Senate File 597 - Introduced SENATE FILE 597 BY COMMITTEE ON WAYS AND MEANS (SUCCESSOR TO SSB 1114) A BILL FOR An Act exempting from the sales tax certain items and services 1 sold or furnished to nonprofit blood centers, including 2 effective date and retroactive applicability provisions. 3 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 4 TLSB 1397SV (4) 88 jm/jh

S.F. 597 Section 1. Section 423.3, subsection 26A, Code 2019, is 1 amended by striking the subsection and inserting in lieu 2 thereof the following: 3 26A. a. The sales price of tangible personal property sold 4 or of test laboratory services furnished, if such tangible 5 personal property or test laboratory services are sold or 6 furnished to a nonprofit blood center that is registered by the 7 federal food and drug administration, and the tangible personal 8 property or test laboratory services are directly and primarily 9 used in the processing of human blood. 10 b. As used in this subsection, “processing” means the 11 same as defined in section 423.3, subsection 47, except that 12 for purposes of the definition of “processing” used in this 13 subsection, a “manufacturer” shall be construed to include a 14 nonprofit blood center. 15 Sec. 2. Section 423.3, subsection 104, paragraph b, 16 subparagraph (1), Code 2019, is amended to read as follows: 17 (1) “Commercial enterprise” means the same as defined in 18 section 423.3, subsection 47 , paragraph “d” , subparagraph (1), 19 but also includes nonprofit blood centers, professions , and 20 occupations. 21 Sec. 3. REFUNDS. Refunds of taxes, interest, or penalties 22 that arise from claims resulting from the enactment of 23 this Act, for sales occurring between May 30, 2018, and the 24 effective date of this Act, shall not be allowed unless refund 25 claims are filed prior to October 1, 2019, notwithstanding any 26 other provision of law to the contrary. 27 Sec. 4. EFFECTIVE DATE. This Act, being deemed of immediate 28 importance, takes effect upon enactment. 29 Sec. 5. RETROACTIVE APPLICABILITY. This Act applies 30 retroactively to May 30, 2018. 31 EXPLANATION 32 The inclusion of this explanation does not constitute agreement with 33 the explanation’s substance by the members of the general assembly. 34 This bill relates to exempting from the sales tax certain 35 -1- LSB 1397SV (4) 88 jm/jh 1/ 2

S.F. 597 items and services sold or furnished to a nonprofit blood 1 center. 2 The bill amends Code section 423.3(26A) by exempting from 3 the sales tax the sales price of tangible personal property 4 sold or test laboratory services furnished, if such tangible 5 personal property or test laboratory services are sold or 6 furnished to a nonprofit blood center that is registered by the 7 federal food and drug administration, and the tangible personal 8 property or test laboratory services are directly and primarily 9 used in the processing of human blood. 10 The bill expands the definition of “commercial enterprise” 11 in Code section 423.3(104) to include a nonprofit blood center. 12 As a result, the sales price of specified digital products, 13 prewritten computer software, and other enumerated digital and 14 computer services furnished to a nonprofit blood center are 15 exempt from the sales tax, if exclusively used by the blood 16 center. 17 By operation of Code section 423.6, an item exempt from the 18 imposition of the sales tax is also exempt from the use tax 19 imposed in Code section 423.5. 20 The bill permits refunds of taxes, interest, or penalties 21 arising from claims resulting from the enactment of the bill 22 for sales occurring between May 30, 2018, and the effective 23 date of the bill, and requires such claims to be filed prior to 24 October 1, 2019. 25 The bill takes effect upon enactment and applies 26 retroactively to May 30, 2018. 27 -2- LSB 1397SV (4) 88 jm/jh 2/ 2