Bill Text: MN HF11 | 2013 | 88th Legislature 1st Special | Introduced

Bill Title: Farm equipment repair service labor tax repealed.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Introduced - Dead) 2013-09-09 - Introduction and first reading, referred to Rules and Legislative Administration [HF11 Detail]

Download: Minnesota-2013-HF11-Introduced.html

1.1A bill for an act
1.2relating to taxation; sales and use; repealing the tax on labor for farm equipment
1.3repair services;amending Minnesota Statutes 2012, section 297A.61, subdivision
1.43, as amended.

1.6    Section 1. Minnesota Statutes 2012, section 297A.61, subdivision 3, as amended by
1.7Laws 2013, chapter 143, article 8, section 2, is amended to read:
1.8    Subd. 3. Sale and purchase. (a) "Sale" and "purchase" include, but are not limited
1.9to, each of the transactions listed in this subdivision. In applying the provisions of this
1.10chapter, the terms "tangible personal property" and "retail sale" include the taxable
1.11services listed in paragraph (g), clause (6), items (i) to (vi) and (viii), and the provision
1.12of these taxable services, unless specifically provided otherwise. Services performed by
1.13an employee for an employer are not taxable. Services performed by a partnership or
1.14association for another partnership or association are not taxable if one of the entities owns
1.15or controls more than 80 percent of the voting power of the equity interest in the other
1.16entity. Services performed between members of an affiliated group of corporations are not
1.17taxable. For purposes of the preceding sentence, "affiliated group of corporations" means
1.18those entities that would be classified as members of an affiliated group as defined under
1.19United States Code, title 26, section 1504, disregarding the exclusions in section 1504(b).
1.20    (b) Sale and purchase include:
1.21    (1) any transfer of title or possession, or both, of tangible personal property, whether
1.22absolutely or conditionally, for a consideration in money or by exchange or barter; and
2.1    (2) the leasing of or the granting of a license to use or consume, for a consideration
2.2in money or by exchange or barter, tangible personal property, other than a manufactured
2.3home used for residential purposes for a continuous period of 30 days or more.
2.4    (c) Sale and purchase include the production, fabrication, printing, or processing of
2.5tangible personal property for a consideration for consumers who furnish either directly or
2.6indirectly the materials used in the production, fabrication, printing, or processing.
2.7    (d) Sale and purchase include the preparing for a consideration of food.
2.8Notwithstanding section 297A.67, subdivision 2, taxable food includes, but is not limited
2.9to, the following:
2.10    (1) prepared food sold by the retailer;
2.11    (2) soft drinks;
2.12    (3) candy;
2.13    (4) dietary supplements; and
2.14    (5) all food sold through vending machines.
2.15    (e) A sale and a purchase includes the furnishing for a consideration of electricity,
2.16gas, water, or steam for use or consumption within this state.
2.17    (f) A sale and a purchase includes
2.18     the transfer for a consideration of prewritten computer software whether delivered
2.19electronically, by load and leave, or otherwise.
2.20    (g) A sale and a purchase includes the furnishing for a consideration of the following
2.22    (1) the privilege of admission to places of amusement, recreational areas, or athletic
2.23events, and the making available of amusement devices, tanning facilities, reducing
2.24salons, steam baths, Turkish baths, health clubs, and spas or athletic facilities;
2.25    (2) lodging and related services by a hotel, rooming house, resort, campground,
2.26motel, or trailer camp, including furnishing the guest of the facility with access to
2.27telecommunication services, and the granting of any similar license to use real property in
2.28a specific facility, other than the renting or leasing of it for a continuous period of 30 days
2.29or more under an enforceable written agreement that may not be terminated without prior
2.30notice and including accommodations intermediary services provided in connection with
2.31other services provided under this clause;
2.32    (3) nonresidential parking services, whether on a contractual, hourly, or other
2.33periodic basis, except for parking at a meter;
2.34    (4) the granting of membership in a club, association, or other organization if:
3.1    (i) the club, association, or other organization makes available for the use of its
3.2members sports and athletic facilities, without regard to whether a separate charge is
3.3assessed for use of the facilities; and
3.4    (ii) use of the sports and athletic facility is not made available to the general public
3.5on the same basis as it is made available to members.
3.6Granting of membership means both onetime initiation fees and periodic membership
3.7dues. Sports and athletic facilities include golf courses; tennis, racquetball, handball, and
3.8squash courts; basketball and volleyball facilities; running tracks; exercise equipment;
3.9swimming pools; and other similar athletic or sports facilities;
3.10    (5) delivery of aggregate materials by a third party, excluding delivery of aggregate
3.11material used in road construction; and delivery of concrete block by a third party if the
3.12delivery would be subject to the sales tax if provided by the seller of the concrete block.
3.13For purposes of this clause, "road construction" means construction of:
3.14    (i) public roads;
3.15    (ii) cartways; and
3.16    (iii) private roads in townships located outside of the seven-county metropolitan area
3.17up to the point of the emergency response location sign; and
3.18    (6) services as provided in this clause:
3.19    (i) laundry and dry cleaning services including cleaning, pressing, repairing, altering,
