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House Study Bill 150 - IntroducedA Bill ForAn Act 1relating to financial crime enforcement by assessing
2a drug paraphernalia surcharge, creating a money transfer
3service fee and related fund and income tax credit, and
4including retroactive applicability provisions.
5BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
1 Section 1. NEW SECTION. 80.32 Financial crime and wire
2transmitter fund.
31. A financial crime and wire transmitter fund is
4established in the office of the treasurer of state under the
5control of the department. Any moneys annually appropriated,
6granted, or credited to the fund, including any federal moneys,
7are appropriated to the department for investigating indictable
8criminal offenses committed for financial gain.
92. Notwithstanding section 12C.7, subsection 2, interest
10and earnings on moneys deposited in the fund shall be credited
11to the fund. Notwithstanding section 8.33, moneys remaining
12in the fund at the end of the fiscal year shall not revert to
13any other fund but shall remain available to be used for the
14purposes specified in this section.
153. For the fiscal year beginning July 1, 2017, and for
16each fiscal year thereafter, the department shall transfer
17from the fund to the general fund of the state, the lesser of
18the amount of fees credited to the fund for the fiscal year
19pursuant to section 533C.104 or an amount of money equal to the
20money transfer service tax credits claimed pursuant to section
21422.10C in that fiscal year, if any. The moneys transferred
22to the general fund of the state in accordance with this
23subsection shall not be considered new revenues for purposes
24of the state general fund expenditure limitation under section
258.54 but instead as replacement of a like amount included in
26the expenditure limitation for the fiscal year in which the
27transfer is made.
28 Sec. 2. NEW SECTION. 422.10C Money transfer service fee tax
29credit.
301. The taxes imposed under this division, less the credits
31allowed under section 422.12, shall be reduced by a money
32transfer service fee tax credit equal to the amount of money
33transfer service fees under section 533C.104 paid by the
34taxpayer during the tax year.
352. A credit shall not be allowed under this section to
-1-1an individual who does not include on the tax return for the
2taxable year such individual’s valid taxpayer identification
3number and, if the individual is married, the valid taxpayer
4identification number of such individual’s spouse. For
5purposes of this subsection, “taxpayer identification number”
6means the same as defined in section 32 of the Internal Revenue
7Code.
83. Any credit in excess of the tax liability is refundable.
9In lieu of claiming a refund, the taxpayer may elect to have
10the overpayment shown on the taxpayer’s final, completed return
11credited to the tax liability for the following tax year.
12 Sec. 3. NEW SECTION. 533C.104 Money transfer service fee —
13licensee requirements — enforcement.
141. For purposes of this section, unless the context
15otherwise requires:
16a. “Department” means the department of revenue.
17b. “Director” means the director of revenue.
18c. “Money transfer service” means the transmission of
19money by any means including transmission within this country
20or to or from locations abroad by payment instrument, wire,
21facsimile, or electronic transfer, courier, or otherwise.
222. a. A licensee and the authorized delegates of a licensee
23shall collect from customers a money transfer service fee equal
24to one percent of the amount of each money transfer service
25transaction.
26b. Money transfer service fees shall be paid over to the
27department by licensees and their authorized delegates who
28furnish money transfer services.
29c. The department, in consultation with the superintendent,
30shall administer and enforce the money transfer service fee as
31nearly as possible in conjunction with the administration and
32enforcement of the state sales and use tax law, except that
33portion of the law which implements the streamlined sales and
34use tax agreement.
35d. The director may require licensees and their authorized
-2-1delegates to register with the department for purposes of this
2section. The director may also require a permit applicable
3only to this section for any licensee or the authorized
4delegate of a licensee not collecting taxes under chapter 423.
5e. All powers and requirements of the director to administer
6the state sales and use tax law are applicable to the
7administration of the money transfer service fee, including but
8not limited to the provisions of section 422.25, subsection 4,
9sections 422.30, 422.67, and 422.68, section 422.69, subsection
101, sections 422.70 through 422.75, section 423.14, subsection
111 and subsection 2, paragraphs “b” through “e”, and sections
12423.15, 423.23, 423.24, 423.25, 423.31 through 423.35, 423.37
13through 423.42, 423.46, and 423.47.
14f. Failure by a licensee or a licensee’s authorized
15delegate to collect and remit money transfer service fees
16or to comply with any other provision of this section shall
17subject the licensee and the authorized delegates of a licensee
18to the enforcement provisions of article 7 of this chapter.
19The director and the department shall cooperate with the
20superintendent in identifying violations of this section and in
21discharging the superintendent’s enforcement responsibilities
22under article 7 of this chapter.
