Senate Study Bill 3063 - Introduced SENATE/HOUSE FILE _____ BY (PROPOSED DEPARTMENT OF REVENUE BILL) A BILL FOR An Act relating to sales, use, and motor vehicle fuel taxes 1 administered by the department of revenue including 2 distributions to local governments and school districts, the 3 liability of sellers, tax refund and tax credit incentives, 4 and motor fuel tax reporting and terminology modifications, 5 and providing penalties, and including effective date and 6 applicability provisions. 7 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 8 TLSB 5284XD (6) 89 jm/jh
S.F. _____ H.F. _____ DIVISION I 1 SALES, USE, AND EXCISE TAX —— RETURNS DUE 2 Section 1. Section 9C.3, subsection 3, Code 2022, is amended 3 to read as follows: 4 3. The application shall state whether or not the applicant 5 has an Iowa retailers sales or use tax permit and if the 6 applicant has such permit, shall state the number of such 7 permit. 8 Sec. 2. Section 9C.5, Code 2022, is amended to read as 9 follows: 10 9C.5 Issuance of license. 11 Upon receiving an application for a transient merchant’s 12 license, the secretary of state shall investigate or cause to 13 be investigated, the reputation and character of the applicant. 14 If, upon making such investigation, the secretary of state is 15 satisfied that the statements and representations contained in 16 the application are true, and that the applicant is of good 17 reputation and character, and the holder of an Iowa retailer’s 18 sales or use tax permit, and if a foreign corporation, has 19 authority to do business in the state of Iowa, the secretary 20 shall issue to the applicant a license as a transient merchant 21 upon payment of the fee as herein prescribed for the period of 22 time requested in said application and for use at the location 23 and place where it is stated in said application the sale will 24 be held or the business conducted, both of which shall be set 25 out in said license. Such license shall be valid only for the 26 period of time and at the location and place described therein. 27 Sec. 3. Section 99G.30A, subsection 2, paragraph c, Code 28 2022, is amended to read as follows: 29 c. Frequency of deposits and quarterly monthly reports of 30 the monitor vending machine excise tax with the department of 31 revenue are governed by the tax provisions in section 423.31 . 32 Monitor vending machine excise tax collections shall not be 33 included in computation of the total tax to determine frequency 34 of filing under section 423.31 . 35 -1- LSB 5284XD (6) 89 jm/jh 1/ 47
S.F. _____ H.F. _____ Sec. 4. Section 321.105A, subsection 4, paragraph b, Code 1 2022, is amended to read as follows: 2 b. Section 422.25, subsection 4 , sections 422.30 , 422.67 , 3 and 422.68 , section 422.69, subsection 1 , sections 422.70 , 4 422.71 , 422.72 , 422.74 , and 422.75 , section 423.14, subsection 5 2 , and sections 423.23 , 423.24 , 423.25 , 423.32 , 423.33 , 423.35 , 6 423.37 through 423.42 , 423.45 , and 423.47 , consistent with the 7 provisions of this section , apply with respect to the fees 8 for new registration authorized under this section in the 9 same manner and with the same effect as if the fees for new 10 registration were retail use taxes within the meaning of those 11 statutes. 12 Sec. 5. Section 421.26, Code 2022, is amended to read as 13 follows: 14 421.26 Personal liability for tax due. 15 If a licensee or other person under section 452A.65 , a 16 retailer or purchaser under chapter 423A , 423B , 423C , 423D , 17 or 423E , or section 423.14 , 423.14A , 423.29 , 423.31 , 423.32 , 18 or 423.33 , or a user under section 423.34 , or a permit holder 19 or licensee under section 453A.13 , 453A.16 , or 453A.44 fails 20 to pay a tax under those sections when due, an officer of a 21 corporation or association, notwithstanding section 489.304 , 22 a member or manager of a limited liability company, or a 23 partner of a partnership, having control or supervision of 24 or the authority for remitting the tax payments and having 25 a substantial legal or equitable interest in the ownership 26 of the corporation, association, limited liability company, 27 or partnership, who has intentionally failed to pay the tax 28 is personally liable for the payment of the tax, interest, 29 and penalty due and unpaid. However, this section shall 30 not apply to taxes on accounts receivable. The dissolution 31 of a corporation, association, limited liability company, 32 or partnership shall not discharge a person’s liability for 33 failure to remit the tax due. 34 Sec. 6. Section 423.2, subsection 1, paragraph b, Code 2022, 35 -2- LSB 5284XD (6) 89 jm/jh 2/ 47
S.F. _____ H.F. _____ is amended to read as follows: 1 b. Sales of building materials, supplies, and equipment 2 to owners, contractors, subcontractors, or builders for the 3 erection of buildings or the alteration, repair, or improvement 4 of real property are retail sales of tangible personal property 5 in whatever quantity sold. Where the owner, contractor, 6 subcontractor, or builder is also a retailer holding a retail 7 sales or use tax permit and transacting retail sales of 8 building materials, supplies, and equipment, the person shall 9 purchase such items of tangible personal property without 10 liability for the tax if such property will be subject to the 11 tax at the time of resale or at the time it is withdrawn from 12 inventory for construction purposes. The sales tax shall be 13 due in the reporting period when the materials, supplies, 14 and equipment are withdrawn from inventory for construction 15 purposes or when sold at retail. The tax shall not be due when 16 materials are withdrawn from inventory for use in construction 17 outside of Iowa and the tax shall not apply to tangible 18 personal property purchased and consumed by the manufacturer as 19 building materials in the performance by the manufacturer or 20 its subcontractor of construction outside of Iowa. The sale 21 of carpeting is not a sale of building materials. The sale of 22 carpeting to owners, contractors, subcontractors, or builders 23 shall be treated as the sale of ordinary tangible personal 24 property and subject to the tax imposed under this subsection 25 and the use tax. 26 Sec. 7. Section 423.3, subsection 39, paragraph a, 27 subparagraph (2), Code 2022, is amended to read as follows: 28 (2) The sale of all or substantially all of the tangible 29 personal property, or specified digital products, or services 30 held or used by a seller in the course of the seller’s trade 31 or business for which the seller is required to hold a sales 32 or use tax permit when the seller sells or otherwise transfers 33 the trade or business to another person who shall engage in a 34 similar trade or business. 35 -3- LSB 5284XD (6) 89 jm/jh 3/ 47
S.F. _____ H.F. _____ Sec. 8. Section 423.3, subsection 80, paragraph d, Code 1 2022, is amended to read as follows: 2 d. Subject to the limitations in paragraph “c” , where the 3 owner, contractor, subcontractor, or builder is also a retailer 4 holding a retail sales or use tax permit and transacting 5 retail sales of building materials, supplies, and equipment, 6 the tax shall not be due when materials are withdrawn from 7 inventory for use in construction performed for a designated 8 exempt entity if an exemption certificate is received from such 9 entity. 10 Sec. 9. Section 423.5, subsection 2, Code 2022, is amended 11 to read as follows: 12 2. The excise tax is imposed upon every person using 13 the property within this state until the tax has been paid 14 directly to the county treasurer, the state department of 15 transportation, a retailer, or the department. This tax is 16 imposed on every person using the services or the product of 17 the services in this state until the user has paid the tax 18 either to an Iowa sales or use tax permit holder or to the 19 department. 20 Sec. 10. Section 423.14, subsection 2, paragraph b, Code 21 2022, is amended to read as follows: 22 b. The tax upon the use of all tangible personal property 23 and specified digital products other than that enumerated in 24 paragraph “a” , which is sold by a seller who is a retailer or 25 its agent that is not otherwise required to collect sales tax 26 under the provisions of this chapter , may be collected by the 27 retailer or agent and remitted to the department, pursuant to 28 the provisions of paragraph “e” , and sections 423.24 , 423.29 , 29 423.30 , 423.32 423.31 , and 423.33 . 30 Sec. 11. Section 423.14A, subsection 3, paragraph c, 31 subparagraph (2), Code 2022, is amended to read as follows: 32 (2) A marketplace facilitator shall collect sales and 33 use tax on the entire sales price or purchase price paid by 34 a purchaser on each Iowa sale subject to sales and use tax 35 -4- LSB 5284XD (6) 89 jm/jh 4/ 47
S.F. _____ H.F. _____ that is made or facilitated by the marketplace facilitator, 1 regardless of whether the marketplace seller for whom an Iowa 2 sale is made or facilitated has or is required to have a retail 3 sales or use tax permit or would have been required to collect 4 sales and use tax had the sale not been facilitated by the 5 marketplace facilitator, and regardless of the amount of the 6 sales price or purchase price that will ultimately accrue 7 to or benefit the marketplace facilitator, the marketplace 8 seller, or any other person. This sales and use tax collection 9 responsibility of a marketplace facilitator applies but shall 10 not be limited to sales facilitated through a computer software 11 application, commonly referred to as in-app purchases, or 12 through another specified digital product. 13 Sec. 12. Section 423.31, subsections 1, 3, 5, and 6, Code 14 2022, are amended to read as follows: 15 1. a. Each Except as provided in paragraph “b” , each person 16 subject to this section and section 423.36 and in accordance 17 with the provisions of this section and section 423.36 shall, 18 on or before the last day of the month following the close of 19 each calendar quarter month during which such person is or 20 has become or ceased being subject to the provisions of this 21 section and section 423.36 , make, sign, and file electronically 22 a return for the calendar quarter month in the form as may be 23 required. Returns shall show information relating to sales 24 prices including tangible personal property, specified digital 25 products, and services converted to the use of such person, 26 the amounts of sales prices excluded and exempt from the tax, 27 the amounts of sales prices subject to tax, a calculation of 28 tax due, and any other information for the period covered by 29 the return as may be required. Returns shall be signed by 30 the retailer or the retailer’s authorized agent and must be 31 certified by the retailer to be correct in accordance with 32 forms and rules prescribed by the director. A person required 33 to file a sales or use tax return who is unable to do so may 34 request permission from the director to file a return by 35 -5- LSB 5284XD (6) 89 jm/jh 5/ 47
S.F. _____ H.F. _____ another method. 1 b. Notwithstanding paragraph “a” , each person subject to 2 this section who collects and remits less than one thousand 3 two hundred dollars in sales or use tax to the department per 4 calendar year may file a return on or before the last day of the 5 month following the close of the calendar year. 6 3. The sales tax forms prescribed by the director shall be 7 referred to as “retailers tax deposit”. Deposit forms shall 8 be signed by the retailer or the retailer’s duly authorized 9 agent, and shall be duly certified by the retailer or agent to 10 be correct. The director may authorize incorporated banks and 11 trust companies or other depositories authorized by law which 12 are depositories or financial agents of the United States, 13 or of this state, to receive any sales or use tax imposed 14 under this chapter , in the manner, at the times, and under 15 the conditions the director prescribes. The director shall 16 prescribe the manner, times, and conditions under which the 17 receipt of the tax by those depositories is to be treated as 18 payment of the tax to the department. 19 5. a. Upon making application and receiving approval 20 from the director, a person and its affiliates that make 21 retail sales of tangible personal property, specified digital 22 products, or taxable enumerated services may make deposits and 23 file a consolidated sales or use tax return for the affiliated 24 group, pursuant to rules adopted by the director. A person and 25 each affiliate that files a consolidated return are jointly and 26 severally liable for all tax, penalty, and interest found due 27 for the tax period for which a consolidated return is filed or 28 required to be filed. 29 b. A business required to file a consolidated sales or use 30 tax return shall file a form entitled “schedule of consolidated 31 business locations” with its quarterly sales or use tax 32 return that shows the taxpayer’s consolidated permit number, 33 the permit number for each Iowa business location, the state 34 sales tax amount by business location, and the amount of state 35 -6- LSB 5284XD (6) 89 jm/jh 6/ 47
