Bill Text: IA HF2115 | 2017-2018 | 87th General Assembly | Introduced


Bill Title: A bill for an act modifying the rebate of sales and use tax to the owner or operator of a raceway facility and including effective date and retroactive applicability provisions.

Spectrum: Partisan Bill (Republican 1-0)

Status: (Introduced - Dead) 2018-05-03 - Withdrawn. H.J. 949. [HF2115 Detail]

Download: Iowa-2017-HF2115-Introduced.html

House File 2115 - Introduced




                                 HOUSE FILE       
                                 BY  HEARTSILL

                                 (COMPANION TO SF 2074
                                     BY SINCLAIR)

                                      A BILL FOR

  1 An Act modifying the rebate of sales and use tax to the owner or
  2    operator of a raceway facility and including effective date
  3    and retroactive applicability provisions.
  4 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
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PAG LIN



  1  1    Section 1.  Section 423.2, subsection 11, paragraph b,
  1  2 subparagraph (7), Code 2018, is amended to read as follows:
  1  3    (7)  Beginning the first day of the quarter following July
  1  4 1, 2014, transfer to the raceway facility tax rebate fund
  1  5 created in section 423.4, subsection 11, paragraph "e", that
  1  6 portion of the sales tax receipts collected and remitted upon
  1  7 sales of tangible personal property or services furnished by
  1  8 retailers at a raceway facility meeting the qualifications of
  1  9 section 423.4, subsection 11, that remains after the transfers
  1 10 required in subparagraphs (1) through (6) of this paragraph
  1 11 "b". This subparagraph is repealed June 30, 2025, or thirty
  1 12 days following the date on which an amount of total rebates
  1 13 specified in section 423.4, subsection 11, paragraph "c",
  1 14 subparagraph (4), subparagraph division (a) or (b), whichever
  1 15 is applicable (3), has been provided or thirty days following
  1 16 the date on which rebates cease as provided in section 423.4,
  1 17 subsection 11, paragraph "c", subparagraph (5) (4), whichever
  1 18 is earliest.
  1 19    Sec. 2.  Section 423.4, subsection 11, paragraphs b, c, d, e,
  1 20 and g, Code 2018, are amended to read as follows:
  1 21    b.  The owner or operator of a raceway facility may apply to
  1 22 the department for a rebate of the following:
  1 23    (1)  Sales sales tax imposed and collected by retailers upon
  1 24 sales of tangible personal property or services furnished to
  1 25 purchasers at the raceway facility. Notwithstanding the state
  1 26 sales tax imposed in section 423.2, a sales tax rebate issued
  1 27 pursuant to this subparagraph shall not exceed the amounts
  1 28 transferred to the raceway facility tax rebate fund pursuant to
  1 29 section 423.2, subsection 11, paragraph "b", subparagraph (7).
  1 30    (2)  (a)  Sales or use tax upon the sales price of all
  1 31 tangible personal property, or from services furnished to a
  1 32 contractor, used in the fulfillment of a written contract with
  1 33 the owner or operator if the property becomes an integral part
  1 34 of the project under contract and at the completion of the
  1 35 project becomes part of the raceway facility.
  2  1    (b)  The rebate available under this subparagraph shall be
  2  2 limited to one project per raceway facility. If such a project
  2  3 is undertaken, the owner or operator of the raceway facility
  2  4 shall notify the department upon completion of the project.
  2  5    (c)  Notwithstanding the state sales tax imposed in section
  2  6 423.2, a sales tax rebate issued pursuant to this subparagraph
  2  7 shall not exceed the amounts remaining after the transfers
  2  8 required under section 423.2, subsection 11, paragraph "b",
  2  9 subparagraphs (1) through (6), have been made from the total
  2 10 amount of sales tax for which the rebate is requested.
  2 11    (d)  Notwithstanding the state use tax imposed in section
  2 12 423.5, a use tax rebate issued pursuant to this subparagraph
  2 13 shall not exceed the amounts remaining after the transfers
  2 14 required under section 423.43, subsection 1, have been made
  2 15 from the total amount of use tax for which the rebate is
  2 16 requested.
  2 17    c.  The rebate may be obtained only in the following amounts