23g. All money transfer service fees collected under this
24section shall be deposited in a separate account in the
25financial crime and wire transmitter fund established by
26section 80.32.
273. A licensee and the authorized delegates of a licensee
28furnishing money transfer services shall post a notice in the
29form and manner prescribed by the superintendent that notifies
30customers that upon filing an individual income tax return with
31a valid taxpayer identification number, the customer shall be
32entitled to an individual income tax credit equal to the amount
33of money transfer service fees paid by the customer during the
34tax year.
35 Sec. 4. Section 602.8102, subsection 135A, Code 2017, is
-3-1amended to read as follows:
2135A. Assess the surcharges provided by sections 911.1,
3911.2, 911.2A, 911.2B, 911.2C, 911.3, and 911.4, and 911.5.
4 Sec. 5. Section 602.8108, Code 2017, is amended by adding
5the following new subsection:
6 NEW SUBSECTION. 13. The clerk of the district court shall
7remit all moneys collected from the assessment of the drug
8paraphernalia surcharge provided in section 911.5 to the state
9court administrator for deposit in the financial crime and wire
10transmitter fund established in section 80.32.
11 Sec. 6. NEW SECTION. 911.5 Drug paraphernalia surcharge.
121. In addition to any other surcharge, the clerk of the
13district court shall assess a drug paraphernalia surcharge of
14five dollars if an adjudication of guilt or a deferred judgment
15has been entered for a criminal violation of section 124.414 or
16a similar city or county ordinance.
172. The surcharge shall be remitted by the clerk of court as
18provided in section 602.8108, subsection 13.
19 Sec. 7. RETROACTIVE APPLICABILITY. The following provision
20or provisions of this Act apply retroactively to January 1,
212017, for tax years beginning on or after that date:
221. The section of this division enacting section 422.10C.
23EXPLANATION
24The inclusion of this explanation does not constitute agreement with
25the explanation’s substance by the members of the general assembly.
26This bill relates to financial crime enforcement by
27assessing a drug paraphernalia surcharge and creating a money
28transfer service fee and related fund and income tax credit.
29DRUG PARAPHERNALIA SURCHARGE. The bill provides that the
30clerk of the district court shall assess a drug paraphernalia
31surcharge of five dollars if an adjudication of guilt or
32a deferred judgment has been entered for possessing drug
33paraphernalia in violation of Code section 124.414 or a similar
34city or county ordinance. The bill specifies that the clerk of
35the district court shall remit all moneys collected from the
-4-1assessment of the surcharge to the state court administrator
2for deposit in the financial crime and wire transmitter fund
3established by the bill.
4MONEY TRANSFER SERVICE FEE AND RELATED FUND AND TAX CREDIT.
5The bill requires a licensee under Code chapter 533C, the
6uniform money services Act, to collect from customers a money
7transfer service fee equal to 1 percent of the amount of each
8money transfer service transaction. The bill defines “money
9transfer service” as the transmission of money by any means
10including transmission within this country or to or from
11locations abroad by payment instrument, wire, facsimile, or
12electronic transfer, courier, or otherwise.
13The bill requires such licensees to pay such fees over to the
14department of revenue. The bill requires the department, in
15consultation with the superintendent of banking, to administer
16and enforce the money transfer service fee as nearly as
17possible in conjunction with the administration and enforcement
18of the state sales and use tax law, except that portion of
19the law which implements the streamlined sales and use tax
20agreement.
21The bill permits the director of revenue to require
22licensees to register with the department for purposes of
23the bill. The bill permits the director to require a permit
24applicable only to the bill for any licensee not collecting
25taxes under Code chapter 423. The bill provides that all
26powers and requirements of the director to administer the state
27sales and use tax law are applicable to the administration of
28the money transfer service fee.
29Failure by a licensee to collect and remit money transfer
30service fees or to comply with any other provision of the bill
31shall subject the licensee to the enforcement provisions of
32article 7 of Code chapter 533C. The bill requires the director
33and the department to cooperate with the superintendent in
34identifying violations of the bill and in discharging the
35superintendent’s enforcement responsibilities under article 7
-5-1of Code chapter 533C.
2Penalties provided for in article 7 of Code chapter 533C
3include suspension and revocation of a license under Code
4chapter 533C, civil penalties, and criminal penalties that
5include class “C” and “D” felonies and aggravated and simple
6misdemeanors. A class “C” felony is punishable by confinement
7for no more than 10 years and a fine of at least $1,000 but
8not more than $10,000. A class “D” felony is punishable by
9confinement for no more than five years and a fine of at least
10$750 but not more than $7,500. An aggravated misdemeanor
11is punishable by confinement for no more than two years and
12a fine of at least $625 but not more than $6,250. A simple
13misdemeanor is punishable by confinement for no more than 30
14days or a fine of at least $65 but not more than $625 or by
15both.