S.F. _____ H.F. _____ sales tax due on goods consumed that are not assigned to a 1 specific business location. Consolidated quarterly sales or 2 use tax returns that are not accompanied by the schedule of 3 consolidated business locations form are considered incomplete 4 and are subject to penalty under section 421.27 . 5 6. If necessary or advisable in order to insure ensure 6 the payment of the tax, the director may require returns and 7 payment of the tax to be made for other than quarterly monthly 8 periods, the provisions of this section or other provision to 9 the contrary notwithstanding. 10 Sec. 13. Section 423.31, subsection 2, Code 2022, is amended 11 by striking the subsection. 12 Sec. 14. Section 423.33, subsection 1, paragraph a, Code 13 2022, is amended to read as follows: 14 a. If a purchaser fails to pay sales tax to the retailer 15 required to collect the tax, then in addition to all of the 16 rights, obligations, and remedies provided, a use tax is 17 payable by the purchaser directly to the department, and 18 sections 423.31 , 423.32 , 423.37 , 423.38 , 423.39 , 423.40 , 19 423.41 , and 423.42 apply to the purchaser. 20 Sec. 15. Section 423.33, subsection 3, Code 2022, is amended 21 to read as follows: 22 3. Event sponsor’s liability for sales tax. A person 23 sponsoring a flea market or a craft, antique, coin, or stamp 24 show or similar event shall obtain from every retailer selling 25 tangible personal property, specified digital products, or 26 taxable services at the event proof that the retailer possesses 27 a valid sales or use tax permit or secure from the retailer 28 a statement, taken in good faith, that tangible personal 29 property, specified digital products, or services offered for 30 sale are not subject to sales tax. Failure to do so renders 31 a sponsor of the event liable for payment of any sales tax, 32 interest, and penalty due and owing from any retailer selling 33 property or services at the event. Sections 423.31 , 423.32 , 34 423.37 , 423.38 , 423.39 , 423.40 , 423.41 , and 423.42 apply to the 35 -7- LSB 5284XD (6) 89 jm/jh 7/ 47
S.F. _____ H.F. _____ sponsors. For purposes of this subsection , a “person sponsoring 1 a flea market or a craft, antique, coin, or stamp show or similar 2 event” does not include a marketplace facilitator as defined in 3 section 423.14A, subsection 1, an organization which sponsors 4 an event determined to qualify as an event involving casual 5 sales pursuant to section 423.3, subsection 39 , or the state 6 fair or a fair as defined in section 174.1 . 7 Sec. 16. Section 423.34, Code 2022, is amended to read as 8 follows: 9 423.34 Liability of user. 10 Any person who uses any tangible personal property, 11 specified digital products, or services enumerated in section 12 423.2 upon which the use tax has not been paid, either to the 13 county treasurer or to a retailer or direct to the department 14 as required by this subchapter , shall be liable for the payment 15 of tax, and shall on or before the last day of the month next 16 succeeding each quarterly monthly period pay the use tax upon 17 all tangible personal property, specified digital products, 18 or services used by the person during the preceding quarterly 19 monthly period in the manner and accompanied by such returns 20 as the director shall prescribe. All of the provisions of 21 sections 423.32 423.31 and 423.33 with reference to the returns 22 and payments shall be applicable to the returns and payments 23 required by this section . 24 Sec. 17. Section 423.36, subsection 4, paragraph b, Code 25 2022, is amended to read as follows: 26 b. If an applicant is making sales outside Iowa for use in 27 this state or furnishing services outside Iowa, the product 28 or result of which will be used in this state, that applicant 29 shall be issued one sales or use tax permit by the department 30 applicable to these out-of-state sales or services. 31 Sec. 18. Section 423.36, subsection 4, Code 2022, is amended 32 by adding the following new paragraph: 33 NEW PARAGRAPH . c. If an applicant is required to collect 34 sales or use tax and is not included in the definition of a 35 -8- LSB 5284XD (6) 89 jm/jh 8/ 47
S.F. _____ H.F. _____ retailer maintaining a place of business in this state in 1 section 423.1, subsection 48, paragraph “a” , subparagraph (1), 2 the applicant shall be issued one sales or use tax permit by 3 the department regardless of the number of locations from which 4 sales are made. 5 Sec. 19. Section 423.36, subsections 7 and 8, Code 2022, are 6 amended to read as follows: 7 7. a. Sellers who are not regularly engaged in selling 8 at retail and do not have a permanent place of business, but 9 who are temporarily engaged in selling from trucks, portable 10 roadside stands, concessionaires at state, county, district, 11 or local fairs, carnivals, or the like, shall report and remit 12 the sales tax on a temporary seasonal basis, under rules 13 the director shall provide for the efficient collection of 14 the sales tax. This subsection applies to sellers who are 15 temporarily engaged in furnishing services. 16 b. Persons engaged in selling tangible personal property, 17 specified digital products, or furnishing services shall not 18 be required to obtain or retain a sales or use tax permit for a 19 place of business at which taxable sales of tangible personal 20 property, specified digital products, or taxable performance of 21 services will not occur. 22 8. The provisions of subsection 1 , dealing with the lawful 23 right of a retailer to transact business, as applicable, apply 24 to persons having receipts from furnishing services enumerated 25 in section 423.2 , except that a person holding a permit 26 pursuant to subsection 1 shall not be required to obtain any 27 separate sales or use tax permit for the purpose of engaging in 28 business involving the services. 29 Sec. 20. Section 423.40, subsections 1, 2, 3, and 5, Code 30 2022, are amended to read as follows: 31 1. In addition to the sales or use tax or additional sales 32 or use tax, the taxpayer shall pay a penalty as provided in 33 section 421.27 . The taxpayer shall also pay interest on the 34 sales or use tax or additional sales or use tax at the rate 35 -9- LSB 5284XD (6) 89 jm/jh 9/ 47
S.F. _____ H.F. _____ in effect under section 421.7 for each month counting each 1 fraction of a month as an entire month, computed from the date 2 the semimonthly or monthly tax deposit form or return was 3 required to be filed. The penalty and interest shall be paid 4 to the department and disposed of in the same manner as other 5 receipts under this subchapter . Unpaid penalties and interest 6 may be enforced in the same manner as the taxes imposed by this 7 chapter . 8 2. a. Any person who knowingly sells tangible personal 9 property, specified digital products, tickets or admissions 10 to places of amusement and athletic events, or gas, water, 11 electricity, or communication service at retail, or engages in 12 the furnishing of services enumerated in section 423.2 , in this 13 state without procuring a permit to collect tax, as provided 14 in section 423.36 , or who violates section 423.24 and the 15 officers of any corporation who so act are guilty of a serious 16 misdemeanor. 17 b. A person who knowingly sells tangible personal property, 18 specified digital products, tickets or admissions to places of 19 amusement and athletic events, or gas, water, electricity, or 20 communication service at retail, or engages in the furnishing 21 of services enumerated in section 423.2 , in this state after 22 the person’s sales or use tax permit has been revoked and 23 before it has been restored as provided in section 423.36, 24 subsection 6 , and the officers of any corporation who so act 25 are guilty of an aggravated misdemeanor. 26 3. A person who willfully attempts in any manner to evade 27 any tax imposed by this chapter or the payment of the tax or 28 a person who makes or causes to be made a false or fraudulent 29 semimonthly or monthly tax deposit form or return with intent 30 to evade any tax imposed by subchapter II or III or the payment 31 of the tax is guilty of a class “D” felony. 32 5. A person required to pay sales or use tax, or to make, 33 sign, or file a tax deposit form or return or supplemental 34 return, who willfully makes a false or fraudulent tax deposit 35 -10- LSB 5284XD (6) 89 jm/jh 10/ 47
S.F. _____ H.F. _____ form or return, or willfully fails to pay at least ninety 1 percent of the tax or willfully fails to make, sign, or file 2 the tax deposit form or return, at the time required by law, is 3 guilty of a fraudulent practice. 4 Sec. 21. Section 423.45, subsection 4, paragraph b, Code 5 2022, is amended to read as follows: 6 b. The sales tax liability for all sales of tangible 7 personal property and specified digital products and all sales 8 of services is upon the seller and the purchaser unless the 9 seller takes from the purchaser a valid exemption certificate 10 stating under penalty of perjury that the purchase is for a 11 nontaxable purpose and is not a retail sale as defined in 12 section 423.1 , or the seller is not obligated to collect tax 13 due, or unless the seller takes a fuel exemption certificate 14 pursuant to subsection 5 . If the tangible personal property, 15 specified digital products, or services are purchased tax free 16 pursuant to a valid exemption certificate and the tangible 17 personal property, specified digital products, or services are 18 used or disposed of by the purchaser in a nonexempt manner, the 19 purchaser is solely liable for the taxes and shall remit the 20 taxes directly to the department and sections 423.31 , 423.32 , 21 423.37 , 423.38 , 423.39 , 423.40 , 423.41 , and 423.42 shall apply 22 to the purchaser. 23 Sec. 22. Section 423.45, subsection 5, paragraph c, Code 24 2022, is amended to read as follows: 25 c. The seller may accept a completed fuel exemption 26 certificate, as prepared by the purchaser, for three 27 years unless the purchaser files a new completed exemption 28 certificate. If the fuel is purchased tax free pursuant to a 29 fuel exemption certificate which is taken by the seller, and 30 the fuel is used or disposed of by the purchaser in a nonexempt 31 manner, the purchaser is solely liable for the taxes, and shall 32 remit the taxes directly to the department and sections 423.31 , 33 423.32 , 423.37 , 423.38 , 423.39 , 423.40 , 423.41 , and 423.42 34 shall apply to the purchaser. 35 -11- LSB 5284XD (6) 89 jm/jh 11/ 47
