Bill Text: IA SF2336 | 2013-2014 | 85th General Assembly | Introduced
Bill Title: A bill for an act relating to the sales tax exemption for the purchase of certain items used in certain manufacturing, research and development, data processing or storage, or recycling activities.
Spectrum: Partisan Bill (Republican 21-1)
Status: (Introduced - Dead) 2014-03-12 - Subcommittee, Bolkcom, Feenstra, and Quirmbach. S.J. 542. [SF2336 Detail]
Download: Iowa-2013-SF2336-Introduced.html
Senate
File
2336
-
Introduced
SENATE
FILE
2336
BY
FEENSTRA
,
ANDERSON
,
BERTRAND
,
SCHNEIDER
,
CHELGREN
,
BOETTGER
,
CHAPMAN
,
GREINER
,
SMITH
,
GUTH
,
JOHNSON
,
SEGEBART
,
ZAUN
,
GARRETT
,
BREITBACH
,
KAPUCIAN
,
ZUMBACH
,
BEHN
,
DIX
,
WHITVER
,
ROZENBOOM
,
and
SINCLAIR
A
BILL
FOR
An
Act
relating
to
the
sales
tax
exemption
for
the
purchase
1
of
certain
items
used
in
certain
manufacturing,
research
2
and
development,
data
processing
or
storage,
or
recycling
3
activities.
4
BE
IT
ENACTED
BY
THE
GENERAL
ASSEMBLY
OF
THE
STATE
OF
IOWA:
5
TLSB
5652XS
(2)
85
mm/nh
S.F.
2336
Section
1.
Section
423.3,
subsection
47,
paragraph
a,
1
unnumbered
paragraph
1,
Code
2014,
is
amended
to
read
as
2
follows:
3
The
sales
price
from
the
sale
or
rental
of
computers,
4
machinery,
and
equipment,
including
replacement
parts
,
5
supplies
,
and
materials
used
to
construct
or
self-construct
6
computers,
machinery,
and
equipment
,
replacement
parts,
and
7
supplies,
if
such
items
are
any
of
the
following:
8
Sec.
2.
Section
423.3,
subsection
47,
paragraph
d,
Code
9
2014,
is
amended
by
adding
the
following
new
subparagraphs:
10
NEW
SUBPARAGRAPH
.
(7)
“Replacement
part”
means
tangible
11
personal
property
other
than
computers,
machinery,
equipment,
12
or
supplies,
regardless
of
the
cost
or
useful
life
of
the
13
tangible
personal
property,
that
meets
all
of
the
following
14
conditions:
15
(a)
The
tangible
personal
property
replaces
a
component
of
16
a
computer,
machinery,
or
equipment,
which
component
is
capable
17
of
being
separated
from
the
computer,
machinery,
or
equipment.
18
(b)
The
tangible
personal
property
performs
the
same
or
19
similar
function
as
the
component
it
replaced.
20
(c)
The
tangible
personal
property
restores
the
computer,
21
machinery,
or
equipment
to
an
operational
condition,
or
22
upgrades
or
improves
the
efficiency
of
the
computer,
machinery,
23
or
equipment.
24
NEW
SUBPARAGRAPH
.
(8)
“Supplies”
means
tangible
personal
25
property,
other
than
computers,
machinery,
equipment,
or
26
replacement
parts,
that
meets
one
of
the
following
conditions:
27
(a)
The
tangible
personal
property
is
to
be
connected
28
to
a
computer,
machinery,
or
equipment
and
requires
regular
29
replacement
because
the
property
is
consumed
or
deteriorates
30
during
use,
including
but
not
limited
to
saw
blades,
drill
31
bits,
filters,
and
other
similar
items
with
a
short
useful
32
life.
33
(b)
The
tangible
personal
property
is
used
in
conjunction
34
with
a
computer,
machinery,
or
equipment
and
is
specially
35
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LSB
5652XS
(2)
85
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3
S.F.
2336
designed
for
use
in
manufacturing
specific
products
and
may
1
be
used
interchangeably
and
intermittently
on
a
particular
2
computer,
machine,
or
piece
of
equipment,
including
but
not
3
limited
to
jigs,
dies,
tools,
and
other
similar
items.
