| 1 | A bill to be entitled |
| 2 | An act relating to the Joint Legislative Sales and Use Tax |
| 3 | Exemption Review Committee; creating s. 11.95, F.S.; |
| 4 | creating the Joint Legislative Sales and Use Tax Exemption |
| 5 | Review Committee for the purpose of reviewing exemptions |
| 6 | from the general state sales and use tax; providing for |
| 7 | appointments to and organization of the committee; |
| 8 | specifying duties and procedures with respect to such |
| 9 | review; providing for open meetings; providing for |
| 10 | reports; requiring continuing periodic review of sales and |
| 11 | use tax exemptions; providing a period of exemption from |
| 12 | review for newly enacted exemptions; providing |
| 13 | applicability to other legislation proposing to modify, |
| 14 | repeal, or enact an exemption; providing an effective |
| 15 | date. |
| 16 |
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| 17 | Be It Enacted by the Legislature of the State of Florida: |
| 18 |
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| 19 | Section 1. Section 11.95, Florida Statutes, is created to |
| 20 | read: |
| 21 | 11.95 Joint Legislative Sales and Use Tax Exemption Review |
| 22 | Committee.-- |
| 23 | (1) The Joint Legislative Sales and Use Tax Exemption |
| 24 | Review Committee is created to conduct comprehensive, periodic |
| 25 | reviews of all exemptions from the general state sales and use |
| 26 | tax. The committee shall consist of nine senators appointed by |
| 27 | the President of the Senate and nine representatives appointed |
| 28 | by the Speaker of the House of Representatives. The terms of the |
| 29 | members of the initial committee for each review cycle shall |
| 30 | commence upon appointment and shall run to the general election |
| 31 | preceding the organization of the next Legislature. The terms of |
| 32 | the members of subsequent committees for each review cycle shall |
| 33 | be for 2 years and shall run from the organization of one |
| 34 | Legislature to the general election preceding the organization |
| 35 | of the next Legislature. A vacancy shall be filled in the same |
| 36 | manner as the original appointment. During even-numbered years, |
| 37 | the chair of the committee shall be appointed by the President |
| 38 | of the Senate, and the vice chair of the committee shall be |
| 39 | appointed by the Speaker of the House of Representatives. During |
| 40 | odd-numbered years, the chair of the committee shall be |
| 41 | appointed by the Speaker of the House of Representatives, and |
| 42 | the vice chair of the committee shall be appointed by the |
| 43 | President of the Senate. |
| 44 | (2) The committee for each review cycle shall have its |
| 45 | initial meeting no later than December 1 of the year of its |
| 46 | first regular session and thereafter as necessary at the call of |
| 47 | the chair at the time and place designated by the chair. A |
| 48 | quorum shall consist of a majority of the committee members from |
| 49 | each house. During the interim between regular sessions, the |
| 50 | committee may conduct its meetings through teleconferences or |
| 51 | other similar means. All meetings of the committee shall be open |
| 52 | and noticed to the public and subject to order and decorum in |
| 53 | accordance with s. 4(e), Art. III of the State Constitution. |
| 54 | (3) The committee shall be governed by joint rules adopted |
| 55 | by the Legislature pursuant to authority to adopt rules under s. |
| 56 | 4, Art. III of the State Constitution. |
| 57 | (4) For purposes of this section, the term: |
| 58 | (a) "General state sales and use tax" means the sales and |
| 59 | use tax imposed under chapter 212. |
| 60 | (b) "Exemption" means a provision in chapter 212 that |
| 61 | relieves from taxation a sale, use, or other transaction that |
| 62 | would, but for such provision, be subject to tax under chapter |
| 63 | 212. A transaction that is beyond the reach of chapter 212 by |
| 64 | reason of definitional or other exclusions shall not be deemed |
| 65 | the subject of an exemption for purposes of this section. |
| 66 | Included among the transactions excluded from taxation under |
| 67 | chapter 212 and therefore not the subject of an exemption to be |
| 68 | reviewed by the committee under this section are the following: |
| 69 | 1. Sales that are not retail sales pursuant to s. |
| 70 | 212.02(14). |
| 71 | 2. Export sales under s. 212.06(5)(a). |
| 72 | 3. Sales for resale under s. 212.07. |
| 73 | 4. Occasional and isolated sales. |
| 74 | 5. The sale or use of intangible property. |
| 75 | 6. The sale of real property. |
| 76 | 7. The sale or use of services, excepting only those |
| 77 | services enumerated as taxable in chapter 212. |
| 78 | (c) "Single exemption" means an exemption that describes a |
| 79 | single transaction or an exemption set forth in a section, |
| 80 | subsection, or paragraph of chapter 212, whichever describes the |
| 81 | fewest number of transactions. |
| 82 | (5) The committee shall have the power and duty to conduct |
| 83 | a comprehensive review of all current exemptions from the |
| 84 | general state sales and use tax. The committee shall establish |
| 85 | criteria by which each exemption shall be evaluated. In |
| 86 | developing the evaluation criteria, the committee shall consider |
| 87 | the following principles of taxation: |
| 88 | (a) Equity.--The Florida tax system should treat |
| 89 | individuals equitably. It should impose similar tax burdens on |
| 90 | people in similar circumstances and should minimize |
| 91 | regressivity. |
| 92 | (b) Compliance.--The Florida tax system should facilitate |
| 93 | taxpayer compliance. It should be simple and easy to understand |
| 94 | so as to minimize compliance costs and increase the visibility |
| 95 | and awareness of the taxes being paid. Enforcement and |
| 96 | collection of tax revenues should be done in a fair, consistent, |
