed a retail
40 32 sale for purposes of the processing exemption in this
40 33 subsection.
40 34 4. All articles of tangible personal property
40 35 brought into the state of Iowa by a nonresident
40 36 individual for the individual's use or enjoyment while
40 37 within the state.
40 38 5. Services exempt from taxation by the provisions
40 39 of section 423.3.
40 40 6. Tangible personal property or services the
40 41 sales price of which is exempt from the sales tax
40 42 under section 423.3, except subsections 39 and 73, as
40 43 it relates to the sale, but not the lease or rental,
40 44 of vehicles subject to registration or subject only to
40 45 the issuance of a certificate of title and as it
40 46 relates to aircraft subject to registration under
40 47 section 328.20.
40 48 7. Advertisement and promotional material and
40 49 matter, seed catalogs, envelopes for same, and other
40 50 similar material temporarily stored in this state
41 1 which are acquired outside of Iowa and which,
41 2 subsequent to being brought into this state, are sent
41 3 outside of Iowa, either singly or physically attached
41 4 to other tangible personal property sent outside of
41 5 Iowa.
41 6 8. Vehicles, as defined in section 321.1,
41 7 subsections 41, 64A, 71, 85, and 88, except such
41 8 vehicles subject to registration which are designed
41 9 primarily for carrying persons, when purchased for
41 10 lease and actually leased to a lessee for use outside
41 11 the state of Iowa and the subsequent sole use in Iowa
41 12 is in interstate commerce or interstate
41 13 transportation.
41 14 9. Tangible personal property which, by means of
41 15 fabrication, compounding, or manufacturing, becomes an
41 16 integral part of vehicles, as defined in section
41 17 321.1, subsections 41, 64A, 71, 85, and 88,
41 18 manufactured for lease and actually leased to a lessee
41 19 for use outside the state of Iowa and the subsequent
41 20 sole use in Iowa is in interstate commerce or
41 21 interstate transportation. Vehicles subject to
41 22 registration which are designed primarily for carrying
41 23 persons are excluded from this subsection.
41 24 10. Vehicles subject to registration which are
41 25 transferred from a business or individual conducting a
41 26 business within this state as a sole proprietorship,
41 27 partnership, or limited liability company to a
41 28 corporation formed by the sole proprietorship,
41 29 partnership, or limited liability company for the
41 30 purpose of continuing the business when all of the
41 31 stock of the corporation so formed is owned by the
41 32 sole proprietor and the sole proprietor's spouse, by
41 33 all the partners in the case of a partnership, or by
41 34 all the members in the case of a limited liability
41 35 company. This exemption is equally available where
41 36 the vehicles subject to registration are transferred
41 37 from a corporation to a sole proprietorship,
41 38 partnership, or limited liability company formed by
41 39 that corporation for the purpose of continuing the
41 40 business when all of the incidents of ownership are
41 41 owned by the same person or persons who were
41 42 stockholders of the corporation.
41 43 This exemption also applies where the vehicles
41 44 subject to registration are transferred from a
41 45 corporation as part of the liquidation of the
41 46 corporation to its stockholders if within three months
41 47 of such transfer the stockholders retransfer those
41 48 vehicles subject to registration to a sole
41 49 proprietorship, partnership, or limited liability
41 50 company for the purpose of continuing the business of
42 1 the corporation when all of the incidents of ownership
42 2 are owned by the same person or persons who were
42 3 stockholders of the corporation.
42 4 11. Vehicles registered or operated under chapter
42 5 326 and used substantially in interstate commerce,
42 6 section 423.5, subsection 7, notwithstanding. For
42 7 purposes of this subsection, "substantially in
42 8 interstate commerce" means that a minimum of twenty=
42 9 five percent of the miles operated by the vehicle
42 10 accrues in states other than Iowa. This subsection
42 11 applies only to vehicles which are registered for a
42 12 gross weight of thirteen tons or more.
42 13 For purposes of this subsection, trailers and
42 14 semitrailers registered or operated under chapter 326
42 15 are deemed to be used substantially in interstate
42 16 commerce and to be registered for a gross weight of
42 17 thirteen tons or more.
42 18 For the purposes of this subsection, if a vehicle
42 19 meets the requirement that twenty=five percent of the
42 20 miles operated accrues in states other than Iowa in
42 21 each year of the first four=year period of operation,
42 22 the exemption from use tax shall continue until the
42 23 vehicle is sold or transferred. If the vehicle is
42 24 found to have not met the exemption requirements or
42 25 the exemption was revoked, the value of the vehicle
42 26 upon which the use tax shall be imposed is the book or
42 27 market value, whichever is less, at the time the
42 28 exemption requirements were not met or the exemption
42 29 was revoked.
42 30 12. Mobile homes and manufactured housing the use
42 31 of which has previously been subject to the tax
42 32 imposed under this subchapter and for which that tax
42 33 has been paid.
42 34 13. Mobile homes to the extent of the portion of
42 35 the purchase price of the mobile home which is not
42 36 attributable to the cost of the tangible personal
42 37 property used in the processing of the mobile home,
42 38 and manufactured housing to the extent of the purchase
42 39 price or the installed purchase price of the
42 40 manufactured housing which is not attributable to the
42 41 cost of the tangible personal property used in the
42 42 processing of the manufactured housing. For purposes
42 43 of this exemption, the portion of the purchase price
42 44 which is not attributable to the cost of the tangible
42 45 personal property used in the processing of the mobile
42 46 home is forty percent and the portion of the purchase
42 47 price or installed purchase price which is not
42 48 attributable to the cost of the tangible personal
42 49 property used in the processing of the manufactured
42 50 housing is forty percent.
43 1 14. Tangible personal property used or to be used
43 2 as a ship, barge, or waterborne vessel which is used
43 3 or to be used primarily in or for the transportation
43 4 of property or cargo for hire on the rivers bordering
43 5 the state or as materials or parts of such ship,
43 6 barge, or waterborne vessel.
43 7 15. Vehicles subject to registration in any state
43 8 when purchased for rental or registered and titled by
43 9 a motor vehicle dealer licensed pursuant to chapter
43 10 322 for rental use, and held for rental for a period
43 11 of one hundred twenty days or more and actually rented
43 12 for periods of sixty days or less by a person
43 13 regularly engaged in the business of renting vehicles
43 14 including, but not limited to, motor vehicle dealers
43 15 licensed pursuant to chapter 322 who rent automobiles
43 16 to users, if the rental of the vehicles is subject to
43 17 taxation under chapter 423C.
43 18 16. Motor vehicles subject to registration which
43 19 were registered and titled between July 1, 1982, and
43 20 July 1, 1992, to a motor vehicle dealer licensed under
43 21 chapter 322 and which were rented to a user as defined
43 22 in section 423C.2 if the following occurred:
43 23 a. The dealer kept the vehicle on the inventory of
43 24 vehicles for sale at all times.
43 25 b. The vehicle was to be immediately taken from
43 26 the user of the vehicle when a buyer was found.
43 27 c. The user was aware of this situation.
43 28 17. Vehicles subject to registration under chapter
43 29 321, with a gross vehicle weight rating of less than
43 30 sixteen thousand pounds, excluding motorcycles and
43 31 motorized bicycles, when purchased for lease and
43 32 titled by the lessor licensed pursuant to chapter 321F
43 33 and actually leased for a period of twelve months or
43 34 more if the lease of the vehicle is subject to
43 35 taxation under section 423.27.
43 36 A lessor may maintain the exemption from use tax
43 37 under this subsection for a qualifying lease that
43 38 terminates at the conclusion or prior to the
43 39 contracted expiration date, if the lessor does not use
43 40 the vehicle for any purpose other than for lease.
43 41 Once the vehicle is used by the lessor for a purpose
43 42 other than for lease, the exemption from use tax under
43 43 this subsection no longer applies and, unless there is
43 44 an exemption from the use tax, use tax is due on the
43 45 fair market value of the vehicle determined at the
43 46 time the lessor uses the vehicle for a purpose other
43 47 than for lease, payable to the department. If the
43 48 lessor holds the vehicle exclusively for sale, use tax
43 49 is due and payable on the purchase price of the
43 50 vehicle at the time of purchase pursuant to this
44 1 subchapter.
44 2 18. Aircraft for use in a scheduled interstate
44 3 federal aviation administration certificated air
44 4 carrier operation.
44 5 19. Aircraft; tangible personal property
44 6 permanently affixed or attached as a component part of
44 7 the aircraft, including but not limited to repair or
44 8 replacement materials or parts; and all services used
44 9 for aircraft repair, remodeling, and maintenance
44 10 services when such services are performed on aircraft,
44 11 aircraft engines, or aircraft component materials or
44 12 parts. For the purposes of this exemption, "aircraft"
44 13 means aircraft used in a scheduled interstate federal
44 14 aviation administration certificated air carrier
44 15 operation.
44 16 20. Tangible personal property permanently affixed
44 17 or attached as a component part of the aircraft,
44 18 including but not limited to repair or replacement
44 19 materials or parts; and all services used for aircraft
44 20 repair, remodeling, and maintenance services when such
44 21 services are performed on aircraft, aircraft engines,
44 22 or aircraft component materials or parts. For the
44 23 purposes of this exemption, "aircraft" means aircraft
44 24 used in a nonscheduled interstate federal aviation
44 25 administration certificated air carrier operation
44 26 operating under 14 C.F.R., ch. 1, pt. 135.
44 27 21. Aircraft sold to an aircraft dealer who in
44 28 turn rents or leases the aircraft if all of the
44 29 following apply:
44 30 a. The aircraft is kept in the inventory of the
44 31 dealer for sale at all times.
44 32 b. The dealer reserves the right to immediately
44 33 take the aircraft from the renter or lessee when a
44 34 buyer is found.
44 35 c. The renter or lessee is aware that the dealer
44 36 will immediately take the aircraft when a buyer is
44 37 found.
44 38 If an aircraft exempt under this subsection is used
44 39 for any purpose other than leasing or renting, or the
44 40 conditions in paragraphs "a", "b", and "c" are not
44 41 continuously met, the dealer claiming the exemption
44 42 under this subsection is liable for the tax that would
44 43 have been due except for this subsection. The tax
44 44 shall be computed upon the original purchase price.
44 45 22. The use in this state of building materials,
44 46 supplies, or equipment, the sale or use of which is
44 47 not treated as a retail sale or a sale at retail under
44 48 section 423.2, subsection 1.
44 49 23. Exempted from the purchase price of any
44 50 vehicle subject to registration is:
45 1 a. The amount of any cash rebate which is provided
45 2 by a motor vehicle manufacturer to the purchaser of
45 3 the vehicle subject to registration so long as the
45 4 rebate is applied to the purchase price of the
45 5 vehicle.
45 6 b. In a transaction between persons, neither of
45 7 which is a retailer of vehicles subject to
45 8 registration, in which a vehicle subject to
45 9 registration is traded toward the purchase price of
45 10 another vehicle subject to registration, the amount of
45 11 the trade=in value allowed on the vehicle subject to
45 12 registration traded.
45 13 SUBCHAPTER IV
45 14 UNIFORM SALES AND USE TAX ADMINISTRATION ACT
45 15 Sec. . NEW SECTION. 423.7 TITLE.
45 16 This subchapter shall be known and may be cited as
45 17 the "Uniform Sales and Use Tax Administration Act".
45 18 Sec. . NEW SECTION. 423.8 LEGISLATIVE FINDING
45 19 AND INTENT.
45 20 The general assembly finds that Iowa should enter
45 21 into an agreement with one or more states to simplify
45 22 and modernize sales and use tax administration in
45 23 order to substantially reduce the burden of tax
45 24 compliance for all sellers and for all types of
45 25 commerce. It is the intent of the general assembly
45 26 that entering into this agreement will lead to
45 27 simplification and modernization of the sales and use
45 28 tax law and not to the imposition of new taxes or an
45 29 increase or decrease in the existing number of
45 30 exemptions, unless such a result is unavoidable under
45 31 the terms of the agreement.
45 32 Sec. . NEW SECTION. 423.9 AUTHORITY TO ENTER
45 33 AGREEMENT AND TO REPRESENT THE STATE.
45 34 The director is authorized and directed to enter
45 35 into the streamlined sales and use tax agreement with
45 36 one or more states to simplify and modernize sales and
45 37 use tax administration in order to substantially
45 38 reduce the burden of tax compliance for all sellers
45 39 and for all types of commerce.
45 40 The director is further authorized to take other
45 41 actions reasonably required to implement the
45 42 provisions set forth in this chapter. Other actions
45 43 authorized by this section include, but are not
45 44 limited to, the adoption of rules and the joint
45 45 procurement, with other member states, of goods and
45 46 services in furtherance of the cooperative agreement.
45 47 The director or the director's designee is
45 48 authorized to be a member of the governing board
45 49 established pursuant to the agreement and to represent
45 50 Iowa before that body.
46 1 Sec. . NEW SECTION. 423.10 RELATIONSHIP TO
46 2 STATE LAW.
46 3 Entry into the agreement by the director does not
46 4 amend or modify any law of this state. Implementation
46 5 of any condition of the agreement in this state,
46 6 whether adopted before, at, or after membership of
46 7 this state in the agreement, shall be by action of the
46 8 general assembly.
46 9 Sec. . NEW SECTION. 423.11 AGREEMENT
46 10 REQUIREMENTS.
46 11 The director shall not enter into the agreement
46 12 unless the agreement requires each state to abide by
46 13 the following requirements:
46 14 1. UNIFORM STATE RATE. The agreement must set
46 15 restrictions to achieve more uniform state rates
46 16 through the following:
46 17 a. Limiting the number of state rates.
46 18 b. Limiting the application of maximums on the
46 19 amount of state tax that is due on a transaction.
46 20 c. Limiting the application of thresholds on the
46 21 application of state tax.
46 22 2. UNIFORM STANDARDS. The agreement must
46 23 establish uniform standards for the following:
46 24 a. The sourcing of transactions to taxing
46 25 jurisdictions.
46 26 b. The administration of exempt sales.
46 27 c. The allowances a seller can take for bad debts.
46 28 d. Sales and use tax returns and remittances.
46 29 3. UNIFORM DEFINITIONS. The agreement must
46 30 require states to develop and adopt uniform
46 31 definitions of sales and use tax terms. The
46 32 definitions must enable a state to preserve its
46 33 ability to make policy choices not inconsistent with
46 34 the uniform definitions.
46 35 4. CENTRAL REGISTRATION. The agreement must
46 36 provide a central, electronic registration system that
46 37 allows a seller to register to collect and remit sales
46 38 and use taxes for all member states.
46 39 5. NO NEXUS ATTRIBUTION. The agreement must
46 40 provide that registration with the central
46 41 registration system and the collection of sales and
46 42 use taxes in the member states must not be used as a
46 43 factor in determining whether the seller has nexus
46 44 with a state for any tax.
46 45 6. LOCAL SALES AND USE TAXES. The agreement must
46 46 provide for reduction of the burdens of complying with
46 47 local sales and use taxes through the following:
46 48 a. Restricting variances between the state and
46 49 local tax bases.
46 50 b. Requiring states to administer any sales and
47 1 use taxes levied by local jurisdictions within the
47 2 state so that sellers collecting and remitting these
47 3 taxes must not have to register or file returns with,
47 4 remit funds to, or be subject to independent audits
47 5 from local taxing jurisdictions.
47 6 c. Restricting the frequency of changes in the
47 7 local sales and use tax rates and setting effective
47 8 dates for the application of local jurisdictional
47 9 boundary changes to local sales and use taxes.
47 10 d. Providing notice of changes in local sales and
47 11 use tax rates and of changes in the boundaries of
47 12 local taxing jurisdictions.
47 13 7. MONETARY ALLOWANCES. The agreement must
47 14 outline any monetary allowances that are to be
47 15 provided by the states to sellers or certified service
47 16 providers.
47 17 8. STATE COMPLIANCE. The agreement must require
47 18 each state to certify compliance with the terms of the
47 19 agreement prior to joining and to maintain compliance,
47 20 under the laws of the member state, with all
47 21 provisions of the agreement while a member.
47 22 9. CONSUMER PRIVACY. The agreement must require
47 23 each state to adopt a uniform policy for certified
47 24 service providers that protects the privacy of
47 25 consumers and maintains the confidentiality of tax
47 26 information.
47 27 10. ADVISORY COUNCILS. The agreement must provide
47 28 for the appointment of an advisory council of private
47 29 sector representatives and an advisory council of
47 30 nonmember state representatives to consult with in the
47 31 administration of the agreement.
47 32 Sec. . NEW SECTION. 423.12 LIMITED BINDING
47 33 AND BENEFICIAL EFFECT.
47 34 1. The agreement binds and inures only to the
47 35 benefit of Iowa and the other member states. A
47 36 person, other than a member state, is not an intended
47 37 beneficiary of the agreement. Any benefit to a person
47 38 other than a member state is established by the law of
47 39 Iowa and not by the terms of the agreement.
47 40 2. A person shall not have any cause of action or
47 41 defense under the agreement or by virtue of this
47 42 state's entry into the agreement. A person may not
47 43 challenge, in any action brought under any provision
47 44 of law, any action or inaction by any department,
47 45 agency, or other instrumentality of this state, or any
47 46 political subdivision of this state on the ground that
47 47 the action or inaction is inconsistent with the
47 48 agreement.
47 49 3. A law of this state, or the application of it,
47 50 shall not be declared invalid as to any such person or
48 1 circumstance on the ground that the provision or
48 2 application is inconsistent with the agreement.
48 3 SUBCHAPTER V
48 4 SALES AND USE TAX ACT == ADMINISTRATION OF
48 5 RETAILERS NOT REGISTERED UNDER THE AGREEMENT AND OF
48 6 CONSUMERS OBLIGATED TO PAY USE TAX DIRECTLY
48 7 Sec. . NEW SECTION. 423.13 PURPOSE OF THIS
48 8 SUBCHAPTER.
48 9 The purpose of this subchapter is to provide for
48 10 the administration and collection of sales or use tax
48 11 on the part of retailers who are not registered under
48 12 the agreement and for the collection of use tax on the
48 13 part of consumers who are obligated to pay that tax
48 14 directly. Any application of the sections of this
48 15 subchapter to retailers registered under the agreement
48 16 is only by way of incorporation by reference into
48 17 subchapter VI of this chapter.
48 18 Sec. . NEW SECTION. 423.14 SALES AND USE TAX
48 19 COLLECTION.
48 20 1. a. Sales tax, other than that described in
48 21 paragraph "c", shall be collected by sellers who are
48 22 retailers or by their agents. Sellers or their agents
48 23 shall, as far as practicable, add the sales tax, or
48 24 the average equivalent thereof, to the sales price or
48 25 charge, less trade=ins allowed and taken and when
48 26 added such tax shall constitute a part of the sales
48 27 price or charge, shall be a debt from consumer or user
48 28 to seller or agent until paid, and shall be
48 29 recoverable at law in the same manner as other debts.
48 30 b. In computing the tax to be collected as the
48 31 result of any transaction, the tax computation must be
48 32 carried to the third decimal place. Whenever the
48 33 third decimal place is greater than four, the tax must
48 34 be rounded up to the next whole cent; whenever the
48 35 third decimal place is four or less, the tax must be
48 36 rounded downward to a whole cent. Sellers may elect
48 37 to compute the tax due on transactions on an item or
48 38 invoice basis. Sellers are not required to use a
48 39 bracket system.
48 40 c. The tax imposed upon those sales of motor
48 41 vehicle fuel which are subject to tax and refund under
48 42 chapter 452A shall be collected by the state treasurer
48 43 by way of deduction from refunds otherwise allowable
48 44 under that chapter. The treasurer shall transfer the
48 45 amount of such deductions from the motor vehicle fuel
48 46 tax fund to the special tax fund.
48 47 2. Use tax shall be collected in the following
48 48 manner:
48 49 a. The tax upon the use of all vehicles subject to
48 50 registration or subject only to the issuance of a
49 1 certificate of title or the tax upon the use of
49 2 manufactured housing shall be collected by the county
49 3 treasurer or the state department of transportation
49 4 pursuant to sections 423.26 and 423.27. The county
49 5 treasurer shall retain one dollar from each tax
49 6 payment collected, to be credited to the county
49 7 general fund.
49 8 b. The tax upon the use of all tangible personal
49 9 property other than that enumerated in paragraph "a",
49 10 which is sold by a seller who is a retailer
49 11 maintaining a place of business in this state, or by
49 12 such other retailer or agent as the director shall
49 13 authorize pursuant to section 423.30, shall be
49 14 collected by the retailer or agent and remitted to the
49 15 department, pursuant to the provisions of paragraph
49 16 "e", and sections 423.24, 423.29, 423.30, 423.32, and
49 17 423.33.
49 18 c. The tax upon the use of all tangible personal
49 19 property not paid pursuant to paragraphs "a" and "b"
49 20 shall be paid to the department directly by any person
49 21 using the property within this state, pursuant to the
49 22 provisions of section 423.34.
49 23 d. The tax imposed on the use of services
49 24 enumerated in section 423.5 shall be collected,
49 25 remitted, and paid to the department of revenue and
49 26 finance in the same manner as use tax on tangible
49 27 personal property is collected, remitted, and paid
49 28 under this subchapter.
