CODING: Words stricken are deletions; words underlined are additions.



                                                  SENATE AMENDMENT

    Bill No. CS for SB 1186

    Amendment No. ___   Barcode 175992

                            CHAMBER ACTION
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11  Senator Pruitt moved the following amendment:

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13         Senate Amendment (with title amendment) 

14         On page 39, between lines 28 and 29,

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16  insert:

17         Section 6.  Effective upon this act becoming a law,

18  section 11.35, Florida Statutes, is created to read:

19         11.35  Joint Legislative Committee on Tax Exemptions;

20  membership; duties.--

21         (1)  The Joint Legislative Committee on Tax Exemptions

22  is created as a joint standing committee of the Legislature

23  composed of 12 members, 6 of whom are members of the Senate

24  appointed by the President of the Senate and 6 of whom are

25  members of the House of Representatives appointed by the

26  Speaker of the House of Representatives. The terms of members

27  are 2 years and run from one organization session of the

28  Legislature to the following organization session. In each

29  even-numbered year, the President of the Senate shall appoint

30  a member of the Senate to serve as chair for a term of 1 year;

31  and, in each odd-numbered year, the Speaker of the House of

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                                                  SENATE AMENDMENT

    Bill No. CS for SB 1186

    Amendment No. ___   Barcode 175992





  1  Representatives shall appoint a member of the House of

  2  Representatives to serve as chair for a term of 1 year. A

  3  vacancy is to be filled for the unexpired portion of the term

  4  in the same manner as the original appointment.

  5         (2)  The committee shall conduct a periodic review of

  6  all exemptions from taxation under chapter 212, except those

  7  specified in s. 212.25(3). The committee must complete the

  8  first of its reviews by December 1, 2004, and its initial

  9  review of all exemptions by December 1, 2009. For purposes of

10  the review, the committee shall:

11         (a)  Assign each exemption to a discrete category of

12  exemptions, placing, to the extent practicable, similar and

13  related exemptions within the same category. The committee

14  shall identify discrete classes of transactions exempted by s.

15  212.25(2) and assign the exemption of each class to the

16  appropriate category.

17         (b)  Schedule, for each year, one or more of the

18  categories to be reviewed before the following regular session

19  of the Legislature. Each category must be reviewed once by

20  December 1, 2009. By December 1, 2003, the committee shall

21  prepare, and submit to the President of the Senate and the

22  Speaker of the House of Representatives for introduction at

23  the 2004 regular session of the Legislature, a proposed bill

24  that amends the statutes to set the expiration date for each

25  exemption 18 months after the year in which it is scheduled

26  for review. The proposed bill shall set July 1, 2006, as the

27  expiration date for those exemptions which are scheduled to be

28  reviewed by December 1, 2004.

29         (c)  Adopt standards and criteria that it will use for

30  its review of exemptions and upon which it will base its

31  recommendation to reauthorize an exemption. In developing

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                                                  SENATE AMENDMENT

    Bill No. CS for SB 1186

    Amendment No. ___   Barcode 175992





  1  these standards and criteria, the committee should consider

  2  the following principles of taxation:

  3         1.  Equity.--The Florida tax system should treat

  4  individuals equitably. It should impose similar tax burdens on

  5  people in similar circumstances and should minimize

  6  regressivity.

  7         2.  Compliance.--The Florida tax system should

  8  facilitate taxpayer compliance.  It should be simple and easy

  9  to understand so as to minimize compliance costs and increase

10  the visibility and awareness of the taxes being paid.

11  Enforcement and collection of tax revenues should be done in a

12  fair, consistent, professional, predictable, and

13  cost-effective manner.

14         3.  Promotion of competition.--The Florida tax system

15  should be responsive to interstate and international

16  competition in order to encourage savings and investment in

17  plant, equipment, people, and technology.

18         4.  Neutrality.--The Florida tax system should affect

19  competitors uniformly and not become a tool for "social

20  engineering."  It should minimize government involvement in

21  investment decisions, making any such involvement explicit,

22  and should minimize pyramiding.

23         5.  Stability.--The Florida tax system should produce

24  revenues in a stable and reliable manner which are sufficient

25  to fund appropriate governmental functions and expenditures.

26         6.  Integration.--The Florida tax system should balance

27  the need for integration of federal, state, and local

28  taxation.

29         7.  Public purpose.--Any sales tax exemption should be

30  based upon a determination that the exemption promotes an

31  important state interest, including, but not limited to,

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                                                  SENATE AMENDMENT

    Bill No. CS for SB 1186

    Amendment No. ___   Barcode 175992





  1  economic development, job creation and retention, economic

  2  diversification, and community revitalization.

