HB1466M
SECOND REGULAR SESSION
SENATE COMMITTEE SUBSTITUTE
FOR
HOUSE BILL NO. 1466
88TH GENERAL ASSEMBLY
Reported from the
Committee on Corrections and General Laws, April 15, 1996, with
recommendation that the Senate Committee Substitute do pass, and
be placed on the Consent Calendar.
.
TERRY L. SPIELER, Secretary.
S3312.06C
AN
ACT
To repeal section 144.030,
RSMo Supp. 1995, relating to sales tax exemptions, and to enact
in lieu thereof one new section relating to the same subject.
Be it enacted by the
General Assembly of the State of Missouri, as follows:
Section A. Section
144.030, RSMo Supp. 1995, is repealed and one new section enacted
in lieu thereof, to be known as section 144.030, to read as follows:
144.030. 1. There
is hereby specifically exempted from the provisions of sections
144.010 to 144.525 and from the computation of the tax levied,
assessed or payable [under] pursuant to sections
144.010 to 144.525 such retail sales as may be made in commerce
between this state and any other state of the United States, or
between this state and any foreign country, and any retail sale
which the state of Missouri is prohibited from taxing [under]
pursuant to the Constitution or laws of the United States
of America, and such retail sales of tangible personal property
which the general assembly of the state of Missouri is prohibited
from taxing or further taxing by the constitution of this state.
2. There are
also specifically exempted from the provisions of the local sales
tax law as defined in section 32.085, RSMo, section 238.235, RSMo,
and sections 144.010 to 144.525 and 144.600 to 144.745 and from
the computation of the tax levied, assessed or payable [under]
pursuant to the local sales tax law as defined in section
32.085, RSMo, section 238.235, RSMo, and sections 144.010 to 144.525
and 144.600 to 144.745:
(1) Motor fuel
or special fuel subject to an excise tax of this state, unless
all or part of such excise tax is refunded pursuant to section
142.584, RSMo; or upon the sale at retail of fuel to be consumed
in manufacturing or creating gas, power, steam, electrical current
or in furnishing water to be sold ultimately at retail; or feed
for livestock or poultry which is to be used in the feeding of
livestock or poultry to be sold ultimately in processed form or
otherwise at retail; or grain to be converted into foodstuffs
which are to be sold ultimately in processed form at retail; or
seed, limestone or fertilizer which is to be used for seeding,
liming or fertilizing crops which when harvested will be sold
at retail or will be fed to livestock or poultry to be sold ultimately
in processed form at retail; economic poisons registered [under]
pursuant to the provisions of the Missouri pesticide registration
law (sections 281.220 to 281.310, RSMo) which are to be used in
connection with the growth or production of crops, fruit trees
or orchards applied before, during, or after planting, the crop
of which when harvested will be sold at retail or will be converted
into foodstuffs which are to be sold ultimately in processed form
at retail;
(2) Materials,
manufactured goods, machinery and parts which when used in manufacturing,
processing, compounding, mining, producing or fabricating become
a component part or ingredient of the new personal property resulting
from such manufacturing, processing, compounding, mining, producing
or fabricating and which new personal property is intended to
be sold ultimately for final use or consumption; and materials,
including without limitation gases, and manufactured goods,
including without limitation slagging materials and firebrick,
which are ultimately consumed in the manufacturing process by
blending, reacting or interacting with or by becoming,
in whole or in part, [a] component [part]
parts or [ingredient] ingredients
of steel products intended to be sold ultimately for final use
or consumption;
(3) Materials,
replacement parts and equipment purchased for use directly upon,
and for the repair and maintenance or manufacture of, motor vehicles,
watercraft, railroad rolling stock or aircraft engaged as common
carriers of persons or property;
(4) Machinery
and equipment, and the materials and supplies solely required
for the installation or construction of such machinery and equipment,
replacing and used for the same purposes as the machinery and
equipment replaced by reason of design or product changes, which
is purchased for and used directly for manufacturing or fabricating
a product which is intended to be sold ultimately for final use
or consumption; and machinery and equipment, and the materials
and supplies required solely for the operation, installation or
construction of such machinery and equipment, purchased and used
to establish new, or to replace or expand existing, material recovery
processing plants in this state. For the purposes of
this subdivision, a ?material
recovery processing plant@
means a facility which converts recovered materials into a new
product, or a different form which is used in producing a new
product, and shall not include a facility or equipment which is
used solely for the collection of recovered materials for delivery
to a material recovery processing plant;
(5) Machinery
and equipment, and the materials and supplies solely required
for the installation or construction of such machinery and equipment,
purchased and used to establish new or to expand existing manufacturing,
mining or fabricating plants in the state if such machinery and
equipment is used directly in manufacturing, mining or fabricating
a product which is intended to be sold ultimately for final use
or consumption;
(6) Tangible
personal property which is used exclusively in the manufacturing,
processing, modification or assembling of products sold to the
United States government or to any agency of the United States
government;
(7) Animals