49 29 e. All persons obligated by paragraph "a", "b", or
49 30 "d", to collect use tax shall, as far as practicable,
49 31 add that tax, or the average equivalent thereof, to
49 32 the purchase price, less trade=ins allowed and taken,
49 33 and when added the tax shall constitute a part of the
49 34 purchase price. Use tax which this section requires
49 35 to be collected by a retailer and any tax collected
49 36 pursuant to this section by a retailer shall
49 37 constitute a debt owed by the retailer to this state.
49 38 Tax which must be paid directly to the department,
49 39 pursuant to paragraph "c" or "d", is to be computed
49 40 and added by the consumer or user to the purchase
49 41 price in the same manner as this paragraph requires a
49 42 seller to compute and add the tax. The tax shall be a
49 43 debt from the consumer or user to the department until
49 44 paid, and shall be recoverable at law in the same
49 45 manner as other debts.
49 46 Sec. . NEW SECTION. 423.15 GENERAL SOURCING
49 47 RULES.
49 48 All sellers obligated to collect Iowa sales or use
49 49 tax shall use the standards set out in this section to
49 50 determine where sales of products occur, excluding
50 1 sales enumerated in section 423.16. These provisions
50 2 apply regardless of the characterization of a product
50 3 as tangible personal property, a digital good, or a
50 4 service, excluding telecommunications services. This
50 5 section only applies to determine a seller's
50 6 obligation to pay or collect and remit a sales or use
50 7 tax with respect to the seller's sale of a product.
50 8 This section does not affect the obligation of a
50 9 purchaser or lessee to remit tax on the use of the
50 10 product to the taxing jurisdictions in which the use
50 11 occurs. A seller's obligation to collect Iowa sales
50 12 tax or Iowa use tax only occurs if the sale is sourced
50 13 to this state. The application of whether Iowa sales
50 14 tax applies to sales sourced to Iowa depends upon
50 15 where the sale is consummated by delivery.
50 16 1. Sales, excluding leases or rentals other than
50 17 leases or rentals set out in subsection 2, of products
50 18 shall be sourced as follows.
50 19 a. When the product is received by the purchaser
50 20 at a business location of the seller, the sale is
50 21 sourced to that business location.
50 22 b. When the product is not received by the
50 23 purchaser at a business location of the seller, the
50 24 sale is sourced to the location where receipt by the
50 25 purchaser or the purchaser's donee, designated as such
50 26 by the purchaser, occurs, including the location
50 27 indicated by instructions for delivery to the
50 28 purchaser or donee, known to the seller.
50 29 c. When paragraphs "a" and "b" do not apply, the
50 30 sale is sourced to the location indicated by an
50 31 address for the purchaser that is available from the
50 32 business records of the seller that are maintained in
50 33 the ordinary course of the seller's business when use
50 34 of this address does not constitute bad faith.
50 35 d. When paragraphs "a", "b", and "c" do not apply,
50 36 the sale is sourced to the location indicated by an
50 37 address for the purchaser obtained during the
50 38 consummation of the sale, including the address of a
50 39 purchaser's payment instrument, if no other address is
50 40 available, when use of this address does not
50 41 constitute bad faith.
50 42 e. When paragraphs "a", "b", "c", and "d" do not
50 43 apply, including the circumstance where the seller is
50 44 without sufficient information to apply the previous
50 45 rules, then the location will be determined by the
50 46 address from which tangible personal property was
50 47 shipped, from which the digital good or the computer
50 48 software delivered electronically was first available
50 49 for transmission by the seller, or from which the
50 50 service was provided disregarding for these purposes
51 1 any location that merely provided the digital transfer
51 2 of the product sold.
51 3 2. The lease or rental of tangible personal
51 4 property, other than property identified in subsection
51 5 3 or section 423.16, shall be sourced as follows:
51 6 a. For a lease or rental that requires recurring
51 7 periodic payments, the first periodic payment is
51 8 sourced the same as a retail sale in accordance with
51 9 the provisions of subsection 1. Periodic payments
51 10 made subsequent to the first payment are sourced to
51 11 the primary property location for each period covered
51 12 by the payment. The primary property location shall
51 13 be as indicated by an address for the property
51 14 provided by the lessee that is available to the lessor
51 15 from its records maintained in the ordinary course of
51 16 business, when use of this address does not constitute
51 17 bad faith. The property location shall not be altered
51 18 by intermittent use at different locations, such as
51 19 use of business property that accompanies employees on
51 20 business trips and service calls.
51 21 b. For a lease or rental that does not require
51 22 recurring periodic payments, the payment is sourced
51 23 the same as a retail sale in accordance with the
51 24 provisions of subsection 1.
51 25 c. This subsection does not affect the imposition
51 26 or computation of sales or use tax on leases or
51 27 rentals based on a lump sum or accelerated basis, or
51 28 on the acquisition of property for lease.
51 29 3. The retail sale, including lease or rental, of
51 30 transportation equipment shall be sourced the same as
51 31 a retail sale in accordance with the provisions of
51 32 subsection 1, notwithstanding the exclusion of lease
51 33 or rental in that subsection. "Transportation
51 34 equipment" means any of the following:
51 35 a. Locomotives or railcars that are utilized for
51 36 the carriage of persons or property in interstate
51 37 commerce.
51 38 b. Trucks and truck=tractors with a gross vehicle
51 39 weight rating of ten thousand one pounds or greater,
51 40 trailers, semitrailers, or passenger buses that meet
51 41 both of the following requirements:
51 42 (1) Are registered through the international
51 43 registration plan.
51 44 (2) Are operated under authority of a carrier
51 45 authorized and certificated by the United States
51 46 department of transportation or another federal
51 47 authority to engage in the carriage of persons or
51 48 property in interstate commerce.
51 49 c. Aircraft that are operated by air carriers
51 50 authorized and certificated by the United States
52 1 department of transportation or another federal or a
52 2 foreign authority to engage in the carriage of persons
52 3 or property in interstate or foreign commerce.
52 4 d. Containers designed for use on and component
52 5 parts attached or secured on the items set forth in
52 6 paragraphs "a" through "c".
52 7 Sec. . NEW SECTION. 423.16 TRANSACTIONS TO
52 8 WHICH THE GENERAL SOURCING RULES DO NOT APPLY.
52 9 Section 423.15 does not apply to sales or use taxes
52 10 levied on the following:
52 11 1. The retail sale or transfer of watercraft,
52 12 modular homes, manufactured housing, or mobile homes,
52 13 and the retail sale, excluding lease or rental, of
52 14 motor vehicles, trailers, semitrailers, or aircraft
52 15 that do not qualify as transportation equipment, as
52 16 defined in section 423.15, subsection 3.
52 17 2. The lease or rental of motor vehicles,
52 18 trailers, semitrailers, or aircraft that do not
52 19 qualify as transportation equipment, as defined in
52 20 section 423.15, subsection 3, which shall be sourced
52 21 in accordance with section 423.17.
52 22 3. Transactions to which the multiple points use
52 23 exemption is applicable, which shall be sourced in
52 24 accordance with section 423.18.
52 25 4. Transactions to which direct mail sourcing is
52 26 applicable, which shall be sourced in accordance with
52 27 section 423.19.
52 28 5. Telecommunications services, as set out in
52 29 section 423.20, which shall be sourced in accordance
52 30 with section 423.20, subsection 2.
52 31 Sec. . NEW SECTION. 423.17 SOURCING RULES FOR
52 32 VARIOUS TYPES OF LEASED OR RENTED EQUIPMENT WHICH IS
52 33 NOT TRANSPORTATION EQUIPMENT.
52 34 The lease or rental of motor vehicles, trailers,
52 35 semitrailers, or aircraft that do not qualify as
52 36 transportation equipment, as defined in section
52 37 423.15, subsection 3, shall be sourced as follows:
52 38 1. For a lease or rental that requires recurring
52 39 periodic payments, each periodic payment is sourced to
52 40 the primary property location. The primary property
52 41 location shall be as indicated by an address for the
52 42 property provided by the lessee that is available to
52 43 the lessor from its records maintained in the ordinary
52 44 course of business, when use of this address does not
52 45 constitute bad faith. This location shall not be
52 46 altered by intermittent use at different locations.
52 47 2. For a lease or rental that does not require
52 48 recurring periodic payments, the payment is sourced
52 49 the same as a retail sale in accordance with the
52 50 provisions of section 423.15, subsection 1.
53 1 3. This section does not affect the imposition or
53 2 computation of sales or use tax on leases or rentals
53 3 based on a lump sum or accelerated basis, or on the
53 4 acquisition of property for lease.
53 5 Sec. . NEW SECTION. 423.18 MULTIPLE POINTS OF
53 6 USE EXEMPTION FORMS.
53 7 A business purchaser that is not a holder of a
53 8 direct pay tax permit pursuant to section 423.36 that
53 9 knows at the time of its purchase of a digital good,
53 10 computer software delivered electronically, or a
53 11 service that the digital good, computer software
53 12 delivered electronically, or service will be
53 13 concurrently available for use in more than one
53 14 jurisdiction shall deliver to the seller in
53 15 conjunction with its purchase a "multiple points of
53 16 use" or "MPU" exemption form disclosing this fact.
53 17 1. Upon receipt of the MPU exemption form, the
53 18 seller is relieved of all obligation to collect, pay,
53 19 or remit the applicable tax and the purchaser shall be
53 20 obligated to collect, pay, or remit the applicable tax
53 21 on a direct pay basis.
53 22 2. A purchaser delivering the MPU exemption form
53 23 may use any reasonable, but consistent and uniform,
53 24 method of apportionment that is supported by the
53 25 purchaser's business records as they exist at the time
53 26 of the consummation of the sale.
53 27 3. The MPU exemption form will remain in effect
53 28 for all future sales by the seller to the purchaser
53 29 except as to the subsequent sale's specific
53 30 apportionment that is governed by the principle of
53 31 subsection 2 and the facts existing at the time of the
53 32 sale until it is revoked in writing.
53 33 4. A holder of a direct pay tax permit under
53 34 section 423.36 shall not be required to deliver an MPU
53 35 exemption form to the seller. A direct pay tax permit
53 36 holder shall follow the provisions of subsection 2 in
53 37 apportioning the tax due on a digital good, computer
53 38 software delivered electronically, or service that
53 39 will be concurrently available for use in more than
53 40 one jurisdiction.
53 41 Sec. . NEW SECTION. 423.19 DIRECT MAIL
53 42 SOURCING.
53 43 1. Notwithstanding section 423.15, a purchaser of
53 44 direct mail that is not a holder of a direct pay tax
53 45 permit pursuant to section 423.36 shall provide to the
53 46 seller in conjunction with the purchase either a
53 47 direct mail form or information to show the
53 48 jurisdictions to which the direct mail is delivered to
53 49 recipients.
53 50 a. Upon receipt of the direct mail form, the
54 1 seller is relieved of all obligations to collect, pay,
54 2 or remit the applicable tax and the purchaser is
54 3 obligated to pay or remit the applicable tax on a
54 4 direct pay basis. A direct mail form shall remain in
54 5 effect for all future sales of direct mail by the
54 6 seller to the purchaser until it is revoked in
54 7 writing.
54 8 b. Upon receipt of information from the purchaser
54 9 showing the jurisdictions to which the direct mail is
54 10 delivered to recipients, the seller shall collect the
54 11 tax according to the delivery information provided by
54 12 the purchaser. In the absence of bad faith, the
54 13 seller is relieved of any further obligation to
54 14 collect tax on any transaction where the seller has
54 15 collected tax pursuant to the delivery information
54 16 provided by the purchaser.
54 17 2. If the purchaser of direct mail does not have a
54 18 direct pay tax permit and does not provide the seller
54 19 with either a direct mail form or delivery
54 20 information, as required by subsection 1, the seller
54 21 shall collect the tax according to section 423.15,
54 22 subsection 1, paragraph "e". Nothing in this
54 23 subsection shall limit a purchaser's obligation for
54 24 sales or use tax to any state to which the direct mail
54 25 is delivered.
54 26 3. If a purchaser of direct mail provides the
54 27 seller with documentation of direct pay authority, the
54 28 purchaser shall not be required to provide a direct
54 29 mail form or delivery information to the seller.
54 30 Sec. . NEW SECTION. 423.20 TELECOMMUNICATIONS
54 31 SERVICE SOURCING.
54 32 1. As used in this section:
54 33 a. "Air=to=ground radiotelephone service" means a
54 34 radio service, as that term is used in 47 C.F.R. }
54 35 22.99, in which common carriers are authorized to
54 36 offer and provide radio telecommunications service for
54 37 hire to subscribers in aircraft.
54 38 b. "Call=by=call basis" means any method of
54 39 charging for the telecommunications service where the
54 40 price is measured by individual calls.
54 41 c. "Communications channel" means a physical or
54 42 virtual path of communications over which signals are
54 43 transmitted between or among customer channel
54 44 termination points.
54 45 d. "Customer" means the person or entity that
54 46 contracts with the seller of the telecommunications
54 47 service. If the end user of the telecommunications
54 48 service is not the contracting party, the end user of
54 49 the telecommunications service is the customer of the
54 50 telecommunications service, but this sentence only
55 1 applies for the purpose of sourcing sales of the
55 2 telecommunications service under this section.
55 3 "Customer" does not include a reseller of a
55 4 telecommunications service or for mobile
55 5 telecommunications service of a serving carrier under
55 6 an agreement to serve the customer outside the home
55 7 service provider's licensed service area.
55 8 e. "Customer channel termination point" means the
55 9 location where the customer either inputs or receives
55 10 the communications.
55 11 f. "End user" means the person who utilizes the
55 12 telecommunications service. In the case of an entity,
55 13 "end user" means the individual who utilizes the
55 14 service on behalf of the entity.
55 15 g. "Home service provider" means the same as that
55 16 term is defined in the federal Mobile
55 17 Telecommunications Sourcing Act, Pub. L. No. 106=252,
55 18 4 U.S.C. } 124(5).
55 19 h. "Mobile telecommunications service" means the
55 20 same as that term is defined in federal Mobile
55 21 Telecommunications Sourcing Act, Pub. L. No. 106=252,
55 22 4 U.S.C. } 124(7).
55 23 i. "Place of primary use" means the street address
55 24 representative of where the customer's use of the
55 25 telecommunications service primarily occurs, which
55 26 must be the residential street address or the primary
55 27 business street address of the customer. In the case
55 28 of mobile telecommunications service, "place of
55 29 primary use" must be within the licensed service area
55 30 of the home service provider.
55 31 j. "Postpaid calling service" means the
55 32 telecommunications service obtained by making a
55 33 payment on a call=by=call basis either through the use
55 34 of a credit card or payment mechanism such as a bank
55 35 card, travel card, credit card, or debit card, or by
55 36 charge made to a telephone number which is not
55 37 associated with the origination or termination of the
55 38 telecommunications service. A "postpaid calling
55 39 service" includes a telecommunications service that
55 40 would be a prepaid calling service except it is not
55 41 exclusively a telecommunications service.
55 42 k. "Prepaid calling service" means the right to
55 43 access exclusively telecommunications services, which
55 44 must be paid for in advance and which enables the
55 45 origination of calls using an access number or
55 46 authorization code, whether manually or electronically
55 47 dialed, and that is sold in predetermined units or
55 48 dollars of which the amount declines with use in a
55 49 known amount.
55 50 l. "Private communication service" means a
56 1 telecommunications service that entitles the customer
56 2 to exclusive or priority use of a communications
56 3 channel or group of channels between or among
56 4 termination points, regardless of the manner in which
56 5 such channel or channels are connected, and includes
56 6 switching capacity, extension lines, stations, and any
56 7 other associated services that are provided in
56 8 connection with the use of such channel or channels.
56 9 m. "Service address" means one of the following:
56 10 (1) The location of the telecommunications
56 11 equipment to which a customer's call is charged and
56 12 from which the call originates or terminates,
56 13 regardless of where the call is billed or paid.
56 14 (2) If the location in subparagraph (1) is not
56 15 known, "service address" means the origination point
56 16 of the signal of the telecommunications service first
56 17 identified by either the seller's telecommunications
56 18 system or in information received by the seller from
56 19 its service provider, where the system used to
56 20 transport such signals is not that of the seller.
56 21 (3) If the locations in subparagraphs (1) and (2)
56 22 are not known, the "service address" means the
56 23 location of the customer's place of primary use.
56 24 2. Sales of telecommunications services shall be
56 25 sourced in the following manner:
56 26 a. Except for the defined telecommunications
56 27 services in paragraph "c", the sale of
56 28 telecommunications services sold on a call=by=call
56 29 basis shall be sourced to one of the following:
56 30 (1) Each level of taxing jurisdiction where the
56 31 call originates and terminates in that jurisdiction.
56 32 (2) Each level of taxing jurisdiction where the
56 33 call either originates or terminates and in which the
56 34 service address is also located.
56 35 b. Except for the defined telecommunications
56 36 services in paragraph "c", a sale of
56 37 telecommunications services sold on a basis other than
56 38 a call=by=call basis is sourced to the customer's
56 39 place of primary use.
56 40 c. Sale of the following telecommunications
56 41 services shall be sourced to each level of taxing
56 42 jurisdiction as follows:
56 43 (1) A sale of mobile telecommunications services
56 44 other than air=to=ground radiotelephone service or
56 45 prepaid calling service is sourced to the customer's
56 46 place of primary use as required by the federal Mobile
56 47 Telecommunications Sourcing Act.
56 48 (2) A sale of postpaid calling service is sourced
56 49 to the origination point of the telecommunications
56 50 signal as first identified by either of the following:
57 1 (a) The seller's telecommunications system.
57 2 (b) Information received by the seller from its
57 3 service provider, where the system used to transport
57 4 such signals is not that of the seller.
57 5 (3) A sale of prepaid calling service is sourced
57 6 in accordance with section 423.15. However, in the
57 7 case of a sale of mobile telecommunications services
57 8 that is a prepaid telecommunications service, the rule
57 9 provided in section 423.15, subsection 1, paragraph
57 10 "e", shall include as an option the location
57 11 associated with the mobile telephone number.
57 12 (4) A sale of a private telecommunications service
57 13 is sourced as follows:
57 14 (a) Service for a separate charge related to a
57 15 customer channel termination point is sourced to each
57 16 level of jurisdiction in which such customer channel
57 17 termination point is located.
57 18 (b) Service where all customer termination points
57 19 are located entirely within one jurisdiction or level
57 20 of jurisdiction is sourced in such jurisdiction in
57 21 which the customer channel termination points are
57 22 located.
57 23 (c) Service for segments of a channel between two
57 24 customer channel termination points located in
57 25 different jurisdictions and which segments of a
57 26 channel are separately charged is sourced fifty
57 27 percent in each level of jurisdiction in which the
57 28 customer channel termination points are located.
57 29 (d) Service for segments of a channel located in
57 30 more than one jurisdiction or levels of jurisdiction
57 31 and which segments are not separately billed is
57 32 sourced in each jurisdiction based on the percentage
57 33 determined by dividing the number of customer channel
57 34 termination points in such jurisdiction by the total
57 35 number of customer channel termination points.
57 36 Sec. . NEW SECTION. 423.21 BAD DEBT
57 37 DEDUCTIONS.
57 38 1. For the purposes of this section, "bad debt"
57 39 means an amount properly calculated pursuant to
57 40 section 166 of the Internal Revenue Code then adjusted
57 41 to exclude financing charges or interest, sales or use
57 42 taxes charged on the purchase price, uncollectible
57 43 amounts on property that remain in the possession of
57 44 the seller until the full purchase price is paid,
57 45 expenses incurred in attempting to collect any debt,
57 46 and repossessed property.
57 47 2. In computing the amount of tax due, a seller
57 48 may deduct bad debts from the total amount upon which
57 49 the tax is calculated for any return. Any deduction
57 50 taken or refund paid which is attributed to bad debts
58 1 shall not include interest.
58 2 3. A seller may deduct bad debts on the return for
58 3 the period during which the bad debt is written off as
58 4 uncollectible in the seller's books and records and is
58 5 eligible to be deducted for federal income tax
58 6 purposes. For purposes of this subsection, a seller
58 7 who is not required to file federal income tax returns
58 8 may deduct a bad debt on a return filed for the period
58 9 in which the bad debt is written off as uncollectible
58 10 in the seller's books and records and would be
58 11 eligible for a bad debt deduction for federal income
58 12 tax purposes if the seller were required to file a
58 13 federal income tax return.
58 14 4. If a deduction is taken for a bad debt and the
58 15 seller subsequently collects the debt in whole or in
58 16 part, the tax on the amount so collected must be paid
58 17 and reported on the return filed for the period in
58 18 which the collection is made.
58 19 5. A seller may obtain a refund of tax on any
58 20 amount of bad debt that exceeds the amount of taxable
58 21 sales within the period allowed for refund claims by
58 22 section 423.47. However, the period allowed for
58 23 refund claims shall be measured from the due date of
58 24 the return on which the bad debt could first be
58 25 claimed.
58 26 6. For the purposes of computing a bad debt
58 27 deduction or reporting a payment received on a
58 28 previously claimed bad debt, any payments made on a
58 29 debt or account shall be applied first to the price of
58 30 the property or service and tax thereon,
58 31 proportionally, and secondly to interest, service
58 32 charges, and any other charges.
58 33 Sec. . NEW SECTION. 423.22 TAXATION IN
58 34 ANOTHER STATE.