16The bill provides that all money transfer service fees
17collected under the bill shall be deposited in the financial
18crime and wire transmitter fund established by the bill.
19The bill requires a licensee furnishing money transfer
20services to post a notice in the form and manner prescribed
21by the superintendent that notifies customers that upon
22filing an individual income tax return with a valid taxpayer
23identification number, the customer shall be entitled to an
24individual income tax credit equal to the amount of money
25transfer service fees paid by the customer during the tax year.
26The bill also applies to authorized delegates of a licensee
27under Code chapter 533C.
28The bill provides an individual income tax credit equal to
29the amount of money transfer service fees paid by the taxpayer
30during the tax year. The bill provides that the credit shall
31not be allowed to an individual who does not include on the tax
32return for the taxable year the individual’s valid taxpayer
33identification number and that of the individual’s spouse if
34applicable. The bill provides that the credit is refundable
35and may be credited to the individual’s tax liability for the
-6-1following tax year. The provision enacting the tax credit
2applies retroactively to January 1, 2017, for tax years
3beginning on or after that date.
4The bill establishes a financial crime and wire transmitter
5fund in the office of the treasurer of state under the control
6of the department of public safety. Any moneys annually
7appropriated, granted, or credited to the fund, including any
8federal moneys, are appropriated to the department of public
9safety for the purpose of investigating indictable criminal
10offenses committed for financial gain. Interest and earnings
11on moneys deposited in the fund shall be credited to the fund
12and moneys remaining in the fund at the end of the fiscal year
13shall not revert.
14The bill requires the department of public safety, for
15the fiscal year beginning July 1, 2017, and for each fiscal
16year thereafter, to transfer from the fund to the general
17fund of the state, the lesser of the amount of money transfer
18service fees collected or an amount of money equal to the money
19transfer service tax credits claimed in that fiscal year, if
20any. The bill provides that the moneys transferred to the
21general fund of the state in accordance with the bill shall not
22be considered new revenues for purposes of the state general
23fund expenditure limitation under Code section 8.54 but instead
24as replacement of a like amount included in the expenditure
25limitation for the fiscal year in which the transfer is made.
-7-jm/nh
2a drug paraphernalia surcharge, creating a money transfer
3service fee and related fund and income tax credit, and
4including retroactive applicability provisions.
5BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
1 Section 1. NEW SECTION. 80.32 Financial crime and wire
2transmitter fund.
31. A financial crime and wire transmitter fund is
4established in the office of the treasurer of state under the
5control of the department. Any moneys annually appropriated,
6granted, or credited to the fund, including any federal moneys,
7are appropriated to the department for investigating indictable
8criminal offenses committed for financial gain.
92. Notwithstanding section 12C.7, subsection 2, interest
10and earnings on moneys deposited in the fund shall be credited
11to the fund. Notwithstanding section 8.33, moneys remaining
12in the fund at the end of the fiscal year shall not revert to
13any other fund but shall remain available to be used for the
14purposes specified in this section.
153. For the fiscal year beginning July 1, 2017, and for
16each fiscal year thereafter, the department shall transfer
17from the fund to the general fund of the state, the lesser of
18the amount of fees credited to the fund for the fiscal year
19pursuant to section 533C.104 or an amount of money equal to the
20money transfer service tax credits claimed pursuant to section
21422.10C in that fiscal year, if any. The moneys transferred
22to the general fund of the state in accordance with this
23subsection shall not be considered new revenues for purposes
24of the state general fund expenditure limitation under section
258.54 but instead as replacement of a like amount included in
26the expenditure limitation for the fiscal year in which the
27transfer is made.
28 Sec. 2. NEW SECTION. 422.10C Money transfer service fee tax
29credit.
301. The taxes imposed under this division, less the credits
31allowed under section 422.12, shall be reduced by a money
32transfer service fee tax credit equal to the amount of money
33transfer service fees under section 533C.104 paid by the
34taxpayer during the tax year.
352. A credit shall not be allowed under this section to
-1-1an individual who does not include on the tax return for the
2taxable year such individual’s valid taxpayer identification
3number and, if the individual is married, the valid taxpayer
4identification number of such individual’s spouse. For
5purposes of this subsection, “taxpayer identification number”
6means the same as defined in section 32 of the Internal Revenue
7Code.
83. Any credit in excess of the tax liability is refundable.
9In lieu of claiming a refund, the taxpayer may elect to have
10the overpayment shown on the taxpayer’s final, completed return
11credited to the tax liability for the following tax year.
