Bill Text: IA SF2074 | 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. (See SF 2407.)
Spectrum: Partisan Bill (Republican 2-0)
Status: (Introduced - Dead) 2018-03-13 - Subcommittee recommends passage. [SF2074 Detail]
Download: Iowa-2017-SF2074-Introduced.html
Senate File 2074 - Introduced SENATE FILE BY SINCLAIR and ROZENBOOM 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: TLSB 5503XS (3) 87 mm/jh 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 This subparagraph is repealed June 30, 2025, or thirty 1 12 days following the date on which an amount of total rebates 1 13 specified in section 423.4, subsection 11, paragraph "c", 1 14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 thefollowing:1 23(1)Salessales 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 onOn 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 exceedthe 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)Twoone million eight hundred thousand dollars. 3 18(5)(4) Notwithstanding subparagraph(4)(3), the rebate 3 19 of salesor usetax 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, thefollowing shall occur:3 28(1)For rebates pursuant to paragraph "b", subparagraph 3 29 (1), theowner 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 exceedthe amount specified in paragraph "c", 4 24 subparagraph (4), subparagraph division (a) or (b), whichever 4 25 is applicableone 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 whichan amount of total rebates 4 34 specified in paragraph "c", subparagraph (4), subparagraph 4 35 division (a) or (b), whichever is applicable, hasone 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. LSB 5503XS (3) 87 mm/jh