1.1 	A bill for an act
1.2 	relating to taxation; providing for a gross receipts
1.3 	tax on retail sales of consumer goods in excess of
1.4 	$20,000,000 at an individual location; establishing
1.5 	thresholds for compensation and percentage of
1.6 	full-time employees that cause the establishment to be
1.7 	subject to the gross receipts tax; amending Minnesota
1.8 	Statutes 2004, section 289A.01; proposing coding for
1.9 	new law in Minnesota Statutes, chapter 295.
1.10 	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

1.11 	Section 1. Minnesota Statutes 2004, section 289A.01, is
1.12 	amended to read:
1.13 	289A.01 APPLICATION OF CHAPTER.
1.14 	This chapter applies to laws administered by the
1.15 	commissioner under chapters 290, 290A, 291, and 297A, and
1.16 	sections 295.61 to 295.65,298.01,and 298.015.

1.17 	Sec. 2. [295.61] RETAIL SALES GROSS RECEIPTS TAX;
1.18 	DEFINITIONS.
1.19 		Subdivision 1.Scope. As used in sections 295.61 to
1.20 	295.65, the following definitions apply.
1.21 		Subd. 2.Commissioner. "Commissioner" means the
1.22 	commissioner of revenue.
1.23 		Subd. 3.Consumer goods. "Consumer goods" has the
1.24 	meaning provided in section 336.9-102, paragraph (a), clause
1.25 	(23).  The term does not include farm implements, gasoline,
1.26 	electricity, or vehicles.
1.27 		Subd. 4.Employee compensation package. "Employee
2.1 	compensation package" means the annual total cost to an employer
2.2 	for:
2.3 	(1) an employee's wages or salary;
2.4 	(2) an employee's leave time, including vacation and sick
2.5 	leave;
2.6 	(3) an employee's insurance, including employer
2.7 	contributions for health, life, and dental insurance;
2.8 	(4) an employee's retirement plan, employer contributions
2.9 	required by the Federal Insurance Contributions Act, and
2.10 	employer contributions to employee savings, flexible spending,
2.11 	and similar plans; and 
2.12 	(5) similar employee benefits identified by the department
2.13 	by rule.
2.14 		Subd. 5.Farm implement. "Farm implement" means any
2.15 	vehicle, machine, or attachment designed or adapted and used
2.16 	exclusively for agricultural operations and only incidentally
2.17 	operated or used on the highways.
2.18 		Subd. 6.Gross receipts. "Gross receipts" means all
2.19 	receipts from retail sales from each taxable establishment
2.20 	within the state, whether in the form of money, credits, or
2.21 	other valuable consideration, received as a result of engaging
2.22 	in or conducting retail sales, without deduction on account of
2.23 	the cost of the property sold, the cost of the materials used,
2.24 	labor or service costs, interest paid, taxes, losses, or any
2.25 	other expense.  A taxable establishment may deduct the cost of
2.26 	employer contributions for retirement benefits and health
2.27 	insurance for employees from gross receipts.  The term does not
2.28 	include cash discounts allowed and taken on sales and sales
2.29 	refunds, either in cash or by credit, uncollectible accounts
2.30 	written off from time to time, or payments received in final
2.31 	liquidation of accounts included in the gross receipts of any
2.32 	previous return made by the taxable establishment.
2.33 		Subd. 7.Retail sale. "Retail sale" means any transfer
2.34 	of consumer goods for consideration for any purpose other than
2.35 	for resale, sublease, subrent, or use in a manufacturing process.
2.36 		Subd. 8.Taxable establishment. "Taxable establishment"
3.1 	means:
3.2 	(1) a premises in this state in which retail sales of
3.3 	consumer goods are offered to the general public; and 
3.4 	(2) the retail sales are conducted by an employer:
3.5 	(i) that provides full-time, nonmanagement or
3.6 	nonprofessional, entry-level employees with an employee
3.7 	compensation package that is equivalent to less than $22,000 a
3.8 	year; or 
3.9 	(ii) that has more than 25 percent, when annualized, of its
3.10 	employees working less than 40 hours a week.
3.11 		Subd. 9.Vehicle. "Vehicle" means a device in, upon, or
3.12 	by which any person or property may be transported or drawn that
3.13 	is required to be registered or that is subject to a tax or fee
3.14 	imposed under chapter 84, 86B, or 168.

3.15 	Sec. 3. [295.62] RETAIL SALES GROSS RECEIPTS TAX.
3.16 	(a) A retail sales gross receipts tax is imposed on all
3.17 	retail sales of consumer goods from a single taxable
3.18 	establishment that are in excess of $20,000,000 in a calendar
3.19 	year.
3.20 	(b) The rate of tax on gross receipts in excess of
3.21 	$20,000,000 is as follows:
3.22 	(1) on gross receipts of $20,000,001 to $30,000,000, one
3.23 	percent;
3.24 	(2) on gross receipts of $30,000,001 to $40,000,000, 1.5
3.25 	percent; and 
3.26 	(3) on gross receipts in excess of $40,000,000, two percent.

3.27 	Sec. 4. [295.63] RETURNS; PAYMENT; AUTHORITY OF
3.28 	DEPARTMENT.
3.29 		Subdivision 1.Return; payment of tax; audit. On or
3.30 	before January 31 each year, a return, in a form required by the
3.31 	department, with a remittance of the tax owed for gross receipts
3.32 	from retail sales occurring during the preceding year, must be
3.33 	filed with the department by each taxable establishment required
3.34 	to pay the tax.  The filing and remittance may be done
3.35 	electronically.  For the purposes of reporting or paying the
3.36 	gross receipts tax, the taxable establishment and any agent of
4.1 	the taxable establishment are subject to the audit and
4.2 	enforcement provisions of chapter 289A that apply to collections
4.3 	of the corporate franchise tax.  Each return must be
4.4 	authenticated by the person filing the return or by the person's
4.5 	agent who is authorized in writing to file the return.  Pursuant
4.6 	to rules adopted by the Department of Revenue, returns may be
4.7 	filed electronically.
4.8 		Subd. 2.Information. A person required to report and
4.9 	pay to the department a tax under sections 295.61 to 295.65
4.10 	shall keep records, file statements, make returns, and comply
4.11 	with the provisions of sections 295.61 to 295.65 and the rules
4.12 	adopted by the department.  Each return or statement must
4.13 	include the information required by the rules of the department.

4.14 	Sec. 5. [295.64] DEPOSIT OF PROCEEDS.
4.15 	Retail sales gross receipts tax proceeds must be deposited
4.16 	in the state general fund.

4.17 	Sec. 6. [295.65] ADMINISTRATION; RULES.
4.18 	The department shall:
4.19 	(1) administer and enforce the provisions of sections
4.20 	295.61 to 295.65 by applying the provisions of chapter 289A that
4.21 	apply to administration of the corporate franchise tax to
4.22 	taxpayers under sections 295.61 to 295.65;
4.23 	(2) cause to be prepared and distributed forms and
4.24 	information that may be necessary to administer the provisions
4.25 	of sections 295.61 to 295.65; and 
4.26 	(3) adopt rules that may be necessary or appropriate to
4.27 	administer and enforce the provisions of sections 295.61 to
4.28 	295.65.

4.29 	Sec. 7. EFFECTIVE DATE.
 4.30 	This act is effective for retail sales after December 31,
4.31 	2004.