58 35 If any person who causes tangible personal property
58 36 to be brought into this state or who uses in this
58 37 state services enumerated in section 423.2 has already
58 38 paid a tax in another state in respect to the sale or
58 39 use of the property or the performance of the service,
58 40 or an occupation tax in respect to the property or
58 41 service, in an amount less than the tax imposed by
58 42 subchapter II or III, the provisions of those
58 43 subchapters shall apply, but at a rate measured by the
58 44 difference only between the rate fixed by subchapter
58 45 II or III and the rate by which the previous tax on
58 46 the sale or use, or the occupation tax, was computed.
58 47 If the tax imposed and paid in the other state is
58 48 equal to or more than the tax imposed by those
58 49 subchapters, then a tax is not due in this state on
58 50 the personal property or service.
59 1 Sec. . NEW SECTION. 423.23 SELLERS'
59 2 AGREEMENTS.
59 3 Agreements between competing sellers, or the
59 4 adoption of appropriate rules and regulations by
59 5 organizations or associations of sellers to provide
59 6 uniform methods for adding sales or use tax or the
59 7 average equivalent thereof, and which do not involve
59 8 price=fixing agreements otherwise unlawful, are
59 9 expressly authorized and shall be held not in
59 10 violation of chapter 553 or other antitrust laws of
59 11 this state. The director shall cooperate with
59 12 sellers, organizations, or associations in formulating
59 13 agreements and rules.
59 14 Sec. . NEW SECTION. 423.24 ABSORBING TAX
59 15 PROHIBITED.
59 16 A seller shall not advertise or hold out or state
59 17 to the public or to any purchaser, consumer, or user,
59 18 directly or indirectly, that the taxes or any parts
59 19 thereof imposed by subchapter II or III will be
59 20 assumed or absorbed by the seller or the taxes will
59 21 not be added to the sales price of the property sold,
59 22 or if added that the taxes or any part thereof will be
59 23 refunded. Any person violating any of the provisions
59 24 of this section within this state is guilty of a
59 25 simple misdemeanor.
59 26 Sec. . NEW SECTION. 423.25 DIRECTOR'S POWER
59 27 TO ADOPT RULES.
59 28 The director shall have the power to adopt rules
59 29 for adding the taxes imposed by subchapters II and
59 30 III, or the average equivalents thereof, by providing
59 31 different methods applying uniformly to retailers
59 32 within the same general classification for the purpose
59 33 of enabling the retailers to add and collect, as far
59 34 as practicable, the amounts of those taxes.
59 35 Sec. . NEW SECTION. 423.26 VEHICLES SUBJECT
59 36 TO REGISTRATION OR ONLY TO THE ISSUANCE OF TITLE ==
59 37 MANUFACTURED HOUSING.
59 38 The use tax imposed upon the use of vehicles
59 39 subject to registration or subject only to the
59 40 issuance of a certificate of title or imposed upon the
59 41 use of manufactured housing shall be paid by the owner
59 42 of the vehicle or of the manufactured housing to the
59 43 county treasurer or the state department of
59 44 transportation from whom the registration receipt or
59 45 certificate of title is obtained. A registration
59 46 receipt for a vehicle subject to registration or
59 47 certificate of title shall not be issued until the tax
59 48 has been paid. The county treasurer or the state
59 49 department of transportation shall require every
59 50 applicant for a registration receipt for a vehicle
60 1 subject to registration or certificate of title to
60 2 supply information as the county treasurer or the
60 3 director deems necessary as to the time of purchase,
60 4 the purchase price, installed purchase price, and
60 5 other information relative to the purchase of the
60 6 vehicle or manufactured housing. On or before the
60 7 tenth day of each month, the county treasurer or the
60 8 state department of transportation shall remit to the
60 9 department the amount of the taxes collected during
60 10 the preceding month.
60 11 A person who willfully makes a false statement in
60 12 regard to the purchase price of a vehicle subject to
60 13 taxation under this section is guilty of a fraudulent
60 14 practice. A person who willfully makes a false
60 15 statement in regard to the purchase price of such a
60 16 vehicle with the intent to evade the payment of tax
60 17 shall be assessed a penalty of seventy=five percent of
60 18 the amount of tax unpaid and required to be paid on
60 19 the actual purchase price less trade=in allowance.
60 20 Sec. . NEW SECTION. 423.27 MOTOR VEHICLE
60 21 LEASE TAX.
60 22 1. The use tax imposed upon the use of leased
60 23 vehicles subject to registration under chapter 321,
60 24 with gross vehicle weight ratings of less than sixteen
60 25 thousand pounds, excluding motorcycles and motorized
60 26 bicycles, which are leased by a lessor licensed
60 27 pursuant to chapter 321F for a period of twelve months
60 28 or more shall be paid by the owner of the vehicle to
60 29 the county treasurer or state department of
60 30 transportation from whom the registration receipt or
60 31 certificate of title is obtained. A registration
60 32 receipt for a vehicle subject to registration or
60 33 issuance of a certificate of title shall not be issued
60 34 until the tax is paid in the initial instance. Tax on
60 35 the lease transaction that does not require titling or
60 36 registration of the vehicle shall be remitted to the
60 37 department. Tax and the reporting of tax due to the
60 38 department shall be remitted on or before fifteen days
60 39 from the last day of the month that the vehicle lease
60 40 tax becomes due. Failure to timely report or remit
60 41 any of the tax when due shall result in a penalty and
60 42 interest being imposed on the tax due pursuant to
60 43 section 423.40, subsection 1, and section 423.42,
60 44 subsection 1.
60 45 2. The amount subject to tax shall be computed on
60 46 each separate lease transaction by taking the total of
60 47 the lease payments, plus the down payment, and
60 48 excluding all of the following:
60 49 a. Title fee.
60 50 b. Registration fees.
61 1 c. Vehicle lease tax pursuant to this section.
61 2 d. Federal excise taxes attributable to the sale
61 3 of the vehicle to the owner or to the lease of the
61 4 vehicle by the owner.
61 5 e. Optional service or warranty contracts subject
61 6 to tax pursuant to section 423.2, subsection 1.
61 7 f. Insurance.
61 8 g. Manufacturer's rebate.
61 9 h. Refundable deposit.
61 10 i. Finance charges, if any, on items listed in
61 11 paragraphs "a" through "h".
61 12 If any or all of the items in paragraphs "a"
61 13 through "i" are excluded from the taxable lease price,
61 14 the owner shall maintain adequate records of the
61 15 amounts of those items. If the parties to a lease
61 16 enter into an agreement providing that the tax imposed
61 17 under this statute is to be paid by the lessee or
61 18 included in the monthly lease payments to be paid by
61 19 the lessee, the total cost of the tax shall not be
61 20 included in the computation of lease price for the
61 21 purpose of taxation under this section. The county
61 22 treasurer, the state department of transportation, or
61 23 the department of revenue and finance shall require
61 24 every applicant for a registration receipt for a
61 25 vehicle subject to tax under this section to supply
61 26 information as the county treasurer or director deems
61 27 necessary as to the date of the lease transaction, the
61 28 lease price, and other information relative to the
61 29 lease of the vehicle.
61 30 3. On or before the tenth day of each month, the
61 31 county treasurer or the state department of
61 32 transportation shall remit to the department the
61 33 amount of the taxes collected during the preceding
61 34 month.
61 35 4. If the lease is terminated prior to the
61 36 termination date contained in the lease agreement, no
61 37 refund shall be allowed for tax previously paid under
61 38 this section, except as provided in section 322G.4.
61 39 Sec. . NEW SECTION. 423.28 SALES TAX REPORT
61 40 == DEDUCTION.
61 41 Motor vehicle or trailer dealers, in making their
61 42 reports and returns to the department for the purpose
61 43 of paying the sales tax, shall be permitted to deduct
61 44 all sales prices from retail sales of vehicles subject
61 45 to registration or subject only to the issuance of a
61 46 certificate of title. Sales prices from sales of
61 47 vehicles subject to registration or subject only to
61 48 the issuance of a certificate of title are exempted
61 49 from the sales tax, but, if required by the director,
61 50 the sales prices shall be included in the returns made
62 1 by motor vehicle or trailer dealers under subchapter
62 2 II, and proper deductions taken pursuant to this
62 3 section.
62 4 Sec. . NEW SECTION. 423.29 COLLECTIONS BY
62 5 SELLERS.
62 6 Every seller who is a retailer and who is making
62 7 taxable sales of tangible personal property in Iowa
62 8 shall, at the time of selling the property, collect
62 9 the sales tax. Every seller who is a retailer
62 10 maintaining a place of business in this state and
62 11 selling tangible personal property for use in Iowa
62 12 shall, at the time of making the sale, whether within
62 13 or without the state, collect the use tax. Sellers
62 14 required to collect sales or use tax shall give to any
62 15 purchaser a receipt for the tax collected in the
62 16 manner and form prescribed by the director.
62 17 Every seller who is a retailer furnishing taxable
62 18 services in Iowa and every seller who is a retailer
62 19 maintaining a place of business in this state and
62 20 furnishing taxable services in Iowa or services
62 21 outside Iowa if the product or result of the service
62 22 is used in Iowa shall be subject to the provisions of
62 23 the preceding paragraph.
62 24 Sec. . NEW SECTION. 423.30 FOREIGN SELLERS
62 25 NOT REGISTERED UNDER THE AGREEMENT.
62 26 The director may, upon application, authorize the
62 27 collection of the use tax by any seller who is a
62 28 retailer not maintaining a place of business within
62 29 this state and not registered under the agreement,
62 30 who, to the satisfaction of the director, furnishes
62 31 adequate security to ensure collection and payment of
62 32 the tax. Such sellers shall be issued, without
62 33 charge, permits to collect tax subject to any
62 34 regulations which the director shall prescribe. When
62 35 so authorized, it shall be the duty of foreign sellers
62 36 to collect the tax upon all tangible personal property
62 37 sold, to the retailer's knowledge, for use within this
62 38 state, in the same manner and subject to the same
62 39 requirements as a retailer maintaining a place of
62 40 business within this state. The authority and permit
62 41 may be canceled when, at any time, the director
62 42 considers the security inadequate, or that tax can
62 43 more effectively be collected from the person using
62 44 property in this state.
62 45 The discretionary power granted in this section is
62 46 extended to apply in the case of foreign retailers
62 47 furnishing services enumerated in section 423.2.
62 48 Sec. . NEW SECTION. 423.31 FILING OF SALES
62 49 TAX RETURNS AND PAYMENT OF SALES TAX.
62 50 1. Each person subject to this section and section
63 1 423.36 and in accordance with the provisions of this
63 2 section and section 423.36 shall, on or before the
63 3 last day of the month following the close of each
63 4 calendar quarter during which such person is or has
63 5 become or ceased being subject to the provisions of
63 6 this section and section 423.36, make, sign, and file
63 7 a return for the calendar quarter in the form as may
63 8 be required. Returns shall show information relating
63 9 to sales prices including goods, wares, and services
63 10 converted to the use of such person, the amounts of
63 11 sales prices excluded and exempt from the tax, the
63 12 amounts of sales prices subject to tax, a calculation
63 13 of tax due, and any other information for the period
63 14 covered by the return as may be required. Returns
63 15 shall be signed by the retailer or the retailer's
63 16 authorized agent and must be certified by the retailer
63 17 to be correct in accordance with forms and rules
63 18 prescribed by the director.
63 19 2. Persons required to file, or committed to file
63 20 by reason of voluntary action or by order of the
63 21 department, deposits of taxes due under this
63 22 subchapter shall be entitled to take credit against
63 23 the total quarterly amount of tax due such amount as
63 24 shall have been deposited by such persons during that
63 25 calendar quarter. The balance remaining due after
63 26 such credit for deposits shall be entered on the
63 27 return. However, such person may be granted an
63 28 extension of time not exceeding thirty days for filing
63 29 the quarterly return, upon a proper showing of
63 30 necessity. If an extension is granted, such person
63 31 shall have paid by the twentieth day of the month
63 32 following the close of such quarter ninety percent of
63 33 the estimated tax due.
63 34 3. The sales tax forms prescribed by the director
63 35 shall be referred to as "retailers tax deposit".
63 36 Deposit forms shall be signed by the retailer or the
63 37 retailer's duly authorized agent, and shall be duly
63 38 certified by the retailer or agent to be correct. The
63 39 director may authorize incorporated banks and trust
63 40 companies or other depositories authorized by law
63 41 which are depositories or financial agents of the
63 42 United States, or of this state, to receive any sales
63 43 tax imposed under this chapter, in the manner, at the
63 44 times, and under the conditions the director
63 45 prescribes. The director shall prescribe the manner,
63 46 times, and conditions under which the receipt of the
63 47 tax by those depositories is to be treated as payment
63 48 of the tax to the department.
63 49 4. Every retailer at the time of making any return
63 50 required by this section shall compute and pay to the
64 1 department the tax due for the preceding period. The
64 2 tax on sales prices from the sale or rental of
64 3 tangible personal property under a consumer rental
64 4 purchase agreement as defined in section 537.3604,
64 5 subsection 8, is payable in the tax period of receipt.
64 6 5. Upon making application and receiving approval
64 7 from the director, a parent corporation and its
64 8 affiliated corporations that make retail sales of
64 9 tangible personal property or taxable enumerated
64 10 services may make deposits and file a consolidated
64 11 sales tax return for the affiliated group, pursuant to
64 12 rules adopted by the director. A parent corporation
64 13 and each affiliate corporation that files a
64 14 consolidated return are jointly and severally liable
64 15 for all tax, penalty, and interest found due for the
64 16 tax period for which a consolidated return is filed or
64 17 required to be filed.
64 18 A business required to file a consolidated sales
64 19 tax return shall file a form entitled "schedule of
64 20 consolidated business locations" with its quarterly
64 21 sales tax return that shows the taxpayer's
64 22 consolidated permit number, the permit number for each
64 23 Iowa business location, the state sales tax amount by
64 24 business location, and the amount of state sales tax
64 25 due on goods consumed that are not assigned to a
64 26 specific business location. Consolidated quarterly
64 27 sales tax returns that are not accompanied by the
64 28 schedule of consolidated business locations form are
64 29 considered incomplete and are subject to penalty under
64 30 section 421.27.
64 31 6. If necessary or advisable in order to insure
64 32 the payment of the tax, the director may require
64 33 returns and payment of the tax to be made for other
64 34 than quarterly periods, the provisions of this
64 35 section, or other provision to the contrary
64 36 notwithstanding.
64 37 Sec. . NEW SECTION. 423.32 FILING OF USE TAX
64 38 RETURNS AND PAYMENT OF USE TAX.
64 39 1. A retailer maintaining a place of business in
64 40 this state who is required to collect or a user who is
64 41 required to pay the use tax or a foreign retailer
64 42 authorized, pursuant to section 423.30, to collect the
64 43 use tax, shall remit to the department the amount of
64 44 tax on or before the last day of the month following
64 45 each calendar quarterly period. However, a retailer
64 46 who collects or owes more than fifteen hundred dollars
64 47 in use taxes in a month shall deposit with the
64 48 department or in a depository authorized by law and
64 49 designated by the director, the amount collected or
64 50 owed, with a deposit form for the month as prescribed
65 1 by the director.
65 2 a. The deposit form is due on or before the
65 3 twentieth day of the month following the month of
65 4 collection, except a deposit is not required for the
65 5 third month of the calendar quarter, and the total
65 6 quarterly amount, less the amounts deposited for the
65 7 first two months of the quarter, is due with the
65 8 quarterly report on the last day of the month
65 9 following the month of collection. At that time, the
65 10 retailer shall file with the department a return for
65 11 the preceding quarterly period in the form prescribed
65 12 by the director showing the purchase price of the
65 13 tangible personal property sold by the retailer during
65 14 the preceding quarterly period, the use of which is
65 15 subject to the use tax imposed by this chapter, and
65 16 other information the director deems necessary for the
65 17 proper administration of the use tax.
65 18 b. The return shall be accompanied by a remittance
65 19 of the use tax for the period covered by the return.
65 20 If necessary in order to ensure payment to the state
65 21 of the tax, the director may in any or all cases
65 22 require returns and payments to be made for other than
65 23 quarterly periods. The director, upon request and a
65 24 proper showing of necessity, may grant an extension of
65 25 time not to exceed thirty days for making any return
65 26 and payment. Returns shall be signed, in accordance
65 27 with forms and rules prescribed by the director, by
65 28 the retailer or the retailer's authorized agent, and
65 29 shall be certified by the retailer or agent to be
65 30 correct.
65 31 2. If it is reasonably expected, as determined by
65 32 rules prescribed by the director, that a retailer's
65 33 annual sales or use tax liability will not exceed one
65 34 hundred twenty dollars for a calendar year, the
65 35 retailer may request and the director may grant
65 36 permission to the retailer, in lieu of the quarterly
65 37 filing and remitting requirements set out elsewhere in
65 38 this section, to file the return required by and remit
65 39 the sales or use tax due under this section on a
65 40 calendar=year basis. The return and tax are due and
65 41 payable no later than January 31 following each
65 42 calendar year in which the retailer carries on
65 43 business.
65 44 3. The director, in cooperation with the
65 45 department of management, may periodically change the
65 46 filing and remittance thresholds by administrative
65 47 rule if in the best interests of the state and
65 48 taxpayer to do so.
65 49 Sec. . NEW SECTION. 423.33 LIABILITY OF
65 50 PERSONS OTHER THAN RETAILERS FOR PAYMENT OF SALES OR
66 1 USE TAX.
66 2 1. LIABILITY OF PURCHASER FOR SALES TAX. If a
66 3 purchaser fails to pay sales tax to the retailer
66 4 required to collect the tax, then in addition to all
66 5 of the rights, obligations, and remedies provided, the
66 6 tax is payable by the purchaser directly to the
66 7 department, and sections 423.31, 423.32, 423.37,
66 8 423.38, 423.39, 423.40, 423.41, and 423.42 apply to
66 9 the purchaser. For failure to pay, the retailer and
66 10 purchaser are liable, unless the circumstances
66 11 described in section 421.60, subsection 2, paragraph
66 12 "m", or section 423.45, subsection 4, paragraph "b" or
66 13 "e", or subsection 5, paragraph "c" or "e", are
66 14 applicable.
66 15 2. IMMEDIATE SUCCESSOR LIABILITY FOR SALES OR USE
66 16 TAX. If a retailer sells the retailer's business or
66 17 stock of goods or quits the business, the retailer
66 18 shall prepare a final return and pay all sales or use
66 19 tax due within the time required by law. The
66 20 immediate successor to the retailer, if any, shall
66 21 withhold a sufficient portion of the purchase price,
66 22 in money or money's worth, to pay the amount of
66 23 delinquent tax, interest, or penalty due and unpaid.
66 24 If the immediate successor of the business or stock of
66 25 goods intentionally fails to withhold the amount due
66 26 from the purchase price as provided in this
66 27 subsection, the immediate successor is personally
66 28 liable for the payment of delinquent taxes, interest,
66 29 and penalty accrued and unpaid on account of the
66 30 operation of the business by the immediate former
66 31 retailer, except when the purchase is made in good
66 32 faith as provided in section 421.28. However, a
66 33 person foreclosing on a valid security interest or
66 34 retaking possession of premises under a valid lease is
66 35 not an "immediate successor" for purposes of this
66 36 section. The department may waive the liability of
66 37 the immediate successor under this subsection if the
66 38 immediate successor exercised good faith in
66 39 establishing the amount of the previous liability.
66 40 3. EVENT SPONSOR'S LIABILITY FOR SALES TAX. A
66 41 person sponsoring a flea market or a craft, antique,
66 42 coin, or stamp show or similar event shall obtain from
66 43 every retailer selling tangible personal property or
66 44 taxable services at the event proof that the retailer
66 45 possesses a valid sales tax permit or secure from the
66 46 retailer a statement, taken in good faith, that
66 47 property or services offered for sale are not subject
66 48 to sales tax. Failure to do so renders a sponsor of
66 49 the event liable for payment of any sales tax,
66 50 interest, and penalty due and owing from any retailer
67 1 selling property or services at the event. Sections
67 2 423.31, 423.32, 423.37, 423.38, 423.39, 423.40,
67 3 423.41, and 423.42 apply to the sponsors. For
67 4 purposes of this subsection, a person sponsoring a
67 5 flea market or a craft, antique, coin, or stamp show
67 6 or similar event does not include an organization
67 7 which sponsors an event less than three times a year
67 8 or a state, county, or district agricultural fair.
67 9 Sec. . NEW SECTION. 423.34 LIABILITY OF USER.
67 10 Any person who uses any property or services
67 11 enumerated in section 423.2 upon which the use tax has
67 12 not been paid, either to the county treasurer or to a
67 13 retailer or direct to the department as required by
67 14 this subchapter, shall be liable for the payment of
67 15 tax, and shall on or before the last day of the month
67 16 next succeeding each quarterly period pay the use tax
67 17 upon all property or services used by the person
67 18 during the preceding quarterly period in the manner
67 19 and accompanied by such returns as the director shall
67 20 prescribe. All of the provisions of sections 423.32
67 21 and 423.33 with reference to the returns and payments
67 22 shall be applicable to the returns and payments
67 23 required by this section.
67 24 Sec. . NEW SECTION. 423.35 POSTING OF BOND TO
67 25 SECURE PAYMENT.
