Bill Text: OH HB285 | 2009-2010 | 128th General Assembly | Introduced

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Bill Title: To provide a three-day period in August and in December each year during which sales of clothing, footwear, school supplies, personal computers and computer-related items, and sporting equipment are exempt from sales and use taxes.

Sponsorship: Partisan Bill (Republican 11)

Status: (Introduced - Dead) 2009-09-29 - To Ways & Means [HB285 Detail]

Download: Ohio-2009-HB285-Introduced.html

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As Introduced

128th General Assembly Regular Session 2009-2010

H. B. No. 285

Representative Bacon 

Cosponsors: Representatives Wachtmann, Derickson, Ruhl, Grossman, Boose, Jordan, Uecker, Adams, J., Maag, Mandel 

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A BILL

To amend sections 5739.02 and 5739.05 of the Revised

1

Code to provide a three-day period in August and

2

in December each year during which sales of

3

clothing, footwear, school supplies, personal

4

computers and computer-related items, and sporting

5

equipment are exempt from sales and use taxes.

6

BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO:

Section 1. That sections 5739.02 and 5739.05 of the Revised	7
Code be amended to read as follows:	8

Sec. 5739.02.  For the purpose of providing revenue with	9
which to meet the needs of the state, for the use of the general	10
revenue fund of the state, for the purpose of securing a thorough	11
and efficient system of common schools throughout the state, for	12
the purpose of affording revenues, in addition to those from	13
general property taxes, permitted under constitutional	14
limitations, and from other sources, for the support of local	15
governmental functions, and for the purpose of reimbursing the	16
state for the expense of administering this chapter, an excise tax	17
is hereby levied on each retail sale made in this state.	18

(A)(1) The tax shall be collected as provided in section	19
5739.025 of the Revised Code. The rate of the tax shall be five	20
and one-half per cent. The tax applies and is collectible when	21
the sale is made, regardless of the time when the price is paid	22
or delivered.	23

(2) In the case of the lease or rental, with a fixed term of	24
more than thirty days or an indefinite term with a minimum period	25
of more than thirty days, of any motor vehicles designed by the	26
manufacturer to carry a load of not more than one ton, watercraft,	27
outboard motor, or aircraft, or of any tangible personal property,	28
other than motor vehicles designed by the manufacturer to carry a	29
load of more than one ton, to be used by the lessee or renter	30
primarily for business purposes, the tax shall be collected by the	31
vendor at the time the lease or rental is consummated and shall be	32
calculated by the vendor on the basis of the total amount to be	33
paid by the lessee or renter under the lease agreement. If the	34
total amount of the consideration for the lease or rental includes	35
amounts that are not calculated at the time the lease or rental is	36
executed, the tax shall be calculated and collected by the vendor	37
at the time such amounts are billed to the lessee or renter. In	38
the case of an open-end lease or rental, the tax shall be	39
calculated by the vendor on the basis of the total amount to be	40
paid during the initial fixed term of the lease or rental, and for	41
each subsequent renewal period as it comes due. As used in this	42
division, "motor vehicle" has the same meaning as in section	43
4501.01 of the Revised Code, and "watercraft" includes an outdrive	44
unit attached to the watercraft.	45

A lease with a renewal clause and a termination penalty or	46
similar provision that applies if the renewal clause is not	47
exercised is presumed to be a sham transaction. In such a case,	48
the tax shall be calculated and paid on the basis of the entire	49
length of the lease period, including any renewal periods, until	50
the termination penalty or similar provision no longer applies.	51
The taxpayer shall bear the burden, by a preponderance of the	52
evidence, that the transaction or series of transactions is not a	53
sham transaction.	54

(3) Except as provided in division (A)(2) of this section, in	55
the case of a sale, the price of which consists in whole or in	56
part of the lease or rental of tangible personal property, the tax	57
shall be measured by the installments of that lease or rental.	58

(4) In the case of a sale of a physical fitness facility	59
service or recreation and sports club service, the price of which	60
consists in whole or in part of a membership for the receipt of	61
the benefit of the service, the tax applicable to the sale shall	62
be measured by the installments thereof.	63

(B) The tax does not apply to the following:

64

(1) Sales to the state or any of its political subdivisions,	65
or to any other state or its political subdivisions if the laws of	66
that state exempt from taxation sales made to this state and its	67
political subdivisions;	68

(2) Sales of food for human consumption off the premises	69
where sold;	70

(3) Sales of food sold to students only in a cafeteria,	71
dormitory, fraternity, or sorority maintained in a private,	72
public, or parochial school, college, or university;	73

(4) Sales of newspapers and of magazine subscriptions and	74
sales or transfers of magazines distributed as controlled	75
circulation publications;	76