S.F. _____ H.F. _____ Sec. 23. Section 423.50, subsection 1, Code 2022, is amended 1 to read as follows: 2 1. Only one remittance of tax per return is required except 3 as provided in this subsection . Sellers that collect more 4 than thirty thousand dollars in sales and use taxes for this 5 state during the preceding calendar year shall be required to 6 make additional remittances as required under rules adopted by 7 the director. The filing of a return is not required with an 8 additional remittance. 9 Sec. 24. Section 423.57, Code 2022, is amended to read as 10 follows: 11 423.57 Statutes applicable. 12 The director shall administer this subchapter as it relates 13 to the taxes imposed in this chapter in the same manner and 14 subject to all the provisions of, and all of the powers, 15 duties, authority, and restrictions contained in sections 16 423.14 , 423.14A , 423.14B , 423.15 , 423.16 , 423.17 , 423.19 , 17 423.20 , 423.21 , 423.22 , 423.23 , 423.24 , 423.25 , 423.29 , 423.31 , 18 423.32 , 423.33 , 423.34 , 423.34A , 423.35 , 423.37 , 423.38 , 19 423.39 , 423.40 , 423.41 , and 423.42 , section 423.43, subsection 20 1 , and sections 423.45 , 423.46 , and 423.47 . 21 Sec. 25. Section 423.58, Code 2022, is amended to read as 22 follows: 23 423.58 Collection, permit, and tax return exemption for 24 certain out-of-state businesses. 25 Notwithstanding sections 423.14 , 423.14A , 423.14B , 423.29 , 26 423.31 , 423.32 , and 423.36 , a person meeting the requirements 27 of section 29C.24 is not required to obtain a sales or use tax 28 permit, collect and remit sales and use tax, or make and file 29 applicable sales or use tax returns, as provided in section 30 29C.24, subsection 3 , paragraph “a” , subparagraph (2). 31 Sec. 26. Section 423A.6, subsection 4, Code 2022, is amended 32 to read as follows: 33 4. Section 422.25, subsection 4 , sections 422.30 , 422.67 , 34 and 422.68 , section 422.69, subsection 1 , sections 422.70 , 35 -12- LSB 5284XD (6) 89 jm/jh 12/ 47
S.F. _____ H.F. _____ 422.71 , 422.72 , 422.74 , and 422.75 , section 423.14, subsection 1 1 , and sections 423.23 , 423.24 , 423.25 , 423.31 , 423.33 , 2 423.35 , 423.37 through 423.42 , and 423.47 , consistent with the 3 provisions of this chapter , apply with respect to the taxes 4 authorized under this chapter , in the same manner and with the 5 same effect as if the state and local hotel and motel taxes 6 were retail sales taxes within the meaning of those statutes. 7 Notwithstanding this subsection , the director shall provide 8 for quarterly monthly filing of returns and for other than 9 quarterly monthly filing of returns both as prescribed in 10 section 423.31 . The director may require all persons who are 11 engaged in the business of deriving any sales price subject 12 to tax under this chapter to register with the department. 13 All taxes collected under this chapter by a retailer, lodging 14 provider, lodging facilitator, lodging platform, or any other 15 person are deemed to be held in trust for the state of Iowa and 16 the local jurisdictions imposing the taxes. 17 Sec. 27. Section 423B.5, subsection 3, Code 2022, is amended 18 to read as follows: 19 3. A tax permit other than the state sales or use tax permit 20 required under section 423.36 shall not be required by local 21 authorities. 22 Sec. 28. Section 423B.6, subsection 2, paragraph c, Code 23 2022, is amended to read as follows: 24 c. Frequency of deposits and quarterly monthly reports of a 25 local sales and services tax with the department of revenue are 26 governed by the tax provisions in section 423.31 . Local tax 27 collections shall not be included in computation of the total 28 tax to determine frequency of filing under section 423.31 . 29 Sec. 29. Section 423C.4, Code 2022, is amended to read as 30 follows: 31 423C.4 Administration and enforcement. 32 All powers and requirements of the director of revenue 33 to administer the state sales tax law under chapter 423 are 34 applicable to the administration of the tax imposed under 35 -13- LSB 5284XD (6) 89 jm/jh 13/ 47
S.F. _____ H.F. _____ section 423C.3 , including but not limited to section 422.25, 1 subsection 4 , sections 422.30 , 422.67 , and 422.68 , section 2 422.69, subsection 1 , sections 422.70 through 422.75 , section 3 423.14, subsection 1 , and sections 423.15 , 423.23 , 423.24 , 4 423.25 , 423.31 , 423.33 , 423.35 and 423.37 through 423.42 , 5 423.45 , 423.46 , and 423.47 . However, as an exception to the 6 powers specified in section 423.31 , the director shall only 7 require the filing of quarterly monthly reports. 8 Sec. 30. Section 423D.4, subsection 3, Code 2022, is amended 9 to read as follows: 10 3. Section 422.25, subsection 4 , sections 422.30 , 422.67 , 11 and 422.68 , section 422.69, subsection 1 , sections 422.70 , 12 422.71 , 422.72 , 422.74 , and 422.75 , section 423.14, subsection 13 1 , and sections 423.23 , 423.24 , 423.25 , 423.31 through 14 423.35 , 423.37 through 423.42 , and 423.47 , consistent with 15 the provisions of this chapter , apply with respect to the tax 16 authorized under this chapter , in the same manner and with the 17 same effect as if the excise taxes on equipment sales or use 18 were retail sales taxes within the meaning of those statutes. 19 Notwithstanding this subsection , the director shall provide 20 for quarterly monthly filing of returns and for other than 21 quarterly monthly filing of returns both as prescribed in 22 section 423.31 . All taxes collected under this chapter by a 23 retailer or any user are deemed to be held in trust for the 24 state of Iowa. 25 Sec. 31. Section 423G.5, subsection 3, Code 2022, is amended 26 to read as follows: 27 3. Section 422.25, subsection 4 , sections 422.30 , 422.67 , 28 and 422.68 , section 422.69, subsection 1 , sections 422.70 , 29 422.71 , 422.72 , 422.74 , and 422.75 , section 423.14, subsection 30 1 , and sections 423.23 , 423.24 , 423.25 , 423.31 through 31 423.35 , 423.37 through 423.42 , and 423.47 , consistent with the 32 provisions of this chapter , shall apply with respect to the tax 33 authorized under this chapter , in the same manner and with the 34 same effect as if the excise taxes on the sale or furnishing of 35 -14- LSB 5284XD (6) 89 jm/jh 14/ 47
S.F. _____ H.F. _____ a water service were retail sales taxes within the meaning of 1 those statutes. Notwithstanding this subsection , the director 2 shall provide for quarterly monthly filing of returns and 3 for other than quarterly monthly filing of returns both as 4 prescribed in section 423.31 . All taxes collected under this 5 chapter by a retailer or any user are deemed to be held in trust 6 for the state of Iowa. 7 Sec. 32. Section 728.1, subsection 6, Code 2022, is amended 8 to read as follows: 9 6. “Place of business” means the premises of a business 10 required to obtain a sales or use tax permit pursuant to 11 chapter 423 , the premises of a nonprofit or not-for-profit 12 organization, and the premises of an establishment which is 13 open to the public at large or where entrance is limited by a 14 cover charge or membership requirement. 15 Sec. 33. Section 728.5, subsection 1, unnumbered paragraph 16 1, Code 2022, is amended to read as follows: 17 An owner, manager, or person who exercises direct control 18 over a place of business required to obtain a sales or use tax 19 permit shall be guilty of a serious misdemeanor under any of 20 the following circumstances: 21 Sec. 34. REPEAL. Section 423.32, Code 2022, is repealed. 22 DIVISION II 23 DISTRIBUTIONS OF REVENUE TO LOCAL GOVERNMENTS AND SCHOOL 24 DISTRICTS 25 Sec. 35. Section 423B.7, subsection 2, paragraph a, Code 26 2022, is amended to read as follows: 27 a. The director of revenue by August 15 of each fiscal 28 year the last day of each month shall send transfer to each 29 city or county where the local option tax is imposed , an 30 estimate of the amount of tax moneys remitted to the department 31 attributable to each city or county will receive for the year 32 and for each month of the year from the preceding month . At the 33 end of each month, the director may revise the estimates for 34 the year and remaining months. 35 -15- LSB 5284XD (6) 89 jm/jh 15/ 47
S.F. _____ H.F. _____ Sec. 36. Section 423B.7, subsection 2, paragraphs b and c, 1 Code 2022, are amended by striking the paragraphs. 2 Sec. 37. Section 423F.2, subsection 4, paragraph a, Code 3 2022, is amended to read as follows: 4 a. The director of revenue by August 15 of each fiscal year 5 the last day of each month shall send transfer to each school 6 district an estimate of the amount of tax moneys remitted 7 to the department attributable to each school district will 8 receive for the year and for each month of the year from the 9 preceding month . At the end of each month, the director may 10 revise the estimates for the year and remaining months. 11 Sec. 38. Section 423F.2, subsection 4, paragraphs b and c, 12 Code 2022, are amended by striking the paragraphs. 13 Sec. 39. TRANSITION PROVISION FOR LOCAL OPTION SALES TAX 14 AND SECURING AN ADVANCED VISION FOR EDUCATION —— TRANSFER 15 AMOUNTS. Notwithstanding any other provision of law to the 16 contrary, the department of revenue shall estimate monthly 17 local option sales tax and securing an advanced vision for 18 education transfer amounts through the end of the 2022 calendar 19 year. The department of revenue shall transfer estimated 20 amounts to each local government or school district for the 21 months of July, August, and September 2022. Beginning with the 22 October 2022 transfer, the department shall not use estimated 23 amounts and shall transfer the amount of tax attributable to 24 each local government or school district for the tax remitted 25 in September 2022. Any adjustment amount that is necessary to 26 the July, August, or September 2022 estimated transfer amount 27 to reflect the accurate attributable amount shall be made by 28 the department of revenue or the local government or school 29 district by the close of business on December 30, 2022. 30 DIVISION III 31 LIABILITY OF SELLERS USING CERTIFIED SERVICE PROVIDER 32 Sec. 40. Section 423.48, subsection 3, paragraph a, Code 33 2022, is amended to read as follows: 34 a. A model 1 seller’s obligation to calculate, collect, and 35 -16- LSB 5284XD (6) 89 jm/jh 16/ 47
S.F. _____ H.F. _____ remit sales and use taxes shall be performed by its certified 1 service provider, except for the seller’s obligation to remit 2 tax on its own purchases. As the seller’s agent, the certified 3 service provider is liable for its model 1 seller’s sales 4 and use tax due Iowa on all sales transactions it processes 5 for the seller except as set out in this section . A seller 6 that contracts with a certified service provider is not 7 liable to the state for sales or use tax due on transactions 8 processed by the certified service provider unless the seller 9 misrepresents the types of items or services it sells or 10 commits fraud certified service provider establishes that 11 the certified service provider is not liable in accordance 12 with the agreement . In the absence of probable cause to 13 believe that the seller has committed fraud or made a material 14 misrepresentation liability relief established by the certified 15 service provider , the seller is not subject to audit on the 16 transactions processed by the certified service provider. 17 A model 1 seller is subject to audit for transactions not 18 processed by the certified service provider. The director is 19 authorized to perform a system check of the model 1 seller and 20 review the seller’s procedures to determine if the certified 21 service provider’s system is functioning properly and the 22 extent to which the seller’s transactions are being processed 23 by the certified service provider. 24 DIVISION IV 25 AUTHORITY TO CANCEL VARIOUS PERMITS ISSUED BY THE DEPARTMENT 26 Sec. 41. Section 421.17, Code 2022, is amended by adding the 27 following new subsection: 28 NEW SUBSECTION . 37. Notwithstanding any other provision 29 of law to the contrary, to cancel the following permits upon 30 verification by the department of revenue the permits are no 31 longer in use: income tax withholding, sales or use tax, or 32 motor fuel tax. 33 DIVISION V 34 ECONOMIC DEVELOPMENT AUTHORITY SALES AND USE TAX REFUND 35 -17- LSB 5284XD (6) 89 jm/jh 17/ 47
