Minnesota Legislature
SF 1227
as introduced - 89th Legislature (2015 - 2016) Posted on 08/20/2015 04:18pm
Current Version - as introduced
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A bill for an act
relating to taxation; modifying lawful gambling taxes; amending Minnesota
Statutes 2014, sections 297E.01, by adding a subdivision; 297E.02, subdivisions
1, 6; 297E.06, subdivision 4, by adding a subdivision.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
Section 1.
Minnesota Statutes 2014, section 297E.01, is amended by adding a
subdivision to read:
new text begin Subd. 3a. new text end
new text begin Compensation. new text end
new text begin
"Compensation" means the wages paid by an
organization to its employees for the conduct of lawful gambling and any payroll taxes
imposed on those wages.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective July 1, 2015.
new text end
Sec. 2.
Minnesota Statutes 2014, section 297E.02, subdivision 1, is amended to read:
Subdivision 1.
Imposition.
A tax is imposed on all lawful gambling other than (1)
paper or electronic pull-tab deals or games; (2) tipboard deals or games; new text begin and new text end (3) deleted text begin electronic
linked bingo; and (4)deleted text end items listed in section 297E.01, subdivision 8, clauses (4) and (5), at
the rate of 8.5 percent on the gross receipts as defined in section 297E.01, subdivision 8,
less prizes new text begin and compensation new text end actually paid. The tax imposed by this subdivision is in lieu
of the tax imposed by section 297A.62 and all local taxes and license fees except a fee
authorized under section 349.16, subdivision 8, or a tax authorized under subdivision 5.
The tax imposed under this subdivision is payable by the organization or party
conducting, directly or indirectly, the gambling.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective July 1, 2015.
new text end
Sec. 3.
Minnesota Statutes 2014, section 297E.02, subdivision 6, is amended to read:
Subd. 6.
Combined net receipts tax.
(a) In addition to the taxes imposed under
subdivision 1, a tax is imposed on the combined receipts of the organization. As used
in this section, "combined net receipts" is the sum of the organization's gross receipts
from lawful gambling less gross receipts directly derived from the conduct of paper
bingo, new text begin electronic linked bingo, new text end raffles, and paddlewheels, as defined in section 297E.01,
subdivision 8, and less the new text begin compensation and new text end net prizes actually paid, other than prizes
actually paid for paper bingo, new text begin electronic linked bingo, new text end raffles, and paddlewheels, for the
fiscal year. The combined net receipts of an organization are subject to a tax computed
according to the following schedule:
| If the combined net receipts for the fiscal year are: |
The tax is: |
|||
| Not over deleted text begin $87,500deleted text end new text begin $100,000 new text end |
nine percent |
|||
| Over deleted text begin $87,500deleted text end new text begin $100,000new text end , but not over deleted text begin $122,500deleted text end new text begin $200,000 new text end |
deleted text begin $7,875 plusdeleted text end 18 percent of the amount over deleted text begin $87,500deleted text end new text begin $100,000new text end , but not over deleted text begin $122,500deleted text end new text begin $200,000 new text end |
|||
| Over deleted text begin $122,500deleted text end new text begin $200,000new text end , but not over deleted text begin $157,500deleted text end new text begin $300,000 new text end |
deleted text begin $14,175 plusdeleted text end 27 percent of the amount over deleted text begin $122,500deleted text end new text begin $200,000new text end , but not over deleted text begin $157,500deleted text end new text begin $300,000 new text end |
|||
| Over deleted text begin $157,500deleted text end new text begin $300,000 new text end |
deleted text begin $23,625 plusdeleted text end 36 percent of the amount over deleted text begin $157,500deleted text end new text begin $300,000 new text end |
(b) On or before April 1, 2016, the commissioner shall estimate the total amount of
revenue, including interest and penalties, that will be collected for fiscal year 2016 from
taxes imposed under this chapter. If the amount estimated by the commissioner equals or
exceeds deleted text begin $94,800,000deleted text end new text begin $72,000,000new text end , the commissioner shall certify that effective July 1,
2016, the rates under this paragraph apply in lieu of the rates under paragraph (a) and shall
publish a notice to that effect in the State Register and notify each taxpayer by June 1,
2016. If the rates under this section apply, the combined net receipts of an organization are
