HF 2949

as introduced - 93rd Legislature (2023 - 2024) Posted on 03/16/2023 02:36pm

A bill for an act
relating to taxation; sales and use; authorizing an exemption for sales to and
purchases by certain nonprofit blood centers; amending Minnesota Statutes 2022,
section 297A.70, subdivision 7.

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

Section 1.

Minnesota Statutes 2022, section 297A.70, subdivision 7, is amended to read:

Subd. 7.

Hospitals, outpatient surgical centers, deleted text begin and deleted text end critical access dental providers new text begin ,
and blood centers new text end .

(a) Sales, except for those listed in paragraph deleted text begin (d) deleted text end new text begin (e) new text end , to a hospital are
exempt, if the items purchased are used in providing hospital services. For purposes of this
subdivision, "hospital" means a hospital organized and operated for charitable purposes
within the meaning of section 501(c)(3) of the Internal Revenue Code, and licensed under
chapter 144 or by any other jurisdiction, and "hospital services" are services authorized or
required to be performed by a "hospital" under chapter 144.

(b) Sales, except for those listed in paragraph deleted text begin (d) deleted text end new text begin (e) new text end , to an outpatient surgical center are
exempt, if the items purchased are used in providing outpatient surgical services. For purposes
of this subdivision, "outpatient surgical center" means an outpatient surgical center organized
and operated for charitable purposes within the meaning of section 501(c)(3) of the Internal
Revenue Code, and licensed under chapter 144 or by any other jurisdiction. For the purposes
of this subdivision, "outpatient surgical services" means: (1) services authorized or required
to be performed by an outpatient surgical center under chapter 144; and (2) urgent care. For
purposes of this subdivision, "urgent care" means health services furnished to a person
whose medical condition is sufficiently acute to require treatment unavailable through, or
inappropriate to be provided by, a clinic or physician's office, but not so acute as to require
treatment in a hospital emergency room.

(c) Sales, except for those listed in paragraph deleted text begin (d) deleted text end new text begin (e) new text end , to a critical access dental provider
are exempt, if the items purchased are used in providing critical access dental care services.
For the purposes of this subdivision, "critical access dental provider" means a dentist or
dental clinic that qualifies under section 256B.76, subdivision 4, paragraph (b), and, in the
previous calendar year, had no more than 15 percent of its patients covered by private dental
insurance.

(d) new text begin Sales, except for those listed in paragraph (e), to a blood center are exempt. For
purposes of this subdivision, a "blood center" means an entity organized and operated for
charitable purposes under section 501(c)(3) of the Internal Revenue Code that is:
new text end

new text begin (1) registered as a blood establishment pursuant to Code of Federal Regulations, title
21, part 607;
new text end

new text begin (2) a human cells, tissues, and cellular and tissue-based products establishment under
Code of Federal Regulations, title 21, part 1271, subpart B; or
new text end

new text begin (3) a clinical lab that performs infectious disease testing, blood typing, and other
laboratory testing services in connection with blood processing for transfusion into humans
under Code of Federal Regulations, title 42, part 493.
new text end

new text begin (e) new text end This exemption does not apply to the following products and services:

(1) purchases made by a clinic, physician's office, or any other medical facility not
operating as a hospital, outpatient surgical center, deleted text begin or deleted text end critical access dental provider new text begin , or blood
center new text end , even though the clinic, office, or facility may be owned and operated by a hospital,
outpatient surgical center, deleted text begin or deleted text end critical access dental provider new text begin , or blood center new text end ;

(2) sales under section 297A.61, subdivision 3, paragraph (g), clause (2), and prepared
food, candy, and soft drinks;

(3) building and construction materials used in constructing buildings or facilities that
will not be used principally by the hospital, outpatient surgical center, deleted text begin or deleted text end critical access
dental provider new text begin , or blood center new text end ;

(4) building, construction, or reconstruction materials purchased by a contractor or a
subcontractor as a part of a lump-sum contract or similar type of contract with a guaranteed
maximum price covering both labor and materials for use in the construction, alteration, or
repair of a hospital, outpatient surgical center, deleted text begin or deleted text end critical access dental provider new text begin , or blood
center new text end ; or

(5) the leasing of a motor vehicle as defined in section 297B.01, subdivision 11 new text begin , except
as provided in paragraph (f) new text end .

new text begin (f) The exclusion under paragraph (e), clause (5), does not apply in the case of the leasing
by a blood center of 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 truck, bus, or
automobile is designed and used for carrying out the purposes of the blood center, including
the collection of blood from donors, setting up of blood drives, and delivering blood to
hospitals.
new text end

deleted text begin (e) deleted text end new text begin (g) new text end A limited liability company also qualifies for exemption under this subdivision
if (1) it consists of a sole member that would qualify for the exemption, and (2) the items
purchased qualify for the exemption.

deleted text begin (f) deleted text end new text begin (h) new text end An entity that contains both a hospital and a nonprofit unit may claim this
exemption on purchases made for both the hospital and nonprofit unit provided that:

(1) the nonprofit unit would have qualified for exemption under subdivision 4; and

(2) the items purchased would have qualified for the exemption.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for sales and purchases made after June
30, 2023.
new text end