(5) The furnishing, preparing, or serving of meals without	77
charge by an employer to an employee provided the employer records	78
the meals as part compensation for services performed or work	79
done;	80

(6) Sales of motor fuel upon receipt, use, distribution, or	81
sale of which in this state a tax is imposed by the law of this	82
state, but this exemption shall not apply to the sale of motor	83
fuel on which a refund of the tax is allowable under division (A)	84
of section 5735.14 of the Revised Code; and the tax commissioner	85
may deduct the amount of tax levied by this section applicable to	86
the price of motor fuel when granting a refund of motor fuel tax	87
pursuant to division (A) of section 5735.14 of the Revised Code	88
and shall cause the amount deducted to be paid into the general	89
revenue fund of this state;	90

(7) Sales of natural gas by a natural gas company, of water	91
by a water-works company, or of steam by a heating company, if in	92
each case the thing sold is delivered to consumers through pipes	93
or conduits, and all sales of communications services by a	94
telegraph company, all terms as defined in section 5727.01 of the	95
Revised Code, and sales of electricity delivered through wires;	96

(8) Casual sales by a person, or auctioneer employed directly	97
by the person to conduct such sales, except as to such sales of	98
motor vehicles, watercraft or outboard motors required to be	99
titled under section 1548.06 of the Revised Code, watercraft	100
documented with the United States coast guard, snowmobiles, and	101
all-purpose vehicles as defined in section 4519.01 of the Revised	102
Code;	103

(9)(a) Sales of services or tangible personal property, other	104
than motor vehicles, mobile homes, and manufactured homes, by	105
churches, organizations exempt from taxation under section	106
501(c)(3) of the Internal Revenue Code of 1986, or nonprofit	107
organizations operated exclusively for charitable purposes as	108
defined in division (B)(12) of this section, provided that the	109
number of days on which such tangible personal property or	110
services, other than items never subject to the tax, are sold does	111
not exceed six in any calendar year, except as otherwise provided	112
in division (B)(9)(b) of this section. If the number of days on	113
which such sales are made exceeds six in any calendar year, the	114
church or organization shall be considered to be engaged in	115
business and all subsequent sales by it shall be subject to the	116
tax. In counting the number of days, all sales by groups within a	117
church or within an organization shall be considered to be sales	118
of that church or organization.	119

(b) The limitation on the number of days on which tax-exempt	120
sales may be made by a church or organization under division	121
(B)(9)(a) of this section does not apply to sales made by student	122
clubs and other groups of students of a primary or secondary	123
school, or a parent-teacher association, booster group, or similar	124
organization that raises money to support or fund curricular or	125
extracurricular activities of a primary or secondary school.	126

(c) Divisions (B)(9)(a) and (b) of this section do not apply	127
to sales by a noncommercial educational radio or television	128
broadcasting station.	129

(10) Sales not within the taxing power of this state under	130
the Constitution of the United States;	131

(11) Except for transactions that are sales under division	132
(B)(3)(r) of section 5739.01 of the Revised Code, the	133
transportation of persons or property, unless the transportation	134
is by a private investigation and security service;	135

(12) Sales of tangible personal property or services to	136
churches, to organizations exempt from taxation under section	137
501(c)(3) of the Internal Revenue Code of 1986, and to any other	138
nonprofit organizations operated exclusively for charitable	139
purposes in this state, no part of the net income of which inures	140
to the benefit of any private shareholder or individual, and no	141
substantial part of the activities of which consists of carrying	142
on propaganda or otherwise attempting to influence legislation;	143
sales to offices administering one or more homes for the aged or	144
one or more hospital facilities exempt under section 140.08 of the	145
Revised Code; and sales to organizations described in division (D)	146
of section 5709.12 of the Revised Code.	147

"Charitable purposes" means the relief of poverty; the	148
improvement of health through the alleviation of illness, disease,	149
or injury; the operation of an organization exclusively for the	150
provision of professional, laundry, printing, and purchasing	151
services to hospitals or charitable institutions; the operation of	152
a home for the aged, as defined in section 5701.13 of the Revised	153
Code; the operation of a radio or television broadcasting station	154
that is licensed by the federal communications commission as a	155
noncommercial educational radio or television station; the	156
operation of a nonprofit animal adoption service or a county	157
humane society; the promotion of education by an institution of	158
learning that maintains a faculty of qualified instructors,	159
teaches regular continuous courses of study, and confers a	160
recognized diploma upon completion of a specific curriculum; the	161
operation of a parent-teacher association, booster group, or	162
similar organization primarily engaged in the promotion and	163
support of the curricular or extracurricular activities of a	164
primary or secondary school; the operation of a community or area	165
center in which presentations in music, dramatics, the arts, and	166
related fields are made in order to foster public interest and	167
education therein; the production of performances in music,	168
dramatics, and the arts; or the promotion of education by an	169
organization engaged in carrying on research in, or the	170
dissemination of, scientific and technological knowledge and	171
information primarily for the public.	172