3.20and storing clothes, linen services and supply, cleaning and blocking hats, and carpet,
3.21drapery, upholstery, and industrial cleaning. Laundry and dry cleaning services do not
3.22include services provided by coin operated facilities operated by the customer;
3.23    (ii) motor vehicle washing, waxing, and cleaning services, including services
3.24provided by coin operated facilities operated by the customer, and rustproofing,
3.25undercoating, and towing of motor vehicles;
3.26    (iii) building and residential cleaning, maintenance, and disinfecting services and
3.27pest control and exterminating services;
3.28    (iv) detective, security, burglar, fire alarm, and armored car services; but not
3.29including services performed within the jurisdiction they serve by off-duty licensed peace
3.30officers as defined in section 626.84, subdivision 1, or services provided by a nonprofit
3.31organization or any organization at the direction of a county for monitoring and electronic
3.32surveillance of persons placed on in-home detention pursuant to court order or under the
3.33direction of the Minnesota Department of Corrections;
3.34    (v) pet grooming services;
3.35    (vi) lawn care, fertilizing, mowing, spraying and sprigging services; garden planting
3.36and maintenance; tree, bush, and shrub pruning, bracing, spraying, and surgery; indoor
4.1plant care; tree, bush, shrub, and stump removal, except when performed as part of a land
4.2clearing contract as defined in section 297A.68, subdivision 40; and tree trimming for
4.3public utility lines. Services performed under a construction contract for the installation of
4.4shrubbery, plants, sod, trees, bushes, and similar items are not taxable;
4.5    (vii) massages, except when provided by a licensed health care facility or
4.6professional or upon written referral from a licensed health care facility or professional for
4.7treatment of illness, injury, or disease; and
4.8    (viii) the furnishing of lodging, board, and care services for animals in kennels and
4.9other similar arrangements, but excluding veterinary and horse boarding services.
4.10    (h) A sale and a purchase includes the furnishing for a consideration of tangible
4.11personal property or taxable services by the United States or any of its agencies or
4.12instrumentalities, or the state of Minnesota, its agencies, instrumentalities, or political
4.14    (i) A sale and a purchase includes the furnishing for a consideration of
4.15telecommunications services, ancillary services associated with telecommunication
4.16services, and pay television services. Telecommunication services include, but are
4.17not limited to, the following services, as defined in section 297A.669: air-to-ground
4.18radiotelephone service, mobile telecommunication service, postpaid calling service,
4.19prepaid calling service, prepaid wireless calling service, and private communication
4.20services. The services in this paragraph are taxed to the extent allowed under federal law.
4.21    (j) A sale and a purchase includes the furnishing for a consideration of installation if
4.22the installation charges would be subject to the sales tax if the installation were provided
4.23by the seller of the item being installed.
4.24    (k) A sale and a purchase includes the rental of a vehicle by a motor vehicle dealer
4.25to a customer when (1) the vehicle is rented by the customer for a consideration, or (2)
4.26the motor vehicle dealer is reimbursed pursuant to a service contract as defined in section
4.2759B.02, subdivision 11.
4.28    (l) A sale and a purchase includes furnishing for a consideration of specified digital
4.29products or other digital products or granting the right for a consideration to use specified
4.30digital products or other digital products on a temporary or permanent basis and regardless
4.31of whether the purchaser is required to make continued payments for such right. Wherever
4.32the term "tangible personal property" is used in this chapter, other than in subdivisions 10
4.33and 38, the provisions also apply to specified digital products, or other digital products,
4.34unless specifically provided otherwise or the context indicates otherwise.
4.35(m) A sale and purchase includes the furnishing for consideration of the following
5.1(1) repairing and maintaining electronic and precision equipment, which service can
5.2be deducted as a business expense under the Internal Revenue Code. This includes, but
5.3is not limited to, repair or maintenance of electronic devices, computers and computer
5.4peripherals, monitors, computer terminals, storage devices, and CD-ROM drives; other
5.5office equipment such as photocopying machines, printers, and facsimile machines;
5.6televisions, stereos, sound systems, video or digital recorders and players; two-way radios
5.7and other communications equipment; radar and sonar equipment, scientific instruments,
5.8microscopes, and medical equipment;
5.9(2) repairing and maintaining commercial and industrial machinery and equipment.
5.10For purposes of this subdivision, the following items are not commercial or industrial
5.11machinery and equipment: (i) motor vehicles; (ii) furniture and fixtures; (iii) ships; (iv)
5.12railroad stock; and (v) aircraft; and (vi) farm machinery and equipment; and
5.13(3) warehousing or storage services for tangible personal property, excluding:
5.14(i) agricultural products;
5.15(ii) refrigerated storage;
5.16(iii) electronic data; and
5.17(iv) self-storage services and storage of motor vehicles, recreational vehicles, and
5.18boats, not eligible to be deducted as a business expense under the Internal Revenue Code.
5.19EFFECTIVE DATE.This section is effective retroactively for sales and purchases
5.20made after June 30, 2013. Refunds for sales tax paid on items exempted under this
5.21provision may be applied for and paid in the same manner as capital equipment refunds
5.22under Minnesota Statutes, section 297A.75.