S.F. _____ H.F. _____ INCENTIVES 1 Sec. 42. Section 15.331A, subsection 2, Code 2022, is 2 amended to read as follows: 3 2. To receive the refund, a claim shall be filed by the 4 eligible business with the department of revenue as follows: 5 a. The contractor or subcontractor shall state under oath, 6 on forms provided by the department of revenue, the amount of 7 the sales of tangible personal property or services rendered, 8 furnished, or performed including water, sewer, gas, and 9 electric utility services upon which sales or use tax has been 10 paid prior to the project contract completion, and shall file 11 the forms with the eligible business before final settlement 12 is made. 13 b. The eligible business shall, not more than one year after 14 project contract completion, make application to the department 15 of revenue for any refund of the amount of the sales and use 16 taxes paid pursuant to chapter 423 upon any tangible personal 17 property, or services rendered, furnished, or performed, 18 including water, sewer, gas, and electric utility services. 19 The application shall be made in the manner and upon forms to 20 be provided by the department of revenue, and the department of 21 revenue shall audit the claim and, if approved, issue a warrant 22 to the eligible business in the amount of the sales or use tax 23 which has been paid to the state of Iowa under a contract. The 24 application must be made within one year after the project 25 completion date. A claim filed by the eligible business in 26 accordance with this section shall not be denied by reason of a 27 limitation provision set forth in chapter 421 or 423 . 28 c. The eligible business shall inform the department of 29 revenue in writing after project contract completion. For 30 purposes of this section , “project completion” means the 31 first date upon which the average annualized production of 32 finished product for the preceding ninety-day period at the 33 manufacturing facility operated by the eligible business is 34 at least fifty percent of the initial design capacity of the 35 -18- LSB 5284XD (6) 89 jm/jh 18/ 47
S.F. _____ H.F. _____ facility. 1 Sec. 43. Section 15.331A, Code 2022, is amended by adding 2 the following new subsection: 3 NEW SUBSECTION . 4. For purposes of this section, “contract 4 completion” means the date of completion of a written contract 5 relating to the construction or equipping of the facility that 6 is part of the project of the eligible business. 7 Sec. 44. Section 15.331C, subsections 1 and 2, Code 2022, 8 are amended to read as follows: 9 1. An In lieu of the sales and use tax refund provided 10 in section 15.331A, an eligible business may claim a tax 11 credit in an amount equal to the sales and use taxes paid by a 12 third-party developer under chapter 423 for gas, electricity, 13 water, or sewer utility services, goods, wares, or merchandise, 14 or on services rendered, furnished, or performed to or for a 15 contractor or subcontractor and used in the fulfillment of a 16 written contract relating to the construction or equipping of 17 a facility of the eligible business. Taxes attributable to 18 intangible property and furniture and furnishings shall not 19 be included, but taxes attributable to racks, shelving, and 20 conveyor equipment to be used in a warehouse or distribution 21 center shall be included. Any credit in excess of the tax 22 liability for the tax year may be credited to the tax liability 23 for the following seven years or until depleted, whichever 24 occurs earlier. An eligible business may elect to receive a 25 refund of all or a portion of an unused tax credit. 26 2. A third-party developer shall state under oath, on 27 forms provided by the department of revenue, the amount of 28 taxes paid as described in subsection 1 and shall submit such 29 forms to the department of revenue. The taxes paid shall be 30 itemized to allow identification of the taxes attributable 31 to racks, shelving, and conveyor equipment to be used in a 32 warehouse or distribution center. The eligible business 33 shall make application to the department of revenue in the 34 manner and form prescribed by the department of revenue, and 35 -19- LSB 5284XD (6) 89 jm/jh 19/ 47
S.F. _____ H.F. _____ within the time for applying for a sales and use tax refund 1 under section 15.331A. After timely receiving the form from 2 the third-party developer and application from the eligible 3 business , the department of revenue shall audit the claim 4 and, if approved, shall issue a tax credit certificate to the 5 eligible business equal to the sales and use taxes paid by a 6 third-party developer under chapter 423 for gas, electricity, 7 water, or sewer utility services, goods, wares, or merchandise, 8 or on services rendered, furnished, or performed to or for a 9 contractor or subcontractor and used in the fulfillment of a 10 written contract relating to the construction or equipping 11 of a facility. The department of revenue shall also issue a 12 tax credit certificate to the eligible business equal to the 13 taxes paid and attributable to racks, shelving, and conveyor 14 equipment to be used in a warehouse or distribution center. 15 The aggregate combined total amount of tax refunds under 16 section 15.331A for taxes paid and attributable to racks, 17 shelving, and conveyor equipment to be used in a warehouse or 18 distribution center and of tax credit certificates issued by 19 the department of revenue under this section for the taxes paid 20 and attributable to racks, shelving, and conveyor equipment 21 to be used in a warehouse or distribution center shall not 22 exceed five hundred thousand dollars in a fiscal year. If 23 an applicant for a tax credit certificate does not receive 24 a refund or certificate for the taxes paid and attributable 25 to racks, shelving, and conveyor equipment to be used in a 26 warehouse or distribution center, the application shall be 27 considered in succeeding fiscal years. The eligible business 28 shall not claim a tax credit under this section unless a tax 29 credit certificate issued by the department of revenue is 30 included with the taxpayer’s tax return for the tax year for 31 which the tax credit is claimed. A tax credit certificate 32 shall contain the eligible business’s name, address, tax 33 identification number, the amount of the tax credit, and other 34 information deemed necessary by the department of revenue. 35 -20- LSB 5284XD (6) 89 jm/jh 20/ 47
S.F. _____ H.F. _____ Sec. 45. Section 15.355, subsection 2, Code 2022, is amended 1 by striking the subsection and inserting in lieu thereof the 2 following: 3 2. a. A housing business may claim a refund of the sales 4 and use taxes paid under chapter 423 prior to the completion 5 of the housing project that are directly related to a housing 6 project and specified in the agreement. 7 b. To receive a refund, a claim shall be filed by the 8 housing business with the department of revenue as follows: 9 (1) The contractor or subcontractor shall state under oath, 10 on forms provided by the department of revenue, the amount 11 of sales and use taxes paid under chapter 423 prior to the 12 completion of the housing project that are directly related to 13 a housing project and specified in the agreement. 14 (2) The contractor or subcontractor shall file the forms 15 with the housing business before final settlement is made. 16 (3) (a) The housing business shall, after the agreement 17 completion date, make application to the department of revenue 18 for any refund of the amount of sales and use taxes paid under 19 chapter 423 prior to the completion of the housing project that 20 were directly related to a housing project and specified in the 21 agreement. The application shall be made in the manner and 22 upon forms to be provided by the department of revenue. The 23 department of revenue shall audit the claim and, if approved, 24 issue a warrant to the housing business. The application 25 must be made within one year after the agreement completion 26 date. A claim filed by the housing business in accordance with 27 this subsection shall not be denied by reason of a limitation 28 provision set forth in chapter 421 or 423. 29 (b) For purposes of this subparagraph, “agreement completion 30 date” means the date on which the authority notifies the 31 department of revenue that all applicable requirements of the 32 agreement entered into pursuant to section 15.354, subsection 33 3, paragraph “a” , and all applicable requirements of this part, 34 including the rules the authority and the department of revenue 35 -21- LSB 5284XD (6) 89 jm/jh 21/ 47
S.F. _____ H.F. _____ adopt pursuant to section 15.356, are satisfied. 1 c. A contractor or subcontractor who willfully makes a 2 false claim under oath in violation of the provisions of this 3 subsection shall be guilty of a simple misdemeanor and in 4 addition to any other penalty, the contractor or subcontractor 5 shall be liable for the payment of the tax and any applicable 6 penalty and interest. 7 Sec. 46. EFFECTIVE DATE. This division of this Act, being 8 deemed of immediate importance, takes effect upon enactment. 9 Sec. 47. APPLICABILITY. This division of this Act applies 10 to claims for refunds filed on or after the effective date of 11 this division of this Act. 12 DIVISION VI 13 MOTOR FUEL REPORTING REQUIREMENT —— PENALTY 14 Sec. 48. Section 452A.33, subsection 1, paragraph c, Code 15 2022, is amended to read as follows: 16 c. (1) The retail dealer shall prepare and submit file 17 the report with the department in a manner and according to 18 procedures required by the department in compliance with 19 section 452A.61 . However, the department may require that the 20 retail dealer file the report with the department by electronic 21 transmission. The department may require that retail dealers 22 report to the department on an annual, quarterly, or monthly 23 basis. The department, upon application by a retail dealer, 24 may grant a reasonable extension of time to file the report. 25 (2) If a retail dealer fails to file the report as required 26 by this section or fails to maintain records required to file 27 the report the department may impose a civil penalty of not 28 more than one hundred dollars per occurrence in addition to any 29 other penalty provided by law. The penalty amount shall be 30 deposited into the general fund of the state. 31 DIVISION VII 32 MOTOR FUEL TAX TERMINOLOGY MODIFICATIONS 33 Sec. 49. Section 312.1, subsection 1, paragraph b, Code 34 2022, is amended to read as follows: 35 -22- LSB 5284XD (6) 89 jm/jh 22/ 47
S.F. _____ H.F. _____ b. All the net proceeds of the motor fuel tax or license 1 permit fees under chapter 452A . 2 Sec. 50. Section 452A.2, subsections 15, 26, 27, 28, 38, and 3 46, Code 2022, are amended to read as follows: 4 15. “Eligible purchaser” means a distributor of motor 5 fuel or special fuel or an end user of special fuel who has 6 purchased a minimum of two hundred forty thousand gallons of 7 special fuel each year in the preceding two years. Eligible 8 purchasers who elect to make delayed payments to a licensed 9 permitted supplier shall use electronic funds transfer. 10 Additional requirements for qualifying as an eligible purchaser 11 shall be established by rule. 12 26. Licensed Permitted compressed natural gas, liquefied 13 natural gas, liquefied petroleum gas, and hydrogen dealer” 14 means a person in the business of handling untaxed compressed 15 natural gas, liquefied natural gas, liquefied petroleum gas, or 16 hydrogen who delivers any part of the fuel into a fuel supply 17 tank of any motor vehicle. 18 27. Licensed Permitted compressed natural gas, liquefied 19 natural gas, liquefied petroleum gas, and hydrogen user” means 20 a person licensed permitted by the department who dispenses 21 compressed natural gas, liquefied natural gas, liquefied 22 petroleum gas, or hydrogen, upon which the special fuel tax has 23 not been previously paid, for highway use from fuel sources 24 owned and controlled by the person into the fuel supply tank 25 of a motor vehicle, or commercial vehicle owned or controlled 26 by the person. 27 28. Licensee Permit holder means a person holding an 28 uncanceled supplier’s, restrictive supplier’s, importer’s, 29 exporter’s, dealer’s, user’s, or blender’s license permit 30 issued by the department under this subchapter or any prior 31 motor fuel tax law or any other person who possesses fuel for 32 which the tax has not been paid. 33 38. “Restrictive supplier” means a person who imports motor 34 fuel or undyed special fuel into this state in tank wagons or 35 -23- LSB 5284XD (6) 89 jm/jh 23/ 47