4
(c)
The
tangible
personal
property
comes
into
physical
5
contact
with
other
tangible
personal
property
used
in
6
processing
and
is
used
to
assist
with
or
maintain
conditions
7
necessary
for
processing,
including
but
not
limited
to
cutting
8
fluids,
oils,
coolants,
lubricants,
and
other
similar
items
9
with
a
short
useful
life.
10
(d)
The
tangible
personal
property
is
directly
and
11
primarily
used
in
an
activity
described
in
paragraph
“a”
,
12
subparagraphs
(1)
through
(6),
including
but
not
limited
13
to
prototype
materials,
testing
materials,
and
application
14
software.
15
EXPLANATION
16
The
inclusion
of
this
explanation
does
not
constitute
agreement
with
17
the
explanation’s
substance
by
the
members
of
the
general
assembly.
18
This
bill
relates
to
the
sales
tax
exemption
in
Code
section
19
423.3(47)
for
the
purchase
or
rental
of
certain
items
used
in
20
manufacturing,
research
and
development,
data
processing
or
21
storage,
or
recycling
activities.
22
Under
current
law,
the
exemption
includes
replacement
23
parts.
The
bill
amends
the
exemption
to
include
materials
24
used
to
construct
or
self-construct
replacement
parts.
The
25
bill
defines
“replacement
part”
for
purposes
of
the
exemption
26
to
mean
tangible
personal
property
other
than
computers,
27
machinery,
equipment,
or
supplies,
regardless
of
the
cost
or
28
useful
life
of
the
property,
that
replaces
a
component
of
a
29
computer,
machinery,
or
equipment,
performs
the
same
or
similar
30
function
as
that
component,
and
restores
or
improves
the
31
computer,
machinery,
or
equipment.
32
The
bill
also
amends
the
exemption
to
include
supplies
33
and
materials
used
to
construct
or
self-construct
supplies.
34
“Supplies”
is
defined
in
the
bill
as
tangible
personal
property
35
-2-
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5652XS
(2)
85
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3
S.F.
2336
that
is
not
a
computer,
machinery,
equipment,
or
replacement
1
part
and
that
meets
one
of
the
following
four
conditions:
2
1.
The
tangible
personal
property
is
to
be
connected
to
3
a
computer,
machinery,
or
equipment
and
requires
regular
4
replacement
because
it
is
consumed
or
deteriorates
during
5
use.
Examples
of
items
that
meet
this
requirement
include
saw
6
blades,
drill
bits,
filters,
and
other
similar
items
with
a
7
short
useful
life.
8
2.
The
tangible
personal
property
is
used
in
conjunction
9
with
a
computer,
machinery,
or
equipment
and
is
specially
10
designed
for
use
in
manufacturing
specific
products
and
may
11
be
used
interchangeably
and
intermittently
on
a
particular
12
computer,
machine,
or
piece
of
equipment.
Examples
of
items
13
that
meet
this
requirement
include
jigs,
dies,
tools,
and
other
14
similar
items.
15
3.
The
tangible
personal
property
comes
into
physical
16
contact
with
other
tangible
personal
property
used
in
17
processing
and
is
used
to
assist
with
or
maintain
conditions
18
necessary
for
processing.
Examples
of
items
that
meet
this
19
requirement
include
cutting
fluids,
oils,
coolants,
lubricants,
20
and
other
similar
items
with
a
short
useful
life.
21
4.
The
tangible
property
is
directly
and
primarily
used
22
in
an
activity
described
in
Code
section
423.3(47)(a)(1)-(6).
23
Examples
of
items
that
meet
this
requirement
include
prototype
24
materials,
testing
materials,
and
application
software.
25
By
operation
of
Code
section
423.6,
an
item
exempt
from
the
26
imposition
of
the
sales
tax
is
also
exempt
from
the
use
tax
27
imposed
in
Code
section
423.5.
28
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5652XS
(2)
85
mm/nh
3/
3