12 Sec. 3. NEW SECTION. 533C.104 Money transfer service fee —
13licensee requirements — enforcement.
141. For purposes of this section, unless the context
15otherwise requires:
16a. “Department” means the department of revenue.
17b. “Director” means the director of revenue.
18c. “Money transfer service” means the transmission of
19money by any means including transmission within this country
20or to or from locations abroad by payment instrument, wire,
21facsimile, or electronic transfer, courier, or otherwise.
222. a. A licensee and the authorized delegates of a licensee
23shall collect from customers a money transfer service fee equal
24to one percent of the amount of each money transfer service
25transaction.
26b. Money transfer service fees shall be paid over to the
27department by licensees and their authorized delegates who
28furnish money transfer services.
29c. The department, in consultation with the superintendent,
30shall administer and enforce the money transfer service fee as
31nearly as possible in conjunction with the administration and
32enforcement of the state sales and use tax law, except that
33portion of the law which implements the streamlined sales and
34use tax agreement.
35d. The director may require licensees and their authorized
-2-1delegates to register with the department for purposes of this
2section. The director may also require a permit applicable
3only to this section for any licensee or the authorized
4delegate of a licensee not collecting taxes under chapter 423.
5e. All powers and requirements of the director to administer
6the state sales and use tax law are applicable to the
7administration of the money transfer service fee, including but
8not limited to the provisions of section 422.25, subsection 4,
9sections 422.30, 422.67, and 422.68, section 422.69, subsection
101, sections 422.70 through 422.75, section 423.14, subsection
111 and subsection 2, paragraphs “b” through “e”, and sections
12423.15, 423.23, 423.24, 423.25, 423.31 through 423.35, 423.37
13through 423.42, 423.46, and 423.47.
14f. Failure by a licensee or a licensee’s authorized
15delegate to collect and remit money transfer service fees
16or to comply with any other provision of this section shall
17subject the licensee and the authorized delegates of a licensee
18to the enforcement provisions of article 7 of this chapter.
19The director and the department shall cooperate with the
20superintendent in identifying violations of this section and in
21discharging the superintendent’s enforcement responsibilities
22under article 7 of this chapter.
23g. All money transfer service fees collected under this
24section shall be deposited in a separate account in the
25financial crime and wire transmitter fund established by
26section 80.32.
273. A licensee and the authorized delegates of a licensee
28furnishing money transfer services shall post a notice in the
29form and manner prescribed by the superintendent that notifies
30customers that upon filing an individual income tax return with
31a valid taxpayer identification number, the customer shall be
32entitled to an individual income tax credit equal to the amount
33of money transfer service fees paid by the customer during the
34tax year.
35 Sec. 4. Section 602.8102, subsection 135A, Code 2017, is
-3-1amended to read as follows:
2135A. Assess the surcharges provided by sections 911.1,
3911.2, 911.2A, 911.2B, 911.2C, 911.3, and 911.4, and 911.5.
4 Sec. 5. Section 602.8108, Code 2017, is amended by adding
5the following new subsection:
6 NEW SUBSECTION. 13. The clerk of the district court shall
7remit all moneys collected from the assessment of the drug
8paraphernalia surcharge provided in section 911.5 to the state
9court administrator for deposit in the financial crime and wire
10transmitter fund established in section 80.32.
11 Sec. 6. NEW SECTION. 911.5 Drug paraphernalia surcharge.
121. In addition to any other surcharge, the clerk of the
13district court shall assess a drug paraphernalia surcharge of
14five dollars if an adjudication of guilt or a deferred judgment
15has been entered for a criminal violation of section 124.414 or
16a similar city or county ordinance.
172. The surcharge shall be remitted by the clerk of court as
18provided in section 602.8108, subsection 13.
19 Sec. 7. RETROACTIVE APPLICABILITY. The following provision
20or provisions of this Act apply retroactively to January 1,
212017, for tax years beginning on or after that date:
221. The section of this division enacting section 422.10C.
23EXPLANATION
24The inclusion of this explanation does not constitute agreement with
25the explanation’s substance by the members of the general assembly.
26This bill relates to financial crime enforcement by
27assessing a drug paraphernalia surcharge and creating a money
28transfer service fee and related fund and income tax credit.
29DRUG PARAPHERNALIA SURCHARGE. The bill provides that the
30clerk of the district court shall assess a drug paraphernalia
31surcharge of five dollars if an adjudication of guilt or
32a deferred judgment has been entered for possessing drug
33paraphernalia in violation of Code section 124.414 or a similar
34city or county ordinance. The bill specifies that the clerk of
35the district court shall remit all moneys collected from the
-4-1assessment of the surcharge to the state court administrator
2for deposit in the financial crime and wire transmitter fund
3established by the bill.