67 26 The director may, when necessary and advisable in
67 27 order to secure the collection of the sales or use
67 28 tax, authorize any person subject to either tax, and
67 29 any retailer required or authorized to collect those
67 30 taxes pursuant to the provisions of section 423.14, to
67 31 file with the department a bond, issued by a surety
67 32 company authorized to transact business in this state
67 33 and approved by the insurance commissioner as to
67 34 solvency and responsibility, in an amount as the
67 35 director may fix, to secure the payment of any tax,
67 36 interest, or penalties due or which may become due
67 37 from such person. In lieu of a bond, securities
67 38 approved by the director, in an amount which the
67 39 director may prescribe, may be deposited with the
67 40 department, which securities shall be kept in the
67 41 custody of the department and may be sold by the
67 42 director at public or private sale, without notice to
67 43 the depositor, if it becomes necessary to do so in
67 44 order to recover any tax, interest, or penalties due.
67 45 Upon the sale, the surplus, if any, above the amounts
67 46 due under this chapter shall be returned to the person
67 47 who deposited the securities.
67 48 Sec. . NEW SECTION. 423.36 PERMITS REQUIRED
67 49 TO COLLECT SALES OR USE TAX == APPLICATIONS ==
67 50 REVOCATION.
68 1 1. A person shall not engage in or transact
68 2 business as a retailer making taxable sales of
68 3 tangible personal property or furnishing services
68 4 within this state or as a retailer making taxable
68 5 sales of tangible personal property or furnishing
68 6 services for use within this state, unless a permit
68 7 has been issued to the retailer under this section,
68 8 except as provided in subsection 6. Every person
68 9 desiring to engage in or transact business as a
68 10 retailer shall file with the department an application
68 11 for a permit to collect sales or use tax. Every
68 12 application for a sales or use tax permit shall be
68 13 made upon a form prescribed by the director and shall
68 14 set forth any information the director may require.
68 15 The application shall be signed by an owner of the
68 16 business if a natural person; in the case of a
68 17 retailer which is an association or partnership, by a
68 18 member or partner; and in the case of a retailer which
68 19 is a corporation, by an executive officer or some
68 20 person specifically authorized by the corporation to
68 21 sign the application, to which shall be attached the
68 22 written evidence of the person's authority.
68 23 2. To collect sales or use tax, the applicant must
68 24 have a permit for each place of business in the state
68 25 of Iowa. The department may deny a permit to an
68 26 applicant who is substantially delinquent in paying a
68 27 tax due, or the interest or penalty on the tax,
68 28 administered by the department at the time of
68 29 application. If the applicant is a partnership, a
68 30 permit may be denied if a partner is substantially
68 31 delinquent in paying any delinquent tax, penalty, or
68 32 interest. If the applicant is a corporation, a permit
68 33 may be denied if any officer having a substantial
68 34 legal or equitable interest in the ownership of the
68 35 corporation owes any delinquent tax, penalty, or
68 36 interest.
68 37 3. The department shall grant and issue to each
68 38 applicant a permit for each place of business in this
68 39 state where sales or use tax is collected. A permit
68 40 is not assignable and is valid only for the person in
68 41 whose name it is issued and for the transaction of
68 42 business at the place designated or at a place of
68 43 relocation within the state if the ownership remains
68 44 the same.
68 45 If an applicant is making sales outside Iowa for
68 46 use in this state or furnishing services outside Iowa,
68 47 the product or result of which will be used in this
68 48 state, that applicant shall be issued one use tax
68 49 permit by the department applicable to these out=of=
68 50 state sales or services.
69 1 4. Permits issued under this section are valid and
69 2 effective until revoked by the department.
69 3 5. If the holder of a permit fails to comply with
69 4 any of the provisions of this subchapter or of
69 5 subchapter II or III or any order or rule of the
69 6 department adopted under those subchapters or is
69 7 substantially delinquent in the payment of a tax
69 8 administered by the department or the interest or
69 9 penalty on the tax, or if the person is a corporation
69 10 and if any officer having a substantial legal or
69 11 equitable interest in the ownership of the corporation
69 12 owes any delinquent tax of the permit=holding
69 13 corporation, or interest or penalty on the tax,
69 14 administered by the department, the director may
69 15 revoke the permit. The director shall send notice by
69 16 mail to a permit holder informing that person of the
69 17 director's intent to revoke the permit and of the
69 18 permit holder's right to a hearing on the matter. If
69 19 the permit holder petitions the director for a hearing
69 20 on the proposed revocation, after giving ten days'
69 21 notice of the time and place of the hearing in
69 22 accordance with section 17A.18, subsection 3, the
69 23 matter may be heard and a decision rendered. The
69 24 director may restore permits after revocation. The
69 25 director shall adopt rules setting forth the period of
69 26 time a retailer must wait before a permit may be
69 27 restored or a new permit may be issued. The waiting
69 28 period shall not exceed ninety days from the date of
69 29 the revocation of the permit.
69 30 6. Sellers who are not regularly engaged in
69 31 selling at retail and do not have a permanent place of
69 32 business, but who are temporarily engaged in selling
69 33 from trucks, portable roadside stands, concessionaires
69 34 at state, county, district, or local fairs, carnivals,
69 35 or the like, shall report and remit the sales tax on a
69 36 temporary basis, under rules the director shall
69 37 provide for the efficient collection of the sales tax.
69 38 This subsection applies to sellers who are temporarily
69 39 engaged in furnishing services.
69 40 Persons engaged in selling tangible personal
69 41 property or furnishing services shall not be required
69 42 to obtain or retain a sales tax permit for a place of
69 43 business at which taxable sales of tangible personal
69 44 property or taxable performance of services will not
69 45 occur.
69 46 7. The provisions of subsection 1, dealing with
69 47 the lawful right of a retailer to transact business,
69 48 as applicable, apply to persons having receipts from
69 49 furnishing services enumerated in section 423.2,
69 50 except that a person holding a permit pursuant to
70 1 subsection 1 shall not be required to obtain any
70 2 separate sales tax permit for the purpose of engaging
70 3 in business involving the services.
70 4 8. a. Except as provided in paragraph "b",
70 5 purchasers, users, and consumers of tangible personal
70 6 property or enumerated services taxed pursuant to
70 7 subchapter II or III of this chapter or chapters 423B
70 8 and 423E may be authorized, pursuant to rules adopted
70 9 by the director, to remit tax owed directly to the
70 10 department instead of the tax being collected and paid
70 11 by the seller. To qualify for a direct pay tax
70 12 permit, the purchaser, user, or consumer must accrue a
70 13 tax liability of more than four thousand dollars in
70 14 tax under subchapters II and III in a semimonthly
70 15 period and make deposits and file returns pursuant to
70 16 section 423.31. This authority shall not be granted
70 17 or exercised except upon application to the director
70 18 and then only after issuance by the director of a
70 19 direct pay tax permit.
70 20 b. The granting of a direct pay tax permit is not
70 21 authorized for any of the following:
70 22 (1) Taxes imposed on the sales, furnishing, or
70 23 service of gas, electricity, water, heat, pay
70 24 television service, and communication service.
70 25 (2) Taxes imposed under sections 423.26 and 423.27
70 26 and chapter 423C.
70 27 Sec. . NEW SECTION. 423.37 FAILURE TO FILE
70 28 SALES OR USE TAX RETURNS == INCORRECT RETURNS.
70 29 1. As soon as practicable after a return is filed
70 30 and in any event within three years after the return
70 31 is filed, the department shall examine it, assess and
70 32 determine the tax due if the return is found to be
70 33 incorrect, and give notice to the person liable for
70 34 the tax of the assessment and determination as
70 35 provided in subsection 2. The period for the
70 36 examination and determination of the correct amount of
70 37 tax is unlimited in the case of a false or fraudulent
70 38 return made with the intent to evade tax or in the
70 39 case of a failure to file a return.
70 40 2. If a return required by this subchapter is not
70 41 filed, or if a return when filed is incorrect or
70 42 insufficient and the maker fails to file a corrected
70 43 or sufficient return within twenty days after the same
70 44 is required by notice from the department, the
70 45 department shall determine the amount of tax due from
70 46 information as the department may be able to obtain
70 47 and, if necessary, may estimate the tax on the basis
70 48 of external indices, such as number of employees of
70 49 the person concerned, rentals paid by the person,
70 50 stock on hand, or other factors. The department shall
71 1 give notice of the determination to the person liable
71 2 for the tax. The determination shall fix the tax
71 3 unless the person against whom it is assessed shall,
71 4 within sixty days after the giving of notice of the
71 5 determination, apply to the director for a hearing or
71 6 unless the taxpayer contests the determination by
71 7 paying the tax, interest, and penalty and timely
71 8 filing a claim for refund. At the hearing evidence
71 9 may be offered to support the determination or to
71 10 prove that it is incorrect. After the hearing the
71 11 director shall give notice of the decision to the
71 12 person liable for the tax.
71 13 3. The three=year period of limitation provided in
71 14 subsection 1 may be extended by a taxpayer by signing
71 15 a waiver agreement form to be provided by the
71 16 department. The agreement shall stipulate the period
71 17 of extension and the tax period to which the extension
71 18 applies. The agreement shall also provide that a
71 19 claim for refund may be filed by the taxpayer at any
71 20 time during the period of extension.
71 21 Sec. . NEW SECTION. 423.38 JUDICIAL REVIEW.
71 22 1. Judicial review of actions of the director may
71 23 be sought in accordance with the terms of the Iowa
71 24 administrative procedure Act.
71 25 2. For cause and upon a showing by the director
71 26 that collection of the tax in dispute is in doubt, the
71 27 court may order the petitioner to file with the clerk
71 28 a bond for the use of the respondent, with sureties
71 29 approved by the clerk, in the amount of tax appealed
71 30 from, conditioned that the petitioner shall perform
71 31 the orders of the court.
71 32 3. An appeal may be taken by the taxpayer or the
71 33 director to the supreme court of this state
71 34 irrespective of the amount involved.
71 35 Sec. . NEW SECTION. 423.39 SERVICE OF
71 36 NOTICES.
71 37 1. A notice authorized or required under this
71 38 subchapter may be given by mailing the notice to the
71 39 person for whom it is intended, addressed to that
71 40 person at the address given in the last return filed
71 41 by the person pursuant to this subchapter, or if no
71 42 return has been filed, then to any address obtainable.
71 43 The mailing of the notice is presumptive evidence of
71 44 the receipt of the notice by the person to whom
71 45 addressed. Any period of time which is determined
71 46 according to this subchapter by the giving of notice
71 47 commences to run from the date of mailing of the
71 48 notice.
71 49 2. The provisions of the Code relative to the
71 50 limitation of time for the enforcement of a civil
72 1 remedy shall not apply to any proceeding or action
72 2 taken to levy, appraise, assess, determine, or enforce
72 3 the collection of any tax or penalty provided by this
72 4 chapter.
72 5 Sec. . NEW SECTION. 423.40 PENALTIES ==
72 6 OFFENSES == LIMITATION.
72 7 1. In addition to the sales or use tax or
72 8 additional sales or use tax, the taxpayer shall pay a
72 9 penalty as provided in section 421.27. The taxpayer
72 10 shall also pay interest on the sales or use tax or
72 11 additional sales or use tax at the rate in effect
72 12 under section 421.7 for each month counting each
72 13 fraction of a month as an entire month, computed from
72 14 the date the semimonthly or monthly tax deposit form
72 15 or return was required to be filed. The penalty and
72 16 interest shall be paid to the department and disposed
72 17 of in the same manner as other receipts under this
72 18 subchapter. Unpaid penalties and interest may be
72 19 enforced in the same manner as the taxes imposed by
72 20 this chapter.
72 21 2. a. Any person who knowingly sells tangible
72 22 personal property, tickets or admissions to places of
72 23 amusement and athletic events, or gas, water,
72 24 electricity, or communication service at retail, or
72 25 engages in the furnishing of services enumerated in
72 26 section 423.2, in this state without procuring a
72 27 permit to collect tax, as provided in section 423.36,
72 28 or who violates section 423.24 and the officers of any
72 29 corporation who so act are guilty of a serious
72 30 misdemeanor.
72 31 b. A person who knowingly sells tangible personal
72 32 property, tickets or admissions to places of amusement
72 33 and athletic events, or gas, water, electricity, or
72 34 communication service at retail, or engages in the
72 35 furnishing of services enumerated in section 423.2, in
72 36 this state after the person's sales tax permit has
72 37 been revoked and before it has been restored as
72 38 provided in section 423.36, subsection 5, and the
72 39 officers of any corporation who so act are guilty of
72 40 an aggravated misdemeanor.
72 41 3. A person who willfully attempts in any manner
72 42 to evade any tax imposed by this chapter or the
72 43 payment of the tax or a person who makes or causes to
72 44 be made a false or fraudulent semimonthly or monthly
72 45 tax deposit form or return with intent to evade any
72 46 tax imposed by subchapter II or III or the payment of
72 47 the tax is guilty of a class "D" felony.
72 48 4. The certificate of the director to the effect
72 49 that a tax has not been paid, that a return has not
72 50 been filed, or that information has not been supplied
73 1 pursuant to the provisions of this subchapter shall be
73 2 prima facie evidence thereof.
73 3 5. A person required to pay sales or use tax, or
73 4 to make, sign, or file a tax deposit form or return or
73 5 supplemental return, who willfully makes a false or
73 6 fraudulent tax deposit form or return, or willfully
73 7 fails to pay at least ninety percent of the tax or
73 8 willfully fails to make, sign, or file the tax deposit
73 9 form or return, at the time required by law, is guilty
73 10 of a fraudulent practice.
73 11 6. A prosecution for an offense specified in this
73 12 section shall be commenced within six years after its
73 13 commission.
73 14 Sec. . NEW SECTION. 423.41 BOOKS ==
73 15 EXAMINATION.
73 16 Every retailer required or authorized to collect
73 17 taxes imposed by this chapter and every person using
73 18 in this state tangible personal property, services, or
73 19 the product of services shall keep records, receipts,
73 20 invoices, and other pertinent papers as the director
73 21 shall require, in the form that the director shall
73 22 require, for as long as the director has the authority
73 23 to examine and determine tax due. The director or any
73 24 duly authorized agent of the department may examine
73 25 the books, papers, records, and equipment of any
73 26 person either selling tangible personal property or
73 27 services or liable for the tax imposed by this
73 28 chapter, and investigate the character of the business
73 29 of any person in order to verify the accuracy of any
73 30 return made, or if a return was not made by the
73 31 person, ascertain and determine the amount due under
73 32 this chapter. These books, papers, and records shall
73 33 be made available within this state for examination
73 34 upon reasonable notice when the director deems it
73 35 advisable and so orders. The preceding requirements
73 36 shall likewise apply to users and persons furnishing
73 37 services enumerated in section 423.2.
73 38 Sec. . NEW SECTION. 423.42 STATUTES
73 39 APPLICABLE.
73 40 1. The director shall administer the taxes imposed
73 41 by subchapters II and III in the same manner and
73 42 subject to all the provisions of, and all of the
73 43 powers, duties, authority, and restrictions contained
73 44 in, section 422.25, subsection 4, section 422.30, and
73 45 sections 422.67 through 422.75.
73 46 2. All the provisions of section 422.26 shall
73 47 apply in respect to the taxes and penalties imposed by
73 48 subchapters II and III and this subchapter, except
73 49 that, as applied to any tax imposed by subchapters II
73 50 and III, the lien provided in section 422.26 shall be
74 1 prior and paramount over all subsequent liens upon any
74 2 personal property within this state, or right to such
74 3 personal property, belonging to the taxpayer without
74 4 the necessity of recording as provided in section
74 5 422.26. The requirements for recording shall, as
74 6 applied to the taxes imposed by subchapters II and
74 7 III, apply only to the liens upon real property. When
74 8 requested to do so by any person from whom a taxpayer
74 9 is seeking credit, or with whom the taxpayer is
74 10 negotiating the sale of any personal property, or by
74 11 any other person having a legitimate interest in such
74 12 information, the director shall, upon being satisfied
74 13 that such a situation exists, inform that person as to
74 14 the amount of unpaid taxes due by such taxpayer under
74 15 the provisions of subchapters II and III. The giving
74 16 of this information under these circumstances shall
74 17 not be deemed a violation of section 422.72 as applied
74 18 to subchapters II and III.
74 19 Sec. . NEW SECTION. 423.43 DEPOSIT OF REVENUE
74 20 == APPROPRIATIONS.
74 21 Except as otherwise provided in section 312.2,
74 22 subsection 15, all revenues derived from the use tax
74 23 on motor vehicles, trailers, and motor vehicle
74 24 accessories and equipment as collected pursuant to
74 25 sections 423.26 and 423.27 shall be deposited and
74 26 credited to the road use tax fund and shall be used
74 27 exclusively for the construction, maintenance, and
74 28 supervision of public highways.
74 29 1. Notwithstanding any provision of this section
74 30 which provides that all revenues derived from the use
74 31 tax on motor vehicles, trailers, and motor vehicle
74 32 accessories and equipment as collected pursuant to
74 33 sections 423.26 and 423.27 shall be deposited and
74 34 credited to the road use tax fund, eighty percent of
74 35 the revenues shall be deposited and credited as
74 36 follows:
74 37 a. Twenty=five percent of all such revenue, up to
74 38 a maximum of four million two hundred fifty thousand
74 39 dollars per quarter, shall be deposited into and
74 40 credited to the Iowa comprehensive petroleum
74 41 underground storage tank fund created in section
74 42 455G.3, and the moneys so deposited are a continuing
74 43 appropriation for expenditure under chapter 455G, and
74 44 moneys so appropriated shall not be used for other
74 45 purposes.
74 46 b. Any such revenues remaining shall be credited
74 47 to the road use tax fund.
74 48 2. Notwithstanding any other provision of this
74 49 section that provides that all revenue derived from
74 50 the use tax on motor vehicles, trailers, and motor
75 1 vehicle accessories and equipment as collected
75 2 pursuant to section 423.26 shall be deposited and
75 3 credited to the road use tax fund, twenty percent of
75 4 the revenues shall be credited and deposited as
75 5 follows: one=half to the road use tax fund and one=
75 6 half to the primary road fund to be used for the
75 7 commercial and industrial highway network.
75 8 3. For the fiscal year beginning July 1, 2004, and
75 9 each subsequent fiscal year, revenues arising under
75 10 the operation of this chapter which are derived from
75 11 the tax imposed on remote sales shall be deposited
75 12 into the remote sales tax fund created in section
75 13 423.60 in an amount equal to the excess of the
75 14 revenues derived from the tax imposed on remote sales
75 15 during the fiscal year over the revenues derived from
75 16 the tax imposed on remote sales during the fiscal year
75 17 beginning July 1, 2003.
75 18 4. All other revenue arising under the operation
75 19 of this chapter shall be credited to the general fund
75 20 of the state.
75 21 Sec. . NEW SECTION. 423.44 REIMBURSEMENT FOR
75 22 PRIMARY ROAD FUND.
75 23 From moneys deposited into the road use tax fund,
75 24 the department may credit to the primary road fund any
75 25 amount of revenues derived from the use tax on motor
75 26 vehicles, trailers, and motor vehicle accessories and
75 27 equipment as collected pursuant to sections 423.26 and
75 28 423.27 to the extent necessary to reimburse that fund
75 29 for the expenditures not otherwise eligible to be made
75 30 from the primary road fund, which are made for
75 31 repairing, improving, and maintaining bridges over the
75 32 rivers bordering the state. Expenditures for those
75 33 portions of bridges within adjacent states may be
75 34 included when they are made pursuant to an agreement
75 35 entered into under section 313.63, 313A.34, or 314.10.
75 36 Sec. . NEW SECTION. 423.45 REFUNDS ==
75 37 EXEMPTION CERTIFICATES.
75 38 1. If an amount of tax represented by a retailer
75 39 to a consumer or user as constituting tax due is
75 40 computed upon a sales price that is not taxable or the
75 41 amount represented is in excess of the actual taxable
75 42 amount and the amount represented is actually paid by
75 43 the consumer or user to the retailer, the excess
75 44 amount of tax paid shall be returned to the consumer
75 45 or user upon notification to the retailer by the
75 46 department that an excess payment exists.
75 47 2. If an amount of tax represented by a retailer
75 48 to a consumer or user as constituting tax due is
75 49 computed upon a sales price that is not taxable or the
75 50 amount represented is in excess of the actual taxable
76 1 amount and the amount represented is actually paid by
76 2 the consumer or user to the retailer, the excess
76 3 amount of tax paid shall be returned to the consumer
76 4 or user upon proper notification to the retailer by
76 5 the consumer or user that an excess payment exists.
76 6 "Proper" notification is written notification which
76 7 allows a retailer at least sixty days to respond and
76 8 which contains enough information to allow a retailer
76 9 to determine the validity of a consumer's or user's
76 10 claim that an excess amount of tax has been paid. No
76 11 cause of action shall accrue against a retailer for
76 12 excess tax paid until sixty days after proper notice
76 13 has been given the retailer by the consumer or user.
76 14 3. In the circumstances described in subsections 1
76 15 and 2, a retailer has the option to either return any
76 16 excess amount of tax paid to a consumer or user, or to
76 17 remit the amount which a consumer or user has paid to
76 18 the retailer to the department.
