Iowa-2017-SF2074-Introduced
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 This subparagraph is repealed June 30, 2025, or thirty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 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.
LSB 5503XS (3) 87
mm/jh