S.F. _____ Section 1. Section 423.1, subsection 5, Code 2019, is 1 amended to read as follows: 2 5. “Agricultural production” includes means the commercial 3 production of livestock, milk, honey, eggs, or plants, 4 including but not limited to flowering, ornamental, or 5 vegetable plants in commercial greenhouses or otherwise, 6 and commercial production from aquaculture, and commercial 7 production from silvicultural activities. “Agricultural 8 products” includes flowering, ornamental, or vegetable plants 9 and those products of aquaculture and silviculture. 10 EXPLANATION 11 The inclusion of this explanation does not constitute agreement with 12 the explanation’s substance by the members of the general assembly. 13 This bill relates to the imposition of the sales and use tax 14 by modifying the definition of agricultural production. 15 The bill modifies the definition of “agricultural 16 production” to include the commercial production of livestock, 17 milk, honey, eggs, or certain ornamental vegetable plants 18 in greenhouses. “Agricultural production” is also modified 19 to include commercial production from aquaculture and 20 silvicultural activities. 21 The amendment to “agricultural production” in Code chapter 22 423 affects the application of the following provisions 23 which are not amended by the bill: Code sections 423.1(19) 24 (definition of farm machinery and equipment), 423.3(5) (exempt 25 agricultural products), 423.3(6) (exempt sales price of fuel 26 used in agricultural production), 423.3(8) (exempt specialized 27 machinery used in agricultural production), 423.3(10) 28 (exempt gas, electricity, water, or heat used in agricultural 29 production), and 423.45(5) (refunds of taxed fuel used in 30 agricultural production). 31 By operation of Code section 423.6, an item exempt from 32 imposition of the sales tax is also exempt from the use tax 33 imposed in Code section 423.5. 34 -1- LSB 2335XC (2) 88 jm/jh 1/ 1