or poultry used for breeding or feeding purposes and the grand
champion animal sold at the sale of champions at the Missouri
state fair;
(8) Newsprint
used in newspapers published for dissemination of news to the
general public;
(9) The rentals
of films, records or any type of sound or picture transcriptions
for public commercial display;
(10) Pumping
machinery and equipment used to propel products delivered by pipelines
engaged as common carriers;
(11) Railroad
rolling stock for use in transporting persons or property in interstate
commerce and motor vehicles licensed for a gross weight of twentyfour
thousand pounds or more or trailers used by common carriers, as
defined in section 390.020, RSMo, solely in the transportation
of persons or property in interstate commerce;
(12) Electrical
energy used in the actual primary manufacture, processing, compounding,
mining or producing of a product, or electrical energy used in
the actual secondary processing or fabricating of the product,
in facilities owned or leased by the taxpayer, if the total
cost of electrical energy so used exceeds ten percent of the total
cost of production, either primary or secondary, exclusive of
the cost of electrical energy so used. For purposes
of this subdivision, ?processing@
means any mode of treatment, act or series of acts performed upon
materials to transform and reduce them to a different state or
thing, including treatment necessary to maintain or preserve such
processing by the producer at the production facility;
(13) Anodes
which are used or consumed in manufacturing, processing, compounding,
mining, producing or fabricating and which have a useful life
of less than one year;
(14) Machinery,
equipment, appliances and devices purchased or leased and used
solely for the purpose of preventing, abating or monitoring air
pollution, and materials and supplies solely required for the
installation, construction or reconstruction of such machinery,
equipment, appliances and devices, and so certified as such by
the director of the department of natural resources, except that
any action by the director [under] pursuant to
this subdivision may be appealed to the air conservation commission
which may uphold or reverse such action;
(15) Machinery,
equipment, appliances and devices purchased or leased and used
solely for the purpose of preventing, abating or monitoring water
pollution, and materials and supplies solely required for the
installation, construction or reconstruction of such machinery,
equipment, appliances and devices, and so certified as such by
the director of the department of natural resources, except that
any action by the director [under] pursuant to
this subdivision may be appealed to the Missouri clean water commission
which may uphold or reverse such action;
(16) Tangible
personal property purchased by a rural water district;
(17) All amounts
paid or charged for admission or participation or other fees paid
by or other charges to individuals in or for any place of amusement,
entertainment or recreation, games or athletic events, including
museums, fairs, zoos and planetariums, owned or operated
by a municipality or other political subdivision where all the
proceeds derived therefrom benefit the municipality or other political
subdivision and do not inure to any private person, firm, or corporation;
(18) All sales
of insulin and prosthetic or orthopedic devices as defined on
January 1, 1980, by the federal medicare program [under]
pursuant to Title XVIII of the Social Security Act of 1965,
including the items specified in section 1862(a)(12) of that act,
and also specifically including hearing aids and hearing aid supplies
and all sales of drugs which may be legally dispensed by a licensed
pharmacist only upon a lawful prescription of a practitioner licensed
to administer those items;
(19) All sales
made by or to religious and charitable organizations and institutions
in their religious, charitable or educational functions and activities
and all sales made by or to all elementary and secondary schools
operated at public expense in their educational functions and
activities;
(20) All sales
of aircraft to common carriers for storage or for use in interstate
commerce and all sales made by or to not for profit civic, social,
service or fraternal organizations, including fraternal organizations
which have been declared tax exempt organizations [under]
pursuant to section 501(c)(8) or (10) of the 1986 Internal
Revenue Code, as amended, solely in their civic or charitable
functions and activities and all sales made to eleemosynary and
penal institutions and industries of the state, and all sales
made to any private not for profit institution of higher education
not otherwise excluded [under] pursuant to
subdivision (19) of this subsection or any institution of higher
education supported by public funds, and all sales made to a state
relief agency in the exercise of relief functions and activities;
(21) All ticket
sales made by benevolent, scientific and educational associations
which are formed to foster, encourage, and promote progress and
improvement in the science of agriculture and in the raising and
breeding of animals, and by nonprofit summer theater organizations
if such organizations are exempt from federal tax [under]
pursuant to the provisions of the Internal Revenue Code
and all admission on entry charges to any fair conducted by
a county agricultural and mechanical society organized and operated
pursuant to sections 262.290 to 262.530, RSMo;
(22) All sales
made to any private not for profit elementary or secondary school,
all sales of feed additives, medications or vaccines administered
to livestock or poultry in the production of food or fiber, all
sales of pesticides used in the production of crops, livestock
or poultry for food or fiber, all sales of bedding used in the
production of livestock or poultry for food or fiber, all sales
