HF 2586

as introduced - 81st Legislature (1999 - 2000) Posted on 12/15/2009 12:00am

  1.1                          A bill for an act 
  1.2             relating to taxation; providing that sales of certain 
  1.3             fruit, vegetables, milk, milk products, juice, juice 
  1.4             products, and other items sold through vending 
  1.5             machines are exempt from the sales tax; amending 
  1.6             Minnesota Statutes 1998, section 297A.01, subdivision 
  1.7             3. 
  1.8   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.9      Section 1.  Minnesota Statutes 1998, section 297A.01, 
  1.10  subdivision 3, is amended to read: 
  1.11     Subd. 3.  A "sale" and a "purchase" includes, but is not 
  1.12  limited to, each of the following transactions: 
  1.13     (a) Any transfer of title or possession, or both, of 
  1.14  tangible personal property, whether absolutely or conditionally, 
  1.15  and the leasing of or the granting of a license to use or 
  1.16  consume tangible personal property other than manufactured homes 
  1.17  used for residential purposes for a continuous period of 30 days 
  1.18  or more, for a consideration in money or by exchange or barter; 
  1.19     (b) The production, fabrication, printing, or processing of 
  1.20  tangible personal property for a consideration for consumers who 
  1.21  furnish either directly or indirectly the materials used in the 
  1.22  production, fabrication, printing, or processing; 
  1.23     (c) The furnishing, preparing, or serving for a 
  1.24  consideration of food, meals, or drinks.  "Sale" or "purchase" 
  1.25  does not include: 
  1.26     (1) meals or drinks served to patients, inmates, or persons 
  2.1   residing at hospitals, sanitariums, nursing homes, senior 
  2.2   citizens homes, and correctional, detention, and detoxification 
  2.3   facilities; 
  2.4      (2) meals or drinks purchased for and served exclusively to 
  2.5   individuals who are 60 years of age or over and their spouses or 
  2.6   to the handicapped and their spouses by governmental agencies, 
  2.7   nonprofit organizations, agencies, or churches or pursuant to 
  2.8   any program funded in whole or part through 42 USCA sections 
  2.9   3001 through 3045, wherever delivered, prepared or served; or 
  2.10     (3) meals and lunches served at public and private schools, 
  2.11  universities, or colleges. 
  2.12  Notwithstanding section 297A.25, subdivision 2, taxable food or 
  2.13  meals include, but are not limited to, the following:  
  2.14     (i) food or drinks sold by the retailer for immediate 
  2.15  consumption on the retailer's premises.  Food and drinks sold 
  2.16  within a building or grounds which require an admission charge 
  2.17  for entrance are presumed to be sold for consumption on the 
  2.18  premises; 
  2.19     (ii) food or drinks prepared by the retailer for immediate 
  2.20  consumption either on or off the retailer's premises.  For 
  2.21  purposes of this subdivision, "food or drinks prepared for 
  2.22  immediate consumption" includes any food product upon which an 
  2.23  act of preparation including, but not limited to, cooking, 
  2.24  mixing, sandwich making, blending, heating, or pouring has been 
  2.25  performed by the retailer so the food product may be immediately 
  2.26  consumed by the purchaser; 
  2.27     (iii) ice cream, ice milk, frozen yogurt products, or 
  2.28  frozen novelties sold in single or individual servings including 
  2.29  cones, sundaes, and snow cones.  For purposes of this 
  2.30  subdivision, "single or individual servings" does not include 
  2.31  products when sold in bulk containers or bulk packaging; 
  2.32     (iv) soft drinks and other beverages including all 
  2.33  carbonated and noncarbonated beverages or drinks sold in liquid 
  2.34  form except beverages or drinks which contain milk or milk 
  2.35  products, beverages or drinks containing 15 or more percent 
  2.36  fruit juice, and noncarbonated and noneffervescent bottled water 
  3.1   sold in individual containers of one-half gallon or more in 
  3.2   size; 
  3.3      (v) gum, candy, and candy products, except when sold for 
  3.4   fundraising purposes by a nonprofit organization that provides 
  3.5   educational and social activities primarily for young people 18 
  3.6   years of age and under; 
  3.7      (vi) ice; 
  3.8      (vii) all food sold from vending machines, except: 
  3.9      (A) beverages or drinks which contain milk or milk 
  3.10  products; 
  3.11     (B) beverages or drinks containing 15 or more percent fruit 
  3.12  juice; 
  3.13     (C) fresh fruit and canned fruit; 
  3.14     (D) vegetables; 
  3.15     (E) granola bars and fruit-filled breakfast bars; 
  3.16     (F) yogurt and pudding; and 
  3.17     (G) cheese and cottage cheese; 
  3.18     (viii) all food for immediate consumption sold from 
  3.19  concession stands and vehicles; 
  3.20     (ix) party trays; 
  3.21     (x) all meals and single servings of packaged snack food 
  3.22  sold in restaurants and bars; and 
  3.23     (xi) bakery products: 
  3.24     (A) prepared by the retailer for consumption on the 
  3.25  retailer's premises; 
  3.26     (B) sold at a place that charges admission; 
  3.27     (C) sold from vending machines; or 
  3.28     (D) sold in single or individual servings from concession 
  3.29  stands, vehicles, bars, and restaurants.  For purposes of this 
  3.30  subdivision, "single or individual servings" does not include 
  3.31  products when sold in bulk containers or bulk packaging.  
