HF 2204

as introduced - 90th Legislature (2017 - 2018) Posted on 03/07/2017 12:57pm

A bill for an act
relating to taxation; sales and use tax; providing an exemption for construction
materials used in state building projects; amending Minnesota Statutes 2016,
sections 297A.71, by adding a subdivision; 297A.75, subdivisions 1, 2.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

Minnesota Statutes 2016, section 297A.71, is amended by adding a subdivision
to read:

new text begin Subd. 49. new text end

new text begin State-owned capital projects. new text end

new text begin Material and supplies used in and equipment
incorporated into the construction and improvement of state-owned buildings and
infrastructure are exempt. The exemption applies at the time of sale for any qualifying
materials, supplies, or equipment purchased by the state or a state agency. For qualifying
purchases by a contractor, subcontractor, or builder, the tax must be imposed and collected
at the time of purchase as if the rate under section 297A.62 applied and refunded in the
manner provided under section 297A.75.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for sales and purchases made after June
30, 2017.
new text end

Sec. 2.

Minnesota Statutes 2016, section 297A.75, subdivision 1, is amended to read:

Subdivision 1.

Tax collected.

The tax on the gross receipts from the sale of the following
exempt items must be imposed and collected as if the sale were taxable and the rate under
section 297A.62, subdivision 1, applied. The exempt items include:

(1) building materials for an agricultural processing facility exempt under section
297A.71, subdivision 13;

(2) building materials for mineral production facilities exempt under section 297A.71,
subdivision 14;

(3) building materials for correctional facilities under section 297A.71, subdivision 3;

(4) building materials used in a residence for disabled veterans exempt under section
297A.71, subdivision 11;

(5) elevators and building materials exempt under section 297A.71, subdivision 12;

(6) materials and supplies for qualified low-income housing under section 297A.71,
subdivision 23;

(7) materials, supplies, and equipment for municipal electric utility facilities under
section 297A.71, subdivision 35;

(8) equipment and materials used for the generation, transmission, and distribution of
electrical energy and an aerial camera package exempt under section 297A.68, subdivision
37;

(9) commuter rail vehicle and repair parts under section 297A.70, subdivision 3, paragraph
(a), clause (10);

(10) materials, supplies, and equipment for construction or improvement of projects and
facilities under section 297A.71, subdivision 40;

(11) materials, supplies, and equipment for construction, improvement, or expansion
of:

(i) an aerospace defense manufacturing facility exempt under section 297A.71,
subdivision 42;

(ii) a biopharmaceutical manufacturing facility exempt under section 297A.71, subdivision
45;

(iii) a research and development facility exempt under section 297A.71, subdivision 46;
and

(iv) an industrial measurement manufacturing and controls facility exempt under section
297A.71, subdivision 47;

(12) enterprise information technology equipment and computer software for use in a
qualified data center exempt under section 297A.68, subdivision 42;

(13) materials, supplies, and equipment for qualifying capital projects under section
297A.71, deleted text begin subdivision deleted text end new text begin subdivisions new text end 44 new text begin and 49 new text end ;

(14) items purchased for use in providing critical access dental services exempt under
section 297A.70, subdivision 7, paragraph (c); and

(15) items and services purchased under a business subsidy agreement for use or
consumption primarily in greater Minnesota exempt under section 297A.68, subdivision
44.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for sales and purchases made after June
30, 2017.
new text end

Sec. 3.

Minnesota Statutes 2016, section 297A.75, subdivision 2, is amended to read:

Subd. 2.

Refund; eligible persons.

Upon application on forms prescribed by the
commissioner, a refund equal to the tax paid on the gross receipts of the exempt items must
be paid to the applicant. Only the following persons may apply for the refund:

(1) for subdivision 1, clauses (1), (2), and (14), the applicant must be the purchaser;

(2) for subdivision 1, clause (3), the applicant must be the governmental subdivision;

(3) for subdivision 1, clause (4), the applicant must be the recipient of the benefits
provided in United States Code, title 38, chapter 21;

(4) for subdivision 1, clause (5), the applicant must be the owner of the homestead
property;

(5) for subdivision 1, clause (6), the owner of the qualified low-income housing project;

(6) for subdivision 1, clause (7), the applicant must be a municipal electric utility or a
joint venture of municipal electric utilities;

(7) for subdivision 1, clauses (8), (11), (12), and (15), the owner of the qualifying
business; and

(8) for subdivision 1, clauses (9), (10), and (13), the applicant must be the governmental
entity new text begin or state agency new text end that owns or contracts for the project or facility.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for sales and purchases made after June
30, 2017.
new text end