Nothing in this division shall be deemed to exempt sales to	173
any organization for use in the operation or carrying on of a	174
trade or business, or sales to a home for the aged for use in the	175
operation of independent living facilities as defined in division	176
(A) of section 5709.12 of the Revised Code.	177

(13) Building and construction materials and services sold to	178
construction contractors for incorporation into a structure or	179
improvement to real property under a construction contract with	180
this state or a political subdivision of this state, or with the	181
United States government or any of its agencies; building and	182
construction materials and services sold to construction	183
contractors for incorporation into a structure or improvement to	184
real property that are accepted for ownership by this state or any	185
of its political subdivisions, or by the United States government	186
or any of its agencies at the time of completion of the structures	187
or improvements; building and construction materials sold to	188
construction contractors for incorporation into a horticulture	189
structure or livestock structure for a person engaged in the	190
business of horticulture or producing livestock; building	191
materials and services sold to a construction contractor for	192
incorporation into a house of public worship or religious	193
education, or a building used exclusively for charitable purposes	194
under a construction contract with an organization whose purpose	195
is as described in division (B)(12) of this section; building	196
materials and services sold to a construction contractor for	197
incorporation into a building under a construction contract with	198
an organization exempt from taxation under section 501(c)(3) of	199
the Internal Revenue Code of 1986 when the building is to be used	200
exclusively for the organization's exempt purposes; building and	201
construction materials sold for incorporation into the original	202
construction of a sports facility under section 307.696 of the	203
Revised Code; and building and construction materials and services	204
sold to a construction contractor for incorporation into real	205
property outside this state if such materials and services, when	206
sold to a construction contractor in the state in which the real	207
property is located for incorporation into real property in that	208
state, would be exempt from a tax on sales levied by that state;	209

(14) Sales of ships or vessels or rail rolling stock used or	210
to be used principally in interstate or foreign commerce, and	211
repairs, alterations, fuel, and lubricants for such ships or	212
vessels or rail rolling stock;	213

(15) Sales to persons primarily engaged in any of the	214
activities mentioned in division (B)(42)(a) or (g) of this	215
section, to persons engaged in making retail sales, or to persons	216
who purchase for sale from a manufacturer tangible personal	217
property that was produced by the manufacturer in accordance with	218
specific designs provided by the purchaser, of packages, including	219
material, labels, and parts for packages, and of machinery,	220
equipment, and material for use primarily in packaging tangible	221
personal property produced for sale, including any machinery,	222
equipment, and supplies used to make labels or packages, to	223
prepare packages or products for labeling, or to label packages or	224
products, by or on the order of the person doing the packaging, or	225
sold at retail. "Packages" includes bags, baskets, cartons,	226
crates, boxes, cans, bottles, bindings, wrappings, and other	227
similar devices and containers, but does not include motor	228
vehicles or bulk tanks, trailers, or similar devices attached to	229
motor vehicles. "Packaging" means placing in a package. Division	230
(B)(15) of this section does not apply to persons engaged in	231
highway transportation for hire.	232

(16) Sales of food to persons using supplemental nutrition	233
assistance program benefits to purchase the food. As used in this	234
division, "food" has the same meaning as in 7 U.S.C. 2012 and	235
federal regulations adopted pursuant to the Food and Nutrition	236
Act of 2008.	237

(17) Sales to persons engaged in farming, agriculture,	238
horticulture, or floriculture, of tangible personal property for	239
use or consumption directly in the production by farming,	240
agriculture, horticulture, or floriculture of other tangible	241
personal property for use or consumption directly in the	242
production of tangible personal property for sale by farming,	243
agriculture, horticulture, or floriculture; or material and parts	244
for incorporation into any such tangible personal property for use	245
or consumption in production; and of tangible personal property	246
for such use or consumption in the conditioning or holding of	247
products produced by and for such use, consumption, or sale by	248
persons engaged in farming, agriculture, horticulture, or	249
floriculture, except where such property is incorporated into real	250
property;	251

(18) Sales of drugs for a human being that may be dispensed	252
only pursuant to a prescription; insulin as recognized in the	253
official United States pharmacopoeia; urine and blood testing	254
materials when used by diabetics or persons with hypoglycemia to	255
test for glucose or acetone; hypodermic syringes and needles when	256
used by diabetics for insulin injections; epoetin alfa when	257
purchased for use in the treatment of persons with medical	258
disease; hospital beds when purchased by hospitals, nursing homes,	259
or other medical facilities; and medical oxygen and medical	260
oxygen-dispensing equipment when purchased by hospitals, nursing	261
homes, or other medical facilities;	262