4MONEY TRANSFER SERVICE FEE AND RELATED FUND AND TAX CREDIT.
5The bill requires a licensee under Code chapter 533C, the
6uniform money services Act, to collect from customers a money
7transfer service fee equal to 1 percent of the amount of each
8money transfer service transaction. The bill defines “money
9transfer service” as the transmission of money by any means
10including transmission within this country or to or from
11locations abroad by payment instrument, wire, facsimile, or
12electronic transfer, courier, or otherwise.
13The bill requires such licensees to pay such fees over to the
14department of revenue. The bill requires the department, in
15consultation with the superintendent of banking, to administer
16and enforce the money transfer service fee as nearly as
17possible in conjunction with the administration and enforcement
18of the state sales and use tax law, except that portion of
19the law which implements the streamlined sales and use tax
20agreement.
21The bill permits the director of revenue to require
22licensees to register with the department for purposes of
23the bill. The bill permits the director to require a permit
24applicable only to the bill for any licensee not collecting
25taxes under Code chapter 423. The bill provides that all
26powers and requirements of the director to administer the state
27sales and use tax law are applicable to the administration of
28the money transfer service fee.
29Failure by a licensee to collect and remit money transfer
30service fees or to comply with any other provision of the bill
31shall subject the licensee to the enforcement provisions of
32article 7 of Code chapter 533C. The bill requires the director
33and the department to cooperate with the superintendent in
34identifying violations of the bill and in discharging the
35superintendent’s enforcement responsibilities under article 7
-5-1of Code chapter 533C.
2Penalties provided for in article 7 of Code chapter 533C
3include suspension and revocation of a license under Code
4chapter 533C, civil penalties, and criminal penalties that
5include class “C” and “D” felonies and aggravated and simple
6misdemeanors. A class “C” felony is punishable by confinement
7for no more than 10 years and a fine of at least $1,000 but
8not more than $10,000. A class “D” felony is punishable by
9confinement for no more than five years and a fine of at least
10$750 but not more than $7,500. An aggravated misdemeanor
11is punishable by confinement for no more than two years and
12a fine of at least $625 but not more than $6,250. A simple
13misdemeanor is punishable by confinement for no more than 30
14days or a fine of at least $65 but not more than $625 or by
15both.
16The bill provides that all money transfer service fees
17collected under the bill shall be deposited in the financial
18crime and wire transmitter fund established by the bill.
19The bill requires a licensee furnishing money transfer
20services to post a notice in the form and manner prescribed
21by the superintendent that notifies customers that upon
22filing an individual income tax return with a valid taxpayer
23identification number, the customer shall be entitled to an
24individual income tax credit equal to the amount of money
25transfer service fees paid by the customer during the tax year.
26The bill also applies to authorized delegates of a licensee
27under Code chapter 533C.
28The bill provides an individual income tax credit equal to
29the amount of money transfer service fees paid by the taxpayer
30during the tax year. The bill provides that the credit shall
31not be allowed to an individual who does not include on the tax
32return for the taxable year the individual’s valid taxpayer
33identification number and that of the individual’s spouse if
34applicable. The bill provides that the credit is refundable
35and may be credited to the individual’s tax liability for the
-6-1following tax year. The provision enacting the tax credit
2applies retroactively to January 1, 2017, for tax years
3beginning on or after that date.
4The bill establishes a financial crime and wire transmitter
5fund in the office of the treasurer of state under the control
6of the department of public safety. Any moneys annually
7appropriated, granted, or credited to the fund, including any
8federal moneys, are appropriated to the department of public
9safety for the purpose of investigating indictable criminal
10offenses committed for financial gain. Interest and earnings
11on moneys deposited in the fund shall be credited to the fund
12and moneys remaining in the fund at the end of the fiscal year
13shall not revert.
14The bill requires the department of public safety, for
15the fiscal year beginning July 1, 2017, and for each fiscal
16year thereafter, to transfer from the fund to the general
17fund of the state, the lesser of the amount of money transfer
18service fees collected or an amount of money equal to the money
19transfer service tax credits claimed in that fiscal year, if
20any. The bill provides that the moneys transferred to the
21general fund of the state in accordance with the bill shall not
22be considered new revenues for purposes of the state general
23fund expenditure limitation under Code section 8.54 but instead
24as replacement of a like amount included in the expenditure
25limitation for the fiscal year in which the transfer is made.
-7-jm/nh