HF 2451

as introduced - 84th Legislature (2005 - 2006) Posted on 12/15/2009 12:00am

A bill for an act
relating to taxation; sales and use; retroactively
clarifying the sales tax exemption for tree removal as
part of land clearing contract; amending Minnesota
Statutes 2004, sections 297A.61, subdivision 3;
297A.68, by adding a subdivision.

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

Section 1.

Minnesota Statutes 2004, section 297A.61,
subdivision 3, is amended to read:

Subd. 3.

Sale and purchase.

(a) "Sale" and "purchase"
include, but are not limited to, each of the transactions listed
in this subdivision.

(b) Sale and purchase include:

(1) any transfer of title or possession, or both, of
tangible personal property, whether absolutely or conditionally,
for a consideration in money or by exchange or barter; and

(2) the leasing of or the granting of a license to use or
consume, for a consideration in money or by exchange or barter,
tangible personal property, other than a manufactured home used
for residential purposes for a continuous period of 30 days or
more.

(c) Sale and purchase include the production, fabrication,
printing, or processing of tangible personal property for a
consideration for consumers who furnish either directly or
indirectly the materials used in the production, fabrication,
printing, or processing.

(d) Sale and purchase include the preparing for a
consideration of food. Notwithstanding section 297A.67,
subdivision 2, taxable food includes, but is not limited to, the
following:

(1) prepared food sold by the retailer;

(2) soft drinks;

(3) candy; and

(4) all food sold through vending machines.

(e) A sale and a purchase includes the furnishing for a
consideration of electricity, gas, water, or steam for use or
consumption within this state.

(f) A sale and a purchase includes the transfer for a
consideration of prewritten computer software whether delivered
electronically, by load and leave, or otherwise.

(g) A sale and a purchase includes the furnishing for a
consideration of the following services:

(1) the privilege of admission to places of amusement,
recreational areas, or athletic events, and the making available
of amusement devices, tanning facilities, reducing salons, steam
baths, turkish baths, health clubs, and spas or athletic
facilities;

(2) lodging and related services by a hotel, rooming house,
resort, campground, motel, or trailer camp and the granting of
any similar license to use real property other than the renting
or leasing of it for a continuous period of 30 days or more;

(3) nonresidential parking services, whether on a
contractual, hourly, or other periodic basis, except for parking
at a meter;

(4) the granting of membership in a club, association, or
other organization if:

(i) the club, association, or other organization makes
available for the use of its members sports and athletic
facilities, without regard to whether a separate charge is
assessed for use of the facilities; and

(ii) use of the sports and athletic facility is not made
available to the general public on the same basis as it is made
available to members.

Granting of membership means both onetime initiation fees and
periodic membership dues. Sports and athletic facilities
include golf courses; tennis, racquetball, handball, and squash
courts; basketball and volleyball facilities; running tracks;
exercise equipment; swimming pools; and other similar athletic
or sports facilities;

(5) delivery of aggregate materials and concrete block by a
third party if the delivery would be subject to the sales tax if
provided by the seller of the aggregate material or concrete
block; and

(6) services as provided in this clause:

(i) laundry and dry cleaning services including cleaning,
pressing, repairing, altering, and storing clothes, linen
services and supply, cleaning and blocking hats, and carpet,
drapery, upholstery, and industrial cleaning. Laundry and dry
cleaning services do not include services provided by coin
operated facilities operated by the customer;

(ii) motor vehicle washing, waxing, and cleaning services,
including services provided by coin operated facilities operated
by the customer, and rustproofing, undercoating, and towing of
motor vehicles;

(iii) building and residential cleaning, maintenance, and
disinfecting and exterminating services;

(iv) detective, security, burglar, fire alarm, and armored
car services; but not including services performed within the
jurisdiction they serve by off-duty licensed peace officers as
defined in section 626.84, subdivision 1, or services provided
by a nonprofit organization for monitoring and electronic
surveillance of persons placed on in-home detention pursuant to
court order or under the direction of the Minnesota Department
of Corrections;

(v) pet grooming services;

(vi) lawn care, fertilizing, mowing, spraying and sprigging
services; garden planting and maintenance; tree, bush, and shrub
pruning, bracing, spraying, and surgery; indoor plant care;
tree, bush, shrub, and stump removal new text begin , except when performed as
part of a land clearing contract as defined in section 297A.68,
subdivision 40 new text end ; and tree trimming for public utility lines.
Services performed under a construction contract for the
installation of shrubbery, plants, sod, trees, bushes, and
similar items are not taxable;

(vii) massages, except when provided by a licensed health
care facility or professional or upon written referral from a
licensed health care facility or professional for treatment of
illness, injury, or disease; and

(viii) the furnishing of lodging, board, and care services
for animals in kennels and other similar arrangements, but
excluding veterinary and horse boarding services.

In applying the provisions of this chapter, the terms
"tangible personal property" and "sales at retail" include
taxable services listed in clause (6), items (i) to (vi) and
(viii), and the provision of these taxable services, unless
specifically provided otherwise. Services performed by an
employee for an employer are not taxable. Services performed by
a partnership or association for another partnership or
association are not taxable if one of the entities owns or
controls more than 80 percent of the voting power of the equity
interest in the other entity. Services performed between
members of an affiliated group of corporations are not taxable.
For purposes of the preceding sentence, "affiliated group of
corporations" includes those entities that would be classified
as members of an affiliated group under United States Code,
title 26, section 1504, and that are eligible to file a
consolidated tax return for federal income tax purposes.

(h) A sale and a purchase includes the furnishing for a
consideration of tangible personal property or taxable services
by the United States or any of its agencies or
instrumentalities, or the state of Minnesota, its agencies,
instrumentalities, or political subdivisions.

(i) A sale and a purchase includes the furnishing for a
consideration of telecommunications services, including cable
television services and direct satellite services.
Telecommunications services are taxed to the extent allowed
under federal law.

(j) A sale and a purchase includes the furnishing for a
consideration of installation if the installation charges would
be subject to the sales tax if the installation were provided by
the seller of the item being installed.

(k) A sale and a purchase includes the rental of a vehicle
by a motor vehicle dealer to a customer when (1) the vehicle is
rented by the customer for a consideration, or (2) the motor
vehicle dealer is reimbursed pursuant to a service contract as
defined in section 65B.29, subdivision 1, clause (1).

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for sales and
purchases made after October 22, 2002, but for land clearing
contracts entered into after October 22, 2002, no refunds may be
claimed under Minnesota Statutes, section 289A.50, for sales
taxes collected and remitted to the state on the land clearing
contracts.
new text end

Sec. 2.

Minnesota Statutes 2004, section 297A.68, is
amended by adding a subdivision to read:

new text begin Subd. 40. new text end

new text begin Land clearing. new text end

new text begin Tree, bush, shrub, and stump
removal are exempt when sold to contractors or subcontractors as
part of a land clearing contract. For purposes of this
subdivision, "land clearing contract" means a contract for the
removal of trees, bushes, and shrubs, including the removal of
roots and stumps, to develop a site for other purposes. This
exemption does not apply to land clearing of a portion of a site
to allow for remodeling, improvement, or expansion of an
existing structure.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for sales and
purchases made after October 22, 2002, but for land clearing
contracts entered into after October 22, 2002, no refunds may be
claimed under Minnesota Statutes, section 289A.50, for sales
taxes collected and remitted to the state on the land clearing
contracts.
new text end