Bill Text: IA HF636 | 2015-2016 | 86th General Assembly | Introduced
Bill Title: A bill for an act excluding certain wagers from the definition of adjusted gross receipts for purposes of the wagering tax on gambling games, providing for a wagering tax on promotional play receipts, and providing for the prospective reduction and repeal of the tax on promotional play receipts. (Formerly HSB 110)
Spectrum: Committee Bill
Status: (Introduced - Dead) 2015-06-04 - Referred to Ways & Means. H.J. 1135. [HF636 Detail]
Download: Iowa-2015-HF636-Introduced.html
House File 636 - Introduced HOUSE FILE BY COMMITTEE ON WAYS AND MEANS (SUCCESSOR TO HSB 110) A BILL FOR 1 An Act excluding certain wagers from the definition of adjusted 2 gross receipts for purposes of the wagering tax on gambling 3 games, providing for a wagering tax on promotional play 4 receipts, and providing for the prospective reduction and 5 repeal of the tax on promotional play receipts. 6 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: TLSB 1391HV (2) 86 ec/nh PAG LIN 1 1 Section 1. Section 99F.1, Code 2015, is amended by adding 1 2 the following new subsections: 1 3 NEW SUBSECTION. 19A. "Promotional play receipts" means 1 4 the total sums wagered on gambling games with tokens, chips, 1 5 electronic credits, or other forms of cashless wagering 1 6 provided by the licensee without an exchange of money as 1 7 described in section 99F.9, subsection 3. 1 8 NEW SUBSECTION. 22. "Taxable gross receipts" means the 1 9 adjusted gross receipts less promotional play receipts. 1 10 Sec. 2. Section 99F.4A, subsection 6, Code 2015, is amended 1 11 to read as follows: 1 12 6. Theadjustedtaxable gross receipts received from 1 13 gambling games shall be taxed at the same rates and the 1 14 proceeds distributed in the same manner as provided in section 1 15 99F.11. 1 16 Sec. 3. Section 99F.11, subsection 1, Code 2015, is amended 1 17 to read as follows: 1 18 1. A tax is imposed on theadjustedtaxable gross receipts 1 19 received each fiscal year from gambling games authorized under 1 20 this chapter at the rate of five percent on the first one 1 21 million dollars ofadjustedtaxable gross receipts and at the 1 22 rate of ten percent on the next two million dollars ofadjusted 1 23taxable gross receipts. 1 24 Sec. 4. Section 99F.11, subsection 2, unnumbered paragraph 1 25 1, Code 2015, is amended to read as follows: 1 26 The tax rate imposed each fiscal year on any amount of 1 27adjustedtaxable gross receipts over three million dollars 1 28 shall be as follows: 1 29 Sec. 5. Section 99F.11, subsection 2, paragraph b, 1 30 subparagraph (2), Code 2015, is amended to read as follows: 1 31 (2) If the licensee of the racetrack enclosure has been 1 32 issued a table games license during the fiscal year or prior 1 33 fiscal year and the adjusted gross receipts from gambling games 1 34 of the licensee in the prior fiscal year were one hundred 1 35 million dollars or more, twenty=two percent onadjustedtaxable 2 1 gross receipts received prior to the operational date and 2 2 twenty=four percent onadjustedtaxable gross receipts received 2 3 on or after the operational date. For purposes of this 2 4 subparagraph, the operational date is the date the commission 2 5 determines table games became operational at the racetrack 2 6 enclosure. 2 7 Sec. 6. Section 99F.11, subsection 3, paragraphs a, b, and 2 8 c, Code 2015, are amended to read as follows: 2 9 a. If the gambling excursion originated at a dock located 2 10 in a city, one=half of one percent of theadjustedtaxable 2 11 gross receipts shall be remitted to the treasurer of the city 2 12 in which the dock is located and shall be deposited in the 2 13 general fund of the city. Another one=half of one percent of 2 14 theadjustedtaxable gross receipts shall be remitted to the 2 15 treasurer of the county in which the dock is located and shall 2 16 be deposited in the general fund of the county. 