(19) Sales of prosthetic devices, durable medical equipment	263
for home use, or mobility enhancing equipment, when made pursuant	264
to a prescription and when such devices or equipment are for use	265
by a human being.	266

(20) Sales of emergency and fire protection vehicles and	267
equipment to nonprofit organizations for use solely in providing	268
fire protection and emergency services, including trauma care and	269
emergency medical services, for political subdivisions of the	270
state;	271

(21) Sales of tangible personal property manufactured in this	272
state, if sold by the manufacturer in this state to a retailer for	273
use in the retail business of the retailer outside of this state	274
and if possession is taken from the manufacturer by the purchaser	275
within this state for the sole purpose of immediately removing the	276
same from this state in a vehicle owned by the purchaser;	277

(22) Sales of services provided by the state or any of its	278
political subdivisions, agencies, instrumentalities, institutions,	279
or authorities, or by governmental entities of the state or any of	280
its political subdivisions, agencies, instrumentalities,	281
institutions, or authorities;	282

(23) Sales of motor vehicles to nonresidents of this state	283
under the circumstances described in division (B) of section	284
5739.029 of the Revised Code;	285

(24) Sales to persons engaged in the preparation of eggs for	286
sale of tangible personal property used or consumed directly in	287
such preparation, including such tangible personal property used	288
for cleaning, sanitizing, preserving, grading, sorting, and	289
classifying by size; packages, including material and parts for	290
packages, and machinery, equipment, and material for use in	291
packaging eggs for sale; and handling and transportation equipment	292
and parts therefor, except motor vehicles licensed to operate on	293
public highways, used in intraplant or interplant transfers or	294
shipment of eggs in the process of preparation for sale, when the	295
plant or plants within or between which such transfers or	296
shipments occur are operated by the same person. "Packages"	297
includes containers, cases, baskets, flats, fillers, filler flats,	298
cartons, closure materials, labels, and labeling materials, and	299
"packaging" means placing therein.	300

(25)(a) Sales of water to a consumer for residential use,	301
except the sale of bottled water, distilled water, mineral water,	302
carbonated water, or ice;	303

(b) Sales of water by a nonprofit corporation engaged	304
exclusively in the treatment, distribution, and sale of water to	305
consumers, if such water is delivered to consumers through pipes	306
or tubing.	307

(26) Fees charged for inspection or reinspection of motor	308
vehicles under section 3704.14 of the Revised Code;	309

(27) Sales to persons licensed to conduct a food service	310
operation pursuant to section 3717.43 of the Revised Code, of	311
tangible personal property primarily used directly for the	312
following:	313

(a) To prepare food for human consumption for sale;

314

(b) To preserve food that has been or will be prepared for	315
human consumption for sale by the food service operator, not	316
including tangible personal property used to display food for	317
selection by the consumer;	318

(c) To clean tangible personal property used to prepare or	319
serve food for human consumption for sale.	320

(28) Sales of animals by nonprofit animal adoption services	321
or county humane societies;	322

(29) Sales of services to a corporation described in division	323
(A) of section 5709.72 of the Revised Code, and sales of tangible	324
personal property that qualifies for exemption from taxation under	325
section 5709.72 of the Revised Code;	326

(30) Sales and installation of agricultural land tile, as	327
defined in division (B)(5)(a) of section 5739.01 of the Revised	328
Code;	329

(31) Sales and erection or installation of portable grain	330
bins, as defined in division (B)(5)(b) of section 5739.01 of the	331
Revised Code;	332

(32) The sale, lease, repair, and maintenance of, parts for,	333
or items attached to or incorporated in, motor vehicles that are	334
primarily used for transporting tangible personal property	335
belonging to others by a person engaged in highway transportation	336
for hire, except for packages and packaging used for the	337
transportation of tangible personal property;	338

(33) Sales to the state headquarters of any veterans'	339
organization in this state that is either incorporated and issued	340
a charter by the congress of the United States or is recognized by	341
the United States veterans administration, for use by the	342
headquarters;	343