  2 18 and manner and only under the following conditions:
  2 19    (1)  For rebates pursuant to paragraph "b", subparagraph (1),
  2 20 on On forms furnished by the department within the time period
  2 21 provided by the department by rule, which time period shall not
  2 22 be longer than quarterly.
  2 23    (2)  For rebates pursuant to paragraph "b", subparagraph (2),
  2 24 on forms furnished by the department within the time period
  2 25 provided by the department by rule, but not more than one year
  2 26 after the final settlement has been made.
  2 27    (3)  (2)  The owner or operator shall provide information as
  2 28 deemed necessary by the department.
  2 29    (4)  (3)  The transactions for which sales or use tax was
  2 30 collected and the rebate is sought occurred on or after January
  2 31 1, 2015, but before January 1, 2025. However, the total amount
  2 32 of rebates provided pursuant to this subsection shall not
  2 33 exceed the lesser of the following amounts:
  2 34    (a)  Twenty=five percent of the project costs, as determined
  2 35 by the department, if such a project is undertaken by the owner
  3  1 or operator. For purposes of this subparagraph division,
  3  2 "project costs" means costs incurred by the owner or operator
  3  3 in connection with the planning, design, construction, and
  3  4 installation of property that becomes an integral part of the
  3  5 project under contract which project upon completion becomes
  3  6 part of the raceway facility, and other costs incurred by
  3  7 the owner or operator in connection with the project that
  3  8 are customarily associated with the renovation, remodeling,
  3  9 reconstruction, expansion, equipping, or improvement of
  3 10 real property. Project costs shall be determined after the
  3 11 department receives notification of completion of the project
  3 12 pursuant to paragraph "b", subparagraph (2), subparagraph
  3 13 division (b). However, if rebates cease because of a change of
  3 14 control of the raceway facility as provided in paragraph "c",
  3 15 subparagraph (5), project costs shall be determined as of the
  3 16 date the change of control occurs.
  3 17    (b)  Two one million eight hundred thousand dollars.
  3 18    (5)  (4)  Notwithstanding subparagraph (4) (3), the rebate
  3 19 of sales or use tax shall cease for transactions occurring
  3 20 on or after the date of the change of control of the raceway
  3 21 facility.
  3 22    (6)  (5)  The raceway facility has not received or shall not
  3 23 receive any grants under the community attraction and tourism
  3 24 program pursuant to chapter 15F, subchapter II, or the vision
  3 25 Iowa program pursuant to chapter 15F, subchapter III.
  3 26    d.  To assist the department in determining the amount of the
  3 27 rebate, the following shall occur:
  3 28    (1)  For rebates pursuant to paragraph "b", subparagraph
  3 29 (1), the owner or operator shall identify to the department
  3 30 retailers located at the raceway facility who will be
  3 31 collecting sales tax. The department shall verify such
  3 32 identity and ensure that all proper permits have been issued.
  3 33 For purposes of this subsection, advance ticket and admissions
  3 34 sales shall be considered occurring at the raceway facility
  3 35 regardless of where the transactions actually occur.
  4  1    (2)  For rebates pursuant to paragraph "b", subparagraph (2),
  4  2 the contractor shall state under oath, on forms provided by
  4  3 the department, the amount of such sales of tangible personal
  4  4 property, or services furnished and used in the performance
  4  5 of a contract, and upon which sales or use tax has been paid,
  4  6 and shall file such forms with the owner or operator which has
  4  7 made any written contract for performance by the contractor.
  4  8 The forms shall be filed by the contractor with the owner or
  4  9 operator before final settlement is made. Any contractor who
  4 10 willfully makes a false report of tax paid under the provisions
  4 11 of this subsection is guilty of a simple misdemeanor and in
  4 12 addition shall be liable for the payment of the tax and any
  4 13 applicable penalty and interest.
  4 14    e.  There is established within the state treasury under
  4 15 the control of the department a raceway facility tax rebate
  4 16 fund consisting of the amount of state sales tax revenues
