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Minnesota Legislature

Office of the Revisor of Statutes

HF 2870

as introduced - 90th Legislature (2017 - 2018) Posted on 03/01/2018 05:10pm

KEY: stricken = removed, old language.
underscored = added, new language.

Current Version - as introduced

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A bill for an act
relating to taxation; sales and use and motor vehicle taxes; modifying exemptions
for certain leases and purchases; amending Minnesota Statutes 2016, sections
297A.61, by adding a subdivision; 297A.70, subdivision 3; 297B.01, by adding a
subdivision; 297B.03.

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

Section 1.

Minnesota Statutes 2016, section 297A.61, is amended by adding a subdivision
to read:


new text begin Subd. 59. new text end

new text begin American-made motor vehicle. new text end

new text begin "American-made motor vehicle" means a
motor vehicle bearing a vehicle identification number as defined by Code of Federal
Regulations, title 49, section 565, that begins with the number "1."
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, 2018.
new text end

Sec. 2.

Minnesota Statutes 2016, section 297A.70, subdivision 3, is amended to read:


Subd. 3.

Sales of certain goods and services to government.

(a) The following sales
to or use by the specified governments and political subdivisions of the state are exempt:

(1) repair and replacement parts for emergency rescue vehicles, fire trucks, and fire
apparatus to a political subdivision;

(2) machinery and equipment, except for motor vehicles, used directly for mixed
municipal solid waste management services at a solid waste disposal facility as defined in
section 115A.03, subdivision 10;

(3) chore and homemaking services to a political subdivision of the state to be provided
to elderly or disabled individuals;

(4) telephone services to the Office of MN.IT Services that are used to provide
telecommunications services through the MN.IT services revolving fund;

(5) firefighter personal protective equipment as defined in paragraph (b), if purchased
or authorized by and for the use of an organized fire department, fire protection district, or
fire company regularly charged with the responsibility of providing fire protection to the
state or a political subdivision;

(6) bullet-resistant body armor that provides the wearer with ballistic and trauma
protection, if purchased by a law enforcement agency of the state or a political subdivision
of the state, or a licensed peace officer, as defined in section 626.84, subdivision 1;

(7) motor vehicles purchased or leased by political subdivisions of the state if the vehicles
are exempt from registration under section 168.012, subdivision 1, paragraph (b), exempt
from taxation under section 473.448, or exempt from the motor vehicle sales tax under
section 297B.03, clause (12);

(8) equipment designed to process, dewater, and recycle biosolids for wastewater
treatment facilities of political subdivisions, and materials incidental to installation of that
equipment;

(9) the removal of trees, bushes, or shrubs for the construction and maintenance of roads,
trails, or firebreaks when purchased by an agency of the state or a political subdivision of
the state;

(10) purchases by the Metropolitan Council or the Department of Transportation of
vehicles and repair parts to equip operations provided for in section 174.90, including, but
not limited to, the Northstar Corridor Rail project; deleted text beginand
deleted text end

(11) purchases of water used directly in providing public safety services by an organized
fire department, fire protection district, or fire company regularly charged with the
responsibility of providing fire protection to the state or a political subdivisiondeleted text begin.deleted text endnew text begin; and
new text end

new text begin (12) the lease of an American-made motor vehicle by:
new text end

new text begin (i) the state or any of its agencies or instrumentalities;
new text end

new text begin (ii) a local government as defined in subdivision 2, paragraph (d); or
new text end

new text begin (iii) a school district.
new text end

(b) For purposes of this subdivision, "firefighters personal protective equipment" means
helmets, including face shields, chin straps, and neck liners; bunker coats and pants, including
pant suspenders; boots; gloves; head covers or hoods; wildfire jackets; protective coveralls;
goggles; self-contained breathing apparatus; canister filter masks; personal alert safety
systems; spanner belts; optical or thermal imaging search devices; and all safety equipment
required by the Occupational Safety and Health Administration.

(c) For purchases of items listed in paragraph (a), clause (10), the tax must be imposed
and collected as if the rate under section 297A.62, subdivision 1, applied and then refunded
in the manner provided in section 297A.75.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for sales and purchases made after June
30, 2018.
new text end

Sec. 3.

Minnesota Statutes 2016, section 297B.01, is amended by adding a subdivision to
read:


new text begin Subd. 19. new text end

new text begin American-made motor vehicle. new text end

new text begin "American-made motor vehicle" means a
motor vehicle bearing a vehicle identification number as defined by Code of Federal
Regulations, title 49, section 565, that begins with the number "1."
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, 2018.
new text end

Sec. 4.