2 17 b. If the gambling excursion originated at a dock located 2 18 in a part of the county outside a city, one=half of one percent 2 19 of theadjustedtaxable gross receipts shall be remitted to 2 20 the treasurer of the county in which the dock is located and 2 21 shall be deposited in the general fund of the county. Another 2 22 one=half of one percent of theadjustedtaxable gross receipts 2 23 shall be remitted to the treasurer of the Iowa city nearest to 2 24 where the dock is located and shall be deposited in the general 2 25 fund of the city. 2 26 c. Eight=tenths of one percent of theadjustedtaxable gross 2 27 receiptstaxshall be deposited in the county endowment fund 2 28 created in section 15E.311. 2 29 Sec. 7. Section 99F.11, subsection 3, paragraph d, 2 30 unnumbered paragraph 1, Code 2015, is amended to read as 2 31 follows: 2 32 Two=tenths of one percent of theadjustedtaxable gross 2 33 receiptstaxshall be allocated each fiscal year as follows: 2 34 Sec. 8. Section 99F.11, subsection 3, paragraph e, Code 2 35 2015, is amended to read as follows: 3 1 e. The remaining amount of theadjustedtaxable gross 3 2 receipts tax shall be credited as provided in section 8.57, 3 3 subsection 5. 3 4 Sec. 9. NEW SECTION. 99F.11A Promotional play receipts tax 3 5 == repeal. 3 6 1. A qualified sponsoring organization conducting gambling 3 7 games at a pari=mutuel racetrack enclosure licensed under 3 8 section 99F.4A, or on an excursion gambling boat or gambling 3 9 structure licensed under section 99F.7, shall pay a tax on 3 10 promotional play receipts each fiscal year as provided in this 3 11 section. 3 12 2. The tax rate imposed each fiscal year on any amount of 3 13 promotional play receipts of a licensee subject to tax shall 3 14 be at the rate specified for that licensee on taxable gross 3 15 receipts as provided in section 99F.11, subsection 2, subject 3 16 to the limitation provided in subsection 3 of this section. 3 17 3. The total taxes paid in a fiscal year by all licensees 3 18 on promotional play receipts shall not exceed the following 3 19 amounts for the following fiscal years: 3 20 a. For the fiscal year beginning July 1, 2015, and ending 3 21 June 30, 2016, twenty=seven million dollars. 3 22 b. For the fiscal year beginning July 1, 2016, and ending 3 23 June 30, 2017, twenty=two million dollars. 3 24 c. For the fiscal year beginning July 1, 2017, and ending 3 25 June 30, 2018, seventeen million dollars. 3 26 d. For the fiscal year beginning July 1, 2018, and ending 3 27 June 30, 2019, twelve million dollars. 3 28 e. For the fiscal year beginning July 1, 2019, and ending 3 29 June 30, 2020, seven million dollars. 3 30 f. For the fiscal year beginning July 1, 2020, and ending 3 31 June 30, 2021, two million dollars. 3 32 4. The taxes imposed by this section shall be paid by 3 33 the licensee to the treasurer of state within ten days after 3 34 the close of the day when the wagers were made and shall be 3 35 distributed as follows: 4 1 a. If the excursion gambling boat, gambling structure, or 4 2 racetrack enclosure is located in a city, an amount equal to 4 3 two percent of the promotional play receipts tax paid shall be 4 4 remitted to the treasurer of the city in which the excursion 4 5 gambling boat, gambling structure, or racetrack enclosure is 4 6 located and shall be deposited in the general fund of the 4 7 city. Another two percent of the promotional play receipts tax 4 8 paid shall be remitted to the treasurer of the county in which 4 9 the excursion gambling boat, gambling structure, or racetrack 4 10 enclosure is located and shall be deposited in the general fund 4 11 of the county. 