  3         (3)  By December 1 of each year, the committee shall

  4  submit to the President of the Senate and the Speaker of the

  5  House of Representatives a separate report for each category

  6  of exemptions reviewed during that year. Each report must

  7  contain the committee's recommendations with respect to each

  8  exemption assigned to that category and include, for

  9  consideration at the next regular session of the Legislature,

10  a proposed bill to reauthorize, for a period not to exceed 10

11  years, those exemptions that the committee recommends be

12  reauthorized and to cleanse the statutes of those exemptions

13  that the committee recommends be allowed to expire. Each

14  report must also include, for each exemption for which the

15  committee makes no recommendation, a separate bill to

16  reauthorize that exemption for a period not to exceed 10

17  years. Each proposed bill must provide that each reauthorized

18  exemption expires on a specified date occurring no more than

19  10 years after the effective date of the bill and is to be

20  reviewed pursuant to this section at least 18 months prior to

21  its expiration.

22         Section 7.  Effective upon this act becoming a law,

23  section 212.25, Florida Statutes, is created to read:

24         212.25  Expiration and review of tax exemptions; status

25  of transactions neither expressly taxable nor exempt.--

26         (1)  Effective July 1, 2011, and on July 1 of every

27  10th year thereafter, each exemption from taxation under this

28  chapter expires, except those specified in subsection (3) and

29  those specifically set by law to expire on another date. Prior

30  to its expiration, each such exemption shall be reviewed by

31  the Joint Legislative Committee on Tax Exemptions in

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                                                  SENATE AMENDMENT

    Bill No. CS for SB 1186

    Amendment No. ___   Barcode 175992





  1  accordance with the law governing such reviews.

  2         (2)  Until July 1, 2011, any sale of goods or services

  3  that is neither expressly taxable nor expressly exempt from

  4  taxation under this chapter is exempt from such taxation, and

  5  the exemptions provided by this subsection are subject to

  6  review under s. 11.35. Effective July 1, 2011, any sale of

  7  goods or services that is neither expressly taxable nor

  8  expressly exempt from taxation under this chapter is subject

  9  to tax at the same rate as the general tax rate prescribed by

10  this chapter for the retail sale of items of tangible personal

11  property.

12         (3)  Notwithstanding the other provisions of this

13  section, the following transactions remain exempt from

14  taxation under this chapter and are not subject to expiration

15  or review under this section or s. 11.35: the sale of

16  groceries, prescription drugs, health services, real property,

17  intangible personal property, or communications services; the

18  sale of tangible personal property purchased for resale or

19  imported, produced, or manufactured in this state for export;

20  and the payment of residential rent or employee salaries or

21  benefits.

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23  (Redesignate subsequent sections.)

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25

26  ================ T I T L E   A M E N D M E N T ===============

27  And the title is amended as follows:

28         On page 3, line 6, delete that line,

29

30  and insert:

31         creating s. 11.35, F.S.; creating the Joint

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                                                  SENATE AMENDMENT

    Bill No. CS for SB 1186

    Amendment No. ___   Barcode 175992





  1         Legislative Committee on Tax Exemptions;

  2         providing for its membership and prescribing

  3         its duties; requiring it to periodically review

  4         and make recommendations concerning tax

  5         exemptions prescribed in ch. 212, F.S.;

  6         creating s. 212.25, F.S.; providing for the

  7         periodic expiration and review of tax

  8         exemptions under ch. 212, F.S.; providing that

  9         sales of goods or services that are neither

10         expressly taxable nor expressly exempt from

11         taxation by a specified date become taxable;

12         exempting specified transactions from taxation

13         and from the the expiration and review

14         requirements of the act; providing an effective

15         date.

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17         WHEREAS, the Legislature has identified a crisis in the

18  economy which compels the Legislature to take a broad and

19  comprehensive approach to economic development, addressing its

20  many facets, including both economic stimulus and the state's

21  tax policy, and

22         WHEREAS, the Legislature recognizes the obvious natural

23  and logical connection between economic development and the

24  distribution of the tax burden among the diverse segments of

25  the economy, and

26         WHEREAS, the Legislature seeks by this legislation to

27  accomplish goals that are not separate or disassociated

28  objects of legislative effort, but that are integrated and

29  dependent elements of a comprehensive approach to a rational

30  economic policy that will fairly and equitably promote

31  economic development throughout the diverse segments of the

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                                                  SENATE AMENDMENT

    Bill No. CS for SB 1186

    Amendment No. ___   Barcode 175992





  1  economy, and

  2         WHEREAS, the Legislature, as part of this comprehensive

  3  approach to a rational economic policy, seeks to create a

  4  process by which the Legislature will periodically review, on

  5  an orderly schedule, the array of tax exemptions and identify

  6  those that serve as a widespread stimulus to the economy and

  7  those that hamper economic development by unfairly

  8  distributing the tax burden or giving an undue competitive

  9  advantage to a business over others similarly situated, NOW,

10  THEREFORE,

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