Minnesota Statutes 2016, section 297B.03, is amended to read:


297B.03 EXEMPTIONS.

There is specifically exempted from the provisions of this chapter and from computation
of the amount of tax imposed by it the following:

(1) purchase or use, including use under a lease purchase agreement or installment sales
contract made pursuant to section 465.71, of any motor vehicle by the United States and its
agencies and instrumentalities and by any person described in and subject to the conditions
provided in section 297A.67, subdivision 11;

(2) purchase or use of any motor vehicle by any person who was a resident of another
state or country at the time of the purchase and who subsequently becomes a resident of
Minnesota, provided the purchase occurred more than 60 days prior to the date such person
began residing in the state of Minnesota and the motor vehicle was registered in the person's
name in the other state or country;

(3) purchase or use of any motor vehicle by any person making a valid election to be
taxed under the provisions of section 297A.90;

(4) purchase or use of any motor vehicle previously registered in the state of Minnesota
when such transfer constitutes a transfer within the meaning of section 118, 331, 332, 336,
337, 338, 351, 355, 368, 721, 731, 1031, 1033, or 1563(a) of the Internal Revenue Code;

(5) purchase or use of any vehicle owned by a resident of another state and leased to a
Minnesota-based private or for-hire carrier for regular use in the transportation of persons
or property in interstate commerce provided the vehicle is titled in the state of the owner or
secured party, and that state does not impose a sales tax or sales tax on motor vehicles used
in interstate commerce;

(6) purchase or use of a motor vehicle by a private nonprofitnew text begin,new text end or new text beginan American-made
motor vehicle by a
new text endpublic educational institutionnew text begin,new text end for use as an instructional aid in automotive
training programs operated by the institution. "Automotive training programs" includes
motor vehicle body and mechanical repair courses but does not include driver education
programs;

(7) purchase of deleted text beginadeleted text endnew text begin an American-madenew text end motor vehicle by an ambulance service licensed
under section 144E.10 when that vehicle is equipped and specifically intended for emergency
response or for providing ambulance service;

(8) purchase of deleted text beginadeleted text endnew text begin an American-madenew text end motor vehicle by or for a public library, as defined
in section 134.001, subdivision 2, as a bookmobile or library delivery vehicle;

(9) purchase of a ready-mixed concrete truck;

(10) purchase or use of deleted text beginadeleted text endnew text begin an American-madenew text end motor vehicle by a town for use exclusively
for road maintenance, including snowplows and dump trucks, but not including automobiles,
vans, or pickup trucks;

(11) purchase or use of a motor vehicle by a corporation, society, association, foundation,
or institution organized and operated exclusively for charitable, religious, or educational
purposes, except a public school, university, or library, but only if the vehicle is:

(i) a truck, as defined in section 168.002, a bus, as defined in section 168.002, or a
passenger automobile, as defined in section 168.002, if the automobile is designed and used
for carrying more than nine persons including the driver; and

(ii) intended to be used primarily to transport tangible personal property or individuals,
other than employees, to whom the organization provides service in performing its charitable,
religious, or educational purpose;

(12) purchase of deleted text beginadeleted text endnew text begin an American-madenew text end motor vehicle for use by a transit provider
exclusively to provide transit service is exempt if the transit provider is either (i) receiving
financial assistance or reimbursement under section 174.24 or 473.384, or (ii) operating
under section 174.29, 473.388, or 473.405;

(13) purchase or use of a motor vehicle by a qualified business, as defined in section
469.310, located in a job opportunity building zone, if the motor vehicle is principally
garaged in the job opportunity building zone and is primarily used as part of or in direct
support of the person's operations carried on in the job opportunity building zone. The
exemption under this clause applies to sales, if the purchase was made and delivery received
during the duration of the job opportunity building zone. The exemption under this clause
also applies to any local sales and use tax;

(14) purchase of a leased vehicle by the lessee who was a participant in a lease-to-own
program from a charitable organization that is:

(i) described in section 501(c)(3) of the Internal Revenue Code; and

(ii) licensed as a motor vehicle lessor under section 168.27, subdivision 4; and

(15) purchase of a motor vehicle used exclusively as a mobile medical unit for the
provision of medical or dental services by a federally qualified health center, as defined
under title 19 of the Social Security Act, as amended by Section 4161 of the Omnibus Budget
Reconciliation Act of 1990.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for sales and purchases made after June
30, 2018.
new text end