| 97 | professional, predictable, and cost-effective manner. |
| 98 | (c) Pro-competitiveness.--The Florida tax system should be |
| 99 | responsive to interstate and international competition in order |
| 100 | to encourage savings and investment in plants, equipment, |
| 101 | people, and technology in Florida. |
| 102 | (d) Neutrality.--The Florida tax system should affect |
| 103 | competitors uniformly and not become a tool for "social |
| 104 | engineering." It should minimize government involvement in |
| 105 | investment decisions, making any such involvement explicit, and |
| 106 | should minimize pyramiding. |
| 107 | (e) Stability.--The Florida tax system should produce |
| 108 | revenues in a stable and reliable manner that is sufficient to |
| 109 | fund appropriate governmental functions and expenditures. |
| 110 | (f) Integration.--The Florida tax system should balance |
| 111 | the need for integration of federal, state, and local taxation. |
| 112 | (g) Public purpose.--Any sales and use tax exemption under |
| 113 | the Florida tax system should be based upon a determination that |
| 114 | the exemption promotes an important state interest, including, |
| 115 | but not limited to, economic development, job creation and |
| 116 | retention, economic diversification, and community |
| 117 | revitalization. |
| 118 | (6) In conducting its review of each exemption from the |
| 119 | general state sales and use tax, the committee shall make |
| 120 | findings of fact and recommend whether the exemption should be |
| 121 | retained, modified, or repealed. Each recommendation must be |
| 122 | made by majority vote of the committee members. If a majority |
| 123 | vote of the committee members cannot be achieved, the committee |
| 124 | must recommend that the exemption be retained. The findings of |
| 125 | fact and recommendations of the committee shall be made by |
| 126 | reports to the President of the Senate and the Speaker of the |
| 127 | House of Representatives. |
| 128 | (7) The committee may use its discretion in determining |
| 129 | the order in which it reviews the exemptions; however, the |
| 130 | committee should review approximately one-third of the |
| 131 | exemptions each year of a 3-year review period. No exemption |
| 132 | shall be reviewed more than once during any 3-year review |
| 133 | period. For the initial 3-year review, the committee shall |
| 134 | submit, to the President of the Senate and the Speaker of the |
| 135 | House of Representatives, its reports not later than 30 days |
| 136 | prior to each regular session in the years 2007, 2008, and 2009. |
| 137 | The committee shall begin a new 3-year review cycle of all |
| 138 | exemptions from the general state sales and use tax every 10 |
| 139 | years following the termination of the previous review cycle. |
| 140 | For each subsequent 3-year review, the committee shall submit |
| 141 | its reports not later than 30 days prior to the regular session |
| 142 | of each year of that review period, beginning with the 10th year |
| 143 | after the year of the final report for the previous review. |
| 144 | (8) At the regular session following submission of each |
| 145 | annual report to the presiding officers of the Legislature, the |
| 146 | ranking member of each house of the Legislature on the committee |
| 147 | shall sponsor and file for introduction in his or her respective |
| 148 | house of the Legislature bills presenting for modification or |
| 149 | repeal those exemptions from the general state sales and use tax |
| 150 | that were recommended by the committee for modification or |
| 151 | repeal in the report submitted immediately prior to the session |
| 152 | in which introduced. However, if either such member voted |
| 153 | against the recommendation of the committee, another member of |
| 154 | the committee from that house of the Legislature who voted for |
| 155 | the recommendation of the committee shall sponsor the bill in |
| 156 | that house of the Legislature. Each bill filed under this |
| 157 | subsection shall be exempt from any filing limits applicable in |
| 158 | either house of the Legislature and shall be limited to a single |
| 159 | exemption and for that purpose only. Upon introduction, each |
| 160 | bill filed under this subsection shall be placed on the calendar |
| 161 | of the respective house of the Legislature without reference to |
| 162 | any committee and must be submitted to a vote of the members of |
| 163 | the house of the Legislature in which introduced no later than |
| 164 | the eighth week of the session in which introduced, unless the |
| 165 | substance of the bill has already been voted on by the members |
| 166 | of the other house of the Legislature in another bill during |
| 167 | that session and defeated. In addition, each bill filed under |
| 168 | this subsection that receives a majority vote in the house of |
| 169 | the Legislature in which introduced must be submitted to a vote |
| 170 | of the members of the other house of the Legislature during that |
| 171 | session, unless the substance of the bill has already been voted |
| 172 | on by the members of the other house of the Legislature in |
| 173 | another bill during that session and defeated. |
| 174 | (9) In no event shall the repeal of an exemption take |
| 175 | effect sooner than 180 days following its passage by the |
| 176 | Legislature. |
| 177 | (10) Any new exemption from taxation under chapter 212 is |
| 178 | exempt from review under this section for 6 years after it takes |
| 179 | effect. |
| 180 | (11) Nothing contained in this section shall preclude, or |
| 181 | be construed to limit, a legislator from filing for any |
| 182 | legislative session a bill proposing to modify, repeal, or enact |
| 183 | any exemption from the general state sales and use tax or the |
| 184 | imposition of such taxation on the sales of any service. |
| 185 | Section 2. This act shall take effect upon becoming a law. |