S.F. _____ H.F. _____ in small tanks not otherwise licensed permitted as an importer. 1 46. “Use” , with respect to liquefied petroleum gas, means 2 the receipt, delivery, or placing of liquefied petroleum gas 3 by a licensed permitted liquefied petroleum gas user into a 4 fuel supply tank of a motor vehicle while the vehicle is in the 5 state. With respect to natural gas used as a special fuel, 6 “use” means the receipt, delivery, or placing of the natural gas 7 into equipment for compressing the gas for subsequent delivery 8 into the fuel supply tank of a motor vehicle while the vehicle 9 is in the state. With respect to hydrogen used as a special 10 fuel, “use” means the receipt, delivery, or placing of hydrogen 11 by a licensed permitted hydrogen user into a fuel supply tank 12 of a motor vehicle while the vehicle is in the state. 13 Sec. 51. Section 452A.3, subsection 8, paragraph a, 14 subparagraphs (2) and (5), Code 2022, are amended to read as 15 follows: 16 (2) Tax shall not be paid when the sale of alcohol occurs 17 within a terminal from an alcohol manufacturer to an Iowa 18 licensed permitted supplier. The tax shall be paid by the Iowa 19 licensed permitted supplier when the invoiced gross gallonage 20 of the alcohol or the alcohol part of ethanol blended gasoline 21 is withdrawn from a terminal for delivery in this state. 22 (5) Any other person who possesses taxable fuel upon which 23 the tax has not been paid to a licensee permit holder . 24 Sec. 52. Section 452A.4, Code 2022, is amended to read as 25 follows: 26 452A.4 Supplier’s, restrictive supplier’s, importer’s, 27 exporter’s, dealer’s, and user’s license permit . 28 1. It shall be unlawful for any person to sell motor fuel or 29 undyed special fuel within this state or to otherwise act as 30 a supplier, restrictive supplier, importer, exporter, dealer, 31 or user unless the person holds an uncanceled license permit 32 issued by the department. To procure a license permit , a 33 supplier, restrictive supplier, importer, exporter, dealer, or 34 user shall file with the department an application signed under 35 -24- LSB 5284XD (6) 89 jm/jh 24/ 47
S.F. _____ H.F. _____ penalty for false certificate setting forth and complying with 1 all of the following: 2 a. The name under which the licensee permit holder will 3 transact business in this state. 4 b. The location, with street number address, of the 5 principal office or place of business of the licensee permit 6 holder within this state. 7 c. The name and complete residence address of the owner 8 or the names and addresses of the partners, if the licensee 9 permit holder is a partnership, or the names and addresses of 10 the principal officers, if the licensee permit holder is a 11 corporation or association. 12 d. A dealer’s or user’s license permit shall be required for 13 each separate place of business or location where compressed 14 natural gas, liquefied natural gas, liquefied petroleum gas, or 15 hydrogen is delivered or placed into the fuel supply tank of a 16 motor vehicle. 17 e. An applicant for an exporter’s license permit shall 18 provide verification as required by the department that the 19 applicant has the appropriate license permit valid in the state 20 or states into which the motor fuel or undyed special fuel will 21 be exported. 22 2. a. The department may deny the issuance of a license 23 permit to an applicant who is substantially delinquent in 24 the payment of a tax due, or the interest or penalty on the 25 tax, administered by the department. If the applicant is a 26 partnership, a license permit may be denied if a partner owes 27 any delinquent tax, interest, or penalty. If the applicant is 28 a corporation, a license permit may be denied if any officer 29 having a substantial legal or equitable interest in the 30 ownership of the corporation owes any delinquent tax, interest, 31 or penalty of the applicant corporation. 32 b. The department may deny the issuance of a license permit 33 if an application for a license permit to transact business as 34 a supplier, restrictive supplier, importer, exporter, dealer, 35 -25- LSB 5284XD (6) 89 jm/jh 25/ 47
S.F. _____ H.F. _____ or user in this state is filed by a person whose license permit 1 or registration has been canceled for cause at any time under 2 the provisions of this chapter or any prior motor fuel tax law, 3 if the department has reason to believe that the application is 4 not filed in good faith, or if the application is filed by some 5 person as a subterfuge for the real person in interest whose 6 license permit or registration has been canceled for cause 7 under the provisions of this chapter or any prior motor fuel 8 tax law. The applicant shall be given fifteen days’ notice in 9 writing of the date of the hearing and shall have the right to 10 appear in person or by counsel and present testimony. 11 3. a. The application in proper form having been accepted 12 for filing, and the other conditions and requirements of 13 this section and subchapter IV having been complied with, 14 the department shall issue to the applicant a license permit 15 to transact business as a supplier, restrictive supplier, 16 importer, exporter, dealer, or user in this state. The license 17 permit shall remain in full force and effect until canceled as 18 provided in this chapter . 19 b. The license permit shall not be assignable and shall be 20 valid only for the licensee permit holder in whose name it is 21 issued. 22 c. The department shall keep and file all applications and 23 bonds and a record of all licensees permit holders . 24 Sec. 53. Section 452A.6, Code 2022, is amended to read as 25 follows: 26 452A.6 Ethanol blended gasoline and other products —— 27 blender’s license permit . 28 1. a. A person other than a supplier, restrictive supplier, 29 or importer licensed permitted under this subchapter , who 30 blends gasoline with ethanol as defined in section 214A.1 in 31 order to formulate ethanol blended gasoline, shall obtain a 32 blender’s license permit . 33 b. A person who blends two or more special fuel products 34 or sells one hundred percent biofuel shall obtain a blender’s 35 -26- LSB 5284XD (6) 89 jm/jh 26/ 47
S.F. _____ H.F. _____ license permit . 1 2. A blender’s license permit shall be obtained by following 2 the procedure under section 452A.4 and the blender’s license 3 permit is subject to the same restrictions as contained in that 4 section. 5 3. A blender required to obtain a license permit pursuant 6 to this section shall maintain records as required by section 7 452A.10 as to motor fuel, ethanol, ethanol blended gasoline, 8 and special fuels. 9 Sec. 54. Section 452A.6A, subsection 3, paragraph b, Code 10 2022, is amended to read as follows: 11 b. Affect the blender’s license permit requirements under 12 section 452A.6 . 13 Sec. 55. Section 452A.7, Code 2022, is amended to read as 14 follows: 15 452A.7 Foreign suppliers. 16 The director, upon application, may authorize the 17 collection and reporting of the tax by any supplier not having 18 jurisdictional connections with this state. A foreign supplier 19 shall be issued a license permit to collect and report the tax 20 and shall be subject to the same regulations and requirements 21 as suppliers having a jurisdictional connection with the state, 22 or other regulations and agreements as prescribed by the 23 director. 24 Sec. 56. Section 452A.8, subsection 1, paragraph a, Code 25 2022, is amended to read as follows: 26 a. A statement of the number of invoiced gallons of motor 27 fuel and undyed special fuel withdrawn from the terminal by the 28 licensee permit holder within this state during the preceding 29 calendar month in such detail as determined by the department. 30 This includes on-site blending reports at the terminal. 31 Sec. 57. Section 452A.8, subsection 2, paragraph a, 32 unnumbered paragraph 1, Code 2022, is amended to read as 33 follows: 34 From the total number of invoiced gallons of motor fuel 35 -27- LSB 5284XD (6) 89 jm/jh 27/ 47
S.F. _____ H.F. _____ or undyed special fuel withdrawn from the terminal by the 1 licensee permit holder during the preceding calendar month or 2 semimonthly period the following deductions shall be made: 3 Sec. 58. Section 452A.8, subsection 2, paragraph a, 4 subparagraph (1), Code 2022, is amended to read as follows: 5 (1) The gallonage of motor fuel or undyed special fuel 6 withdrawn from a terminal by a licensee permit holder and 7 exported outside Iowa. 8 Sec. 59. Section 452A.8, subsection 2, paragraph c, Code 9 2022, is amended to read as follows: 10 c. The tax due under paragraph “b” shall be the amount 11 of fuel tax due from the supplier, restrictive supplier, or 12 importer for the preceding reporting period. The director 13 may require by rule that the payment of taxes by suppliers, 14 restrictive suppliers, and importers be made by electronic 15 funds transfer. The director may allow a tax float by rule 16 where the eligible purchaser is not required to pay the tax 17 to the supplier until one business day prior to the date the 18 tax is due. A licensed permitted supplier who is unable to 19 recover the tax from an eligible purchaser is not liable for 20 the tax, upon proper documentation, and may credit the amount 21 of unpaid tax against a later remittance of tax. Under this 22 provision, a supplier does not qualify for a credit if the 23 purchaser did not elect to use the eligible purchaser status, 24 or otherwise does not qualify to be an eligible purchaser. To 25 qualify for the credit, the supplier must notify the department 26 of the uncollectible account no later than ten calendar days 27 after the due date for payment of the tax. If a supplier 28 sells additional motor fuel or undyed special fuel to a 29 delinquent eligible purchaser after notifying the department 30 that the supplier has an uncollectible debt with that eligible 31 purchaser, the limited liability provision does not apply to 32 the additional fuel. The supplier is liable for tax collected 33 from the purchaser. 34 Sec. 60. Section 452A.8, subsection 2, paragraph e, 35 -28- LSB 5284XD (6) 89 jm/jh 28/ 47
S.F. _____ H.F. _____ subparagraphs (1), (2), (3), and (4), Code 2022, are amended 1 to read as follows: 2 (1) For purposes of this paragraph “e” , “dealer” or “user” 3 means a licensed permitted compressed natural gas, liquefied 4 natural gas, liquefied petroleum gas, and hydrogen dealer or 5 user and “fuel” means compressed natural gas, liquefied natural 6 gas, liquefied petroleum gas, or hydrogen. 7 (2) The tax for compressed natural gas, liquefied natural 8 gas, liquefied petroleum gas, and hydrogen delivered by a 9 licensed permitted dealer for use in this state shall attach at 10 the time of the delivery and shall be collected by the dealer 11 from the purchaser and paid to the department as provided in 12 this chapter . The tax, with respect to compressed natural gas, 13 liquefied natural gas, liquefied petroleum gas, and hydrogen 14 acquired by a purchaser in any manner other than by delivery by 15 a licensed permitted dealer into a fuel supply tank of a motor 16 vehicle, attaches at the time of the use of the fuel and shall 17 be paid over to the department by the purchaser as provided in 18 this chapter . 19 (3) The department shall adopt rules governing the 20 dispensing of compressed natural gas, liquefied natural 21 gas, liquefied petroleum gas, and hydrogen by licensed 22 permitted dealers and licensed permitted users. The director 23 may require by rule that reports and returns be filed by 24 electronic transmission. The department shall require that 25 all pumps located at dealer locations and user locations 26 through which liquefied petroleum gas can be dispensed shall 27 be metered, inspected, tested for accuracy, and sealed and 28 licensed permitted by the department of agriculture and land 29 stewardship, and that fuel delivered into the fuel supply tank 30 of any motor vehicle shall be dispensed only through tested 31 metered pumps and may be sold without temperature correction 32 or corrected to a temperature of 60 degrees Fahrenheit. If 33 the metered gallonage is to be temperature-corrected, only 34 a temperature-compensated meter shall be used. Natural gas 35 -29- LSB 5284XD (6) 89 jm/jh 29/ 47