  3.32     For purposes of this subdivision, "premises" means the 
  3.33  total space and facilities, including buildings, grounds, and 
  3.34  parking lots that are made available or that are available for 
  3.35  use by the retailer or customer for the purpose of sale or 
  3.36  consumption of prepared food and drinks.  The premises of a 
  4.1   caterer is the place where the catered food or drinks are 
  4.2   served; 
  4.3      (d) The granting of the privilege of admission to places of 
  4.4   amusement, recreational areas, or athletic events, except a 
  4.5   world championship football game sponsored by the national 
  4.6   football league, and the privilege of having access to and the 
  4.7   use of amusement devices, tanning facilities, reducing salons, 
  4.8   steam baths, turkish baths, health clubs, and spas or athletic 
  4.9   facilities; 
  4.10     (e) The furnishing for a consideration of lodging and 
  4.11  related services by a hotel, rooming house, tourist court, motel 
  4.12  or trailer camp and of the granting of any similar license to 
  4.13  use real property other than the renting or leasing thereof for 
  4.14  a continuous period of 30 days or more; 
  4.15     (f) The furnishing for a consideration of electricity, gas, 
  4.16  water, or steam for use or consumption within this state, or 
  4.17  local exchange telephone service, intrastate toll service, and 
  4.18  interstate toll service, if that service originates from and is 
  4.19  charged to a telephone located in this state.  Telephone service 
  4.20  does not include services purchased with prepaid telephone 
  4.21  calling cards.  Telephone service includes paging services and 
  4.22  private communication service, as defined in United States Code, 
  4.23  title 26, section 4252(d), as amended through December 31, 1991, 
  4.24  except for private communication service purchased by an agent 
  4.25  acting on behalf of the state lottery.  The furnishing for a 
  4.26  consideration of access to telephone services by a hotel to its 
  4.27  guests is a sale under this clause.  Sales by municipal 
  4.28  corporations in a proprietary capacity are included in the 
  4.29  provisions of this clause.  The furnishing of water and sewer 
  4.30  services for residential use shall not be considered a sale.  
  4.31  The sale of natural gas to be used as a fuel in vehicles 
  4.32  propelled by natural gas shall not be considered a sale for the 
  4.33  purposes of this section; 
  4.34     (g) The furnishing for a consideration of cable television 
  4.35  services, including charges for basic service, charges for 
  4.36  premium service, and any other charges for any other 
  5.1   pay-per-view, monthly, or similar television services; 
  5.2      (h) The furnishing for a consideration of parking services, 
  5.3   whether on a contractual, hourly, or other periodic basis, 
  5.4   except for parking at a meter; 
  5.5      (i) The furnishing for a consideration of services listed 
  5.6   in this paragraph: 
  5.7      (i) (1) laundry and dry cleaning services including 
  5.8   cleaning, pressing, repairing, altering, and storing clothes, 
  5.9   linen services and supply, cleaning and blocking hats, and 
  5.10  carpet, drapery, upholstery, and industrial cleaning.  Laundry 
  5.11  and dry cleaning services do not include services provided by 
  5.12  coin operated facilities operated by the customer; 
  5.13     (ii) (2) motor vehicle washing, waxing, and cleaning 
  5.14  services, including services provided by coin-operated 
  5.15  facilities operated by the customer, and rustproofing, 
  5.16  undercoating, and towing of motor vehicles; 
  5.17     (iii) (3) building and residential cleaning, maintenance, 
  5.18  and disinfecting and exterminating services; 
  5.19     (iv) (4) detective services, security services, burglar, 
  5.20  fire alarm, and armored car services; but not including services 
  5.21  performed within the jurisdiction they serve by off-duty 
  5.22  licensed peace officers as defined in section 626.84, 
  5.23  subdivision 1, or services provided by a nonprofit organization 
  5.24  for monitoring and electronic surveillance of persons placed on 
  5.25  in-home detention pursuant to court order or under the direction 