76 19 4. a. The department shall issue or the seller
76 20 may separately provide exemption certificates in the
76 21 form prescribed by the director, including
76 22 certificates not made of paper, which conform to the
76 23 requirements of paragraph "c", to assist retailers in
76 24 properly accounting for nontaxable sales of tangible
76 25 personal property or services to purchasers for a
76 26 nontaxable purpose. The department shall also allow
76 27 the use of exemption certificates for those
76 28 circumstances in which a sale is taxable but the
76 29 seller is not obligated to collect tax from the buyer.
76 30 b. The sales tax liability for all sales of
76 31 tangible personal property and all sales of services
76 32 is upon the seller and the purchaser unless the seller
76 33 takes in good faith from the purchaser a valid
76 34 exemption certificate stating under penalty of perjury
76 35 that the purchase is for a nontaxable purpose and is
76 36 not a retail sale as defined in section 423.1, or the
76 37 seller is not obligated to collect tax due, or unless
76 38 the seller takes a fuel exemption certificate pursuant
76 39 to subsection 5. If the tangible personal property or
76 40 services are purchased tax free pursuant to a valid
76 41 exemption certificate which is taken in good faith by
76 42 the seller, and the tangible personal property or
76 43 services are used or disposed of by the purchaser in a
76 44 nonexempt manner, the purchaser is solely liable for
76 45 the taxes and shall remit the taxes directly to the
76 46 department and sections 423.31, 423.32, 423.37,
76 47 423.38, 423.39, 423.40, 423.41, and 423.42 shall apply
76 48 to the purchaser.
76 49 c. A valid exemption certificate is an exemption
76 50 certificate which is complete and correct according to
77 1 the requirements of the director.
77 2 d. A valid exemption certificate is taken in good
77 3 faith by the seller when the seller has exercised that
77 4 caution and diligence which honest persons of ordinary
77 5 prudence would exercise in handling their own business
77 6 affairs, and includes an honesty of intention and
77 7 freedom from knowledge of circumstances which ought to
77 8 put one upon inquiry as to the facts. In order for a
77 9 seller to take a valid exemption certificate in good
77 10 faith, the seller must exercise reasonable prudence to
77 11 determine the facts supporting the valid exemption
77 12 certificate, and if any facts upon such certificate
77 13 would lead a reasonable person to further inquiry,
77 14 such inquiry must be made with an honest intent to
77 15 discover the facts.
77 16 e. If the circumstances change and as a result the
77 17 tangible personal property or services are used or
77 18 disposed of by the purchaser in a nonexempt manner or
77 19 the purchaser becomes obligated to pay the tax, the
77 20 purchaser is liable solely for the taxes and shall
77 21 remit the taxes directly to the department in
77 22 accordance with this subsection.
77 23 5. a. The department shall issue or the seller
77 24 may separately provide fuel exemption certificates in
77 25 the form prescribed by the director.
77 26 b. For purposes of this subsection:
77 27 (1) "Fuel" includes gas, electricity, water, heat,
77 28 steam, and any other tangible personal property
77 29 consumed in creating heat, power, or steam.
77 30 (2) "Fuel consumed in processing" means fuel used
77 31 or consumed for processing including grain drying, for
77 32 providing heat or cooling for livestock buildings or
77 33 for greenhouses or buildings or parts of buildings
77 34 dedicated to the production of flowering, ornamental,
77 35 or vegetable plants intended for sale in the ordinary
77 36 course of business, for use in aquaculture production,
77 37 or for generating electric current, or in implements
77 38 of husbandry engaged in agricultural production.
77 39 (3) "Fuel exemption certificate" means an
77 40 exemption certificate given by the purchaser under
77 41 penalty of perjury to assist retailers in properly
77 42 accounting for nontaxable sales of fuel consumed in
77 43 processing.
77 44 (4) "Substantial change" means a change in the use
77 45 or disposition of tangible personal property and
77 46 services by the purchaser such that the purchaser pays
77 47 less than ninety percent of the purchaser's actual
77 48 sales tax liability. A change includes a misstatement
77 49 of facts in an application made pursuant to paragraph
77 50 "d" or in a fuel exemption certificate.
78 1 c. The seller may accept a completed fuel
78 2 exemption certificate, as prepared by the purchaser,
78 3 for three years unless the purchaser files a new
78 4 completed exemption certificate. If the fuel is
78 5 purchased tax free pursuant to a fuel exemption
78 6 certificate which is taken by the seller, and the fuel
78 7 is used or disposed of by the purchaser in a nonexempt
78 8 manner, the purchaser is solely liable for the taxes,
78 9 and shall remit the taxes directly to the department
78 10 and sections 423.31, 423.32, 423.37, 423.38, 423.39,
78 11 423.40, 423.41, and 423.42 shall apply to the
78 12 purchaser.
78 13 d. The purchaser may apply to the department for
78 14 its review of the fuel exemption certificate. In this
78 15 event, the department shall review the fuel exemption
78 16 certificate within twelve months from the date of
78 17 application and determine the correct amount of the
78 18 exemption. If the amount determined by the department
78 19 is different than the amount that the purchaser claims
78 20 is exempt, the department shall promptly notify the
78 21 purchaser of the determination. Failure of the
78 22 department to make a determination within twelve
78 23 months from the date of application shall constitute a
78 24 determination that the fuel exemption certificate is
78 25 correct as submitted. A determination of exemption by
78 26 the department is final unless the purchaser appeals
78 27 to the director for a revision of the determination
78 28 within sixty days after the date of the notice of
78 29 determination. The director shall grant a hearing,
78 30 and upon the hearing, the director shall determine the
78 31 correct exemption and notify the purchaser of the
78 32 decision by mail. The decision of the director is
78 33 final unless the purchaser seeks judicial review of
78 34 the director's decision under section 423.38 within
78 35 sixty days after the date of the notice of the
78 36 director's decision. Unless there is a substantial
78 37 change, the department shall not impose penalties
78 38 pursuant to section 423.40 both retroactively to
78 39 purchases made after the date of application and
78 40 prospectively until the department gives notice to the
78 41 purchaser that a tax or additional tax is due, for
78 42 failure to remit any tax due which is in excess of a
78 43 determination made under this section. A
78 44 determination made by the department pursuant to this
78 45 subsection does not constitute an audit for purposes
78 46 of section 423.37.
78 47 e. If the circumstances change and the fuel is
78 48 used or disposed of by the purchaser in a nonexempt
78 49 manner, the purchaser is solely liable for the taxes
78 50 and shall remit the taxes directly to the department
79 1 in accordance with paragraph "c".
79 2 f. The purchaser shall attach documentation to the
79 3 fuel exemption certificate which is reasonably
79 4 necessary to support the exemption for fuel consumed
79 5 in processing. If the purchaser files a new exemption
79 6 certificate with the seller, documentation shall not
79 7 be required if the purchaser previously furnished the
79 8 seller with this documentation and substantial change
79 9 has not occurred since that documentation was
79 10 furnished or if fuel consumed in processing is
79 11 separately metered and billed by the seller.
79 12 6. Nothing in this section authorizes any cause of
79 13 action by any person to recover sales or use taxes
79 14 directly from the state or extends any person's time
79 15 to seek a refund of sales or use taxes which have been
79 16 collected and remitted to the state.
79 17 Sec. . NEW SECTION. 423.46 RATE AND BASE
79 18 CHANGES.
79 19 The department shall make a reasonable effort to
79 20 provide sellers with as much advance notice as
79 21 practicable of a rate change and to notify sellers of
79 22 legislative changes in the tax base and amendments to
79 23 sales and use tax rules. Failure of a seller to
79 24 receive notice or failure of this state to provide
79 25 notice or limit the effective date of a rate change
79 26 shall not relieve the seller of its obligation to
79 27 collect sales or use taxes for this state.
79 28 Sec. . NEW SECTION. 423.47 REFUNDS AND
79 29 CREDITS.
79 30 If it shall appear that, as a result of mistake, an
79 31 amount of tax, penalty, or interest has been paid
79 32 which was not due under the provisions of this
79 33 chapter, such amount shall be credited against any tax
79 34 due, or to become due, on the books of the department
79 35 from the person who made the erroneous payment, or
79 36 such amount shall be refunded to such person by the
79 37 department. A claim for refund or credit that has not
79 38 been filed with the department within three years
79 39 after the tax payment for which a refund or credit is
79 40 claimed became due, or one year after such tax payment
79 41 was made, whichever time is the later, shall not be
79 42 allowed by the director.
79 43 SUBCHAPTER VI
79 44 SALES AND USE TAX ACT == ADMINISTRATION OF
79 45 RETAILERS REGISTERED VOLUNTARILY UNDER THE
79 46 AGREEMENT
79 47 Sec. . NEW SECTION. 423.48 RESPONSIBILITIES
79 48 AND RIGHTS OF SELLERS REGISTERED UNDER THE AGREEMENT.
79 49 1. By registering under the agreement, the seller
79 50 agrees to collect and remit sales and use taxes for
80 1 all its taxable Iowa sales. Iowa's withdrawal from
80 2 the agreement or revocation of its membership in the
80 3 agreement shall not relieve a seller from its
80 4 responsibility to remit taxes previously collected on
80 5 behalf of this state.
80 6 2. The following provisions apply to any seller
80 7 who registers under the agreement:
80 8 a. The seller may register on=line.
80 9 b. Registration under the agreement and the
80 10 collection of Iowa sales and use taxes shall not be
80 11 used as factors in determining whether the seller has
80 12 nexus with Iowa for any tax.
80 13 c. If registered under the agreement with any
80 14 other member state, the seller is considered to be
80 15 registered in Iowa.
80 16 d. The seller is not required to pay registration
80 17 fees or other charges.
80 18 e. A written signature from the seller is not
80 19 required.
80 20 f. The seller may register by way of an agent.
80 21 The agent's appointment shall be in writing and
80 22 submitted to the department if requested by the
80 23 department.
80 24 g. The seller may cancel its registration at any
80 25 time under procedures adopted by the governing board
80 26 established pursuant to the agreement. Cancellation
80 27 does not relieve the seller of its liability for
80 28 remitting any Iowa taxes collected.
80 29 3. The following additional responsibilities and
80 30 rights apply to model sellers:
80 31 a. A model 1 seller's obligation to calculate,
80 32 collect, and remit sales and use taxes shall be
80 33 performed by its certified service provider, except
80 34 for the seller's obligation to remit tax on its own
80 35 purchases. As the seller's agent, the certified
80 36 service provider is liable for its model 1 seller's
80 37 sales and use tax due Iowa on all sales transactions
80 38 it processes for the seller except as set out in this
80 39 section. A seller that contracts with a certified
80 40 service provider is not liable to the state for sales
80 41 or use tax due on transactions processed by the
80 42 certified service provider unless the seller
80 43 misrepresents the types of items or services it sells
80 44 or commits fraud. In the absence of probable cause to
80 45 believe that the seller has committed fraud or made a
80 46 material misrepresentation, the seller is not subject
80 47 to audit on the transactions processed by the
80 48 certified service provider. A model 1 seller is
80 49 subject to audit for transactions not processed by the
80 50 certified service provider. The director is
81 1 authorized to perform a system check of the model 1
81 2 seller and review the seller's procedures to determine
81 3 if the certified service provider's system is
81 4 functioning properly and the extent to which the
81 5 seller's transactions are being processed by the
81 6 certified service provider.
81 7 b. A model 2 seller shall calculate the amount of
81 8 tax due on a transaction by the use of a certified
81 9 automated system, but shall collect and remit tax on
81 10 its own sales. A person that provides a certified
81 11 automated system is responsible for the proper
81 12 functioning of that system and is liable to this state
81 13 for underpayments of tax attributable to errors in the
81 14 functioning of the certified automated system. A
81 15 seller that uses a certified automated system remains
81 16 responsible and is liable to the state for reporting
81 17 and remitting tax.
81 18 c. A model 3 seller shall use its own proprietary
81 19 automated system to calculate tax due and collect and
81 20 remit tax on its own sales. A model 3 seller is
81 21 liable for the failure of its proprietary automated
81 22 system to meet the applicable performance standard.
81 23 Sec. . NEW SECTION. 423.49 RETURNS.
81 24 1. All model 1, 2, or 3 sellers are subject to all
81 25 of the following return requirements:
81 26 a. The seller is required to file only one return
81 27 per month for this state and for all taxing
81 28 jurisdictions within this state.
81 29 b. The date for filing returns shall be determined
81 30 under rules adopted by the director. However, in no
81 31 case shall the return be due earlier than the
81 32 twentieth day of the following month.
81 33 c. The director shall request additional
81 34 information returns. These returns shall not be
81 35 required more frequently than every six months.
81 36 2. Any registered seller which does not have a
81 37 legal obligation to register in this state and is not
81 38 a model 1, 2, or 3 seller is subject to all of the
81 39 following return requirements:
81 40 a. The seller is required to file a return within
81 41 one year of the month of initial registration and
81 42 shall file a return on an annual basis in succeeding
81 43 years.
81 44 b. In addition to the return required in paragraph
81 45 "a", if the seller accumulates more than one thousand
81 46 dollars in total state and local tax, the seller is
81 47 required to file a return in the following month.
81 48 c. The format of the return and the due date of
81 49 the initial return and the annual return shall be
81 50 determined under rules adopted by the department.
82 1 Sec. . NEW SECTION. 423.50 REMITTANCE OF
82 2 FUNDS.
82 3 1. Only one remittance of tax per return is
82 4 required except as provided in this subsection.
82 5 Sellers that collect more than thirty thousand dollars
82 6 in sales and use taxes for this state during the
82 7 preceding calendar year shall be required to make
82 8 additional remittances as required under rules adopted
82 9 by the director. The filing of a return is not
82 10 required with an additional remittance.
82 11 2. All remittances shall be remitted
82 12 electronically.
82 13 3. Electronic payments may be made either by
82 14 automated clearinghouse credit or automated
82 15 clearinghouse debit. Any data accompanying a
82 16 remittance must be formatted using uniform tax type
82 17 and payment codes approved by the governing board
82 18 established pursuant to the agreement. An alternative
82 19 method for making same=day payments shall be
82 20 determined under rules adopted by the director.
82 21 4. If a due date falls on a legal banking holiday
82 22 in this state, the taxes are due on the succeeding
82 23 business day.
82 24 Sec. . NEW SECTION. 423.51 ADMINISTRATION OF
82 25 EXEMPTIONS.
82 26 1. The following provisions shall apply when a
82 27 purchaser claims an exemption:
82 28 a. The seller shall obtain identifying information
82 29 of the purchaser and the reason for claiming a tax
82 30 exemption at the time of the purchase as determined by
82 31 the member states acting jointly.
82 32 b. A purchaser is not required to provide a
82 33 signature to claim an exemption from tax unless a
82 34 paper certificate is used.
82 35 c. The seller shall use the standard form for
82 36 claiming an exemption electronically as adopted
82 37 jointly by the member states.
82 38 d. The seller shall obtain the same information
82 39 for proof of a claimed exemption regardless of the
82 40 medium in which the transaction occurred.
82 41 e. The department may authorize a system wherein
82 42 the purchaser exempt from the payment of the tax is
82 43 issued an identification number which shall be
82 44 presented to the seller at the time of the sale.
82 45 f. The seller shall maintain proper records of
82 46 exempt transactions and provide them to the department
82 47 when requested.
82 48 g. The department shall administer entity=based
82 49 and use=based exemptions when practicable through a
82 50 direct pay tax permit, an exemption certificate, or
83 1 another means that does not burden sellers. For the
83 2 purposes of this paragraph:
83 3 (1) An "entity=based exemption" is an exemption
83 4 based on who purchases the product or who sells the
83 5 product.
83 6 (2) A "use=based exemption" is an exemption based
83 7 on the purchaser's use of the product.
83 8 2. Sellers that follow the requirements of this
83 9 section are relieved from any tax otherwise applicable
83 10 if it is determined that the purchaser improperly
83 11 claimed an exemption and that the purchaser is liable
83 12 for the nonpayment of tax. This relief from liability
83 13 does not apply to a seller who fraudulently fails to
83 14 collect the tax or solicits purchasers to participate
83 15 in the unlawful claim of an exemption.
83 16 Sec. . NEW SECTION. 423.52 RELIEF FROM
83 17 LIABILITY FOR SELLERS AND CERTIFIED SERVICE PROVIDERS.
83 18 Sellers and certified service providers are
83 19 relieved from liability to this state or its local
83 20 taxing jurisdictions for having charged and collected
83 21 the incorrect amount of sales or use tax resulting
83 22 from the seller or certified service provider relying
83 23 on erroneous data provided by this state on tax rates,
83 24 boundaries, or taxing jurisdiction assignments. If
83 25 this state provides an address=based system for
83 26 assigning taxing jurisdictions whether or not pursuant
83 27 to the federal Mobile Telecommunications Sourcing Act,
83 28 the director is not required to provide liability
83 29 relief for errors resulting from reliance on the
83 30 information provided by this state.
83 31 Sec. . NEW SECTION. 423.53 BAD DEBTS AND
83 32 MODEL 1 SELLERS.
83 33 A certified service provider may claim, on behalf
83 34 of a model 1 seller, any bad debt deduction as
83 35 provided in section 423.21. The certified service
83 36 provider must credit or refund the full amount of any
83 37 bad debt deduction or refund received to the seller.
83 38 Sec. . NEW SECTION. 423.54 AMNESTY FOR
83 39 REGISTERED SELLERS.
83 40 1. Subject to the limitations in subsections 2
83 41 through 6, the following provisions apply:
83 42 a. Amnesty is provided for uncollected or unpaid
83 43 sales or use tax to a seller who registers to pay or
83 44 to collect and remit applicable sales or use tax on
83 45 sales made to purchasers in this state in accordance
83 46 with the terms of the agreement, provided the seller
83 47 was not so registered in this state in the twelve=
83 48 month period preceding the commencement of Iowa's
83 49 participation in the agreement.
83 50 b. Amnesty precludes assessment of the seller for
84 1 uncollected or unpaid sales or use tax together with
84 2 penalty or interest for sales made during the period
84 3 the seller was not registered in this state, provided
84 4 registration occurs within twelve months of the
84 5 commencement of Iowa's participation in the agreement.
84 6 c. Amnesty shall be provided to any seller
84 7 lawfully registered under the agreement by any other
84 8 member state prior to the date of the commencement of
84 9 Iowa's participation in the agreement.
84 10 2. Amnesty is not available to a seller with
84 11 respect to any matter or matters for which the seller
84 12 received notice of the commencement of an audit and
84 13 which audit is not yet finally resolved, including any
84 14 related administrative and judicial processes.
84 15 3. Amnesty is not available for sales or use taxes
84 16 already paid or remitted or to taxes collected by the
84 17 seller.
84 18 4. Amnesty is fully effective absent the seller's
84 19 fraud or intentional misrepresentation of a material
84 20 fact as long as the seller continues registration and
84 21 continues payment or collection and remittance of
84 22 applicable sales or use taxes for a period of at least
84 23 thirty=six months. The statute of limitations
84 24 applicable to asserting a tax liability is tolled
84 25 during this thirty=six month period.
84 26 5. Amnesty is applicable only to sales or use
84 27 taxes due from a seller in its capacity as a seller
84 28 and not to sales or use taxes due from a seller in its
84 29 capacity as a buyer.
84 30 6. The director may allow amnesty on terms and
84 31 conditions more favorable to a seller than the terms
84 32 required by this section.
84 33 Sec. . NEW SECTION. 423.55 DATABASES.
84 34 The department shall provide and maintain databases
84 35 required by the agreement for the benefit of sellers
84 36 registered under the agreement.
84 37 Sec. . NEW SECTION. 423.56 CONFIDENTIALITY
84 38 AND PRIVACY PROTECTIONS UNDER MODEL 1.
84 39 1. As used in this section:
84 40 a. "Anonymous data" means information that does
84 41 not identify a person.
84 42 b. "Confidential taxpayer information" means all
84 43 information that is protected under this state's laws,
84 44 rules, and privileges.
84 45 c. "Personally identifiable information" means
84 46 information that identifies a person.
84 47 2. With very limited exceptions, a certified
84 48 service provider shall perform its tax calculation,
84 49 remittance, and reporting functions without retaining
84 50 the personally identifiable information of consumers.
85 1 3. A certified service provider may perform its
85 2 services in this state only if the certified service
85 3 provider certifies that:
85 4 a. Its system has been designed and tested to
85 5 ensure that the fundamental precept of anonymity is
85 6 respected.
85 7 b. Personally identifiable information is only
85 8 used and retained to the extent necessary for the
85 9 administration of model 1 sellers with respect to
85 10 exempt purchasers.
85 11 c. It provides consumers clear and conspicuous
85 12 notice of its information practices, including what
85 13 information it collects, how it collects the
85 14 information, how it uses the information, how long, if
85 15 at all, it retains the information, and whether it
85 16 discloses the information to member states. This
85 17 notice shall be satisfied by a written privacy policy
85 18 statement accessible by the public on the official web
85 19 site of the certified service provider.
85 20 d. Its collection, use, and retention of
85 21 personally identifiable information is limited to that
85 22 required by the member states to ensure the validity
85 23 of exemptions from taxation that are claimed by reason
85 24 of a consumer's status or the intended use of the
85 25 goods or services purchased.
85 26 e. It provides adequate technical, physical, and
85 27 administrative safeguards so as to protect personally
85 28 identifiable information from unauthorized access and
85 29 disclosure.
