Minnesota Legislature
HF 1991
as introduced - 91st Legislature (2019 - 2020) Posted on 03/04/2019 02:04pm
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| Introduction | Posted on 03/04/2019 |
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A bill for an act
relating to taxation; sales and use; repealing the extra tax on short-term motor
vehicle rentals; amending Minnesota Statutes 2018, sections 297A.64, subdivisions
2, 3, 4; 297A.94; repealing Minnesota Statutes 2018, section 297A.64, subdivision
1.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
Section 1.
Minnesota Statutes 2018, section 297A.64, subdivision 2, is amended to read:
Subd. 2.
Fee imposed.
(a) A fee equal to five percent of the sales price is imposed on
deleted text begin leases or rentals of vehicles subject to the tax under subdivision 1deleted text end new text begin a lease or rental in this
state for not more than 28 days of a passenger automobile as defined in section 168.002,
subdivision 24, a van as defined in section 168.002, subdivision 40, or a pickup truck as
defined in section 168.002, subdivision 26new text end . The lessor on the invoice to the customer may
designate the fee as "a fee imposed by the State of Minnesota for the registration of rental
cars."
(b) The provisions of this subdivision do not apply to the vehicles of a nonprofit
corporation or similar entity, consisting of individual or group members who pay the
organization for the use of a motor vehicle, if the organization:
(1) owns or leases a fleet of vehicles of the type subject to the tax under subdivision 1
that are available to its members for use, priced on the basis of intervals of one hour or less;
(2) parks its vehicles at unstaffed, self-service locations that are accessible at any time
of the day;
(3) maintains its vehicles, insures its vehicles on behalf of its members, and purchases
fuel for its fleet; and
(4) does not charge usage rates that decline on a per unit basis, whether specified based
on distance or time.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for leases and rentals entered into after
June 30, 2019.
new text end
Sec. 2.
Minnesota Statutes 2018, section 297A.64, subdivision 3, is amended to read:
Subd. 3.
Administration.
deleted text begin The retailer shall report and pay the tax imposed in subdivision
1 to the commissioner of revenue with the taxes imposed in this chapter.deleted text end The deleted text begin tax imposed
in subdivision 1 and thedeleted text end fee imposed in subdivision 2 deleted text begin aredeleted text end new text begin isnew text end subject to the same interest,
penalty, and other provisions provided for sales and use taxes under this chapter and chapter
289A. The audit, assessment, appeal, collection, enforcement, and administrative provisions
of this chapter and chapters 270C and 289A, that apply to sales and use taxes, apply to the
deleted text begin tax anddeleted text end fee.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for leases and rentals entered into after
June 30, 2019.
new text end
Sec. 3.
Minnesota Statutes 2018, section 297A.64, subdivision 4, is amended to read:
Subd. 4.
Exemptions.
(a) The deleted text begin tax and thedeleted text end fee imposed by this section deleted text begin dodeleted text end new text begin doesnew text end not apply
to a lease or rental of (1) a vehicle to be used by the lessee to provide a licensed taxi service;
(2) a hearse or limousine used in connection with a burial or funeral service; or (3) a van
designed or adapted primarily for transporting property rather than passengers. The deleted text begin tax and
thedeleted text end fee imposed under this section deleted text begin dodeleted text end new text begin doesnew text end not apply when the lease or rental of a vehicle
is exempt from the tax imposed under section 297A.62, subdivision 1.
(b) The lessor may elect not to charge the fee imposed in subdivision 2 if in the previous
calendar year the lessor had no more than 20 vehicles available for lease that would have
been subject to tax under this section, or no more than $50,000 in gross receipts that would
have been subject to tax under this section.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for leases and rentals entered into after
June 30, 2019.
new text end
Sec. 4.
Minnesota Statutes 2018, section 297A.94, is amended to read:
297A.94 DEPOSIT OF REVENUES.
(a) Except as provided in this section, the commissioner shall deposit the revenues,
including interest and penalties, derived from the taxes imposed by this chapter in the state
treasury and credit them to the general fund.
(b) The commissioner shall deposit taxes in the Minnesota agricultural and economic
account in the special revenue fund if:
(1) the taxes are derived from sales and use of property and services purchased for the
construction and operation of an agricultural resource project; and
(2) the purchase was made on or after the date on which a conditional commitment was
made for a loan guaranty for the project under section 41A.04, subdivision 3.
The commissioner of management and budget shall certify to the commissioner the date on
which the project received the conditional commitment. The amount deposited in the loan
guaranty account must be reduced by any refunds and by the costs incurred by the Department
of Revenue to administer and enforce the assessment and collection of the taxes.
(c) The commissioner shall deposit the revenues, including interest and penalties, derived
from the taxes imposed on sales and purchases included in section 297A.61, subdivision 3,
paragraph (g), clauses (1) and (4), in the state treasury, and credit them as follows:
(1) first to the general obligation special tax bond debt service account in each fiscal
year the amount required by section 16A.661, subdivision 3, paragraph (b); and
(2) after the requirements of clause (1) have been met, the balance to the general fund.
deleted text begin
(d) Beginning with sales taxes remitted after July 1, 2017, the commissioner shall deposit
in the state treasury the revenues collected under section 297A.64, subdivision 1, including
interest and penalties and minus refunds, and credit them to the highway user tax distribution
fund.
deleted text end
deleted text begin (e)deleted text end new text begin (d)new text end The commissioner shall deposit the revenues, including interest and penalties,
collected under section 297A.64, subdivision 5, in the state treasury and credit them to the
general fund. By July 15 of each year the commissioner shall transfer to the highway user
tax distribution fund an amount equal to the excess fees collected under section 297A.64,
subdivision 5, for the previous calendar year.