S.F. _____ H.F. _____ used as fuel shall be delivered into compressing equipment 1 through sealed meters certified for accuracy by the department 2 of agriculture and land stewardship. Hydrogen used as fuel 3 shall be delivered into the fuel supply tank of any motor 4 vehicle through sealed meters certified for accuracy by the 5 department of agriculture and land stewardship. The department 6 of agriculture and land stewardship may adopt rules pursuant 7 to chapter 17A relating to the certification and accuracy of 8 meters used to deliver hydrogen. 9 (4) (a) All gallonage which is not for highway use, 10 dispensed through metered pumps as licensed permitted under 11 this section on which fuel tax is not collected, must be 12 substantiated by exemption certificates as provided by the 13 department or by valid exemption certificates provided by 14 the dealers, signed by the purchaser, and retained by the 15 dealer. A “valid exemption certificate provided by a dealer” 16 is an exemption certificate which is in the form prescribed by 17 the director to assist a dealer to properly account for fuel 18 dispensed for which tax is not collected and which is complete 19 and correct according to the requirements of the director. 20 (b) For the privilege of purchasing liquefied petroleum 21 gas, dispensed through licensed permitted metered pumps, on a 22 basis exempt from the tax, the purchaser shall sign exemption 23 certificates for the gallonage claimed which is not for highway 24 use. 25 (c) The department shall disallow all sales of gallonage 26 which is not for highway use unless proof is established by the 27 certificate. Exemption certificates shall be retained by the 28 dealer for a period of three years. 29 Sec. 61. Section 452A.8, subsections 3 and 4, Code 2022, are 30 amended to read as follows: 31 3. For the purpose of determining the amount of the tax 32 liability on alcohol blended to produce ethanol blended 33 gasoline or a blend of special fuel products, each licensed 34 permitted blender shall, not later than the last day of each 35 -30- LSB 5284XD (6) 89 jm/jh 30/ 47
S.F. _____ H.F. _____ month following the month in which the blending is done, file 1 with the department a monthly return, signed under penalty for 2 false certificate, containing information required by rules 3 adopted by the director. The director may require by rule that 4 reports and returns be filed by electronic transmission. 5 4. A person who possesses fuel or uses fuel in a motor 6 vehicle upon which no tax has been paid by a licensee permit 7 holder in this state is subject to reporting and paying the 8 applicable tax. The director may require by rule that reports 9 and returns be filed by electronic transmission. 10 Sec. 62. Section 452A.9, Code 2022, is amended to read as 11 follows: 12 452A.9 Returns from persons not licensed permitted as 13 suppliers, restrictive suppliers, importers, or blenders. 14 Every person other than a licensed permitted supplier, 15 restrictive supplier, importer, or blender, who purchases, 16 brings into this state, or otherwise acquires within this state 17 motor fuel or undyed special fuel, not otherwise exempted, 18 which the person has knowingly not paid or incurred liability 19 to pay either to a licensee permit holder or to a dealer 20 the motor fuel or special fuel tax, shall be subject to 21 the provisions of this subchapter that apply to suppliers, 22 restrictive suppliers, importers, and blenders of motor fuel or 23 undyed special fuel and shall file the same returns and make 24 the same tax payments and be subject to the same penalties 25 for delinquent filing or nonfiling or delinquent payment or 26 nonpayment as apply to suppliers, restrictive suppliers, 27 importers, and blenders. 28 Sec. 63. Section 452A.12, subsection 1, Code 2022, is 29 amended to read as follows: 30 1. A serially numbered manifest shall be carried on 31 every vehicle, except small tank wagons, while in use in 32 transportation service, on which shall be entered the following 33 information as to the cargo of motor fuel or special fuel being 34 moved in the vehicle: The date and place of loading, the place 35 -31- LSB 5284XD (6) 89 jm/jh 31/ 47
S.F. _____ H.F. _____ to be unloaded, the person for whom it is to be delivered, 1 the nature and kind of product, the amount of product, and 2 other information required by the department. The manifest 3 for small tank wagons shall be retained at the home office. 4 The manifest covering each load transported, upon consummation 5 of the delivery, shall be completed by showing the date and 6 place of actual delivery and the person to whom actually 7 delivered and shall be kept as a permanent record for a period 8 of three years. However, the record of the manifest of past 9 cargoes need not be carried on the conveyance but shall be 10 preserved by the carrier for inspection by the department. A 11 carrier subject to this subsection when distributing for a 12 licensee permit holder may with the approval of the department 13 substitute the loading and delivery evidence required in 14 subsection 2 for the manifest. 15 Sec. 64. Section 452A.15, subsection 1, paragraph c, Code 16 2022, is amended to read as follows: 17 c. If a person required under this section to file 18 transportation reports is a licensee permit holder under 19 this subchapter and if the information required in the 20 transportation report is contained in any other report rendered 21 by the person under this subchapter , a separate transportation 22 report of that information shall not be required. 23 Sec. 65. Section 452A.21, subsection 1, Code 2022, is 24 amended to read as follows: 25 1. Persons not licensed permitted under this subchapter 26 who blend motor fuel and alcohol to produce ethanol blended 27 gasoline may file for a refund for the difference between taxes 28 paid on the motor fuel purchased to produce ethanol blended 29 gasoline and the tax due on the ethanol blended gasoline 30 blended. If, during any month, a person licensed permitted 31 under this subchapter uses tax paid motor fuel to blend ethanol 32 blended gasoline and the refund otherwise due under this 33 section is greater than the licensee’s total tax liability of 34 the permit holder for that month, the licensee permit holder is 35 -32- LSB 5284XD (6) 89 jm/jh 32/ 47
S.F. _____ H.F. _____ entitled to a credit. The claim for credit shall be filed as 1 part of the return required by section 452A.8 . 2 Sec. 66. Section 452A.22, Code 2022, is amended to read as 3 follows: 4 452A.22 Tax collected on exempt fuel. 5 If an amount of tax represented by a licensee permit 6 holder to a purchaser as constituting tax due is computed 7 upon gallonage that is not taxable or the amount represented 8 is in excess of the actual amount of tax due and the amount 9 represented is actually paid by the purchaser to the licensee 10 permit holder , the excess amount of tax paid shall be returned 11 to the purchaser by the licensee permit holder . If the 12 licensee permit holder fails to return the excess tax paid to 13 the purchaser, the amount which the purchaser has paid to the 14 licensee permit holder shall be remitted by the licensee permit 15 holder to the department. 16 Sec. 67. Section 452A.52, subsection 2, Code 2022, is 17 amended to read as follows: 18 2. Any person who is unable to display either of the permits 19 or the license permit provided in section 452A.53 and brings 20 into the state in the fuel supply tanks of a commercial motor 21 vehicle more than thirty gallons of motor fuel or special fuel 22 in violation of subsection 1 commits a simple misdemeanor 23 punishable as a scheduled violation under section 805.8A, 24 subsection 13 , paragraph “c” . 25 Sec. 68. Section 452A.53, Code 2022, is amended to read as 26 follows: 27 452A.53 Permit or license . 28 1. The advance arrangements referred to in section 452A.52 29 shall include the procuring of a permanent international fuel 30 tax agreement permit or license or single-trip interstate 31 permit. 32 2. Persons choosing not to make advance arrangements with 33 the state department of transportation by procuring a permit or 34 license are not relieved of their responsibility to purchase 35 -33- LSB 5284XD (6) 89 jm/jh 33/ 47
S.F. _____ H.F. _____ motor fuel and special fuel commensurate with their use of the 1 state’s highway system. When there is reasonable cause to 2 believe that there is evasion of the fuel tax on commercial 3 motor vehicles, the state department of transportation may 4 audit persons not holding a permit or license . Audits shall 5 be conducted pursuant to section 452A.55 and in accordance 6 with international fuel tax agreement guidelines. The state 7 department of transportation shall collect all taxes due and 8 refund any overpayment. 9 3. A permanent international fuel tax agreement permit 10 or license may be obtained upon application to the state 11 department of transportation. A fee of ten dollars shall be 12 charged for each permit or license issued. The holder of 13 a permanent permit or license shall have the privilege of 14 bringing into this state in the fuel supply tanks of commercial 15 motor vehicles any amount of motor fuel or special fuel to be 16 used in the operation of the vehicles and for that privilege 17 shall pay Iowa motor fuel or special fuel taxes as provided in 18 section 452A.54 . 19 4. A single-trip interstate permit may be obtained from the 20 state department of transportation. A fee of twenty dollars 21 shall be charged for each individual single-trip interstate 22 permit issued. A single-trip interstate permit is subject to 23 the following provisions and limitations: 24 a. The permit shall be issued and be valid for seventy-two 25 consecutive hours, except in emergencies, or until the time of 26 leaving the state, whichever first occurs. 27 b. The permit shall cover only one commercial motor vehicle 28 and is not transferable. 29 c. Single-trip interstate fuel permits may be made available 30 from sources other than indicated in this section at the 31 discretion of the state department of transportation. 32 5. Each vehicle operated into or through Iowa in interstate 33 operations using motor fuel or special fuel acquired in any 34 other state shall carry in or on the vehicle a duplicate or 35 -34- LSB 5284XD (6) 89 jm/jh 34/ 47
S.F. _____ H.F. _____ evidence of the permit or license required in this section . 1 A fee not to exceed fifty cents shall be charged for each 2 duplicate or other evidence of a permit or license issued. 3 Sec. 69. Section 452A.54, subsections 2, 4, and 5, Code 4 2022, are amended to read as follows: 5 2. Notwithstanding any provision of this chapter to the 6 contrary, except as provided in this section , the holder of a 7 permanent international fuel tax agreement permit or license 8 may make application to the state department of transportation 9 for a refund, not later than the last day of the third month 10 following the quarter in which the overpayment of Iowa 11 fuel tax paid on excess purchases of motor fuel or special 12 fuel was reported as provided in section 452A.8 , and which 13 application is supported by such proof as the state department 14 of transportation may require. The state department of 15 transportation shall refund Iowa fuel tax paid on motor fuel or 16 special fuel purchased in excess of the amount consumed by such 17 commercial motor vehicles in their operation on the highways 18 of this state. 19 4. To determine the amount of fuel taxes due under this 20 subchapter and to prevent the evasion thereof, the state 21 department of transportation shall require a quarterly report 22 on forms prescribed by the state department of transportation. 23 It shall be filed not later than the last day of the month 24 following the quarter reported, and each quarter thereafter. 25 These reports shall be required of all persons who have been 26 issued a permit or license under this subchapter and shall 27 cover actual operation and fuel consumption in Iowa on the 28 basis of the permit or license holder’s average consumption 29 of fuel in Iowa, determined by the total miles traveled and 30 the total fuel purchased and consumed for highway use by the 31 permittee’s or licensee’s permit holder’s commercial motor 32 vehicles in the permittee’s or licensee’s entire operation 33 of the permit holder in all states to establish an overall 34 miles per gallon ratio, which ratio shall be used to compute 35 -35- LSB 5284XD (6) 89 jm/jh 35/ 47