(34) Sales to a telecommunications service vendor, mobile	344
telecommunications service vendor, or satellite broadcasting	345
service vendor of tangible personal property and services used	346
directly and primarily in transmitting, receiving, switching, or	347
recording any interactive, one- or two-way electromagnetic	348
communications, including voice, image, data, and information,	349
through the use of any medium, including, but not limited to,	350
poles, wires, cables, switching equipment, computers, and record	351
storage devices and media, and component parts for the tangible	352
personal property. The exemption provided in this division shall	353
be in lieu of all other exemptions under division (B)(42)(a) of	354
this section to which the vendor may otherwise be entitled, based	355
upon the use of the thing purchased in providing the	356
telecommunications, mobile telecommunications, or satellite	357
broadcasting service.	358

(35)(a) Sales where the purpose of the consumer is to use or	359
consume the things transferred in making retail sales and	360
consisting of newspaper inserts, catalogues, coupons, flyers, gift	361
certificates, or other advertising material that prices and	362
describes tangible personal property offered for retail sale.	363

(b) Sales to direct marketing vendors of preliminary	364
materials such as photographs, artwork, and typesetting that will	365
be used in printing advertising material; of printed matter that	366
offers free merchandise or chances to win sweepstake prizes and	367
that is mailed to potential customers with advertising material	368
described in division (B)(35)(a) of this section; and of equipment	369
such as telephones, computers, facsimile machines, and similar	370
tangible personal property primarily used to accept orders for	371
direct marketing retail sales.	372

(c) Sales of automatic food vending machines that preserve	373
food with a shelf life of forty-five days or less by refrigeration	374
and dispense it to the consumer.	375

For purposes of division (B)(35) of this section, "direct	376
marketing" means the method of selling where consumers order	377
tangible personal property by United States mail, delivery	378
service, or telecommunication and the vendor delivers or ships the	379
tangible personal property sold to the consumer from a warehouse,	380
catalogue distribution center, or similar fulfillment facility by	381
means of the United States mail, delivery service, or common	382
carrier.	383

(36) Sales to a person engaged in the business of	384
horticulture or producing livestock of materials to be	385
incorporated into a horticulture structure or livestock structure;	386

(37) Sales of personal computers, computer monitors, computer	387
keyboards, modems, and other peripheral computer equipment to an	388
individual who is licensed or certified to teach in an elementary	389
or a secondary school in this state for use by that individual in	390
preparation for teaching elementary or secondary school students;	391

(38) Sales to a professional racing team of any of the	392
following:	393

(a) Motor racing vehicles;

394

(b) Repair services for motor racing vehicles;

395

(c) Items of property that are attached to or incorporated in	396
motor racing vehicles, including engines, chassis, and all other	397
components of the vehicles, and all spare, replacement, and	398
rebuilt parts or components of the vehicles; except not including	399
tires, consumable fluids, paint, and accessories consisting of	400
instrumentation sensors and related items added to the vehicle to	401
collect and transmit data by means of telemetry and other forms of	402
communication.	403

(39) Sales of used manufactured homes and used mobile homes,	404
as defined in section 5739.0210 of the Revised Code, made on or	405
after January 1, 2000;	406

(40) Sales of tangible personal property and services to a	407
provider of electricity used or consumed directly and primarily in	408
generating, transmitting, or distributing electricity for use by	409
others, including property that is or is to be incorporated into	410
and will become a part of the consumer's production, transmission,	411
or distribution system and that retains its classification as	412
tangible personal property after incorporation; fuel or power used	413
in the production, transmission, or distribution of electricity;	414
and tangible personal property and services used in the repair and	415
maintenance of the production, transmission, or distribution	416
system, including only those motor vehicles as are specially	417
designed and equipped for such use. The exemption provided in this	418
division shall be in lieu of all other exemptions in division	419
(B)(42)(a) of this section to which a provider of electricity may	420
otherwise be entitled based on the use of the tangible personal	421
property or service purchased in generating, transmitting, or	422
distributing electricity.	423

(41) Sales to a person providing services under division	424
(B)(3)(r) of section 5739.01 of the Revised Code of tangible	425
personal property and services used directly and primarily in	426
providing taxable services under that section.	427

(42) Sales where the purpose of the purchaser is to do any of	428
the following:	429

(a) To incorporate the thing transferred as a material or a	430
part into tangible personal property to be produced for sale by	431
manufacturing, assembling, processing, or refining; or to use or	432
consume the thing transferred directly in producing tangible	433
personal property for sale by mining, including, without	434
limitation, the extraction from the earth of all substances that	435
are classed geologically as minerals, production of crude oil and	436
natural gas, farming, agriculture, horticulture, or floriculture,	437
or directly in the rendition of a public utility service, except	438
that the sales tax levied by this section shall be collected upon	439
all meals, drinks, and food for human consumption sold when	440
transporting persons. Persons engaged in rendering farming,	441
agricultural, horticultural, or floricultural services, and	442
services in the exploration for, and production of, crude oil and	443
natural gas, for others are deemed engaged directly in farming,	444
agriculture, horticulture, and floriculture, or exploration for,	445
and production of, crude oil and natural gas. This paragraph does	446
not exempt from "retail sale" or "sales at retail" the sale of	447
tangible personal property that is to be incorporated into a	448
structure or improvement to real property.	449

