House Bill 0397er

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    ENROLLED

    1999 Legislature                                     CS/HB 397



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  2         An act relating to tax on sales, use, and other

  3         transactions; amending s. 212.08, F.S.;

  4         revising the industries to which the exemption

  5         for electricity or steam used in certain

  6         manufacturing and related operations applies;

  7         providing an exemption for labor charges for,

  8         and parts and materials used in, the repair of

  9         machinery and equipment used to produce

10         tangible personal property at a fixed location

11         by specified industries; providing a schedule

12         for implementing the exemption; providing an

13         effective date.

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15  Be It Enacted by the Legislature of the State of Florida:

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17         Section 1.  Paragraph (ii) of subsection (7) of section

18  212.08, Florida Statutes, 1998 Supplement, is amended, and

19  paragraph (zz) is added to said subsection, to read:

20         212.08  Sales, rental, use, consumption, distribution,

21  and storage tax; specified exemptions.--The sale at retail,

22  the rental, the use, the consumption, the distribution, and

23  the storage to be used or consumed in this state of the

24  following are hereby specifically exempt from the tax imposed

25  by this chapter.

26         (7)  MISCELLANEOUS EXEMPTIONS.--

27         (ii)  Certain electricity or steam uses.--

28         1.  Charges for electricity or steam used to operate

29  machinery and equipment at a fixed location in this state when

30  such machinery and equipment is used to manufacture, process,

31  compound, produce, or prepare for shipment items of tangible


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    ENROLLED

    1999 Legislature                                     CS/HB 397



  1  personal property for sale, or to operate pollution control

  2  equipment, recycling equipment, maintenance equipment, or

  3  monitoring or control equipment used in such operations are

  4  exempt to the extent provided in this paragraph. In order to

  5  qualify for this exemption, 75 percent or more of the

  6  electricity used at the fixed location must be used to operate

  7  qualifying machinery or equipment. If less than 75 percent but

  8  50 percent or more of the electricity is used at a fixed

  9  location to operate qualifying machinery or equipment, then it

10  is presumed that 50 percent of the charge for electricity is

11  for nonexempt purposes.

12         2.  This exemption applies only to industries

13  classified under SIC Industry Major Group Numbers 10, 12, 13,

14  14, 20, 22, 23, 24, 25, 26, 27, 28, 29, 30, 31, 32, 33, 34,

15  35, 36, 37, 38, and 39 and Industry Group Number 212. As used

16  in this paragraph, "SIC" means those classifications contained

17  in the Standard Industrial Classification Manual, 1987, as

18  published by the Office of Management and Budget, Executive

19  Office of the President.

20         3.  Possession by a seller of a written certification

21  by the purchaser, certifying the purchaser's entitlement to an

22  exemption permitted by this subsection, relieves the seller

23  from the responsibility of collecting the tax on the

24  nontaxable amounts, and the department shall look solely to

25  the purchaser for recovery of such tax if it determines that

26  the purchaser was not entitled to the exemption.

27         4.  Such exemption shall be applied as follows:

28         a.  Beginning July 1, 1996, 20 percent of the charges

29  for such electricity shall be exempt.

30         b.  Beginning July 1, 1997, 40 percent of the charges

31  for such electricity shall be exempt.


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    ENROLLED

    1999 Legislature                                     CS/HB 397



  1         c.  Beginning July 1, 1998, 60 percent of the charges

  2  for such electricity or steam shall be exempt.

  3         d.  Beginning July 1, 1999, 80 percent of the charges

  4  for such electricity or steam shall be exempt.

  5         e.  Beginning July 1, 2000, 100 percent of the charges

  6  for such electricity or steam shall be exempt.

  7         5.  Notwithstanding any other provision in this

  8  paragraph to the contrary, in order to receive the exemption

  9  provided in this paragraph a taxpayer must first register with

10  the WAGES Program Business Registry established by the local

11  WAGES coalition for the area in which the taxpayer is located.

12  Such registration establishes a commitment on the part of the

13  taxpayer to hire WAGES program participants to the maximum

14  extent possible consistent with the nature of their business.

15         6.a.  In order to determine whether the exemption

16  provided in this paragraph from the tax on charges for

17  electricity or steam has an effect on retaining or attracting

18  companies to this state, the Office of Program Policy Analysis

19  and Governmental Accountability shall periodically monitor and

20  report on the industries receiving the exemption.

21         b.  The first report shall be submitted no later than

22  January 1, 1997, and must be conducted in such a manner as to

23  specifically determine the number of companies within each SIC

24  Industry Major Group receiving the exemption as of September

25  1, 1996, and the number of individuals employed by companies

26  within each SIC Industry Major Group receiving the exemption

27  as of September 1, 1996.

28         c.  The second report shall be submitted no later than

29  January 1, 2001, and must be comprehensive in scope, but, at a

30  minimum, must be conducted in such a manner as to specifically

31  determine the number of companies within each SIC Industry


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    ENROLLED

    1999 Legislature                                     CS/HB 397



  1  Major Group receiving the exemption as of September 1, 2000,

  2  the number of individuals employed by companies within each

  3  SIC Industry Major Group receiving the exemption as of

  4  September 1, 2000, whether the change, if any, in such number

  5  of companies or employees is attributable to the exemption

  6  provided in this paragraph, whether it would be sound public

  7  policy to continue or discontinue the exemption, and the

  8  consequences of doing so.

  9         d.  Both reports shall be submitted to the President of

10  the Senate, the Speaker of the House of Representatives, the

11  Senate Minority Leader, and the House Minority Leader.

12         (zz)  Certain repair and labor charges.--

13         1.  Subject to the provisions of subparagraphs 2. and

14  3., there is exempt from the tax imposed by this chapter all

15  labor charges for the repair of, and parts and materials used

16  in the repair of and incorporated into, industrial machinery

17  and equipment which is used for the manufacture, processing,

18  compounding, or production of items of tangible personal

19  property at a fixed location within this state.

20         2.  This exemption applies only to industries

21  classified under SIC Industry Major Group Numbers 10, 12, 13,

22  14, 20, 22, 23, 24, 25, 26, 27, 28, 29, 30, 31, 32, 33, 34,

23  36, 37, 38, and 39 and Industry Group Number 212. As used in

24  this subparagraph, "SIC" means those classifications contained

25  in the Standard Industrial Classification Manual, 1987, as

26  published by the Office of Management and Budget, Executive

27  Office of the President.

28         3.  This exemption shall be applied as follows:

29         a.  Beginning July 1, 1999, 25 percent of such charges

30  for repair parts and labor shall be exempt.

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    ENROLLED

    1999 Legislature                                     CS/HB 397



  1         b.  Beginning July 1, 2000, 50 percent of such charges

  2  for repair parts and labor shall be exempt.

  3         c.  Beginning July 1, 2001, 75 percent of such charges

  4  for repair parts and labor shall be exempt.

  5         d.  Beginning July 1, 2002, 100 percent of such charges

  6  for repair parts and labor shall be exempt.

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  8  Exemptions provided to any entity by this subsection shall not

  9  inure to any transaction otherwise taxable under this chapter

10  when payment is made by a representative or employee of such

11  entity by any means, including, but not limited to, cash,

12  check, or credit card even when that representative or

13  employee is subsequently reimbursed by such entity.

14         Section 2.  This act shall take effect July 1, 1999.

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