of propane or natural gas, electricity or diesel fuel used exclusively
for drying agricultural crops, and all sales of farm machinery,
other than airplanes, motor vehicles and trailers. As
used in this subdivision, the term ?feed
additives@
means tangible personal property which, when mixed with feed for
livestock or poultry, is to be used in the feeding of livestock
or poultry. As used in this subdivision, the term ?farm
machinery@
means new or used farm tractors and such other new or used farm
machinery and equipment and repair or replacement parts thereon
and onehalf of each purchaser=s
purchase of diesel fuel therefor which is:
(a) Used exclusively
for agricultural purposes;
(b) Used on
land owned or leased for the purpose of producing farm products;
and
(c) Used directly
in producing farm products to be sold ultimately in processed
form or otherwise at retail or in producing farm products to be
fed to livestock or poultry to be sold ultimately in processed
form at retail;
(23) Except
as otherwise provided in section 144.032, all sales of metered
water service, electricity, electrical current, natural, artificial
or propane gas, wood, coal or home heating oil for domestic use
and in any city not within a county, all sales of metered or unmetered
water service for domestic use;
(a) ?Domestic
use@
means that portion of metered water service, electricity, electrical
current, natural, artificial or propane gas, wood, coal or home
heating oil, and in any city not within a county, metered or unmetered
water service, which an individual occupant of a residential premises
uses for nonbusiness, noncommercial or nonindustrial purposes. Utility
service through a single or master meter for residential apartments
or condominiums, including service for common areas and facilities
and vacant units, shall be deemed to be for domestic use. Each
seller shall establish and maintain a system whereby individual
purchases are determined as exempt or nonexempt;
(b) Regulated
utility sellers shall determine whether individual purchases are
exempt or nonexempt based upon the seller=s
utility service rate classifications as contained in tariffs on
file with and approved by the Missouri public service commission. Sales
and purchases made pursuant to the rate classification ?residential@
and sales to and purchases made by or on behalf of the occupants
of residential apartments or condominiums through a single or
master meter, including service for common areas and facilities
and vacant units, shall be considered as sales made for domestic
use and such sales shall be exempt from sales tax. Sellers
shall charge sales tax upon the entire amount of purchases classified
as nondomestic use. The seller=s
utility service rate classification and the provision of service
thereunder shall be conclusive as to whether or not the utility
must charge sales tax;
(c) Each person
making domestic use purchases of services or property and who
uses any portion of the services or property so purchased for
a nondomestic use shall, by the fifteenth day of the fourth month
following the year of purchase, and without assessment, notice
or demand, file a return and pay sales tax on that portion of
nondomestic purchases. Each person making nondomestic
purchases of services or property and who uses any portion of
the services or property so purchased for domestic use, and each
person making domestic purchases on behalf of occupants of residential
apartments or condominiums through a single or master meter, including
service for common areas and facilities and vacant units, under
a nonresidential utility service rate classification may, between
the first day of the first month and the fifteenth day of the
fourth month following the year of purchase, apply for credit
or refund to the director of revenue and the director shall give
credit or make refund for taxes paid on the domestic use portion
of the purchase. The person making such purchases on
behalf of occupants of residential apartments or condominiums
shall have standing to apply to the director of revenue for such
credit or refund;
(24) All sales
of handicraft items made by the seller or [his]
the seller=s
spouse if the seller or [his] the seller=s
spouse is at least sixtyfive years of age, and if the total
gross proceeds from such sales do not constitute a majority of
the annual gross income of the seller;
(25) Excise
taxes, collected on sales at retail, imposed by sections 4041,
4061, 4071, 4081, 4091, 4161, 4181, 4251, 4261 and 4271 of Title
26, United States Code. The director of revenue shall
promulgate rules pursuant to chapter 536, RSMo, to eliminate all
state and local sales taxes on such excise taxes;
(26) Sales of
fuel consumed or used in the operation of ships, barges, or waterborne
vessels which are used primarily in or for the transportation
of property or cargo, or the conveyance of persons for hire, on
navigable rivers bordering on or located in part in this state,
if such fuel is delivered by the seller to the purchaser=s
barge, ship, or waterborne vessel while it is afloat upon such
river;
(27) All sales
made to an interstate compact agency created [under]
pursuant to sections 70.370 to 70.440, RSMo, or sections
238.010 to 238.100, RSMo, in the exercise of the functions and
activities of such agency as provided [under] pursuant
to the compact;
(28) Computers,
computer software and computer security systems purchased for
use by architectural[,] or engineering [or
accounting] firms headquartered in this state. For
the purposes of this subdivision, ?headquartered
in this state@
means the office for the administrative management of at least
four integrated facilities operated by the taxpayer is located
in the state of Missouri;
(29) All
sales of barges which are to be used primarily in the transportation
of property or cargo on interstate waterways.
T