subject to a tax computed according to the following schedule:
| If the combined net receipts for the fiscal year are: |
The tax is: |
|||
| Not over deleted text begin $87,500deleted text end new text begin $100,000 new text end |
8.5 percent |
|||
| Over deleted text begin $87,500deleted text end new text begin $100,000new text end , but not over deleted text begin $122,500deleted text end new text begin $200,000 new text end |
deleted text begin $7,438 plusdeleted text end 17 percent of the amount over deleted text begin $87,500deleted text end new text begin $100,000new text end , but not over deleted text begin $122,500deleted text end new text begin $200,000 new text end |
|||
| Over deleted text begin $122,500deleted text end new text begin $200,000new text end , but not over deleted text begin $157,500deleted text end new text begin $300,000 new text end |
deleted text begin $13,388 plusdeleted text end 25.5 percent of the amount over deleted text begin $122,500deleted text end new text begin $200,000new text end , but not over deleted text begin $157,500deleted text end new text begin $300,000 new text end |
|||
| Over deleted text begin $157,500deleted text end new text begin $300,000 new text end |
deleted text begin $22,313 plusdeleted text end 34 percent of the amount over deleted text begin $157,500deleted text end new text begin $300,000 new text end |
new text begin
(c) In calculating the tax due under subdivisions 1 and 6, $50,000 of gross receipts,
less prizes actually paid, for the fiscal year shall be exempt from taxation under this section.
new text end
deleted text begin (c)deleted text end new text begin (d)new text end Gross receipts derived from sports-themed tipboards are exempt from taxation
under this section. For purposes of this paragraph, a sports-themed tipboard means a
sports-themed tipboard as defined in section 349.12, subdivision 34, under which the
winning numbers are determined by the numerical outcome of a professional sporting event.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective July 1, 2015.
new text end
Sec. 4.
Minnesota Statutes 2014, section 297E.06, is amended by adding a subdivision
to read:
new text begin Subd. 1b. new text end
new text begin Electronic pull-tab activity. new text end
new text begin
The commissioner shall not require
organizations to report the gross receipts and prizes from an electronic pull-tab game
until the game is closed by the organization.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective July 1, 2015.
new text end
Sec. 5.
Minnesota Statutes 2014, section 297E.06, subdivision 4, is amended to read:
Subd. 4.
deleted text begin Annual audit,deleted text end Certified inventorydeleted text begin ,deleted text end and cash count.
(a) deleted text begin An organization
licensed under chapter 349 with gross receipts from lawful gambling of more than
$750,000 in any year must have an annual financial audit of its lawful gambling activities
and funds for that year.
deleted text end
deleted text begin (b)deleted text end The commissioner may require a financial audit of the lawful gambling activities
and funds of an organization licensed under chapter 349deleted text begin , with gross receipts less than
$750,000 annually,deleted text end when an organization has:
(1) failed to timely file required gambling tax returns;
(2) failed to timely pay the gambling tax or regulatory fee;
(3) filed fraudulent gambling tax returns;
(4) failed to take corrective actions required by the commissioner; or
(5) failed to otherwise comply with this chapter.
deleted text begin (c)deleted text end new text begin (b)new text end Audits under this subdivision must be performed by an independent
accountant licensed in accordance with chapter 326A.
deleted text begin (d)deleted text end new text begin (c)new text end An organization licensed under chapter 349 must perform an annual
certified inventory and cash count at the end of its fiscal year and submit the report to
the commissioner within 30 days after the end of its fiscal year. The report shall be on
a form prescribed by the commissioner.
deleted text begin (e)deleted text end new text begin (d)new text end The commissioner of revenue shall prescribe standards for the audits,
certified inventory, and cash count reports required under this subdivision. The standards
may vary based on the gross receipts of the organization. The standards must incorporate
and be consistent with standards prescribed by the American Institute of Certified Public
Accountants. A complete, true, and correct copy of the audits, certified inventory, and
cash count report must be filed as prescribed by the commissioner.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective July 1, 2015.
new text end