85 30 4. The department shall provide public
85 31 notification of its practices relating to the
85 32 collection, use, and retention of personally
85 33 identifiable information.
85 34 5. When any personally identifiable information
85 35 that has been collected and retained by the department
85 36 or certified service provider is no longer required
85 37 for the purposes set forth in subsection 3, paragraph
85 38 "d", that information shall no longer be retained by
85 39 the department or certified service provider.
85 40 6. When personally identifiable information
85 41 regarding an individual is retained by or on behalf of
85 42 this state, this state shall provide reasonable access
85 43 by such individual to his or her own information in
85 44 the state's possession and a right to correct any
85 45 inaccurately recorded information.
85 46 7. This privacy policy is subject to enforcement
85 47 by the department and the attorney general.
85 48 8. This state's laws and rules regarding the
85 49 collection, use, and maintenance of confidential
85 50 taxpayer information remain fully applicable and
86 1 binding. Without limitation, the agreement does not
86 2 enlarge or limit the state's or department's authority
86 3 to:
86 4 a. Conduct audits or other review as provided
86 5 under the agreement and state law.
86 6 b. Provide records pursuant to its examination of
86 7 public records law, disclosure laws of individual
86 8 governmental agencies, or other regulations.
86 9 c. Prevent, consistent with state law, disclosures
86 10 of confidential taxpayer information.
86 11 d. Prevent, consistent with federal law,
86 12 disclosures or misuse of federal return information
86 13 obtained under a disclosure agreement with the
86 14 internal revenue service.
86 15 e. Collect, disclose, disseminate, or otherwise
86 16 use anonymous data for governmental purposes.
86 17 9. This privacy policy does not preclude the
86 18 certification of a certified service provider whose
86 19 privacy policy is more protective of confidential
86 20 taxpayer information or personally identifiable
86 21 information than is required by the agreement.
86 22 Sec. . NEW SECTION. 423.57 STATUTES
86 23 APPLICABLE.
86 24 The director shall administer this subchapter as it
86 25 relates to the taxes imposed in this chapter in the
86 26 same manner and subject to all the provisions of, and
86 27 all of the powers, duties, authority, and restrictions
86 28 contained in sections 423.14, 423.15, 423.16, 423.17,
86 29 423.18, 423.19, 423.20, 423.21, 423.22, 423.23,
86 30 423.24, 423.25, 423.28, 423.29, 423.31, 423.32,
86 31 423.33, 423.34, 423.35, 423.37, 423.38, 423.39,
86 32 423.40, 423.41, and 423.42, section 423.43, subsection
86 33 3, and sections 423.45, 423.46, and 423.47.
86 34 Sec. . NEW SECTION. 423.60 REMOTE SALES TAX
86 35 FUND == APPROPRIATIONS.
86 36 1. A remote sales tax fund is created as a
86 37 separate fund in the state treasury under the control
86 38 of the department of revenue and finance consisting of
86 39 the state sales and use tax revenues collected from
86 40 remote sales and deposited as provided in section
86 41 423.43, subsection 3.
86 42 2. There is appropriated from the remote sales tax
86 43 fund for the fiscal year beginning July 1, 2005, and
86 44 each succeeding fiscal year to the general fund of the
86 45 state the following:
86 46 a. The first sixty million dollars deposited into
86 47 the fund during each fiscal year.
86 48 b. An amount to offset the projected loss during
86 49 the fiscal year to the general fund of the state
86 50 resulting from a state tax relief Act enacted during
87 1 the period beginning four and one=half years prior to
87 2 the start of the fiscal year. However, any state tax
87 3 relief Act enacted prior to July 1, 2004, shall not be
87 4 covered under this subsection.
87 5 3. For purposes of subsection 2, "state tax relief
87 6 Act" means an Act that was projected by the
87 7 legislative fiscal bureau to result in a loss in
87 8 revenue to the general fund of the state of at least
87 9 five million dollars in the first full fiscal year
87 10 during which the Act is effective and that contains
87 11 any of the following:
87 12 a. A state sales or use tax exemption.
87 13 b. A deduction for any state tax.
87 14 c. A reduction in any state tax rate.
87 15 Sec. .
87 16 1. Sections 422.42 through 422.59, Code 2003, are repealed.
87 17 2. Chapter 423, Code 2003, is repealed.
87 18 COORDINATING AMENDMENTS
87 19 Sec. . Section 15.331A, Code 2003, is amended
87 20 to read as follows:
87 21 15.331A SALES, SERVICES, AND USE TAX REFUND ==
87 22 CONTRACTOR OR SUBCONTRACTOR.
87 23 The eligible business or a supporting business
87 24 shall be entitled to a refund of the sales and use
87 25 taxes paid under chapters 422 and chapter 423 for gas,
87 26 electricity, water, or sewer utility services, goods,
87 27 wares, or merchandise, or on services rendered,
87 28 furnished, or performed to or for a contractor or
87 29 subcontractor and used in the fulfillment of a written
87 30 contract relating to the construction or equipping of
87 31 a facility within the economic development area of the
87 32 eligible business or a supporting business. Taxes
87 33 attributable to intangible property and furniture and
87 34 furnishings shall not be refunded.
87 35 To receive the refund a claim shall be filed by the
87 36 eligible business or a supporting business with the
87 37 department of revenue and finance as follows:
87 38 1. The contractor or subcontractor shall state
87 39 under oath, on forms provided by the department, the
87 40 amount of the sales of goods, wares, or merchandise or
87 41 services rendered, furnished, or performed including
87 42 water, sewer, gas, and electric utility services for
87 43 use in the economic development area upon which sales
87 44 or use tax has been paid prior to the project
87 45 completion, and shall file the forms with the eligible
87 46 business or supporting business before final
87 47 settlement is made.
87 48 2. The eligible business or a supporting business
87 49 shall, not more than one year after project
87 50 completion, make application to the department for any
88 1 refund of the amount of the sales and use taxes paid
88 2 pursuant to chapter 422 or 423 upon any goods, wares,
88 3 or merchandise, or services rendered, furnished, or
88 4 performed, including water, sewer, gas, and electric
88 5 utility services. The application shall be made in
88 6 the manner and upon forms to be provided by the
88 7 department, and the department shall audit the claim
88 8 and, if approved, issue a warrant to the eligible
88 9 business or supporting business in the amount of the
88 10 sales or use tax which has been paid to the state of
88 11 Iowa under a contract. A claim filed by the eligible
88 12 business or a supporting business in accordance with
88 13 this section shall not be denied by reason of a
88 14 limitation provision set forth in chapter 421, 422, or
88 15 423.
88 16 3. A contractor or subcontractor who willfully
88 17 makes a false report of tax paid under the provisions
88 18 of this section is guilty of a simple misdemeanor and
88 19 in addition is liable for the payment of the tax and
88 20 any applicable penalty and interest.
88 21 Sec. . Section 15.334A, Code 2003, is amended
88 22 to read as follows:
88 23 15.334A SALES AND USE TAX EXEMPTION.
88 24 An eligible business may claim an exemption from
88 25 sales and use taxation under section 422.45 423.3,
88 26 subsection 27 46, for property which is exempt from
88 27 taxation under section 15.334, notwithstanding the
88 28 requirements of section 422.45 423.3, subsection 27
88 29 46, or any other provision of the Code to the
88 30 contrary.
88 31 Sec. . Section 15A.9, subsections 5, 6, and 7,
88 32 Code 2003, are amended to read as follows:
88 33 5. PROPERTY TAX EXEMPTION.
88 34 a. All property, as defined in section 427A.1,
88 35 subsection 1, paragraphs "e" and "j", Code 1993, used
88 36 by the primary business or a supporting business and
88 37 located within the zone, shall be exempt from property
88 38 taxation for a period of twenty years beginning with
88 39 the year it is first assessed for taxation. In order
88 40 to be eligible for this exemption, the property shall
88 41 be acquired or leased by the primary business or a
88 42 supporting business or relocated by the primary
88 43 business or a supporting business to the zone from
88 44 outside the state prior to project completion.
88 45 b. Property which is exempt for property tax
88 46 purposes under this subsection is eligible for the
88 47 sales and use tax exemption under section 422.45
88 48 423.3, subsection 27 46, notwithstanding that
88 49 subsection or any other provision of the Code to the
88 50 contrary.
89 1 6. SALES, SERVICES, AND USE TAX REFUND. Taxes
89 2 paid pursuant to chapter 422 or 423 on the gross
89 3 receipts sales price or rental price of property
89 4 purchased or rented by the primary business or a
89 5 supporting business for use by the primary business or
89 6 a supporting business within the zone or on gas,
89 7 electricity, water, and sewer utility services prior
89 8 to project completion shall be refunded to the primary
89 9 business or supporting business if the item was
89 10 purchased or the service was performed or received
89 11 prior to project completion. Claims under this
89 12 section shall be submitted on forms provided by the
89 13 department of revenue and finance not later than six
89 14 months after project completion. The refund in this
89 15 subsection shall not apply to furniture or
89 16 furnishings, or intangible property.
89 17 7. SALES, SERVICES, AND USE TAX REFUND ==
89 18 CONTRACTOR OR SUBCONTRACTOR. The primary business or
89 19 a supporting business shall be entitled to a refund of
89 20 the sales and use taxes paid under chapters 422 and
89 21 chapter 423 for gas, electricity, water, or sewer
89 22 utility services, goods, wares, or merchandise, or on
89 23 services rendered, furnished, or performed to or for a
89 24 contractor or subcontractor and used in the
89 25 fulfillment of a written contract relating to the
89 26 construction or equipping of a facility within the
89 27 zone of the primary business or a supporting business.
89 28 Taxes attributable to intangible property and
89 29 furniture and furnishings shall not be refunded.
89 30 To receive the refund a claim shall be filed by the
89 31 primary business or a supporting business with the
89 32 department of revenue and finance as follows:
89 33 a. The contractor or subcontractor shall state
89 34 under oath, on forms provided by the department, the
89 35 amount of the sales of goods, wares, or merchandise or
89 36 services rendered, furnished, or performed including
89 37 water, sewer, gas, and electric utility services for
89 38 use in the zone upon which sales or use tax has been
89 39 paid prior to the project completion, and shall file
89 40 the forms with the primary business or supporting
89 41 business before final settlement is made.
89 42 b. The primary business or a supporting business
89 43 shall, not more than six months after project
89 44 completion, make application to the department for any
89 45 refund of the amount of the sales and use taxes paid
89 46 pursuant to chapter 422 or 423 upon any goods, wares,
89 47 or merchandise, or services rendered, furnished, or
89 48 performed, including water, sewer, gas, and electric
89 49 utility services. The application shall be made in
89 50 the manner and upon forms to be provided by the
90 1 department, and the department shall audit the claim
90 2 and, if approved, issue a warrant to the primary
90 3 business or supporting business in the amount of the
90 4 sales or use tax which has been paid to the state of
90 5 Iowa under a contract. A claim filed by the primary
90 6 business or a supporting business in accordance with
90 7 this subsection shall not be denied by reason of a
90 8 limitation provision set forth in chapter 421, 422, or
90 9 423.
90 10 c. A contractor or subcontractor who willfully
90 11 makes a false report of tax paid under the provisions
90 12 of this subsection is guilty of a simple misdemeanor
90 13 and in addition is liable for the payment of the tax
90 14 and any applicable penalty and interest.
90 15 Sec. . Section 28A.17, unnumbered paragraph 1,
90 16 Code 2003, is amended to read as follows:
90 17 If an authority is established as provided in
90 18 section 28A.6 and after approval of a referendum by a
90 19 simple majority of votes cast in each metropolitan
90 20 area in favor of the sales and services tax, the
90 21 governing board of a county in this state within a
90 22 metropolitan area which is part of the authority shall
90 23 impose, at the request of the authority, a local sales
90 24 and services tax at the rate of one=fourth of one
90 25 percent on gross receipts the sales price taxed by
90 26 this state under chapter 422, division IV section
90 27 423.2, within the metropolitan area located in this
90 28 state. The referendum shall be called by resolution
90 29 of the board and shall be held as provided in section
90 30 28A.6 to the extent applicable. The ballot
90 31 proposition shall contain a statement as to the
90 32 specific purpose or purposes for which the revenues
90 33 shall be expended and the date of expiration of the
90 34 tax. The local sales and services tax shall be
90 35 imposed on the same basis, with the same exceptions,
90 36 and following the same administrative procedures as
90 37 provided for a county under sections 422B.8 and
90 38 422B.9. The amount of the sale, for the purposes of
90 39 determining the amount of the local sales and services
90 40 tax under this section, does not include the amount of
90 41 any local sales and services tax imposed under
90 42 sections 422B.8 and 422B.9.
90 43 Sec. . Section 29C.15, Code 2003, is amended to
90 44 read as follows:
90 45 29C.15 TAX=EXEMPT PURCHASES.
90 46 All purchases under the provisions of this chapter
90 47 shall be exempt from the taxes imposed by sections
90 48 422.43 423.2 and 423.2 423.5.
90 49 Sec. . Section 99E.10, subsection 1, paragraph
90 50 b, Code 2003, is amended to read as follows:
91 1 b. An amount equal to the product of the state
91 2 sales tax rate under section 422.43 423.2 multiplied
91 3 by the gross sales price of each ticket or share sold
91 4 shall be deducted as the sales tax on the sale of that
91 5 ticket or share, remitted to the treasurer of state
91 6 and deposited into the state general fund.
91 7 Sec. . Section 123.187, subsection 2, Code
91 8 2003, is amended to read as follows:
91 9 2. A winery licensed or permitted pursuant to laws
91 10 regulating alcoholic beverages in a state which
91 11 affords this state an equal reciprocal shipping
91 12 privilege may ship into this state by private common
91 13 carrier, to a person twenty=one years of age or older,
91 14 not more than eighteen liters of wine per month, for
91 15 consumption or use by the person. Such wine shall not
91 16 be resold. Shipment of wine pursuant to this
91 17 subsection is not subject to sales tax under section
91 18 422.43 423.2, use tax under section 423.2 423.5, or
91 19 the wine gallonage tax under section 123.183, and does
91 20 not require a refund value for beverage container
91 21 control purposes under chapter 455C.
91 22 Sec. . Section 262.54, Code 2003, is amended to
91 23 read as follows:
91 24 262.54 COMPUTER SALES.
91 25 Sales, by an institution under the control of the
91 26 board of regents, of computer equipment, computer
91 27 software, and computer supplies to students and
91 28 faculty at the institution are retail sales under
91 29 chapter 422, division IV 423.
91 30 Sec. . Section 303.9, subsection 2, Code 2003,
91 31 is amended to read as follows:
91 32 2. The department may sell mementos and other
91 33 items relating to Iowa history and historic sites on
91 34 the premises of property under control of the
91 35 department and at the state capitol. Notwithstanding
91 36 sections 18.12 and 18.16, the department may directly
91 37 and independently enter into rental and lease
91 38 agreements with private vendors for the purpose of
91 39 selling mementos. All fees and income produced by the
91 40 sales and rental or lease agreements shall be credited
91 41 to the account of the department. The mementos and
91 42 other items sold by the department or vendors under
91 43 this subsection are exempt from section 18.6. The
91 44 department is not a retailer under chapter 422 and the
91 45 sale of such mementos and other items by the
91 46 department is not a retail sale under chapter 422 and
91 47 is exempt from the sales tax.
91 48 Sec. . Section 312.1, subsection 4, Code 2003,
91 49 is amended to read as follows:
91 50 4. To the extent provided in section 423.24
92 1 423.43, subsection 1, paragraph "b", from revenue
92 2 derived from the use tax, under chapter 423 on motor
92 3 vehicles, trailers, and motor vehicle accessories and
92 4 equipment.
92 5 Sec. . Section 312.2, subsections 14 and 16,
92 6 Code 2003, are amended to read as follows:
92 7 14. The treasurer of state, before making the
92 8 allotments provided for in this section, shall credit
92 9 monthly from the road use tax fund to the general fund
92 10 of the state from revenue credited to the road use tax
92 11 fund under section 423.24 423.43, subsection 1,
92 12 paragraph "b", an amount equal to one=twentieth of
92 13 eighty percent of the revenue from the operation of
92 14 section 423.7 423.26.
92 15 There is appropriated from the general fund of the
92 16 state for each fiscal year to the state department of
92 17 transportation the amount of revenues credited to the
92 18 general fund of the state during the fiscal year under
92 19 this subsection to be used for purposes of public
92 20 transit assistance under chapter 324A.
92 21 16. The treasurer of state, before making the
92 22 allotments provided for in this section, shall credit
92 23 monthly from the road use tax fund to the motorcycle
92 24 rider education fund established in section 321.180B,
92 25 an amount equal to one dollar per year of license
92 26 validity for each issued or renewed driver's license
92 27 which is valid for the operation of a motorcycle.
92 28 Moneys credited to the motorcycle rider education fund
92 29 under this subsection shall be taken from moneys
92 30 credited to the road use tax fund under section 423.24
92 31 423.43.
92 32 Sec. . Section 321.20, subsection 5, Code 2003,
92 33 is amended to read as follows:
92 34 5. The amount of tax to be paid under section
92 35 423.7 423.26.
92 36 Sec. . Section 321.24, subsections 1 and 3,
92 37 Code 2003, are amended to read as follows:
92 38 1. Upon receipt of the application for title and
92 39 payment of the required fees for a motor vehicle,
92 40 trailer, or semitrailer, the county treasurer or the
92 41 department shall, when satisfied as to the
92 42 application's genuineness and regularity, and, in the
92 43 case of a mobile home or manufactured home, that taxes
92 44 are not owing under chapter 435, issue a certificate
92 45 of title and, except for a mobile home or manufactured
92 46 home, a registration receipt, and shall file the
92 47 application, the manufacturer's or importer's
92 48 certificate, the certificate of title, or other
92 49 evidence of ownership, as prescribed by the
92 50 department. The registration receipt shall be
93 1 delivered to the owner and shall contain upon its face
93 2 the date issued, the name and address of the owner,
93 3 the registration number assigned to the vehicle, the
93 4 amount of the fee paid, the amount of tax paid
93 5 pursuant to section 423.7 423.26, the type of fuel
93 6 used, and a description of the vehicle as determined
93 7 by the department, and upon the reverse side a form
93 8 for notice of transfer of the vehicle. The name and
93 9 address of any lessee of the vehicle shall not be
93 10 printed on the registration receipt or certificate of
93 11 title. Up to three owners may be listed on the
93 12 registration receipt and certificate of title.
93 13 3. The certificate of title shall contain upon its
93 14 face the identical information required upon the face
93 15 of the registration receipt. In addition, the
93 16 certificate of title shall contain a statement of the
93 17 owner's title, the title number assigned to the owner
93 18 or owners of the vehicle, the amount of tax paid
93 19 pursuant to section 423.7 423.26, the name and address
93 20 of the previous owner, and a statement of all security
93 21 interests and encumbrances as shown in the
93 22 application, upon the vehicle described, including the
93 23 nature of the security interest, date of notation, and
93 24 name and address of the secured party.
93 25 Sec. . Section 321.34, subsection 7, paragraph
93 26 c, Code 2003, is amended to read as follows:
93 27 c. The fees for a collegiate registration plate
93 28 are as follows:
93 29 (1) A registration fee of twenty=five dollars.
93 30 (2) A special collegiate registration fee of
93 31 twenty=five dollars.
93 32 These fees are in addition to the regular annual
93 33 registration fee. The fees collected by the director
93 34 under this subsection shall be paid monthly to the
93 35 treasurer of state and credited by the treasurer of
93 36 state to the road use tax fund. Notwithstanding
93 37 section 423.24 423.43 and prior to the revenues being
93 38 credited to the road use tax fund under section 423.24
93 39 423.43, subsection 1, paragraph "b", the treasurer of
93 40 state shall credit monthly from those revenues
93 41 respectively, to Iowa state university of science and
93 42 technology, the university of northern Iowa, and the
93 43 state university of Iowa, the amount of the special
93 44 collegiate registration fees collected in the previous
93 45 month for collegiate registration plates designed for
93 46 the university. The moneys credited are appropriated
93 47 to the respective universities to be used for
93 48 scholarships for students attending the universities.
93 49 Sec. . Section 321.34, subsection 11, paragraph
93 50 c, Code 2003, is amended to read as follows:
94 1 c. The special natural resources fee for letter
94 2 number designated natural resources plates is thirty=
94 3 five dollars. The fee for personalized natural
94 4 resources plates is forty=five dollars which shall be
94 5 paid in addition to the special natural resources fee
94 6 of thirty=five dollars. The fees collected by the
94 7 director under this subsection shall be paid monthly
94 8 to the treasurer of state and credited to the road use
94 9 tax fund. Notwithstanding section 423.24 423.43, and
94 10 prior to the crediting of revenues to the road use tax
94 11 fund under section 423.24 423.43, subsection 1,
94 12 paragraph "b", the treasurer of state shall credit
94 13 monthly from those revenues to the Iowa resources
94 14 enhancement and protection fund created pursuant to
94 15 section 455A.18, the amount of the special natural
94 16 resources fees collected in the previous month for the
94 17 natural resources plates.