4 12 b. If the excursion gambling boat, gambling structure, or 4 13 racetrack enclosure is located in a part of the county outside 4 14 a city, two percent of the promotional play receipts tax paid 4 15 shall be remitted to the treasurer of the county in which the 4 16 excursion gambling boat, gambling structure, or racetrack 4 17 enclosure is located and shall be deposited in the general 4 18 fund of the county. Another two percent of the promotional 4 19 play receipts tax paid shall be remitted to the treasurer of 4 20 the Iowa city nearest to where the excursion gambling boat, 4 21 gambling structure, or racetrack enclosure is located and shall 4 22 be deposited in the general fund of the city. 4 23 c. Four percent of the promotional play receipts tax paid 4 24 shall be deposited in the county endowment fund created in 4 25 section 15E.311. 4 26 d. One percent of the promotional play receipts tax paid 4 27 is appropriated to the community development division of the 4 28 economic development authority for the purposes of regional 4 29 tourism marketing. The moneys appropriated in this paragraph 4 30 shall be disbursed to the authority in quarterly allotments. 4 31 However, moneys appropriated under this paragraph shall not be 4 32 used for administrative purposes. 4 33 e. The remaining amount of the promotional play receipts tax 4 34 paid shall be credited to the rebuild Iowa infrastructure fund 4 35 created in section 8.57. 5 1 5. The commission shall adopt rules pursuant to chapter 17A 5 2 to administer this section, to include the manner of ensuring 5 3 that the total taxes paid by licensees under this section do 5 4 not exceed the limitations provided in subsection 3 and the 5 5 manner of refunding any taxes paid in excess of the limitations 5 6 provided in subsection 3. 5 7 6. This section is repealed July 1, 2021. 5 8 EXPLANATION 5 9 The inclusion of this explanation does not constitute agreement with 5 10 the explanation's substance by the members of the general assembly. 5 11 This bill concerns wagering taxes on gambling game receipts 5 12 as provided in Code chapter 99F. 5 13 Code section 99F.1 is amended by adding two new definitions. 5 14 "Promotional play receipts" is defined as the total sums 5 15 wagered on gambling games with tokens, chips, electronic 5 16 credits, or other forms of cashless wagering provided by 5 17 a licensee without an exchange of money. "Taxable gross 5 18 receipts" is defined as adjusted gross receipts less 5 19 promotional play receipts. 5 20 Code section 99F.11, providing for the wagering tax, is 5 21 amended to provide that the wagering tax is calculated on the 5 22 taxable gross receipts of a gambling game licensee instead of 5 23 the adjusted gross receipts. 5 24 New Code section 99F.11A provides for a wagering tax on 5 25 promotional play receipts. The Code section provides for the 5 26 tax rate on promotional play receipts and provides for the 5 27 distribution of taxes received from promotional play receipts. 5 28 The bill specifies the tax rate as the rate applied to taxable 5 29 gross receipts over $3 million and specifies that the tax 5 30 receipts from promotional play are to be distributed to cities 5 31 and counties where the gambling structures are located, the 5 32 county endowment fund, the community development division of 5 33 the economic development authority, and to the rebuild Iowa 5 34 infrastructure fund created in Code section 8.57, in a manner 5 35 based on the distribution of wagering taxes in Code section 6 1 99F.11. The bill then provides that the total taxes paid by 6 2 all gambling game licensees on promotional play receipts shall 6 3 not exceed a certain dollar amount for designated fiscal years. 6 4 For the fiscal year beginning July 1, 2015, total taxes paid 6 5 shall not exceed $27 million. For each successive fiscal year, 6 6 the maximum of total taxes paid by all licensees is reduced 6 7 by $5 million until the total taxes paid for the fiscal year 6 8 beginning July 1, 2020, shall not exceed $2 million. The new 6 9 Code section is repealed July 1, 2021. LSB 1391HV (2) 86 ec/nh
