Bill Text: NC S1185 | 2010 | Regular Session | Amended
Bill Title: Modernize Sales Tax on Accommodations
Spectrum: Slight Partisan Bill (Democrat 5-3)
Status: (Introduced - Dead) 2010-05-18 - Ref To Com On Finance [S1185 Detail]
Download: North_Carolina-2010-S1185-Amended.html
GENERAL ASSEMBLY OF NORTH CAROLINA
SESSION 2009
S 1
SENATE BILL 1185
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Short Title: Modernize Sales Tax on Accommodations. |
(Public) |
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Sponsors: |
Senators Hartsell, Clodfelter, Blue, Brunstetter, Hoyle, Jenkins, Stein, and Tillman. |
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Referred to: |
Finance. |
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May 18, 2010
A BILL TO BE ENTITLED
AN ACT to modernize the application of the sales tax on accommodations by recognizing that the sales price is the price paid by the consumer regardless of whether it is paid to the accommodations provider or a third party.
The General Assembly of North Carolina enacts:
SECTION 1. G.S. 105‑164.4(a)(3) reads as rewritten:
"§ 105‑164.4. Tax imposed on retailers.
(a) A privilege tax is imposed on a retailer at the following percentage rates of the retailer's net taxable sales or gross receipts, as appropriate. The general rate of tax is five and three‑quarters percent (5.75%).
…
(3) Operators of hotels, motels, tourist homes,
tourist camps, and similar type businesses and persons who rent private
residences and cottages to transients are considered retailers under this
Article. A tax at the general rate of tax is levied on the gross receipts
derived by these retailers from the rental of any rooms, lodgings, or
accommodations furnished to transients for a consideration. This tax does not apply
to any private residence or cottage that is rented for less than 15 days in a
calendar year or to any room, lodging, or accommodation supplied to the same
person for a period of 90 or more continuous days.
As used in this subdivision, the
term "persons who rent to transients" means (i) owners of private
residences and cottages who rent to transients and (ii) rental agents,
including "real estate brokers" as defined in G.S. 93A‑2,
who rent private residences and cottages to transients on behalf of the owners.
If a rental agent is liable for the tax imposed by this subdivision, the owner
is not liable. A tax at the general rate applies to the sales price of
the rental of an accommodation to a transient and to other gross receipts
derived from the rental of an accommodation to a transient. The sales price of
the rental of an accommodation to a transient is determined as if the rental
were a service. An "accommodation" is a hotel room, a motel room, a
residence, a cottage, or a similar space for occupancy by an individual. The
tax does not apply to a residence or a cottage that is rented for less than 15
days in a calendar year or to an accommodation provided to the same person for
a period of 90 or more continuous days.
A person who provides an accommodation to a transient is considered a retailer under this Article. A person who, by written contract, agrees to be the rental agent for the provider of an accommodation is considered a retailer under this Article and is liable for the tax imposed by this subdivision. The liability of a rental agent for the tax imposed by this subdivision relieves the provider of the accommodation from liability. A rental agent includes a real estate broker, as defined in G.S. 93A‑2.
A person who, by written contract, is not the rental agent of the provider of an accommodation but is authorized by the provider to facilitate the rental of the accommodation and to charge a transient for the rental is considered a retailer under this Article for the purpose of determining the sales price of the accommodation. Accordingly, charges designated as facilitation fees or similar fees are considered charges necessary to complete the rental of the accommodation and are included in the sales price. A person who enters into a contract with the provider of an accommodation to a transient to facilitate the rental of an accommodation must report the sales price to the provider of the accommodation. The provider must remit tax on the sales price reported by the facilitator. A facilitator is not liable for tax due on the sales price reported to the provider. A facilitator that does not report the sales price to the provider or that understates the sales price reported to the provider is liable for tax due on the unreported or underreported sales price."
SECTION 2. G.S. 105‑164.4B is amended by adding a new subsection to read:
"(e) Accommodations. – The rental of a transient accommodation is sourced to the location of the accommodation."
SECTION 3. G.S. 153A‑155(c) reads as rewritten:
"(c) Collection. – Every operator of a business
subject to a room occupancy tax shall, on and after the effective date of the
levy of the tax, collect the tax. The tax shall be collected as part of the
charge for furnishing a taxable accommodation. A person who is required
to remit to the Department of Revenue the State sales tax on accommodations
imposed by G.S. 105‑164.4(a)(3) is required to remit a room
occupancy tax to the taxing county on and after the effective date of the levy
of the room occupancy tax. The room occupancy tax applies to the same gross
receipts as the State sales tax on accommodations and is calculated in the same
manner as that tax. A rental agent or a person who facilitates the rental of an
accommodation has the same responsibility and liability under the room
occupancy tax as the rental agent or facilitator has under the State sales tax
on accommodations.
If a taxable accommodation is furnished as part of a package,
the bundled transaction provisions in G.S. 105‑164.4D apply in
determining the sales price of the taxable accommodation. If those provisions
do not address the type of package offered, the operator person
offering the package may determine an allocated price for each item in the
package based on a reasonable allocation of revenue that is supported by the operator'sperson's
business records kept in the ordinary course of business and collect calculate
tax on the allocated price of the taxable accommodation.
