HF 336

as introduced - 87th Legislature (2011 - 2012) Posted on 02/02/2011 09:28am

A bill for an act
relating to taxation; allowing all cities to impose a local sales and use tax;
providing for an aid offset; amending Minnesota Statutes 2010, sections 297A.99,
subdivision 1; 477A.013, by adding a subdivision; 477A.016; proposing coding
for new law in Minnesota Statutes, chapter 297A.

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

Section 1.

Minnesota Statutes 2010, section 297A.99, subdivision 1, is amended to
read:

Subdivision 1.

Authorization; scope.

(a) A political subdivision of this state may
impose a general sales tax (1) under section 297A.992, (2) under section 297A.993, (3)
new text begin under section 297A.994, (4) new text end if permitted by special law enacted prior to May 20, 2008, or
deleted text begin (4) deleted text end new text begin (5) new text end if the political subdivision enacted and imposed the tax before January 1, 1982, and
its predecessor provision.

(b) This section governs the imposition of a general sales tax by the political
subdivision. The provisions of this section preempt the provisions of any special law:

(1) enacted before June 2, 1997, or

(2) enacted on or after June 2, 1997, that does not explicitly exempt the special law
provision from this section's rules by reference.

(c) This section does not apply to or preempt a sales tax on motor vehicles or a
special excise tax on motor vehicles.

deleted text begin (d) Until after May 31, 2010, a political subdivision may not advertise, promote,
expend funds, or hold a referendum to support imposing a local option sales tax unless
it is for extension of an existing tax or the tax was authorized by a special law enacted
prior to May 20, 2008.
deleted text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2011.
new text end

Sec. 2.

new text begin [297A.994] CITY LOCAL SALES AND USE TAX.
new text end

new text begin Subdivision 1. new text end

new text begin Authorization; rates. new text end

new text begin Notwithstanding sections 297A.99,
subdivisions 2, 3, 5, and 13, and 477A.016 or any other law, a statutory or home-rule
charter city may, upon approval of the voters at a general election, impose a local sales
and use tax of up to one-half of one percent within the city. If the city imposes a general
sales and use tax under another law, the amount it may impose under this section may
not exceed one-quarter of one percent while the other tax is imposed. The provisions
of section 297A.99, subdivisions 4 and 6 to 12a govern the imposition, administration,
collection, and enforcement of a tax imposed under this section. A tax authorized under
this section may not be imposed before July 1 of the year following the year in which the
general election is held.
new text end

new text begin Subd. 2. new text end

new text begin Use of revenues. new text end

new text begin Revenues received from a tax imposed under subdivision
1 shall be deposited in the city's general fund and may be used for any city purpose.
new text end

new text begin Subd. 3. new text end

new text begin Termination of tax. new text end

new text begin A tax imposed under subdivision 1 expires when the
city council, by ordinance, terminates the tax, subject to the notification requirements in
section 297A.99, subdivision 12.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective beginning July 1, 2011.
new text end

Sec. 3.

Minnesota Statutes 2010, section 477A.013, is amended by adding a
subdivision to read:

new text begin Subd. 11. new text end

new text begin Aid offset for certain local sales and use taxes. new text end

new text begin The aid under
subdivision 9 is reduced by 50 percent to any city imposing a sales and use tax under
section 297A.994 in the calendar year in which the aid is paid. If the sales tax is first
imposed after June 30 of the calendar year in which the aid is paid, the aid reduction in
that year shall only be equal to 50 percent of the second installment of the aid paid in that
calendar year. The amount of the reduction shall be retained in the general fund and not
redistributed under the formula contained in this section.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for aids payable in calendar year
2012 and thereafter.
new text end

Sec. 4.

Minnesota Statutes 2010, section 477A.016, is amended to read:

477A.016 NEW TAXES PROHIBITED.

No county, city, town or other taxing authority shall increase a present tax or impose
a new tax on sales or income new text begin , except as provided under sections 297A.992, 297A.993,
and 297A.994 new text end .

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end