  4 17 transferred pursuant to section 423.2, subsection 11, paragraph
  4 18 "b", subparagraph (7). An account is created within the
  4 19 fund for each raceway facility meeting the qualifications of
  4 20 this subsection. Moneys in the fund shall only be used to
  4 21 provide rebates of state sales tax pursuant to paragraph "b",
  4 22 subparagraph (1). The total amount of rebates paid from the
  4 23 fund shall not exceed the amount specified in paragraph "c",
  4 24 subparagraph (4), subparagraph division (a) or (b), whichever
  4 25 is applicable one million eight hundred thousand dollars. Any
  4 26 moneys in the fund which represent state sales tax revenue for
  4 27 which the time period in paragraph "c" for receiving a rebate
  4 28 has expired, or which otherwise represent state sales tax
  4 29 revenue that has become ineligible for rebate pursuant to this
  4 30 subsection shall immediately revert to the general fund of the
  4 31 state.
  4 32    g.  This subsection is repealed June 30, 2025, or thirty
  4 33 days following the date on which an amount of total rebates
  4 34 specified in paragraph "c", subparagraph (4), subparagraph
  4 35 division (a) or (b), whichever is applicable, has one million
  5  1 eight hundred thousand dollars in total rebates have been
  5  2 provided and no overpayment of rebates exists, or thirty days
  5  3 following the date on which rebates cease as provided in
  5  4 paragraph "c", subparagraph (5) (4), and no overpayment of
  5  5 rebates exists, whichever is earliest.
  5  6    Sec. 3.  REBATES.  Notwithstanding section 423.4, subsection
  5  7 11, or section 423.47, or any other provision of law to the
  5  8 contrary, a claim for rebate of sales tax imposed and collected
  5  9 by retailers upon sales of tangible personal property or
  5 10 services furnished to purchasers at a raceway facility and
  5 11 occurring before the enactment of this Act shall be considered
  5 12 timely if the claim is filed with the department of revenue
  5 13 within ninety days following the enactment of this Act.
  5 14    Sec. 4.  EFFECTIVE DATE.  This Act, being deemed of immediate
  5 15 importance, takes effect upon enactment.
  5 16    Sec. 5.  RETROACTIVE APPLICABILITY.  This Act applies
  5 17 retroactively to January 1, 2015, for sales occurring on or
  5 18 after that date.
  5 19                           EXPLANATION
  5 20 The inclusion of this explanation does not constitute agreement with
  5 21 the explanation's substance by the members of the general assembly.
  5 22    BACKGROUND.  Current law provides a rebate of sales and use
  5 23 tax to the owner or operator of a raceway facility that meets
  5 24 certain requirements.  The rebate is available for two types of
  5 25 transactions.  The first type is for state sales tax collected
  5 26 on purchases made at the raceway facility.  The second type is
  5 27 for state sales or use tax paid by a contractor in completion
  5 28 of a project at the raceway facility.  The rebate related to
  5 29 the completion of a project is limited to one project per
  5 30 raceway facility.  The rebates only apply to transactions
  5 31 occurring between January 1, 2015, and January 1, 2025.  The
  5 32 maximum amount of rebates is limited to $2 million or 25
  5 33 percent of the project costs if such a project is undertaken at
  5 34 the raceway facility, whichever is less.
  5 35    BILL CHANGES.  This bill strikes provisions allowing the
  6  1 rebate for state sales or use tax paid by a contractor in
  6  2 completion of a project at the raceway facility, and strikes
  6  3 other provisions relating to the administration of that
  6  4 component of the rebate.  The rebate will now be available only
  6  5 for state sales tax collected on purchases made at the raceway
  6  6 facility.  The bill also amends the maximum rebate limit to
  6  7 equal $1.8 million.
  6  8    The bill also provides that a claim for rebate of sales tax
  6  9 relating to sales occurring prior to the enactment of the bill
  6 10 will be considered timely if it is filed with the department
  6 11 of revenue within 90 days of the enactment date of the bill,
  6 12 notwithstanding any other provision of law to the contrary.
  6 13    The bill takes effect upon enactment and applies
  6 14 retroactively to January 1, 2015, for sales occurring on or
  6 15 after that date.
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