  5.26  of the Minnesota department of corrections; 
  5.27     (v) (5) pet grooming services; 
  5.28     (vi) (6) lawn care, fertilizing, mowing, spraying and 
  5.29  sprigging services; garden planting and maintenance; tree, bush, 
  5.30  and shrub pruning, bracing, spraying, and surgery; indoor plant 
  5.31  care; tree, bush, shrub and stump removal; and tree trimming for 
  5.32  public utility lines.  Services performed under a construction 
  5.33  contract for the installation of shrubbery, plants, sod, trees, 
  5.34  bushes, and similar items are not taxable; 
  5.35     (vii) (7) massages, except when provided by a licensed 
  5.36  health care facility or professional or upon written referral 
  6.1   from a licensed health care facility or professional for 
  6.2   treatment of illness, injury, or disease; and 
  6.3      (viii) (8) the furnishing for consideration of lodging, 
  6.4   board and care services for animals in kennels and other similar 
  6.5   arrangements, but excluding veterinary and horse boarding 
  6.6   services. 
  6.7   The services listed in this paragraph are taxable under section 
  6.8   297A.02 if the service is performed wholly within Minnesota or 
  6.9   if the service is performed partly within and partly without 
  6.10  Minnesota and the greater proportion of the service is performed 
  6.11  in Minnesota, based on the cost of performance.  In applying the 
  6.12  provisions of this chapter, the terms "tangible personal 
  6.13  property" and "sales at retail" include taxable services and the 
  6.14  provision of taxable services, unless specifically provided 
  6.15  otherwise.  Services performed by an employee for an employer 
  6.16  are not taxable under this paragraph.  Services performed by a 
  6.17  partnership or association for another partnership or 
  6.18  association are not taxable under this paragraph if one of the 
  6.19  entities owns or controls more than 80 percent of the voting 
  6.20  power of the equity interest in the other entity.  Services 
  6.21  performed between members of an affiliated group of corporations 
  6.22  are not taxable.  For purposes of this section, "affiliated 
  6.23  group of corporations" includes those entities that would be 
  6.24  classified as a member of an affiliated group under United 
  6.25  States Code, title 26, section 1504, as amended through December 
  6.26  31, 1987, and who are eligible to file a consolidated tax return 
  6.27  for federal income tax purposes; 
  6.28     (j) A "sale" and a "purchase" includes the transfer of 
  6.29  computer software, meaning information and directions that 
  6.30  dictate the function performed by data processing equipment.  A 
  6.31  "sale" and a "purchase" does not include the design, 
  6.32  development, writing, translation, fabrication, lease, or 
  6.33  transfer for a consideration of title or possession of a custom 
  6.34  computer program; and 
  6.35     (k) The granting of membership in a club, association, or 
  6.36  other organization if: 
  7.1      (1) the club, association, or other organization makes 
  7.2   available for the use of its members sports and athletic 
  7.3   facilities (without regard to whether a separate charge is 
  7.4   assessed for use of the facilities); and 
  7.5      (2) use of the sports and athletic facilities is not made 
  7.6   available to the general public on the same basis as it is made 
  7.7   available to members.  
  7.8   Granting of membership includes both one-time initiation fees 
  7.9   and periodic membership dues.  Sports and athletic facilities 
  7.10  include golf courses, tennis, racquetball, handball and squash 
  7.11  courts, basketball and volleyball facilities, running tracks, 
  7.12  exercise equipment, swimming pools, and other similar athletic 
  7.13  or sports facilities.  The provisions of this paragraph do not 
  7.14  apply to camps or other recreation facilities owned and operated 
  7.15  by an exempt organization under section 501(c)(3) of the 
  7.16  Internal Revenue Code of 1986, as amended through December 31, 
  7.17  1992, for educational and social activities for young people 
  7.18  primarily age 18 and under.  
  7.19     Sec. 2.  [EFFECTIVE DATE.] 
  7.20     Section 1 is effective for sales after June 30, 2000.