deleted text begin (f)deleted text end new text begin (e)new text end Beginning with sales taxes remitted after July 1, 2017,deleted text begin in conjunction with the
deposit of revenues under paragraph (d),deleted text end the commissioner shall deposit into the state
treasury and credit to the highway user tax distribution fund an amount equal to the estimated
revenues derived from the tax rate imposed under section 297A.62, subdivision 1, on the
lease or rental for not more than 28 days of rental motor vehicles subject to section 297A.64.
deleted text begin The commissioner shall estimate the amount of sales tax revenue deposited under this
paragraph based on the amount of revenue deposited under paragraph (d).
deleted text end
deleted text begin (g)deleted text end new text begin (f)new text end Starting after July 1, 2017, the commissioner shall deposit an amount of the
remittances monthly into the state treasury and credit them to the highway user tax
distribution fund as a portion of the estimated amount of taxes collected from the sale and
purchase of motor vehicle repair parts in that month. For the remittances between July 1,
2017, and June 30, 2019, the monthly deposit amount is $2,628,000. For remittances in
each subsequent fiscal year, the monthly deposit amount is $12,137,000. For purposes of
this paragraph, "motor vehicle" has the meaning given in section 297B.01, subdivision 11,
and "motor vehicle repair and replacement parts" includes (i) all parts, tires, accessories,
and equipment incorporated into or affixed to the motor vehicle as part of the motor vehicle
maintenance and repair, and (ii) paint, oil, and other fluids that remain on or in the motor
vehicle as part of the motor vehicle maintenance or repair. For purposes of this paragraph,
"tire" means any tire of the type used on highway vehicles, if wholly or partially made of
rubber and if marked according to federal regulations for highway use.
deleted text begin (h)deleted text end new text begin (g)new text end 72.43 percent of the revenues, including interest and penalties, transmitted to the
commissioner under section 297A.65, must be deposited by the commissioner in the state
treasury as follows:
(1) 50 percent of the receipts must be deposited in the heritage enhancement account in
the game and fish fund, and may be spent only on activities that improve, enhance, or protect
fish and wildlife resources, including conservation, restoration, and enhancement of land,
water, and other natural resources of the state;
(2) 22.5 percent of the receipts must be deposited in the natural resources fund, and may
be spent only for state parks and trails;
(3) 22.5 percent of the receipts must be deposited in the natural resources fund, and may
be spent only on metropolitan park and trail grants;
(4) three percent of the receipts must be deposited in the natural resources fund, and
may be spent only on local trail grants; and
(5) two percent of the receipts must be deposited in the natural resources fund, and may
be spent only for the Minnesota Zoological Garden, the Como Park Zoo and Conservatory,
and the Duluth Zoo.
deleted text begin (i)deleted text end new text begin (h)new text end The revenue dedicated under paragraph deleted text begin (h)deleted text end new text begin (g)new text end may not be used as a substitute
for traditional sources of funding for the purposes specified, but the dedicated revenue shall
supplement traditional sources of funding for those purposes. Land acquired with money
deposited in the game and fish fund under paragraph deleted text begin (h)deleted text end new text begin (g)new text end must be open to public hunting
and fishing during the open season, except that in aquatic management areas or on lands
where angling easements have been acquired, fishing may be prohibited during certain times
of the year and hunting may be prohibited. At least 87 percent of the money deposited in
the game and fish fund for improvement, enhancement, or protection of fish and wildlife
resources under paragraph deleted text begin (h)deleted text end new text begin (g)new text end must be allocated for field operations.
deleted text begin (j)deleted text end new text begin (i)new text end The commissioner must deposit the revenues, including interest and penalties
minus any refunds, derived from the sale of items regulated under section 624.20, subdivision
1, that may be sold to persons 18 years old or older and that are not prohibited from use by
the general public under section 624.21, in the state treasury and credit:
(1) 25 percent to the volunteer fire assistance grant account established under section
88.068;
(2) 25 percent to the fire safety account established under section 297I.06, subdivision
3; and
(3) the remainder to the general fund.
For purposes of this paragraph, the percentage of total sales and use tax revenue derived
from the sale of items regulated under section 624.20, subdivision 1, that are allowed to be
sold to persons 18 years old or older and are not prohibited from use by the general public
under section 624.21, is a set percentage of the total sales and use tax revenues collected in
the state, with the percentage determined under Laws 2017, First Special Session chapter
1, article 3, section 39.
deleted text begin (k)deleted text end new text begin (j)new text end The revenues deposited under paragraphs (a) to deleted text begin (j)deleted text end new text begin (i)new text end do not include the revenues,
including interest and penalties, generated by the sales tax imposed under section 297A.62,
subdivision 1a, which must be deposited as provided under the Minnesota Constitution,
article XI, section 15.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective July 1, 2019.
new text end
Sec. 5. new text begin REPEALER.
new text end
new text begin
Minnesota Statutes 2018, section 297A.64, subdivision 1,
new text end
new text begin
is repealed.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective July 1, 2019.
new text end
APPENDIX
Repealed Minnesota Statutes: 19-3907
297A.64 RENTAL MOTOR VEHICLE TAX IMPOSED; RATE.
Subdivision 1.
Tax imposed.
A tax is imposed on the lease or rental in this state for not more than 28 days of a passenger automobile as defined in section 168.002, subdivision 24, a van as defined in section 168.002, subdivision 40, or a pickup truck as defined in section 168.002, subdivision 26. The rate of tax is 9.2 percent of the sales price. The tax applies whether or not the vehicle is licensed in the state.