HF 2551

as introduced - 85th Legislature (2007 - 2008) Posted on 12/15/2009 12:00am

A bill for an act
relating to taxation; repealing the sales tax exemption on clothing; decreasing
the sales tax rate; creating an income tax credit; adjusting local option sales tax
rates; appropriating money; amending Minnesota Statutes 2006, sections 295.60,
subdivision 1; 297A.62, subdivision 1; 297B.02, subdivision 1; proposing coding
for new law in Minnesota Statutes, chapter 290; repealing Minnesota Statutes
2006, section 297A.67, subdivision 8.

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

Section 1.

new text begin [290.0683] CLOTHING SALES TAX CREDIT.
new text end

new text begin Subdivision 1. new text end

new text begin Definitions. new text end

new text begin (a) For purposes of this section, the following terms
have the meanings given.
new text end

new text begin (b) "Income" has the meaning given in section 290.067, subdivision 2a.
new text end

new text begin (c) "Dependent" has the meaning given in section 152 of the Internal Revenue Code.
new text end

new text begin Subd. 2. new text end

new text begin Credit allowed. new text end

new text begin A taxpayer is allowed a refundable credit against the tax
imposed under this chapter. The credit is equal to $60 for a married couple filing a joint
return, and $30 for all other filers, plus $30 for the first dependent claimed on the return,
$15 for each of the second and third dependents claimed on the return, $10 for the fourth
dependent claimed on the return, and $5 for each subsequent dependent.
new text end

new text begin Subd. 3. new text end

new text begin Limitations. new text end

new text begin The credit allowed in this section is reduced by $10 for every
$1,000 of income in excess of 200 percent of the federal poverty guidelines.
new text end

new text begin Subd. 4. new text end

new text begin Appropriation. new text end

new text begin An amount sufficient to pay the refunds required by this
section is appropriated to the commissioner from the general fund.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for taxable years beginning after
December 31, 2008.
new text end

Sec. 2.

Minnesota Statutes 2006, section 295.60, subdivision 1, is amended to read:

Subdivision 1.

Imposition.

If clothing made of fur is not subject to the sales tax
under chapter 297A, a tax is imposed on each furrier equal to deleted text begin 6.5 deleted text end new text begin 5.96 new text end percent of gross
revenues from retail sales in Minnesota of clothing made from fur.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2009.
new text end

Sec. 3.

Minnesota Statutes 2006, section 297A.62, subdivision 1, is amended to read:

Subdivision 1.

Generally.

Except as otherwise provided in subdivision 2 or 3 or in
this chapter, a sales tax of deleted text begin 6.5 deleted text end new text begin 5.96 new text end percent is imposed on the gross receipts from retail
sales as defined in section 297A.61, subdivision 4, made in this state or to a destination
in this state by a person who is required to have or voluntarily obtains a permit under
section 297A.83, subdivision 1.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2009.
new text end

Sec. 4.

Minnesota Statutes 2006, section 297B.02, subdivision 1, is amended to read:

Subdivision 1.

Rate.

There is imposed an excise tax at the rate deleted text begin provided in chapter
297A deleted text end new text begin of 6.5 percent new text end on the purchase price of any motor vehicle purchased or acquired,
either in or outside of the state of Minnesota, which is required to be registered under
the laws of this state.

The excise tax is also imposed on the purchase price of motor vehicles purchased
or acquired on Indian reservations when the tribal council has entered into a sales tax on
motor vehicles refund agreement with the state of Minnesota.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2009.
new text end

Sec. 5. new text begin LOCAL OPTION SALES TAXES ADJUSTED.
new text end

new text begin Notwithstanding any law, ordinance, or charter provision to the contrary, the rates of
any local option sales taxes in effect on January 1, 2009, are reduced by six percent of the
rate then in effect, rounded to the nearest one-hundredth of one percent.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2009.
new text end

Sec. 6. new text begin REPEALER.
new text end

new text begin Minnesota Statutes 2006, section 297A.67, subdivision 8, 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 January 1, 2009.
new text end