5.2. ERMUSR 09-10-2013 - Laserfiche WebLink

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OMNIBUS TAX BILL 2013 Session Laws Chapter 143 HF 677 Rep.Ann Lenczewski (DFL- Bloomington) SF 552 Sen. Rod Skoe (R- Clearbrook) Sales Tax Exemption for Cities and Counties (Art. 8, Sec. 29) Exempts cities and counties from the state sales tax on most purchases. (The same exemption was established for towns in 2011.) Excluded from the exemption are purchases of certain building construction or reconstruction materials, prepared food, candy,soft drinks, alcoholic beverages, motor vehicle leases and lodging accommodations. The exemption also does NOT apply to purchases by cities or counties of goods or services that are used as inputs to certain goods or services provided by the local government to its citizens, including, specifically, municipal electric or gas utility service. Under the law, electric or gas service is considered to be a service "generally provided by a private business." However, purchases of inputs to "sewer,water service and wastewater treatment" DO qualify for the new sales tax exemption. As of the printing of this Legislative Report, MMUA was lobbying the Department of Revenue for an interpretation of the exemption carveout for municipal utilities that would still exempt from the sales tax purchases by utilities of goods and services that are not inputs to the utility services they provide(e.g., office supplies, etc.). Amends Minn. Stat. §297A.70,subd. 2. Effective date: For sales and purchases made after December 31, 2013. From HF 295 by Rep. Nick Zerwas (R- Elk River) and SF 329 by Sen. David Senjem (R- Rochester) and HF 469 by Rep. Peter Fischer (DFL- Maplewood) and SF 104 by Sen. Charles Wiger (DFL- Maplewood). Personal Property Tax Exemption for MMPA Electric Generating Plant (Art.4, Sec. 14) To exempt from personal property tax an electric generating plant with a capacity exceeding 5 megawatts that utilizes natural gas in a reciprocating engine in a Twin Cities metropolitan county and is owned by a municipal power agency. The plant must be designed so that the power it generates will be consumed in the municipal utility service territory in which it is located. Amends Minn. Stat. §272.02. Effective date: Assessment year 2013, taxes payable in 2014 and thereafter. From HF 337 by Rep. Leon Lillie (DFL- North St. Paul) and SF 161 by Sen. Charles Wiger (DFL- Maplewood). 74