94 18 Sec. . Section 321.34, subsection 11A,
94 19 paragraph c, Code 2003, is amended to read as follows:
94 20 c. The special fee for letter number designated
94 21 love our kids plates is thirty=five dollars. The fee
94 22 for personalized love our kids plates is twenty=five
94 23 dollars, which shall be paid in addition to the
94 24 special love our kids fee of thirty=five dollars. The
94 25 fees collected by the director under this subsection
94 26 shall be paid monthly to the treasurer of state and
94 27 credited to the road use tax fund. Notwithstanding
94 28 section 423.24 423.43, and prior to the crediting of
94 29 revenues to the road use tax fund under section 423.24
94 30 423.43, subsection 1, paragraph "b", the treasurer of
94 31 state shall transfer monthly from those revenues to
94 32 the Iowa department of public health the amount of the
94 33 special fees collected in the previous month for the
94 34 love our kids plates. Notwithstanding section 8.33,
94 35 moneys transferred under this subsection shall not
94 36 revert to the general fund of the state.
94 37 Sec. . Section 321.34, subsection 11B,
94 38 paragraph c, Code 2003, is amended to read as follows:
94 39 c. The special fee for letter number designated
94 40 motorcycle rider education plates is thirty=five
94 41 dollars. The fee for personalized motorcycle rider
94 42 education plates is twenty=five dollars, which shall
94 43 be paid in addition to the special motorcycle rider
94 44 education fee of thirty=five dollars. The fees
94 45 collected by the director under this subsection shall
94 46 be paid monthly to the treasurer of state and credited
94 47 to the road use tax fund. Notwithstanding section
94 48 423.24 423.43, and prior to the crediting of revenues
94 49 to the road use tax fund under section 423.24 423.43,
94 50 subsection 1, paragraph "b", the treasurer of state
95 1 shall transfer monthly from those revenues to the
95 2 department for use in accordance with section
95 3 321.180B, subsection 6, the amount of the special fees
95 4 collected in the previous month for the motorcycle
95 5 rider education plates.
95 6 Sec. . Section 321.34, subsection 13, paragraph
95 7 d, Code 2003, is amended to read as follows:
95 8 d. A state agency may submit a request to the
95 9 department recommending a special registration plate.
95 10 The alternate fee for letter number designated plates
95 11 is thirty=five dollars with a ten dollar annual
95 12 special renewal fee. The fee for personalized plates
95 13 is twenty=five dollars which is in addition to the
95 14 alternative fee of thirty=five dollars with an annual
95 15 personalized plate renewal fee of five dollars which
95 16 is in addition to the special renewal fee of ten
95 17 dollars. The alternate fees are in addition to the
95 18 regular annual registration fee. The alternate fees
95 19 collected under this paragraph shall be paid monthly
95 20 to the treasurer of state and credited to the road use
95 21 tax fund. Notwithstanding section 423.24 423.43, and
95 22 prior to the crediting of the revenues to the road use
95 23 tax fund under section 423.24 423.43, subsection 1,
95 24 paragraph "b", the treasurer of state shall credit
95 25 monthly the amount of the alternate fees collected in
95 26 the previous month to the state agency that
95 27 recommended the special registration plate.
95 28 Sec. . Section 321.34, subsection 21, paragraph
95 29 c, Code 2003, is amended to read as follows:
95 30 c. The special fees collected by the director
95 31 under this subsection shall be paid monthly to the
95 32 treasurer of state and credited to the road use tax
95 33 fund. Notwithstanding section 423.24 423.43, and
95 34 prior to the crediting of revenues to the road use tax
95 35 fund under section 423.24 423.43, subsection 1,
95 36 paragraph "b", the treasurer of state shall credit
95 37 monthly to the Iowa heritage fund created under
95 38 section 303.9A the amount of the special fees
95 39 collected in the previous month for the Iowa heritage
95 40 plates.
95 41 Sec. . Section 321.34, subsection 22, paragraph
95 42 b, Code 2003, is amended to read as follows:
95 43 b. The special school transportation fee for
95 44 letter number designated education plates is thirty=
95 45 five dollars. The fee for personalized education
95 46 plates is twenty=five dollars, which shall be paid in
95 47 addition to the special school transportation fee of
95 48 thirty=five dollars. The annual special school
95 49 transportation fee is ten dollars for letter number
95 50 designated registration plates and is fifteen dollars
96 1 for personalized registration plates which shall be
96 2 paid in addition to the regular annual registration
96 3 fee. The fees collected by the director under this
96 4 subsection shall be paid monthly to the treasurer of
96 5 state and credited to the road use tax fund.
96 6 Notwithstanding section 423.24 423.43, and prior to
96 7 the crediting of revenues to the road use tax fund
96 8 under section 423.24 423.43, subsection 1, paragraph
96 9 "b", the treasurer of state shall transfer monthly
96 10 from those revenues to the school budget review
96 11 committee in accordance with section 257.31,
96 12 subsection 17, the amount of the special school
96 13 transportation fees collected in the previous month
96 14 for the education plates.
96 15 Sec. . Section 321F.9, Code 2003, is amended to
96 16 read as follows:
96 17 321F.9 OPTION TO PURCHASE == DEALER'S LICENSE.
96 18 Any person engaged in business in this state shall
96 19 not enter into any agreement for the use of a motor
96 20 vehicle under the terms of which such that person
96 21 grants to another an option to purchase such the motor
96 22 vehicle without first having obtained a motor vehicle
96 23 dealer's license under the provisions of chapter 322,
96 24 and all sales of motor vehicles under such options
96 25 shall be subject to sales or use taxes imposed under
96 26 the provisions of chapters 422 and chapter 423.
96 27 Nothing contained in this section shall require such
96 28 person to have a place of business as provided by
96 29 section 322.6, subsection 8.
96 30 Sec. . Section 327I.26, Code 2003, is amended
96 31 to read as follows:
96 32 327I.26 APPROPRIATION TO AUTHORITY.
96 33 Notwithstanding section 423.24 423.43, and prior to
96 34 the application of section 423.24 423.43, subsection
96 35 1, paragraph "b", there shall be deposited into the
96 36 general fund of the state and is appropriated to the
96 37 authority from eighty percent of the revenues derived
96 38 from the operation of section 423.7 423.26, the
96 39 amounts certified by the authority under section
96 40 327I.25. However, the total amount deposited into the
96 41 general fund and appropriated to the Iowa railway
96 42 finance authority under this section shall not exceed
96 43 two million dollars annually. Moneys appropriated to
96 44 the Iowa railway finance authority under this section
96 45 are appropriated only for the payment of principal and
96 46 interest on obligations or the payment of leases
96 47 guaranteed by the authority as provided under section
96 48 327I.25.
96 49 Sec. . Section 328.26, unnumbered paragraph 2,
96 50 Code 2003, is amended to read as follows:
97 1 When an aircraft is registered to a person for the
97 2 first time the fee submitted to the department shall
97 3 include the tax imposed by section 422.43 423.2 or
97 4 section 423.2 423.5 or evidence of the exemption of
97 5 the aircraft from the tax imposed under section 422.43
97 6 423.2 or 423.2 423.5.
97 7 Sec. . Section 331.557, subsection 3, Code
97 8 2003, is amended to read as follows:
97 9 3. Collect the use tax on vehicles subject to
97 10 registration as provided in sections 423.6, 423.7, and
97 11 423.7A 423.14, 423.26, and 423.27.
97 12 Sec. . Section 357A.15, unnumbered paragraph 2,
97 13 Code 2003, is amended to read as follows:
97 14 A rural water district organized under chapter 504A
97 15 shall receive a refund of sales or use taxes upon
97 16 submitting an application to the department of revenue
97 17 and finance for such the refund of taxes imposed upon
97 18 the gross receipts sales price of all sales of
97 19 building materials, supplies, or equipment sold to a
97 20 contractor or used in the fulfillment of a written
97 21 contract for the construction of facilities for such
97 22 the rural water district to the same extent as a rural
97 23 water district organized under this chapter may obtain
97 24 a refund under section 422.45 423.4, subsection 7 1.
97 25 Sec. . Section 421.10, Code 2003, is amended to
97 26 read as follows:
97 27 421.10 APPEAL PERIOD == APPLICABILITY.
97 28 The appeal period for revision of assessment of
97 29 tax, interest, and penalties set out under section
97 30 422.28, 422.54 423.37, 437A.9, 437A.22, 452A.64,
97 31 453A.29, or 453A.46 applies to appeals to notices from
97 32 the department denying changes in filing methods,
97 33 denying refund claims, and denying portions of refund
97 34 claims for the tax covered by that section, and
97 35 notices of any department action directed to a
97 36 specific taxpayer, other than licensing, which
97 37 involves a calculation.
97 38 Sec. . Section 421.17, subsection 22B, Code
97 39 2003, is amended to read as follows:
97 40 22B. Enter To enter into agreements or compacts
97 41 with remote sellers, retailers, or third=party
97 42 providers for the voluntary collection of Iowa sales
97 43 or use taxes attributable to sales into Iowa and to
97 44 enter. The director has the authority to enter into
97 45 and perform all duties required of the office of
97 46 director by multistate agreements or compacts that
97 47 provide for the voluntary collection of sales and use
97 48 taxes, including joint audits with other states or
97 49 audits on behalf of other states. The agreements or
97 50 compacts shall generally conform to the provisions of
98 1 Iowa sales and use tax statutes. All fees for
98 2 services, reimbursements, remuneration, incentives,
98 3 and costs incurred by the department associated with
98 4 these agreements or compacts may be paid or reimbursed
98 5 from the additional revenue generated. An amount is
98 6 appropriated from amounts generated to pay or
98 7 reimburse all costs associated with this subsection.
98 8 Persons entering into an agreement or compact with the
98 9 department pursuant to this subsection are subject to
98 10 the requirements and penalties of the confidentiality
98 11 laws of this state regarding tax information.
98 12 Notwithstanding any other provisions of law, the
98 13 contract, agreement, or compact shall provide for the
98 14 registration, collection, report, and verification of
98 15 amounts subject to this subsection.
98 16 Sec. . Section 421.17, subsection 29, paragraph
98 17 j, Code 2003, is amended to read as follows:
98 18 j. The department's existing right to credit
98 19 against tax due or to become due under section 422.73
98 20 or 423.47 is not to be impaired by a right granted to
98 21 or a duty imposed upon the department or other state
98 22 agency by this subsection. This subsection is not
98 23 intended to impose upon the department any additional
98 24 requirement of notice, hearing, or appeal concerning
98 25 the right to credit against tax due under section
98 26 422.73 or 423.47.
98 27 Sec. . Section 421.17, subsection 34, paragraph
98 28 i, Code 2003, is amended to read as follows:
98 29 i. The director may distribute to credit reporting
98 30 entities and for publication the names, addresses, and
98 31 amounts of indebtedness owed to or being collected by
98 32 the state if the indebtedness is subject to the
98 33 centralized debt collection procedure established in
98 34 this subsection. The director shall adopt rules to
98 35 administer this paragraph, and the rules shall provide
98 36 guidelines by which the director shall determine which
98 37 names, addresses, and amounts of indebtedness may be
98 38 distributed for publication. The director may
98 39 distribute information for publication pursuant to
98 40 this paragraph, notwithstanding sections 422.20,
98 41 422.72, and 423.23 423.42, or any other provision of
98 42 state law to the contrary pertaining to
98 43 confidentiality of information.
98 44 Sec. . Section 421.26, Code 2003, is amended to
98 45 read as follows:
98 46 421.26 PERSONAL LIABILITY FOR TAX DUE.
98 47 If a licensee or other person under section
98 48 452A.65, a retailer or purchaser under chapter 422A or
98 49 422B, or section 422.52 423.31 or 423.33, or a
98 50 retailer or purchaser under section 423.13 423.32 or a
99 1 user under section 423.14 423.34 fails to pay a tax
99 2 under those sections when due, an officer of a
99 3 corporation or association, notwithstanding sections
99 4 490A.601 and 490A.602, a member or manager of a
99 5 limited liability company, or a partner of a
99 6 partnership, having control or supervision of or the
99 7 authority for remitting the tax payments and having a
99 8 substantial legal or equitable interest in the
99 9 ownership of the corporation, association, limited
99 10 liability company, or partnership, who has
99 11 intentionally failed to pay the tax is personally
99 12 liable for the payment of the tax, interest, and
99 13 penalty due and unpaid. However, this section shall
99 14 not apply to taxes on accounts receivable. The
99 15 dissolution of a corporation, association, limited
99 16 liability company, or partnership shall not discharge
99 17 a person's liability for failure to remit the tax due.
99 18 Sec. . Section 421.28, Code 2003, is amended to
99 19 read as follows:
99 20 421.28 EXCEPTIONS TO SUCCESSOR LIABILITY.
99 21 The immediate successor to a licensee's or
99 22 retailer's business or stock of goods under chapter
99 23 422A or 422B, or section 422.52, 423.13, 423.14,
99 24 423.33 or 452A.65, is not personally liable for the
99 25 amount of delinquent tax, interest, or penalty due and
99 26 unpaid if the immediate successor shows that the
99 27 purchase of the business or stock of goods was made in
99 28 good faith that no delinquent tax, interest, or
99 29 penalty was due and unpaid. For purposes of this
99 30 section the immediate successor shows good faith by
99 31 evidence that the department had provided the
99 32 immediate successor with a certified statement that no
99 33 delinquent tax, interest, or penalty is unpaid, or
99 34 that the immediate successor had taken in good faith a
99 35 certified statement from the licensee, retailer, or
99 36 seller that no delinquent tax, interest, or penalty is
99 37 unpaid. When requested to do so by a person with whom
99 38 the licensee or retailer is negotiating the sale of
99 39 the business or stock of goods, the director of
99 40 revenue and finance shall, upon being satisfied that
99 41 such a situation exists, inform that person as to the
99 42 amount of unpaid delinquent tax, interest, or penalty
99 43 due by the licensee or the retailer. The giving of
99 44 the information under this circumstance is not a
99 45 violation of section 422.20, 422.72, or 452A.63.
99 46 Sec. . Section 421B.11, unnumbered paragraph 3,
99 47 Code 2003, is amended to read as follows:
99 48 Judicial review of the actions of the director may
99 49 be sought in accordance with the terms of the Iowa
99 50 administrative procedure Act, and section 422.55
100 1 423.38.
100 2 Sec. . Section 422.7, subsection 21, paragraph
100 3 a, subparagraph (1), unnumbered paragraph 1, Code
100 4 2003, is amended to read as follows:
100 5 Net capital gain from the sale of real property
100 6 used in a business, in which the taxpayer materially
100 7 participated for ten years, as defined in section
100 8 469(h) of the Internal Revenue Code, and which has
100 9 been held for a minimum of ten years, or from the sale
100 10 of a business, as defined in section 422.42 423.1, in
100 11 which the taxpayer was employed or in which the
100 12 taxpayer materially participated for ten years, as
100 13 defined in section 469(h) of the Internal Revenue
100 14 Code, and which has been held for a minimum of ten
100 15 years. The sale of a business means the sale of all
100 16 or substantially all of the tangible personal property
100 17 or service of the business.
100 18 Sec. . Section 422.73, subsection 1, Code 2003,
100 19 is amended by striking the subsection.
100 20 Sec. . Section 422A.1, unnumbered paragraphs 1,
100 21 3, 7, and 8, Code 2003, are amended to read as
100 22 follows:
100 23 A city or county may impose by ordinance of the
100 24 city council or by resolution of the board of
100 25 supervisors a hotel and motel tax, at a rate not to
100 26 exceed seven percent, which shall be imposed in
100 27 increments of one or more full percentage points upon
100 28 the gross receipts sales price from the renting of
100 29 sleeping rooms, apartments, or sleeping quarters in a
100 30 hotel, motel, inn, public lodging house, rooming
100 31 house, manufactured or mobile home which is tangible
100 32 personal property, or tourist court, or in any place
100 33 where sleeping accommodations are furnished to
100 34 transient guests for rent, whether with or without
100 35 meals; except the gross receipts sales price from the
100 36 renting of sleeping rooms in dormitories and in
100 37 memorial unions at all universities and colleges
100 38 located in the state of Iowa and the guests of a
100 39 religious institution if the property is exempt under
100 40 section 427.1, subsection 8, and the purpose of
100 41 renting is to provide a place for a religious retreat
100 42 or function and not a place for transient guests
100 43 generally. The tax when imposed by a city shall apply
100 44 only within the corporate boundaries of that city and
100 45 when imposed by a county shall apply only outside
100 46 incorporated areas within that county. "Renting" and
100 47 "rent" include any kind of direct or indirect charge
100 48 for such sleeping rooms, apartments, or sleeping
100 49 quarters, or their use. However, the tax does not
100 50 apply to the gross receipts sales price from the
101 1 renting of a sleeping room, apartment, or sleeping
101 2 quarters while rented by the same person for a period
101 3 of more than thirty=one consecutive days.
101 4 A local hotel and motel tax shall be imposed on
101 5 January 1, April 1, July 1, or October 1, following
101 6 the notification of the director of revenue and
101 7 finance. Once imposed, the tax shall remain in effect
101 8 at the rate imposed for a minimum of one year. A
101 9 local hotel and motel tax shall terminate only on
101 10 March 31, June 30, September 30, or December 31. At
101 11 least forty=five sixty days prior to the tax being
101 12 effective or prior to a revision in the tax rate, or
101 13 prior to the repeal of the tax, a city or county shall
101 14 provide notice by mail of such action to the director
101 15 of revenue and finance.
101 16 No tax permit other than the state sales tax permit
101 17 required under section 422.53 423.36 may be required
101 18 by local authorities.
101 19 The tax levied shall be in addition to any state
101 20 sales tax imposed under section 422.43 423.2. Section
101 21 422.25, subsection 4, sections 422.30, 422.48 to
101 22 422.52, 422.54 to 422.58, 422.67, and 422.68, section
101 23 422.69, subsection 1, and sections 422.70 to 422.75,
101 24 section 423.14, subsection 1, and sections 423.23,
101 25 423.24, 423.25, 423.31, 423.33, 423.35, 423.37 to
101 26 423.42, and 423.47, consistent with the provisions of
101 27 this chapter, apply with respect to the taxes
101 28 authorized under this chapter, in the same manner and
101 29 with the same effect as if the hotel and motel taxes
101 30 were retail sales taxes within the meaning of those
101 31 statutes. Notwithstanding this paragraph, the
101 32 director shall provide for quarterly filing of returns
101 33 as prescribed in section 422.51 and for other than
101 34 quarterly filing of returns both as prescribed in
101 35 section 422.51, subsection 2 423.31. The director may
101 36 require all persons, as defined in section 422.42
101 37 423.1, who are engaged in the business of deriving
101 38 gross receipts any sales price subject to tax under
101 39 this chapter, to register with the department.
101 40 Sec. . Section 422B.8, Code 2003, is amended to
101 41 read as follows:
101 42 422B.8 LOCAL SALES AND SERVICES TAX.
101 43 A local sales and services tax at the rate of not
101 44 more than one percent may be imposed by a county on
101 45 the gross receipts sales price taxed by the state
101 46 under chapter 422 423, division IV subchapter II. A
101 47 local sales and services tax shall be imposed on the
101 48 same basis as the state sales and services tax or in
101 49 the case of the use of natural gas, natural gas
101 50 service, electricity, or electric service on the same
102 1 basis as the state use tax and shall not be imposed on
102 2 the sale of any property or on any service not taxed
102 3 by the state, except the tax shall not be imposed on
102 4 the gross receipts sales price from the sale of motor
102 5 fuel or special fuel as defined in chapter 452A which
102 6 is consumed for highway use or in watercraft or
102 7 aircraft if the fuel tax is paid on the transaction
102 8 and a refund has not or will not be allowed, on the
102 9 gross receipts sales price from the rental of rooms,
102 10 apartments, or sleeping quarters which are taxed under
102 11 chapter 422A during the period the hotel and motel tax
102 12 is imposed, on the gross receipts sales price from the
102 13 sale of equipment by the state department of
102 14 transportation, on the gross receipts sales price from
102 15 the sale of self=propelled building equipment, pile
102 16 drivers, motorized scaffolding, or attachments
102 17 customarily drawn or attached to self=propelled
102 18 building equipment, pile drivers, and motorized
102 19 scaffolding, including auxiliary attachments which
102 20 improve the performance, safety, operation, or
102 21 efficiency of the equipment and replacement parts and
102 22 are directly and primarily used by contractors,
102 23 subcontractors, and builders for new construction,
102 24 reconstruction, alterations, expansion, or remodeling
102 25 of real property or structures, and on the gross
102 26 receipts sales price from the sale of a lottery ticket
102 27 or share in a lottery game conducted pursuant to
102 28 chapter 99E and except the tax shall not be imposed on
102 29 the gross receipts sales price from the sale or use of
102 30 natural gas, natural gas service, electricity, or
102 31 electric service in a city or county where the gross
102 32 receipts sales price from the sale of natural gas or
102 33 electric energy are subject to a franchise fee or user
102 34 fee during the period the franchise or user fee is
102 35 imposed. A local sales and services tax is applicable
102 36 to transactions within those incorporated and
102 37 unincorporated areas of the county where it is imposed
102 38 and shall be collected by all persons required to
102 39 collect state gross receipts sales taxes. However, a
102 40 person required to collect state retail sales tax
102 41 under chapter 422 423, division IV subchapter V or VI,
102 42 is not required to collect local sales and services
102 43 tax on transactions delivered within the area where
102 44 the local sales and services tax is imposed unless the
102 45 person has physical presence in that taxing area. All
102 46 cities contiguous to each other shall be treated as
102 47 part of one incorporated area and the tax would be
102 48 imposed in each of those contiguous cities only if the
102 49 majority of those voting in the total area covered by
102 50 the contiguous cities favor its imposition.