(b) To hold the thing transferred as security for the	450
performance of an obligation of the vendor;	451

(c) To resell, hold, use, or consume the thing transferred as	452
evidence of a contract of insurance;	453

(d) To use or consume the thing directly in commercial	454
fishing;	455

(e) To incorporate the thing transferred as a material or a	456
part into, or to use or consume the thing transferred directly in	457
the production of, magazines distributed as controlled circulation	458
publications;	459

(f) To use or consume the thing transferred in the production	460
and preparation in suitable condition for market and sale of	461
printed, imprinted, overprinted, lithographic, multilithic,	462
blueprinted, photostatic, or other productions or reproductions of	463
written or graphic matter;	464

(g) To use the thing transferred, as described in section	465
5739.011 of the Revised Code, primarily in a manufacturing	466
operation to produce tangible personal property for sale;	467

(h) To use the benefit of a warranty, maintenance or service	468
contract, or similar agreement, as described in division (B)(7) of	469
section 5739.01 of the Revised Code, to repair or maintain	470
tangible personal property, if all of the property that is the	471
subject of the warranty, contract, or agreement would not be	472
subject to the tax imposed by this section;	473

(i) To use the thing transferred as qualified research and	474
development equipment;	475

(j) To use or consume the thing transferred primarily in	476
storing, transporting, mailing, or otherwise handling purchased	477
sales inventory in a warehouse, distribution center, or similar	478
facility when the inventory is primarily distributed outside this	479
state to retail stores of the person who owns or controls the	480
warehouse, distribution center, or similar facility, to retail	481
stores of an affiliated group of which that person is a member, or	482
by means of direct marketing. This division does not apply to	483
motor vehicles registered for operation on the public highways. As	484
used in this division, "affiliated group" has the same meaning as	485
in division (B)(3)(e) of section 5739.01 of the Revised Code and	486
"direct marketing" has the same meaning as in division (B)(35) of	487
this section.	488

(k) To use or consume the thing transferred to fulfill a	489
contractual obligation incurred by a warrantor pursuant to a	490
warranty provided as a part of the price of the tangible personal	491
property sold or by a vendor of a warranty, maintenance or service	492
contract, or similar agreement the provision of which is defined	493
as a sale under division (B)(7) of section 5739.01 of the Revised	494
Code;	495

(l) To use or consume the thing transferred in the production	496
of a newspaper for distribution to the public;	497

(m) To use tangible personal property to perform a service	498
listed in division (B)(3) of section 5739.01 of the Revised Code,	499
if the property is or is to be permanently transferred to the	500
consumer of the service as an integral part of the performance of	501
the service;	502

(n) To use or consume the thing transferred in acquiring,	503
formatting, editing, storing, and disseminating data or	504
information by electronic publishing.	505

As used in division (B)(42) of this section, "thing" includes	506
all transactions included in divisions (B)(3)(a), (b), and (e) of	507
section 5739.01 of the Revised Code.	508

(43) Sales conducted through a coin operated device that	509
activates vacuum equipment or equipment that dispenses water,	510
whether or not in combination with soap or other cleaning agents	511
or wax, to the consumer for the consumer's use on the premises in	512
washing, cleaning, or waxing a motor vehicle, provided no other	513
personal property or personal service is provided as part of the	514
transaction.	515

(44) Sales of replacement and modification parts for engines,	516
airframes, instruments, and interiors in, and paint for, aircraft	517
used primarily in a fractional aircraft ownership program, and	518
sales of services for the repair, modification, and maintenance of	519
such aircraft, and machinery, equipment, and supplies primarily	520
used to provide those services.	521

(45) Sales of telecommunications service that is used	522
directly and primarily to perform the functions of a call center.	523
As used in this division, "call center" means any physical	524
location where telephone calls are placed or received in high	525
volume for the purpose of making sales, marketing, customer	526
service, technical support, or other specialized business	527
activity, and that employs at least fifty individuals that engage	528
in call center activities on a full-time basis, or sufficient	529
individuals to fill fifty full-time equivalent positions.	530

(46) Sales by a telecommunications service vendor of 900	531
service to a subscriber. This division does not apply to	532
information services, as defined in division (FF) of section	533
5739.01 of the Revised Code.	534

(47) Sales of value-added non-voice data service. This	535
division does not apply to any similar service that is not	536
otherwise a telecommunications service.	537

