SSB 1156 (LSB 1918XC (2) 87)

SENATE FILE _____ 

BY  (PROPOSED COMMITTEE ON WAYS AND MEANS BILL BY CHAIRPERSON FEENSTRA)

A BILL FOR

An Act exempting from the sales tax certain items and services sold to a nonprofit human blood collection and processing establishment, including effective date and retroactive applicability provisions.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:

    Section 1.  Section 423.3, Code 2017, is amended by adding the following new subsection:
   NEW SUBSECTION.  44.  The sales price of chemicals, solvents, sorbents, or reagents sold, or test laboratory services furnished, to a nonprofit human blood collection and processing establishment that meets the definition of establishment in 21 C.F.R. §607.3(c).
    Sec. 2.  REFUNDS.  Refunds of taxes, interest, or penalties that arise from claims resulting from the enactment of this Act, for sales occurring between July 1, 2005, and the effective date of this Act, shall be limited to twenty-five thousand dollars in the aggregate and shall not be allowed unless refund claims are filed prior to October 1, 2017, notwithstanding any other provision of law to the contrary. If the amount of claims totals more than twenty-five thousand dollars in the aggregate, the department of revenue shall prorate the twenty-five thousand dollars among all claimants in relation to the amounts of the claimants’ valid claims.
    Sec. 3.  EFFECTIVE UPON ENACTMENT.  This Act, being deemed of immediate importance, takes effect upon enactment.
    Sec. 4.  RETROACTIVE APPLICABILITY.  This Act applies retroactively to July 1, 2005.
EXPLANATION
The inclusion of this explanation does not constitute agreement with
the explanation’s substance by the members of the general assembly.
   This bill exempts from the sales tax the sales price of chemicals, sorbents, or reagents sold, or test laboratory services furnished, to a nonprofit human blood collection and processing establishment that meets the definition of establishment in 21 C.F.R. §607.3(c). That federal regulation defines “establishment” to mean a place of business under one management at one general physical location. The term includes, among others, human blood and plasma donor centers, blood banks, transfusion services, other blood product manufacturers, and independent laboratories that engage in quality control and testing for registered blood product establishments.
   By operation of Code section 423.6, an item exempt from the imposition of the sales tax is also exempt from the use tax imposed in Code section 423.5.
   The bill limits refunds of taxes, interest, or penalties arising from claims resulting from the enactment of the bill for sales occurring between July 1, 2005, and the effective date of the bill to $25,000 in the aggregate, and requires such claims to be filed prior to October 1, 2017. If the aggregate amount of refund claims exceeds $25,000, the department of revenue is required to prorate the $25,000 among all claimants in relation to each claim amount.
   The bill takes effect upon enactment and applies retroactively to July 1, 2005.