103 1 The amount of the sale, for purposes of determining
103 2 the amount of the local sales and services tax, does
103 3 not include the amount of any state gross receipts
103 4 taxes sales tax.
103 5 A tax permit other than the state sales tax permit
103 6 required under section 422.53 or 423.10 423.36 shall
103 7 not be required by local authorities.
103 8 If a local sales and services tax is imposed by a
103 9 county pursuant to this chapter, a local excise tax at
103 10 the same rate shall be imposed by the county on the
103 11 purchase price of natural gas, natural gas service,
103 12 electricity, or electric service subject to tax under
103 13 chapter 423, subchapter III, and not exempted from tax
103 14 by any provision of chapter 423, subchapter III. The
103 15 local excise tax is applicable only to the use of
103 16 natural gas, natural gas service, electricity, or
103 17 electric service within those incorporated and
103 18 unincorporated areas of the county where it is imposed
103 19 and, except as otherwise provided in this chapter,
103 20 shall be collected and administered in the same manner
103 21 as the local sales and services tax. For purposes of
103 22 this chapter, "local sales and services tax" shall
103 23 also include the local excise tax.
103 24 Sec. . Section 422B.9, subsections 1 and 2,
103 25 Code 2003, are amended to read as follows:
103 26 1. a. A local sales and services tax shall be
103 27 imposed either January 1 or July 1 following the
103 28 notification of the director of revenue and finance
103 29 but not sooner than ninety days following the
103 30 favorable election and not sooner than sixty days
103 31 following notice to sellers, as defined in section
103 32 423.1. However, a jurisdiction which has voted to
103 33 continue imposition of the tax may impose that tax
103 34 without repeal of the prior tax.
103 35 b. A local sales and services tax shall be
103 36 repealed only on June 30 or December 31 but not sooner
103 37 than ninety days following the favorable election if
103 38 one is held. However, a local sales and services tax
103 39 shall not be repealed before the tax has been in
103 40 effect for one year. At least forty days before the
103 41 imposition or repeal of the tax, a county shall
103 42 provide notice of the action by certified mail to the
103 43 director of revenue and finance.
103 44 c. The imposition of or a rate change for a local
103 45 sales and service tax shall not be applied to
103 46 purchases from a printed catalog wherein a purchaser
103 47 computes the local tax based on rates published in the
103 48 catalog unless a minimum of one hundred twenty days'
103 49 notice of the imposition or rate change has been given
103 50 to the seller from the catalog and the first day of a
104 1 calendar quarter has occurred on or after the one
104 2 hundred twentieth day.
104 3 c. d. If a local sales and services tax has been
104 4 imposed prior to April 1, 2000, and at the time of the
104 5 election a date for repeal was specified on the
104 6 ballot, the local sales and services tax may be
104 7 repealed on that date, notwithstanding paragraph "b".
104 8 2. a. The director of revenue and finance shall
104 9 administer a local sales and services tax as nearly as
104 10 possible in conjunction with the administration of
104 11 state gross receipts sales tax laws. The director
104 12 shall provide appropriate forms or provide on the
104 13 regular state tax forms for reporting local sales and
104 14 services tax liability.
104 15 b. The ordinance of a county board of supervisors
104 16 imposing a local sales and services tax shall adopt by
104 17 reference the applicable provisions of the appropriate
104 18 sections of chapter 422, division IV, and chapter 423.
104 19 All powers and requirements of the director to
104 20 administer the state gross receipts sales tax law and
104 21 use tax law are applicable to the administration of a
104 22 local sales and services tax law and the local excise
104 23 tax, including but not limited to, the provisions of
104 24 section 422.25, subsection 4, sections 422.30, 422.48
104 25 to 422.52, 422.54 to 422.58, 422.67, and 422.68,
104 26 section 422.69, subsection 1, sections 422.70 to
104 27 422.75, 423.6, subsections 2 to 4, and sections 423.11
104 28 to 423.18, and 423.21 section 423.14, subsection 1 and
104 29 subsection 2, paragraphs "b" through "e", and sections
104 30 423.15, 423.23, 423.24, 423.25, 423.31 to 423.35,
104 31 423.37 to 423.42, 423.46, and 423.47. Local officials
104 32 shall confer with the director of revenue and finance
104 33 for assistance in drafting the ordinance imposing a
104 34 local sales and services tax. A certified copy of the
104 35 ordinance shall be filed with the director as soon as
104 36 possible after passage.
104 37 c. Frequency of deposits and quarterly reports of
104 38 a local sales and services tax with the department of
104 39 revenue and finance are governed by the tax provisions
104 40 in section 422.52 423.31. Local tax collections shall
104 41 not be included in computation of the total tax to
104 42 determine frequency of filing under section 422.52
104 43 423.31.
104 44 d. The director shall apply a boundary change of a
104 45 county or city imposing or collecting the local sales
104 46 and service tax to the imposition or collection of
104 47 that tax only on the first day of a calendar quarter
104 48 which occurs sixty days or more after the director has
104 49 given notice of the boundary change to sellers.
104 50 Sec. . Section 422C.2, subsections 4 and 6,
105 1 Code 2003, are amended to read as follows:
105 2 4. "Person" means person as defined in section
105 3 422.42 423.1.
105 4 6. "Rental price" means the consideration for
105 5 renting an automobile valued in money, and means the
105 6 same as "gross taxable services" "sales price" as
105 7 defined in section 422.42 423.1.
105 8 Sec. . Section 422C.3, Code 2003, is amended to
105 9 read as follows:
105 10 422C.3 TAX ON RENTAL OF AUTOMOBILES.
105 11 1. A tax of five percent is imposed upon the
105 12 rental price of an automobile if the rental
105 13 transaction is subject to the sales and services tax
105 14 under chapter 422 423, division IV subchapter II, or
105 15 the use tax under chapter 423, subchapter III. The
105 16 tax shall not be imposed on any rental transaction not
105 17 taxable under the state sales and services tax, as
105 18 provided in section 422.45 423.3, or the state use
105 19 tax, as provided in section 423.4 423.6, on automobile
105 20 rental receipts.
105 21 2. The lessor shall collect the tax by adding the
105 22 tax to the rental price of the automobile.
105 23 3. The tax, when collected, shall be stated as a
105 24 distinct item separate and apart from the rental price
105 25 of the automobile and the sales and services tax
105 26 imposed under chapter 422 423, division IV subchapter
105 27 II, or the use tax imposed under chapter 423,
105 28 subchapter III.
105 29 Sec. . Section 422C.4, Code 2003, is amended to
105 30 read as follows:
105 31 422C.4 ADMINISTRATION AND ENFORCEMENT.
105 32 All powers and requirements of the director of
105 33 revenue and finance to administer the state gross
105 34 receipts sales tax law under chapter 422, division IV,
105 35 423 are applicable to the administration of the tax
105 36 imposed under section 422C.3, including but not
105 37 limited to section 422.25, subsection 4, sections
105 38 422.30, 422.48 through 422.52, 422.54 through 422.58,
105 39 422.67, and 422.68, section 422.69, subsection 1, and
105 40 sections 422.70 through 422.75, section 423.14,
105 41 subsection 1, and sections 423.15, 423.23, 423.24,
105 42 423.25, 423.31, 423.33, 423.35 and 423.37 through
105 43 423.42, 423.45, 423.46, and 423.47. However, as an
105 44 exception to the powers specified in section 422.52,
105 45 subsection 1 423.31, the director shall only require
105 46 the filing of quarterly reports.
105 47 Sec. . Section 422E.1, subsection 1, is amended
105 48 to read as follows:
105 49 1. A local sales and services tax for school
105 50 infrastructure purposes may be imposed by a county on
106 1 behalf of school districts as provided in this
106 2 chapter.
106 3 If a local sales and services tax for school
106 4 infrastructure is imposed by a county pursuant to this
106 5 chapter, a local excise tax for school infrastructure
106 6 at the same rate shall be imposed by the county on the
106 7 purchase price of natural gas, natural gas service,
106 8 electricity, or electric service subject to tax under
106 9 chapter 423, subchapter III, and not exempted from tax
106 10 by any provision of chapter 423, subchapter III. The
106 11 local excise tax for school infrastructure is
106 12 applicable only to the use of natural gas, natural gas
106 13 service, electricity, or electric service within those
106 14 incorporated and unincorporated areas of the county
106 15 where it is imposed and, except as otherwise provided
106 16 in this chapter, shall be collected and administered
106 17 in the same manner as the local sales and services tax
106 18 for school infrastructure. For purposes of this
106 19 chapter, "local sales and services tax for school
106 20 infrastructure" shall also include the local excise
106 21 tax for school infrastructure.
106 22 Sec. . Section 422E.3, subsections 1, 2, and 3,
106 23 Code 2003, are amended to read as follows:
106 24 1. If a majority of those voting on the question
106 25 of imposition of a local sales and services tax for
106 26 school infrastructure purposes favors imposition of
106 27 the tax, the tax shall be imposed by the county board
106 28 of supervisors within the county pursuant to section
106 29 422E.2, at the rate specified for a ten=year duration
106 30 on the gross receipts sales price taxed by the state
106 31 under chapter 422 423, division IV subchapter II.
106 32 2. The tax shall be imposed on the same basis as
106 33 the state sales and services tax or in the case of the
106 34 use of natural gas, natural gas service, electricity,
106 35 or electric service on the same basis as the state use
106 36 tax and shall not be imposed on the sale of any
106 37 property or on any service not taxed by the state,
106 38 except the tax shall not be imposed on the gross
106 39 receipts sales price from the sale of motor fuel or
106 40 special fuel as defined in chapter 452A which is
106 41 consumed for highway use or in watercraft or aircraft
106 42 if the fuel tax is paid on the transaction and a
106 43 refund has not or will not be allowed, on the gross
106 44 receipts sales price from the rental of rooms,
106 45 apartments, or sleeping quarters which are taxed under
106 46 chapter 422A during the period the hotel and motel tax
106 47 is imposed, on the gross receipts sales price from the
106 48 sale of equipment by the state department of
106 49 transportation, on the gross receipts sales price from
106 50 the sale of self=propelled building equipment, pile
107 1 drivers, motorized scaffolding, or attachments
107 2 customarily drawn or attached to self=propelled
107 3 building equipment, pile drivers, and motorized
107 4 scaffolding, including auxiliary attachments which
107 5 improve the performance, safety, operation, or
107 6 efficiency of the equipment, and replacement parts and
107 7 are directly and primarily used by contractors,
107 8 subcontractors, and builders for new construction,
107 9 reconstruction, alterations, expansion, or remodeling
107 10 of real property or structures, and on the gross
107 11 receipts sales price from the sale of a lottery ticket
107 12 or share in a lottery game conducted pursuant to
107 13 chapter 99E and except the tax shall not be imposed on
107 14 the gross receipts sales price from the sale or use of
107 15 natural gas, natural gas service, electricity, or
107 16 electric service in a city or county where the gross
107 17 receipts sales price from the sale of natural gas or
107 18 electric energy are subject to a franchise fee or user
107 19 fee during the period the franchise or user fee is
107 20 imposed.
107 21 3. The tax is applicable to transactions within
107 22 the county where it is imposed and shall be collected
107 23 by all persons required to collect state gross
107 24 receipts sales or local excise taxes. However, a
107 25 person required to collect state retail sales tax
107 26 under chapter 422, division IV, 423 is not required to
107 27 collect local sales and services tax on transactions
107 28 delivered within the area where the local sales and
107 29 services tax is imposed unless the person has physical
107 30 presence in that taxing area. The amount of the sale,
107 31 for purposes of determining the amount of the tax,
107 32 does not include the amount of any state gross
107 33 receipts sales taxes or excise taxes or other local
107 34 option sales or excise taxes. A tax permit other than
107 35 the state tax permit required under section 422.53 or
107 36 423.10 423.36 shall not be required by local
107 37 authorities.
107 38 Sec. . Section 425.30, Code 2003, is amended to
107 39 read as follows:
107 40 425.30 NOTICES.
107 41 Section 422.57 423.39, subsection 1, shall apply to
107 42 all notices under this division.
107 43 Sec. . Section 425.31, Code 2003, is amended to
107 44 read as follows:
107 45 425.31 APPEALS.
107 46 Any person aggrieved by an act or decision of the
107 47 director of revenue and finance or the department of
107 48 revenue and finance under this division shall have the
107 49 same rights of appeal and review as provided in
107 50 sections 421.1 and 422.55 423.38 and the rules of the
108 1 department of revenue and finance.
108 2 Sec. . Section 452A.66, unnumbered paragraph 1,
108 3 Code 2003, is amended to read as follows:
108 4 The appropriate state agency shall administer the
108 5 taxes imposed by this chapter in the same manner as
108 6 and subject to section 422.25, subsection 4 and
108 7 section 422.52, subsection 3 423.35.
108 8 Sec. . Section 455B.455, Code 2003, is amended
108 9 to read as follows:
108 10 455B.455 SURCHARGE IMPOSED.
108 11 A land burial surcharge tax of two percent is
108 12 imposed on the fee for land burial of a hazardous
108 13 waste. The owner of the land burial facility shall
108 14 remit the tax collected to the director of revenue and
108 15 finance after consultation with the director according
108 16 to rules that the director shall adopt. The director
108 17 shall forward a copy of the site license to the
108 18 director of revenue and finance which shall be the
108 19 appropriate license for the collection of the land
108 20 burial surcharge tax and shall be subject to
108 21 suspension or revocation if the site license holder
108 22 fails to collect or remit the tax collected under this
108 23 section. The provisions of sections section 422.25,
108 24 subsection 4, sections 422.30, 422.48 to 422.52,
108 25 422.54 to 422.58, 422.67, and 422.68, section 422.69,
108 26 subsection 1, and sections 422.70 to 422.75, section
108 27 423.14, subsection 1, and sections 423.23, 423.24,
108 28 423.25, 423.31, 423.33, 423.35, 423.37 to 423.42, and
108 29 423.47, consistent with the provisions of this part 6
108 30 of division IV, shall apply with respect to the taxes
108 31 authorized under this part, in the same manner and
108 32 with the same effect as if the land burial surcharge
108 33 tax were retail sales taxes within the meaning of
108 34 those statutes. Notwithstanding the provisions of
108 35 this paragraph section, the director shall provide for
108 36 only quarterly filing of returns as prescribed in
108 37 section 422.51 423.31. Taxes collected by the
108 38 director of revenue and finance under this section
108 39 shall be deposited in the general fund of the state.
108 40 Sec. . Section 455G.3, subsection 1, Code 2003,
108 41 is amended to read as follows:
108 42 1. The Iowa comprehensive petroleum underground
108 43 storage tank fund is created as a separate fund in the
108 44 state treasury, and any funds remaining in the fund at
108 45 the end of each fiscal year shall not revert to the
108 46 general fund but shall remain in the Iowa
108 47 comprehensive petroleum underground storage tank fund.
108 48 Interest or other income earned by the fund shall be
108 49 deposited in the fund. The fund shall include moneys
108 50 credited to the fund under this section, section
109 1 423.24 423.43, subsection 1, paragraph "a", and
109 2 sections 455G.8, 455G.9, and 455G.11, and other funds
109 3 which by law may be credited to the fund. The moneys
109 4 in the fund are appropriated to and for the purposes
109 5 of the board as provided in this chapter. Amounts in
109 6 the fund shall not be subject to appropriation for any
109 7 other purpose by the general assembly, but shall be
109 8 used only for the purposes set forth in this chapter.
109 9 The treasurer of state shall act as custodian of the
109 10 fund and disburse amounts contained in it as directed
109 11 by the board including automatic disbursements of
109 12 funds as received pursuant to the terms of bond
109 13 indentures and documents and security provisions to
109 14 trustees and custodians. The treasurer of state is
109 15 authorized to invest the funds deposited in the fund
109 16 at the direction of the board and subject to any
109 17 limitations contained in any applicable bond
109 18 proceedings. The income from such investment shall be
109 19 credited to and deposited in the fund. The fund shall
109 20 be administered by the board which shall make
109 21 expenditures from the fund consistent with the
109 22 purposes of the programs set out in this chapter
109 23 without further appropriation. The fund may be
109 24 divided into different accounts with different
109 25 depositories as determined by the board and to fulfill
109 26 the purposes of this chapter.
109 27 Sec. . Section 455G.6, subsection 4, Code 2003,
109 28 is amended to read as follows:
109 29 4. Grant a mortgage, lien, pledge, assignment, or
109 30 other encumbrance on one or more improvements,
109 31 revenues, asset of right, accounts, or funds
109 32 established or received in connection with the fund,
109 33 including revenues derived from the use tax under
109 34 section 423.24 423.43, subsection 1, paragraph "a",
109 35 and deposited in the fund or an account of the fund.
109 36 Sec. . Section 455G.8, subsection 2, Code 2003,
109 37 is amended to read as follows:
109 38 2. USE TAX. The revenues derived from the use tax
109 39 imposed under chapter 423, subchapter III. The
109 40 proceeds of the use tax under section 423.24 423.43,
109 41 subsection 1, paragraph "a", shall be allocated,
109 42 consistent with this chapter, among the fund's
109 43 accounts, for debt service and other fund expenses,
109 44 according to the fund budget, resolution, trust
109 45 agreement, or other instrument prepared or entered
109 46 into by the board or authority under direction of the
109 47 board.
109 48 Sec. . Section 455G.9, subsection 2, Code 2003,
109 49 is amended to read as follows:
109 50 2. REMEDIAL ACCOUNT FUNDING. The remedial account
110 1 shall be funded by that portion of the proceeds of the
110 2 use tax imposed under chapter 423, subchapter III, and
110 3 other moneys and revenues budgeted to the remedial
110 4 account by the board.
110 5 Sec. . Section 2.67, Code 2003, is repealed.
110 6 Sec. . CODE EDITOR DIRECTIVE. The Code editor
110 7 is directed to transfer Code chapter 423A to Code
110 8 chapter 421A and to transfer Code chapters 422A, 422B,
110 9 422C, and 422E to Code chapters 423A, 423B, 423C, and
110 10 423E, respectively. The Code editor is directed to
110 11 correct Code references as required due to the changes
110 12 made in this Act.
110 13 SALES TAX ADVISORY COUNCIL
110 14 Sec. . IOWA STREAMLINED SALES TAX ADVISORY
110 15 COUNCIL.
110 16 1. An Iowa streamlined sales tax advisory council
110 17 is created. The advisory council shall review, study,
110 18 and submit recommendations to the Iowa streamlined
110 19 sales and use tax delegation regarding the proposed
110 20 streamlined sales and use tax agreement formalized by
110 21 the project's implementing sales on November 12, 2002,
110 22 the proposed language conforming Iowa's sales and use
110 23 tax to the national agreement, and the following
110 24 issues:
110 25 a. Uniform definitions proposed in the current
110 26 streamlined sales and use tax agreement and future
110 27 proposals.
110 28 b. Effects upon taxability of items newly defined
110 29 in Iowa.
110 30 c. Impacts upon business as a result of the
110 31 streamlined sales and use tax.
110 32 d. Technology implementation issues.
110 33 e. Any other issues that are brought before the
110 34 streamlined sales and use tax implementing state or
110 35 the streamlined sales and use tax governing board.
110 36 2. The department shall provide administrative
110 37 support to the Iowa streamlined sales tax advisory
110 38 council. The advisory council shall be representative
110 39 of Iowa's business community and economy when
110 40 reviewing and recommending solutions to streamlined
110 41 sales and use tax issues. The advisory council shall
110 42 provide the general assembly and the governor with
110 43 final recommendations made to the Iowa streamlined
110 44 sales and use tax delegation upon the conclusion of
110 45 each calendar year.
110 46 3. The director of revenue, in consultation with
110 47 the Iowa taxpayers association and the Iowa
110 48 association of business and industry, shall appoint
110 49 members to the Iowa streamlined sales tax advisory
110 50 council, which shall consist of the following members:
111 1 a. One member from the department of revenue and
111 2 finance.
111 3 b. Three members representing small Iowa
111 4 businesses, at least one of whom must be a retailer,
111 5 and at least one of whom shall be a supplier.
111 6 c. Three members representing medium Iowa
111 7 businesses, at least one of whom shall be a retailer,
111 8 and at least one of whom shall be a supplier.
111 9 d. Three members representing large Iowa
111 10 businesses, at least one of whom shall be a retailer,
111 11 and at least one of whom shall be a supplier.
111 12 e. One member representing taxpayers as a whole.
111 13 f. One member representing the retail community as
111 14 a whole.
111 15 g. Any other member the director of revenue and
111 16 finance deems appropriate.
111 17 Sec. . EFFECTIVE DATE. Except for the section
111 18 creating the Iowa streamlined sales tax advisory
111 19 council, this division of this Act takes effect July
111 20 1, 2004.>
111 21 #2. Title page, line 11, by inserting after the
111 22 word <council,> the following: <providing for a
111 23 streamlined sales and use tax law,>.
111 24
111 25
111 26
111 27 JENKINS of Black Hawk
111 28 HF 683.304 80
111 29 mg/cf
-1-