(48)(a) Sales of machinery, equipment, and software to a	538
qualified direct selling entity for use in a warehouse or	539
distribution center primarily for storing, transporting, or	540
otherwise handling inventory that is held for sale to independent	541
salespersons who operate as direct sellers and that is held	542
primarily for distribution outside this state;	543

(b) As used in division (B)(48)(a) of this section:

544

(i) "Direct seller" means a person selling consumer products	545
to individuals for personal or household use and not from a fixed	546
retail location, including selling such product at in-home product	547
demonstrations, parties, and other one-on-one selling.	548

(ii) "Qualified direct selling entity" means an entity	549
selling to direct sellers at the time the entity enters into a tax	550
credit agreement with the tax credit authority pursuant to section	551
122.17 of the Revised Code, provided that the agreement was	552
entered into on or after January 1, 2007. Neither contingencies	553
relevant to the granting of, nor later developments with respect	554
to, the tax credit shall impair the status of the qualified direct	555
selling entity under division (B)(48) of this section after	556
execution of the tax credit agreement by the tax credit authority.	557

(c) Division (B)(48) of this section is limited to machinery,	558
equipment, and software first stored, used, or consumed in this	559
state within the period commencing June 24, 2008, and ending on	560
the date that is five years after that date.	561

(49) Sales of materials, parts, equipment, or engines used	562
in the repair or maintenance of aircraft or avionics systems of	563
such aircraft, and sales of repair, remodeling, replacement, or	564
maintenance services in this state performed on aircraft or on	565
an aircraft's avionics, engine, or component materials or parts.	566
As used in division (B)(49) of this section, "aircraft" means	567
aircraft of more than six thousand pounds maximum certified	568
takeoff weight or used exclusively in general aviation.	569

(50) Sales of full flight simulators that are used for pilot	570
or flight-crew training, sales of repair or replacement parts or	571
components, and sales of repair or maintenance services for such	572
full flight simulators. "Full flight simulator" means a replica	573
of a specific type, or make, model, and series of aircraft	574
cockpit. It includes the assemblage of equipment and computer	575
programs necessary to represent aircraft operations in ground and	576
flight conditions, a visual system providing an	577
out-of-the-cockpit view, and a system that provides cues at	578
least equivalent to those of a three-degree-of-freedom motion	579
system, and has the full range of capabilities of the systems	580
installed in the device as described in appendices A and B of	581
part 60 of chapter 1 of title 14 of the Code of Federal	582
Regulations.	583

(51)(a) Sales of the following occurring during the three-day	584
periods that include the first Friday, Saturday, and Sunday in	585
August and in December each year beginning in 2010:	586

(i) An article of clothing or footwear intended to be worn on	587
or about the human body, the price of which does not exceed two	588
hundred fifty dollars;	589

(ii) An item of school supplies, the price of which does not	590
exceed one hundred fifty dollars;	591

(iii) A personal computer system, the price of which does not	592
exceed three thousand five hundred dollars;	593

(iv) Personal computer-related software and peripherals the	594
price of which does not exceed three thousand five hundred	595
dollars;	596

(v) An item of sporting equipment, the price of which does	597
not exceed two hundred fifty dollars.	598

(b) The lease or rental of clothing, footwear, school	599
supplies, a personal computer system, personal computer-related	600
software and peripherals, or sporting equipment or the sale of	601
such items for use in a trade or business does not qualify for	602
exemption under division (B)(51) of this section.	603

(c) As used in division (B)(51) of this section:

604

(i) "Clothing or footwear" does not include jewelry, watches,	605
handbags, wallets, or umbrellas.	606

(ii) "School supplies" means pens, pencils, binders,	607
notebooks, reference books, book bags, lunch boxes, calculators,	608
and similar items. "School supplies" does not include furniture or	609
school instructional material.	610

(iii) "Personal computer system" means all computer hardware	611
and software sold together in the same retail transaction,	612
including a central processing unit, storage drive, display	613
monitor, keyboard, random access memory, and printer. "Personal	614
computer system" does not include minicomputers, mainframe	615
computers, network servers, local area network hubs, routers and	616
cabling, hardware word processors, personal digital assistants,	617
graphical calculators, hand-held computers, game consoles,	618
internet television devices, network operating systems,	619
multiple-user licensed software and hardware, separate sales or	620
use of internal or external components, or separate sales of	621
add-on components.	622

(iv) "Sporting equipment" means clothing, footwear, or	623
equipment designed primarily for athletic activity or protective	624
use during participation in the athletic activity for which it is	625
designed.	626

(C) For the purpose of the proper administration of this	627
chapter, and to prevent the evasion of the tax, it is presumed	628
that all sales made in this state are subject to the tax until the	629
contrary is established.	630

