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Office of the Revisor of Statutes

Key: (1) language to be deleted (2) new language

                              CHAPTER 3-H.F.No. 3 
                  An act relating to sales tax imposed on the delivery 
                  of aggregate materials and concrete block; making 
                  technical corrections; amending Minnesota Statutes 
                  2002, section 297A.61, subdivision 3.  
        BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
           Section 1.  Minnesota Statutes 2002, section 297A.61, 
        subdivision 3, is amended to read: 
           Subd. 3.  [SALE AND PURCHASE.] (a) "Sale" and "purchase" 
        include, but are not limited to, each of the transactions listed 
        in this subdivision. 
           (b) Sale and purchase include: 
           (1) any transfer of title or possession, or both, of 
        tangible personal property, whether absolutely or conditionally, 
        for a consideration in money or by exchange or barter; and 
           (2) the leasing of or the granting of a license to use or 
        consume, for a consideration in money or by exchange or barter, 
        tangible personal property, other than a manufactured home used 
        for residential purposes for a continuous period of 30 days or 
        more. 
           (c) Sale and purchase include the production, fabrication, 
        printing, or processing of tangible personal property for a 
        consideration for consumers who furnish either directly or 
        indirectly the materials used in the production, fabrication, 
        printing, or processing. 
           (d) Sale and purchase include the preparing for a 
        consideration of food.  Notwithstanding section 297A.67, 
        subdivision 2, taxable food includes, but is not limited to, the 
        following: 
           (1) prepared food sold by the retailer; 
           (2) soft drinks; 
           (3) candy; and 
           (4) all food sold through vending machines. 
           (e) A sale and a purchase includes the furnishing for a 
        consideration of electricity, gas, water, or steam for use or 
        consumption within this state. 
           (f) A sale and a purchase includes the transfer for a 
        consideration of computer software.  
           (g) A sale and a purchase includes the furnishing for a 
        consideration of the following services: 
           (1) the privilege of admission to places of amusement, 
        recreational areas, or athletic events, and the making available 
        of amusement devices, tanning facilities, reducing salons, steam 
        baths, turkish baths, health clubs, and spas or athletic 
        facilities; 
           (2) lodging and related services by a hotel, rooming house, 
        resort, campground, motel, or trailer camp and the granting of 
        any similar license to use real property other than the renting 
        or leasing of it for a continuous period of 30 days or more; 
           (3) parking services, whether on a contractual, hourly, or 
        other periodic basis, except for parking at a meter; 
           (4) the granting of membership in a club, association, or 
        other organization if: 
           (i) the club, association, or other organization makes 
        available for the use of its members sports and athletic 
        facilities, without regard to whether a separate charge is 
        assessed for use of the facilities; and 
           (ii) use of the sports and athletic facility is not made 
        available to the general public on the same basis as it is made 
        available to members.  
        Granting of membership means both onetime initiation fees and 
        periodic membership dues.  Sports and athletic facilities 
        include golf courses; tennis, racquetball, handball, and squash 
        courts; basketball and volleyball facilities; running tracks; 
        exercise equipment; swimming pools; and other similar athletic 
        or sports facilities; 
           (5) delivery of aggregate materials and concrete block by a 
        third party if the delivery would be subject to the sales tax if 
        provided by the seller of the aggregate material or concrete 
        block; and 
           (6) services as provided in this clause: 
           (i) laundry and dry cleaning services including cleaning, 
        pressing, repairing, altering, and storing clothes, linen 
        services and supply, cleaning and blocking hats, and carpet, 
        drapery, upholstery, and industrial cleaning.  Laundry and dry 
        cleaning services do not include services provided by coin 
        operated facilities operated by the customer; 
           (ii) motor vehicle washing, waxing, and cleaning services, 
        including services provided by coin operated facilities operated 
        by the customer, and rustproofing, undercoating, and towing of 
        motor vehicles; 
           (iii) building and residential cleaning, maintenance, and 
        disinfecting and exterminating services; 
           (iv) detective, security, burglar, fire alarm, and armored 
        car services; but not including services performed within the 
        jurisdiction they serve by off-duty licensed peace officers as 
        defined in section 626.84, subdivision 1, or services provided 
        by a nonprofit organization for monitoring and electronic 
        surveillance of persons placed on in-home detention pursuant to 
        court order or under the direction of the Minnesota department 
        of corrections; 
           (v) pet grooming services; 
           (vi) lawn care, fertilizing, mowing, spraying and sprigging 
        services; garden planting and maintenance; tree, bush, and shrub 
        pruning, bracing, spraying, and surgery; indoor plant care; 
        tree, bush, shrub, and stump removal; and tree trimming for 
        public utility lines.  Services performed under a construction 
        contract for the installation of shrubbery, plants, sod, trees, 
        bushes, and similar items are not taxable; 
           (vii) massages, except when provided by a licensed health 
        care facility or professional or upon written referral from a 
        licensed health care facility or professional for treatment of 
        illness, injury, or disease; and 
           (viii) the furnishing of lodging, board, and care services 
        for animals in kennels and other similar arrangements, but 
        excluding veterinary and horse boarding services. 