The tax shall be stated and charged separately from the
sales records and shall be paid by the purchaser to the operator of the
business The provider of an accommodation must separately state the room
occupancy tax. Room occupancy taxes paid to a provider of an accommodation are
paid to the provider as trustee for and on account of the taxing county. The
tax shall be added to the sales price and shall be passed on to the purchaser
instead of being borne by the operator of the business.
The taxing county shall design, print, design and
furnish to all appropriate businesses and persons in the county the necessary
forms for filing returns and instructions to ensure the full collection of the
tax. An operator of a business A provider of accommodations who
collects a room occupancy tax may deduct from the amount remitted to the taxing
county a discount equal to the discount the State allows the operator provider
for State sales and use tax."
SECTION 4. G.S. 153A‑155(g) reads as rewritten:
"(g) Applicability. – Subsection (c) of this section
applies to all counties that levy an occupancy tax. To the extent subsection
(c) conflicts with any provision of a local act, subsection (c) supersedes that
provision. The remainder of this This section applies only to
Alleghany, Anson, Brunswick, Buncombe, Burke, Cabarrus, Camden, Carteret,
Caswell, Chatham, Cherokee, Chowan, Clay, Craven, Cumberland, Currituck, Dare,
Davie, Duplin, Durham, Forsyth, Franklin, Granville, Halifax, Haywood, Madison,
Martin, McDowell, Montgomery, Nash, New Hanover, New Hanover County District U,
Northampton, Pasquotank, Pender, Perquimans, Person, Randolph, Richmond,
Rockingham, Rowan, Sampson, Scotland, Stanly, Swain, Transylvania, Tyrrell,
Vance, Washington, and Wilson Counties, to Surry County District S, to Watauga
County District U, to Yadkin County District Y, and to the Township of
Averasboro in Harnett County and the Ocracoke Township Taxing District."
SECTION 5. G.S. 160A‑215(c) reads as rewritten:
"(c) Collection. – Every operator of a business
subject to a room occupancy tax shall, on and after the effective date of the
levy of the tax, collect the tax. The tax shall be collected as part of the
charge for furnishing a taxable accommodation. A person who is required
to remit to the Department of Revenue the State sales tax on accommodations
imposed by G.S. 105‑164.4(a)(3) is required to remit a room
occupancy tax to the taxing city on and after the effective date of the levy of
the room occupancy tax. The room occupancy tax applies to the same gross
receipts as the State sales tax on accommodations and is calculated in the same
manner as that tax. A rental agent or a person who facilitates the rental of an
accommodation has the same responsibility and liability under the room
occupancy tax as the rental agent or facilitator has under the State sales tax
on accommodations.
If a taxable accommodation is furnished as part of a package,
the bundled transaction provisions in G.S. 105‑164.4D apply in
determining the sales price of the taxable accommodation. If those provisions
do not address the type of package offered, the operator person
offering the package may determine an allocated price for each item in the
package based on a reasonable allocation of revenue that is supported by the operator'sperson's
business records kept in the ordinary course of business and collect calculate
tax on the allocated price of the taxable accommodation.
The tax shall be stated and charged separately from the
sales records and shall be paid by the purchaser to the operator of the
business The provider of an accommodation must separately state the room
occupancy tax. Room occupancy taxes paid to a provider of an accommodation are
paid to the provider as trustee for and on account of the taxing city. The
tax shall be added to the sales price and shall be passed on to the purchaser
instead of being borne by the operator of the business.
The taxing city shall design, print, design and
furnish to all appropriate businesses and persons in the city the necessary
forms for filing returns and instructions to ensure the full collection of the
tax. An operator of a business who collects a room occupancy tax may deduct
from the amount remitted to the taxing city a discount equal to the discount
the State allows the operator provider for State sales and use
tax."
SECTION 6. G.S. 160A‑215(g) reads as rewritten:
"(g) Applicability. – Subsection (c) of this section
applies to all cities that levy an occupancy tax. To the extent subsection (c)
conflicts with any provision of a local act, subsection (c) supersedes that
provision. The remainder of this This section applies only to Beech
Mountain District W, to the Cities of Belmont, Conover, Eden, Elizabeth City,
Gastonia, Goldsboro, Greensboro, Hickory, High Point, Jacksonville, Kings
Mountain, Lenoir, Lexington, Lincolnton, Lowell, Lumberton, Monroe, Mount Airy,
Mount Holly, Reidsville, Roanoke Rapids, Salisbury, Shelby, Statesville,
Washington, and Wilmington, to the Towns of Ahoskie, Beech Mountain, Benson,
Blowing Rock, Boiling Springs, Boone, Burgaw, Carolina Beach, Carrboro,
Cramerton, Dallas, Dobson, Elkin, Franklin, Jonesville, Kenly, Kure Beach,
Leland, McAdenville, Mooresville, Murfreesboro, North Topsail Beach, Pilot
Mountain, Ranlo, Selma, Smithfield, St. Pauls, Troutman, Tryon, West Jefferson,
Wilkesboro, Wrightsville Beach, Yadkinville, and Yanceyville, and to the
municipalities in Avery and Brunswick Counties."
SECTION 7. This act becomes effective January 1, 2011, and applies to gross receipts derived from accommodations provided on or after that date.