(D) The levy of this tax on retail sales of recreation and	631
sports club service shall not prevent a municipal corporation	632
from levying any tax on recreation and sports club dues or on any	633
income generated by recreation and sports club dues.	634

(E) The tax collected by the vendor from the consumer under	635
this chapter is not part of the price, but is a tax collection for	636
the benefit of the state, and of counties levying an additional	637
sales tax pursuant to section 5739.021 or 5739.026 of the Revised	638
Code and of transit authorities levying an additional sales tax	639
pursuant to section 5739.023 of the Revised Code. Except for the	640
discount authorized under section 5739.12 of the Revised Code and	641
the effects of any rounding pursuant to section 5703.055 of the	642
Revised Code, no person other than the state or such a county or	643
transit authority shall derive any benefit from the collection or	644
payment of the tax levied by this section or section 5739.021,	645
5739.023, or 5739.026 of the Revised Code.	646

Sec. 5739.05.  (A)(1) The tax commissioner shall enforce and	647
administer sections 5739.01 to 5739.31 of the Revised Code, which	648
are hereby declared to be sections whichthat the commissioner is	649
required to administer within the meaning of sections 5703.17 to	650
5703.37, 5703.39, 5703.41, and 5703.45 of the Revised Code. The	651
commissioner may adopt and promulgate, in accordance with sections	652
119.01 to 119.13 of the Revised Code, such rules as the	653
commissioner deems necessary to administer sections 5739.01 to	654
5739.31 of the Revised Code.	655

(2) The commissioner, in accordance with section 5703.14 of	656
the Revised Code, shall adopt rules necessary to implement the	657
three-day tax exemption periods provided by division (B)(51) of	658
section 5739.02 of the Revised Code. Before each exemption period	659
required under that division, the commissioner shall make	660
available to vendors informational bulletins explaining the	661
exemption.	662

(B) Upon application, the commissioner may authorize a vendor	663
to pay on a predetermined basis the tax levied by or pursuant to	664
section 5739.02, 5739.021, 5739.023, or 5739.026 of the Revised	665
Code upon sales of things produced or distributed or services	666
provided by such vendor, and the commissioner may waive the	667
collection of the tax from the consumer. The commissioner shall	668
not grant such authority unless the commissioner finds that the	669
granting of the authority would improve compliance and increase	670
the efficiency of the administration of the tax. The person to	671
whom such authority is granted shall post a notice, if required by	672
the commissioner, at the location where the product is offered for	673
sale, that the tax is included in the selling price. The	674
comissionercommissioner may adopt rules to administer this	675
division.	676

(C) The commissioner may authorize a vendor to pay, on the	677
basis of a prearranged agreement under this division, the tax	678
levied by section 5739.02 or pursuant to section 5739.021,	679
5739.023, or 5739.026 of the Revised Code, and waive the	680
requirement that the vendor maintain the complete and accurate	681
record of individual taxable sales and tax collected thereon	682
required by section 5739.11 of the Revised Code, upon application	683
of the vendor, if the commissioner finds that the conditions of	684
the vendor-applicant's business are such that the maintenance of	685
such records of individual taxable sales and tax collected thereon	686
would impose an unreasonable burden upon the vendor. If the	687
commissioner determines that such unreasonable burden has been	688
imposed, the vendor and the commissioner shall agree to the terms	689
and conditions of a test check to be conducted. If the parties are	690
unable to agree to the terms and conditions of the test check, the	691
application shall be denied. The test check conducted shall	692
determine the proportion that taxable retail sales bear to all of	693
the vendor's retail sales and the ratio which the tax required to	694
be collected under sections 5739.02, 5739.021, and 5739.023 of the	695
Revised Code bears to the receipts from the vendor's taxable	696
retail sales.	697

The vendor shall collect the tax on the vendor's taxable	698
sales and the vendor's liability for collecting or remitting shall	699
be based upon the proportions and ratios established by the test	700
check, and not upon any other basis of determination, until such	701
time as a subsequent test check is made at the request of either	702
the vendor or the commissioner where either party believes that	703
the nature of the vendor's business has so changed as to make the	704
prior or existing test check no longer representative. The	705
commissioner may give notice to the vendor at any time that the	706
authorization is revoked or the vendor may notify the commissioner	707
that the vendor no longer elects to report under the	708
authorization. Such notice shall be delivered to the other party	709
personally or by registered mail. The revocation or cancellation	710
is not effective prior to the date of receipt of such notice.	711

Section 2. That existing sections 5739.02 and 5739.05 of the	712
Revised Code are hereby repealed.	713