           In applying the provisions of this chapter, the terms 
        "tangible personal property" and "sales at retail" include 
        taxable services and the provision of taxable services, unless 
        specifically provided otherwise.  Services performed by an 
        employee for an employer are not taxable.  Services performed by 
        a partnership or association for another partnership or 
        association are not taxable if one of the entities owns or 
        controls more than 80 percent of the voting power of the equity 
        interest in the other entity.  Services performed between 
        members of an affiliated group of corporations are not taxable.  
        For purposes of this section, "affiliated group of corporations" 
        includes those entities that would be classified as members of 
        an affiliated group under United States Code, title 26, section 
        1504, and that are eligible to file a consolidated tax return 
        for federal income tax purposes. 
           (h) A sale and a purchase includes the furnishing for a 
        consideration of tangible personal property or taxable services 
        by the United States or any of its agencies or 
        instrumentalities, or the state of Minnesota, its agencies, 
        instrumentalities, or political subdivisions. 
           (i) A sale and a purchase includes the furnishing for a 
        consideration of telecommunications services, including cable 
        television services and direct satellite services.  
        Telecommunications services are taxed to the extent allowed 
        under federal law if those services: 
           (1) either (i) originate and terminate in this state; or 
        (ii) originate in this state and terminate outside the state and 
        the service is charged to a telephone number customer located in 
        this state or to the account of any transmission instrument in 
        this state; or (iii) originate outside this state and terminate 
        in this state and the service is charged to a telephone number 
        customer located in this state or to the account of any 
        transmission instrument in this state; or 
           (2) are rendered by providing a private communications 
        service for which the customer has one or more locations within 
        Minnesota connected to the service and the service is charged to 
        a telephone number customer located in this state or to the 
        account of any transmission instrument in this state. 
           All charges for mobile telecommunications services, as 
        defined in United States Code, title 4, section 124, are deemed 
        to be provided by the customer's home service provider and 
        sourced to the customer's place of primary use and are subject 
        to tax based upon the customer's place of primary use in 
        accordance with the Mobile Telecommunications Sourcing Act, 
        United States Code, title 4, sections 116 to 126.  All other 
        definitions and provisions of the Mobile Telecommunications 
        Sourcing Act as provided in United States Code, title 4, are 
        hereby adopted. 
           (j) A sale and a purchase includes the furnishing for a 
        consideration of installation if the installation charges would 
        be subject to the sales tax if the installation were provided by 
        the seller of the item being installed. 
           [EFFECTIVE DATE.] This section is effective for sales made 
        after June 30, 2002, but shall not apply to sales made pursuant 
        to bona fide written contracts, nor to lump sum or fixed price 
        construction contracts which do not make provision for 
        allocation of future taxes; provided that the contracts were 
        enforceable prior to July 1, 2002, and further provided that the 
        delivery of the aggregate materials or concrete block is made on 
        or before January 1, 2003. 
           Presented to the governor September 19, 2002 
           Signed by the governor September 20, 2002, 9:13 a.m.