House File 2238

                                       HOUSE FILE       
                                       BY  SHOULTZ


    Passed House,  Date               Passed Senate, Date             
    Vote:  Ayes        Nays           Vote:  Ayes        Nays         
                 Approved                            

                                      A BILL FOR

  1 An Act relating to the prohibition of state agencies to enter
  2    into contracts with retailers, or affiliates of retailers, who
  3    do not collect state sales and use taxes.
  4 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
  5 TLSB 6148YH 80
  6 mg/pj/5

PAG LIN

  1  1    Section 1.  Section 8A.311, Code Supplement 2003, is
  1  2 amended by adding the following new subsection:
  1  3    NEW SUBSECTION.  20.  a.  A state agency shall not contract
  1  4 for the purchase of goods or services from a retailer or
  1  5 affiliate of a retailer who fails or refuses to collect or
  1  6 remit the Iowa sales and use tax imposed under section 423.2
  1  7 or 423.5 on the goods or services sold by the retailer or
  1  8 affiliate of the retailer and delivered by any means to
  1  9 locations within this state.
  1 10    b.  Every bid submitted and each contract executed by a
  1 11 state agency shall contain a certification by the bidder or
  1 12 contractor stating that the bidder or contractor is registered
  1 13 with the department of revenue and will collect and remit Iowa
  1 14 sales and use tax due under chapter 423.  In the
  1 15 certification, the bidder or contractor shall also acknowledge
  1 16 that the state agency may declare the contract or bid void if
  1 17 the certification is false.  Fraudulent certification, by act
  1 18 or omission, may result in the state agency or its
  1 19 representative filing for damages for breach of contract.
  1 20    Sec. 2.  NEW SECTION.  73.12  RETAILER'S COLLECTION OF
  1 21 SALES TAX.
  1 22    1.  A state agency shall not contract for the purchase of
  1 23 goods or services from a retailer or affiliate of a retailer
  1 24 who fails or refuses to collect or remit the Iowa sales and
  1 25 use tax imposed under section 423.2 or 423.5 on the goods or
  1 26 services sold by the retailer or affiliate of the retailer and
  1 27 delivered by any means to locations within this state.
  1 28    2.  Every bid submitted and each contract executed by a
  1 29 state agency shall contain a certification by the bidder or
  1 30 contractor stating that the bidder or contractor is registered
  1 31 with the department of revenue and will collect and remit Iowa
  1 32 sales and use tax due under chapter 423.  In the
  1 33 certification, the bidder or contractor shall also acknowledge
  1 34 that the state agency may declare the contract or bid void if
  1 35 the certification is false.  Fraudulent certification, by act
  2  1 or omission, may result in the state agency or its
  2  2 representative filing for damages for breach of contract.
  2  3                           EXPLANATION
  2  4    This bill amends Code section 8A.311 and Code chapter 73,
  2  5 pertaining to duties relating to public contracts, to prohibit
  2  6 state agencies from purchasing goods or services from a
  2  7 retailer or an affiliate of a retailer who fails or refuses to
  2  8 collect sales or use tax on the goods or services sold by the
  2  9 retailer and delivered by any means to locations within the
  2 10 state.
  2 11 LSB 6148YH 80
  2 12 mg/pj/5