S.F. _____ H.F. _____ the gallons used for the miles traveled in Iowa. Failure 1 to receive a quarterly report or fuel credentials by mail, 2 facsimile transmission, or any other means of delivery does not 3 relieve a person from the person’s fuel tax liability or from 4 the requirement to display current fuel credentials. 5 5. Subject to compliance with rules adopted by the 6 department, annual reporting may be permitted in lieu of 7 quarterly reporting. A licensee permitted permit holder 8 allowed to report annually shall maintain records in compliance 9 with this chapter . 10 Sec. 70. Section 452A.55, subsection 2, Code 2022, is 11 amended to read as follows: 12 2. The state department of transportation, within a period 13 of one year from the issuance of a permanent international fuel 14 tax agreement fuel permit or license , may audit the records 15 of the permittee or licensee permit holder for the two years 16 preceding the issuance of the permit or license . The state 17 department of transportation shall collect all taxes due had 18 the permittee or licensee been licensed as if the permit holder 19 had held a permit for the two years prior to the issuance of 20 the permit or license and shall refund any overpayment pursuant 21 to section 452A.54 . When, as a result of an audit, fuel taxes 22 unpaid and due the state of Iowa exceed five hundred dollars, 23 the audit shall be at the expense of the person whose records 24 are being audited. However, if an audit of records maintained 25 under this section is made outside the state of Iowa in a 26 state which requires payment of the costs for similar audits 27 performed by officials or employees of the other state when 28 made in Iowa, then all costs of audits performed outside of 29 Iowa in the other state shall be at the expense of the person 30 whose records are audited. 31 Sec. 71. Section 452A.60, subsection 1, Code 2022, is 32 amended to read as follows: 33 1. The department of revenue or the state department of 34 transportation shall prescribe and furnish all forms, as 35 -36- LSB 5284XD (6) 89 jm/jh 36/ 47
S.F. _____ H.F. _____ applicable, upon which reports, returns, and applications shall 1 be made and claims for refund presented under this chapter 2 and may prescribe forms of record to be kept by suppliers, 3 restrictive suppliers, importers, exporters, blenders, common 4 carriers, contract carriers, licensed permitted compressed 5 natural gas, liquefied natural gas, liquefied petroleum gas, 6 and hydrogen dealers and users, terminal operators, nonterminal 7 storage facility operations, and interstate commercial motor 8 vehicle operators. 9 Sec. 72. Section 452A.62, subsection 1, paragraph a, 10 subparagraph (2), Code 2022, is amended to read as follows: 11 (2) A licensed permitted compressed natural gas, liquefied 12 natural gas, liquefied petroleum gas, or hydrogen dealer, 13 user, or person supplying compressed natural gas, liquefied 14 natural gas, liquefied petroleum gas, or hydrogen to a licensed 15 permitted compressed natural gas, liquefied natural gas, 16 liquefied petroleum gas, or hydrogen dealer or user. 17 Sec. 73. Section 452A.62, subsection 1, paragraph b, Code 18 2022, is amended to read as follows: 19 b. To examine the records, books, papers, receipts, and 20 invoices of any distributor, supplier, restrictive supplier, 21 importer, blender, exporter, terminal operator, nonterminal 22 storage facility, licensed permitted compressed natural gas, 23 liquefied natural gas, liquefied petroleum gas, or hydrogen 24 dealer or user, or any other person who possesses fuel 25 upon which the tax has not been paid to determine financial 26 responsibility for the payment of the taxes imposed by this 27 chapter . 28 Sec. 74. Section 452A.65, subsections 2 and 3, Code 2022, 29 are amended to read as follows: 30 2. A report required of licensees permit holders or persons 31 operating under subchapter III , upon which no tax is due, is 32 subject to a penalty of ten dollars if the report is not timely 33 filed with the state department of transportation. 34 3. If a licensee permit holder or other person sells the 35 -37- LSB 5284XD (6) 89 jm/jh 37/ 47
S.F. _____ H.F. _____ licensee’s permit holder’s or other person’s business or stock 1 of goods or quits the business, the licensee permit holder 2 or other person shall prepare a final return and pay all tax 3 due within the time required by law. The immediate successor 4 to the licensee permit holder or other person, if any, shall 5 withhold sufficient of the purchase price, in money or money’s 6 worth, to pay the amount of any delinquent tax, interest, or 7 penalty due and unpaid. If the immediate successor of the 8 business or stock of goods intentionally fails to withhold 9 any amount due from the purchase price as provided in this 10 subsection , the immediate successor is personally liable for 11 the payment of the taxes, interest, and penalty accrued and 12 unpaid on account of the operation of the business by the 13 immediate former licensee permit holder or other person, 14 except when the purchase is made in good faith as provided 15 in section 421.28 . However, a person foreclosing on a valid 16 security interest or retaking possession of premises under a 17 valid lease is not an “immediate successor” for purposes of 18 this subsection . The department may waive the liability of 19 the immediate successor under this subsection if the immediate 20 successor exercised good faith in establishing the amount of 21 the previous liability. 22 Sec. 75. Section 452A.67, subsection 1, Code 2022, is 23 amended to read as follows: 24 1. The department shall examine the return and enforce 25 collection of any amount of tax, penalty, fine, or interest 26 over and above the amount shown to be due by the return filed by 27 a licensee permit holder as soon as practicable but no later 28 than three years after the return is filed. An assessment 29 shall not be made covering a period beyond three years after 30 the return is filed except that the period for the examination 31 and determination of the correct amount of tax is unlimited in 32 the case of a false or fraudulent return made with the intent 33 to evade tax or in the case of a failure to file a return. 34 Sec. 76. Section 452A.68, Code 2022, is amended to read as 35 -38- LSB 5284XD (6) 89 jm/jh 38/ 47
S.F. _____ H.F. _____ follows: 1 452A.68 Power of department of revenue or the state 2 department of transportation to cancel licenses permits . 3 1. If a licensee permit holder files a false return of 4 the data or information required by this chapter , or fails, 5 refuses, or neglects to file a return required by this chapter , 6 or to pay the full amount of fuel tax as required by this 7 chapter , or is substantially delinquent in paying a tax due, 8 owing, and administered by the department of revenue, and 9 interest and penalty if appropriate, or if the person is a 10 corporation and if any officer having a substantial legal or 11 equitable interest in the ownership of the corporation owes any 12 delinquent tax of the licensee permit holder corporation, or 13 interest or penalty on the tax, administered by the department, 14 then after ten days’ written notice by mail directed to the 15 last known address of the licensee permit holder setting a time 16 and place at which the licensee permit holder may appear and 17 show cause why the license permit should not be canceled, and 18 if the licensee permit holder fails to appear or if upon the 19 hearing it is shown that the licensee permit holder failed to 20 correctly report or pay the tax, the appropriate state agency 21 may cancel the license permit and shall notify the licensee 22 permit holder of the cancellation by mail to the licensee’s 23 last known address of the permit holder . 24 2. If a licensee permit holder abuses the privileges for 25 which the license permit was issued, fails to produce records 26 reasonably requested, fails to extend reasonable cooperation 27 to the appropriate state agency, or has been suspended for 28 nonpayment of fees under chapter 326 and still owes fees to 29 the department, the licensee permit holder shall be advised 30 in writing of a hearing scheduled to determine if the license 31 permit shall be canceled. The appropriate state agency upon 32 the presentation of a preponderance of evidence may cancel a 33 license permit for cause. 34 3. The director of the appropriate state agency may reissue 35 -39- LSB 5284XD (6) 89 jm/jh 39/ 47
S.F. _____ H.F. _____ a license permit which has been canceled for cause. As a 1 condition of reissuance of a license permit , in addition to 2 requirements for issuing a new license permit , the director may 3 require a waiting period not to exceed ninety days before a 4 license permit can be reissued or a new license permit issued. 5 The director shall adopt rules specifying those instances for 6 which a waiting period will be required. 7 4. Upon receipt of written request from any licensee 8 permit holder the appropriate state agency shall cancel the 9 license permit of the licensee permit holder effective on the 10 date of receipt of the request. If, upon investigation, the 11 appropriate state agency finds that a licensee permit holder is 12 no longer engaged in the activities for which a license permit 13 was issued and has not been so engaged for a period of six 14 months, the state agency shall cancel the license permit and 15 give thirty days’ notice of the cancellation mailed to the last 16 known address of the licensee permit holder . 17 Sec. 77. Section 452A.70, Code 2022, is amended to read as 18 follows: 19 452A.70 Discontinuance of licensed activity permit —— 20 liability for taxes and penalties. 21 If a licensee permit holder ceases to engage in the state 22 in activities for which the person’s license permit was issued 23 or discontinues, sells, or transfers the business in which the 24 person has carried on that activity the licensee permit holder 25 shall notify the department of revenue, which shall forward 26 notice to the state department of transportation, in writing at 27 least ten days prior to the time the cessation, discontinuance, 28 sale or transfer takes effect. The notice shall give the date 29 of proposed cessation or discontinuance, and, in the event of 30 a proposed sale or transfer of the business, the date and the 31 name and address of the purchaser or transferee. All fuel 32 taxes, penalties and interest under this chapter not yet due 33 and payable shall, together with any and all interest accruing 34 or penalties imposed under this chapter shall become due and 35 -40- LSB 5284XD (6) 89 jm/jh 40/ 47
S.F. _____ H.F. _____ payable concurrently with the cessation, discontinuances, sale 1 or transfer, and it shall be the duty of the licensee permit 2 holder to make a report and pay all the fuel taxes, interest, 3 and penalties within ten days. 4 Sec. 78. Section 452A.72, subsections 1 and 3, Code 2022, 5 are amended to read as follows: 6 1. If any fuel taxes, penalties, or interest have been 7 erroneously or illegally collected by the appropriate state 8 agency from a licensee permit holder , the appropriate state 9 agency may apply the overpayment against any tax liability 10 outstanding on the books of the department against the 11 claimant, or shall certify the amount to the director of the 12 department of administrative services, who shall draw a warrant 13 for the certified amount on the treasurer of state payable to 14 the licensee permit holder . The refund shall be paid to the 15 licensee permit holder immediately. 16 3. However, if it is found during an examination by the 17 appropriate state agency that a licensee permit holder paid, as 18 a result of a mistake, an amount of tax, penalty, or interest 19 which was not due, and the mistake is found within three years 20 of the overpayment, the appropriate state agency shall credit 21 the amount against any penalty, interest or taxes due or shall 22 refund the amount to the person. 23 Sec. 79. Section 452A.74, subsection 1, paragraphs e and g, 24 Code 2022, are amended to read as follows: 25 e. For any person to act as a supplier, restrictive 26 supplier, importer, exporter, blender, or compressed natural 27 gas, liquefied natural gas, liquefied petroleum gas, or 28 hydrogen dealer or user without the required license permit . 29 g. For any licensed permitted compressed natural gas, 30 liquefied natural gas, liquefied petroleum gas, or hydrogen 31 dealer or user to dispense compressed natural gas, liquefied 32 natural gas, liquefied petroleum gas, or hydrogen into the fuel 33 supply tank of any motor vehicle without collecting the fuel 34 tax. 35 -41- LSB 5284XD (6) 89 jm/jh 41/ 47
