SF 2538

as introduced - 89th Legislature (2015 - 2016) Posted on 04/08/2016 09:09am

A bill for an act
relating to taxation; sales and use; providing for parity in tax treatment of food
sold through vending machines; amending Minnesota Statutes 2014, section
297A.67, subdivisions 2, 4, 5, 6.

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

Section 1.

Minnesota Statutes 2014, section 297A.67, subdivision 2, is amended to read:

Subd. 2.

Food and food ingredients.

Except as otherwise provided in this
subdivision, food and food ingredients are exempt. For purposes of this subdivision,
"food" and "food ingredients" mean substances, whether in liquid, concentrated, solid,
frozen, dried, or dehydrated form, that are sold for ingestion or chewing by humans and
are consumed for their taste or nutritional value. Food and food ingredients exempt under
this subdivision do not include candy, soft drinks, deleted text begin food sold through vending machines,
deleted text end dietary supplements, and prepared foods. Food and food ingredients do not include
alcoholic beverages and tobacco. For purposes of this subdivision, "alcoholic beverages"
means beverages that are suitable for human consumption and contain one-half of one
percent or more of alcohol by volume. For purposes of this subdivision, "tobacco" means
cigarettes, cigars, chewing or pipe tobacco, or any other item that contains tobacco.
For purposes of this subdivision, "dietary supplements" means any product, other than
tobacco, intended to supplement the diet that:

(1) contains one or more of the following dietary ingredients:

(i) a vitamin;

(ii) a mineral;

(iii) an herb or other botanical;

(iv) an amino acid;

(v) a dietary substance for use by humans to supplement the diet by increasing the
total dietary intake; and

(vi) a concentrate, metabolite, constituent, extract, or combination of any ingredient
described in items (i) to (v);

(2) is intended for ingestion in tablet, capsule, powder, softgel, gelcap, or liquid
form, or if not intended for ingestion in such form, is not represented as conventional food
and is not represented for use as a sole item of a meal or of the diet; and

(3) is required to be labeled as a dietary supplement, identifiable by the supplement
facts box found on the label and as required pursuant to Code of Federal Regulations,
title 21, section 101.36.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for sales and purchases made after
June 30, 2016.
new text end

Sec. 2.

Minnesota Statutes 2014, section 297A.67, subdivision 4, is amended to read:

Subd. 4.

Exempt meals at residential facilities.

Prepared food, candy, and soft
drinks served to patients, inmates, or persons residing at hospitals, sanitariums, nursing
homes, senior citizen homes, and correctional, detention, and detoxification facilities new text begin ,
including food sold through vending machines, new text end are exempt. deleted text begin Food sold through vending
machines is not exempt.
deleted 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, 2016.
new text end

Sec. 3.

Minnesota Statutes 2014, section 297A.67, subdivision 5, is amended to read:

Subd. 5.

Exempt meals at schools.

Prepared food, candy, and soft drinks served
at public and private elementary, middle, or secondary schools as defined in section
120A.05 are exempt. Prepared food, candy, and soft drinks served to students at a college,
university, or private career school under a board contract new text begin , including food sold through
vending machines, new text end are exempt. deleted text begin Food sold through vending machines is not exempt.
deleted 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, 2016.
new text end

Sec. 4.

Minnesota Statutes 2014, section 297A.67, subdivision 6, is amended to read:

Subd. 6.

Other exempt meals.

(a) Prepared food, candy, and soft drinks purchased
for and served exclusively to individuals who are 60 years of age or over and their
spouses or to disabled persons and their spouses by governmental agencies, nonprofit
organizations, or churches, or pursuant to any program funded in whole or in part through
United States Code, title 42, sections 3001 through 3045, wherever delivered, prepared, or
served, new text begin including food sold through vending machines, new text end are exempt. deleted text begin Food sold through
vending machines is not exempt.
deleted text end

(b) Prepared food, candy, and soft drinks purchased for and served exclusively to
children who are less than 14 years of age or disabled children who are less than 16 years
of age and who are attending a child care or early childhood education program, are
exempt if they are:

(1) purchased by a nonprofit child care facility that is exempt under section 297A.70,
subdivision 4, and that primarily serves families with income of 250 percent or less of
federal poverty guidelines; and

(2) prepared at the site of the child care facility.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for sales and purchases made after
June 30, 2016.
new text end

Sec. 5. new text begin RULE CHANGE.
new text end

new text begin The commissioner of revenue shall amend Minnesota Rules, part 8130.4700, subpart
1a; subpart 2, item B; subpart 5, item G; subpart 6, item E; subpart 7, item C; and subpart
8, item D, so that the provisions therein reflect the changes enacted under sections 1 to 4.
The commissioner shall use the good cause exemption under Minnesota Statutes, section
14.388, in adopting the amendments. The provisions of Minnesota Statutes, section
14.386, do not apply except as provided in Minnesota Statutes, section 14.388.
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