S.F. _____ H.F. _____ Sec. 80. Section 452A.74, subsection 2, Code 2022, is 1 amended to read as follows: 2 2. Any delivery of compressed natural gas, liquefied 3 natural gas, liquefied petroleum gas, or hydrogen to a 4 compressed natural gas, liquefied natural gas, liquefied 5 petroleum gas, or hydrogen dealer or user for the purpose of 6 evading the state tax on compressed natural gas, liquefied 7 natural gas, liquefied petroleum gas, or hydrogen, into 8 facilities other than those licensed permitted under this 9 chapter knowing that the fuel will be used for highway use 10 shall constitute a violation of this section . Any compressed 11 natural gas, liquefied natural gas, liquefied petroleum gas, 12 or hydrogen dealer or user for purposes of evading the state 13 tax on compressed natural gas, liquefied natural gas, liquefied 14 petroleum gas, or hydrogen, who allows a distributor to place 15 compressed natural gas, liquefied natural gas, liquefied 16 petroleum gas, or hydrogen for highway use in facilities other 17 than those licensed permitted under this chapter , shall also be 18 deemed in violation of this section . 19 Sec. 81. Section 452A.74A, subsection 2, unnumbered 20 paragraph 1, Code 2022, is amended to read as follows: 21 A person who imports motor fuel or undyed special fuel 22 without a valid importer’s license permit or supplier’s license 23 permit shall be assessed a civil penalty as provided in this 24 subsection . However, the owner or operator of the importing 25 vehicle shall not be guilty of violating this subsection if it 26 is shown by the owner or operator that the owner or operator 27 reasonably did not know or reasonably should not have known of 28 the illegal importation. 29 EXPLANATION 30 The inclusion of this explanation does not constitute agreement with 31 the explanation’s substance by the members of the general assembly. 32 This bill relates to sales, use, and motor vehicle fuel 33 taxes administered by the department of revenue including 34 distributions to local governments and school districts, the 35 -42- LSB 5284XD (6) 89 jm/jh 42/ 47
S.F. _____ H.F. _____ liability of sellers, tax refund and tax credit incentives, and 1 motor fuel tax reporting and terminology modifications. 2 DIVISION I —— SALES, USE, AND EXCISE TAX —— RETURNS DUE. The 3 bill allows a taxpayer to have a combined sales and use tax 4 permit and to file a combined return for sales and use taxes. 5 Currently, a taxpayer must possess a separate sales and use tax 6 permit and file separate sales and use tax returns. 7 The bill changes numerous references to the phrase “sales 8 tax permit” in the Code to the phrase “sales or use tax 9 permit”. 10 Currently, a person is required to file a sales or use tax 11 return on a quarterly basis. The bill changes this filing 12 requirement from a quarterly basis to a monthly basis. The 13 bill does allow a person required to file a sales or use tax 14 return and who collects less than $1,200 in sales or use tax in 15 a calendar year, to file a return once a year on or before the 16 last day of the month following the close of the calendar year. 17 The bill allows certain persons required to collect sales 18 or use tax who do not meet the definition of a “retailer 19 maintaining a business in this state” in Code section 20 423.1(48)(a)(1), to be issued only one sales or use tax permit. 21 The bill allows the director of revenue, if necessary, to 22 ensure the payment of sales or use tax, to require a sales or 23 use tax return be filed on a different basis other than on a 24 monthly basis. 25 The bill strikes a provision allowing a person required to 26 file a sales or use tax return to take a credit against the 27 total quarterly amount of tax due, upon a proper showing of 28 necessity, allowing for the balance of tax due to be paid up to 29 30 days after the return was due. 30 The bill strikes a provision requiring a seller, who 31 collects more than $30,000 of sales or use tax in the preceding 32 calendar year, to make additional remittances to the state 33 under the rules adopted by the director of revenue. 34 DIVISION II —— DISTRIBUTIONS OF REVENUE TO LOCAL GOVERNMENTS 35 -43- LSB 5284XD (6) 89 jm/jh 43/ 47
S.F. _____ H.F. _____ AND SCHOOL DISTRICTS. Currently, by August 15, the department 1 of revenue estimates the local option sale tax (LOST) and 2 securing an advanced vision for education (SAVE) tax amounts 3 that will be transferred to each local government or school 4 district on a fiscal year and monthly basis. The transfer 5 estimates may be revised for the year and remaining months by 6 the director of revenue if the estimates are incorrect. 7 Commencing with the fiscal year beginning July 1, 2022, the 8 bill changes the LOST and SAVE transfer amount procedures, by 9 requiring the department of revenue to transfer the actual 10 LOST and SAVE taxes collected that are attributable to each 11 local government or school district to that local government 12 or school district. 13 The bill also creates a transition procedure for the LOST 14 and SAVE tax amounts transferred during July and August 2022. 15 Under the transition procedure, the department of revenue shall 16 transfer estimated amounts of LOST and SAVE to each local 17 government or school district for the months of July, August, 18 and September 2022. However, beginning with the October 2022 19 transfer, the department of revenue shall transfer the actual 20 amount of tax attributable to each local government or school 21 district for the LOST and SAVE tax remitted in September 2022. 22 The bill requires any adjustment amount that is necessary to 23 the July, August, or September 2022 estimated transfer amounts 24 be made by the close of business on December 30, 2022. 25 DIVISION III —— LIABILITY OF SELLERS USING CERTIFIED 26 SERVICE PROVIDER. The bill specifies that a seller of personal 27 property or services who contracts with a certified service 28 provider is not liable to the state for sales or use tax due on 29 transactions processed by the certified service provider unless 30 the certified service provider establishes it is not liable 31 in accordance with the agreement with the seller. The bill 32 specifies that if the certified service provider is liable for 33 the sales or use tax due, the seller is not subject to audit 34 on transactions processed by the certified service provider. 35 -44- LSB 5284XD (6) 89 jm/jh 44/ 47
S.F. _____ H.F. _____ “Certified service provider” is defined in Code section 423.1 1 to mean an agent certified under the agreement to perform 2 all of a seller’s sales or use tax functions, other than the 3 seller’s obligation to remit tax on its own purchases. 4 DIVISION IV —— AUTHORITY TO CANCEL VARIOUS PERMITS ISSUED 5 BY THE DEPARTMENT. The bill allows the director of the 6 department of revenue to cancel the following tax permits if 7 the department determines the permits are no longer in use: 8 income tax withholding, sales or use tax, or motor fuel tax. 9 DIVISION V —— ECONOMIC DEVELOPMENT AUTHORITY SALES AND USE 10 TAX REFUND INCENTIVES. Currently, for certain sales or use 11 tax refund incentives in Code section 15.331A administered 12 by the department of economic development authority, an 13 eligible business must apply for a sales or use tax refund for 14 items purchased prior to the “project” completion date. The 15 bill changes the refund procedures by requiring an eligible 16 business to apply for such sales or use tax refunds for items 17 purchased prior to the completion of the “contract” rather than 18 completion of the “project”. The bill also requires such an 19 application be made within one year of the project completion 20 date, and that the department of revenue be informed in writing 21 after the contract completion. The bill defines “contract 22 completion” as the date of completion of a written contract 23 relating to the construction or equipping of the facility that 24 is part of the project of the eligible business. 25 For the third-party developer tax credit in Code section 26 15.331C relating to a tax credit for sales and use taxes paid 27 by a third-party developer, the bill specifies that this credit 28 is in lieu of the sales and use tax refund tax incentive 29 provided in Code section 15.331A. The bill also provides 30 that the eligible business shall make an application to the 31 department of revenue within one year of the project completion 32 date, and that the department be informed in writing after 33 the contract completion. The bill requires the department 34 of revenue to audit any third-party developer tax credit 35 -45- LSB 5284XD (6) 89 jm/jh 45/ 47
S.F. _____ H.F. _____ claim, prior to issuing a third-party developer tax credit 1 certificate. 2 The bill makes changes to the procedures for workforce 3 housing tax incentives in Code section 15.355. The bill 4 permits a housing business to claim a refund of the sales 5 and use taxes paid prior to the completion of the housing 6 project that are directly related to the housing project and 7 specified in an agreement. In order to receive the sales and 8 use tax refund, the bill requires a contractor or subcontractor 9 working on the housing project to submit a form under oath 10 stating the amount of sales and use taxes paid prior to the 11 housing project. The bill makes it a simple misdemeanor if a 12 contractor or subcontractor willfully makes a false claim under 13 oath in relating to the workforce sales and use tax refund. 14 The bill then requires, after the agreement completion date, 15 the housing business to make an application to the department 16 of revenue for any sales and use tax refund. The bill defines 17 “agreement completion date” to mean the date the economic 18 development authority notifies the department of revenue that 19 all applicable requirements of the agreement have been met. 20 The bill also requires the department of revenue to audit the 21 claim prior to issuing the sales and use tax refund. 22 This division takes effect upon enactment and applies to 23 claims for refunds filed on or after the effective date of the 24 bill. 25 DIVISION VI —— MOTOR FUEL REPORTING REQUIREMENT —— PENALTY. 26 The bill specifies that each motor fuel retail dealer shall 27 file a report with the department of revenue detailing their 28 total motor fuel gallonage within a reporting period in the 29 manner required by the department and in compliance within 30 the time frames established in Code section 452A.61. The 31 bill permits the department of revenue to require a retail 32 dealer to file such a report with the department by electronic 33 transmission. The bill allows the department of revenue to 34 impose a civil penalty on the retail dealer, not to exceed 35 -46- LSB 5284XD (6) 89 jm/jh 46/ 47
S.F. _____ H.F. _____ $100, for each instance a retail dealer fails to timely file 1 a report or fails to maintain records required to file the 2 report. 3 DIVISION VII —— MOTOR FUEL TAX TERMINOLOGY MODIFICATIONS. 4 The bill modifies terms in Code chapter 452A (motor fuel and 5 special fuel taxes). The bill substitutes the term “permit” 6 for the term “license” wherever the term “license” appears. By 7 substituting the term “permit” for the term “license”, the bill 8 also strikes related terms to “license” including “licensed” 9 and “licensee” and substitutes “permitted” and “permit holder” 10 in lieu of “licensed” and “licensee”. 11 -47- LSB 5284XD (6) 89 jm/jh 47/ 47