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Am. S. B. No. 243 As Reported by the Senate Ways and Means CommitteeAs Reported by the Senate Ways and Means Committee
130th General Assembly | Regular Session | 2013-2014 |
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A BILL
To amend sections 5739.02 and 5739.05 of the Revised
Code to provide a three-day sales tax "holiday"
each August during which sales of back-to-school
clothing, school supplies, personal computers, and
personal computer accessories are exempt from
sales and use taxes.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO:
Section 1. That sections 5739.02 and 5739.05 of the Revised
Code be amended to read as follows:
Sec. 5739.02. For the purpose of providing revenue with
which to meet the needs of the state, for the use of the general
revenue fund of the state, for the purpose of securing a thorough
and efficient system of common schools throughout the state, for
the purpose of affording revenues, in addition to those from
general property taxes, permitted under constitutional
limitations, and from other sources, for the support of local
governmental functions, and for the purpose of reimbursing the
state for the expense of administering this chapter, an excise tax
is hereby levied on each retail sale made in this state.
(A)(1) The tax shall be collected as provided in section
5739.025 of the Revised Code. The rate of the tax shall be five
and three-fourths per cent. The tax applies and is collectible
when the sale is made, regardless of the time when the price is
paid or delivered.
(2) In the case of the lease or rental, with a fixed term of
more than thirty days or an indefinite term with a minimum period
of more than thirty days, of any motor vehicles designed by the
manufacturer to carry a load of not more than one ton, watercraft,
outboard motor, or aircraft, or of any tangible personal property,
other than motor vehicles designed by the manufacturer to carry a
load of more than one ton, to be used by the lessee or renter
primarily for business purposes, the tax shall be collected by the
vendor at the time the lease or rental is consummated and shall be
calculated by the vendor on the basis of the total amount to be
paid by the lessee or renter under the lease agreement. If the
total amount of the consideration for the lease or rental includes
amounts that are not calculated at the time the lease or rental is
executed, the tax shall be calculated and collected by the vendor
at the time such amounts are billed to the lessee or renter. In
the case of an open-end lease or rental, the tax shall be
calculated by the vendor on the basis of the total amount to be
paid during the initial fixed term of the lease or rental, and for
each subsequent renewal period as it comes due. As used in this
division, "motor vehicle" has the same meaning as in section
4501.01 of the Revised Code, and "watercraft" includes an outdrive
unit attached to the watercraft.
A lease with a renewal clause and a termination penalty or
similar provision that applies if the renewal clause is not
exercised is presumed to be a sham transaction. In such a case,
the tax shall be calculated and paid on the basis of the entire
length of the lease period, including any renewal periods, until
the termination penalty or similar provision no longer applies.
The taxpayer shall bear the burden, by a preponderance of the
evidence, that the transaction or series of transactions is not a
sham transaction.
(3) Except as provided in division (A)(2) of this section, in
the case of a sale, the price of which consists in whole or in
part of the lease or rental of tangible personal property, the tax
shall be measured by the installments of that lease or rental.
(4) In the case of a sale of a physical fitness facility
service or recreation and sports club service, the price of which
consists in whole or in part of a membership for the receipt of
the benefit of the service, the tax applicable to the sale shall
be measured by the installments thereof.
(B) The tax does not apply to the following:
(1) Sales to the state or any of its political subdivisions,
or to any other state or its political subdivisions if the laws of
that state exempt from taxation sales made to this state and its
political subdivisions;
(2) Sales of food for human consumption off the premises
where sold;
(3) Sales of food sold to students only in a cafeteria,
dormitory, fraternity, or sorority maintained in a private,
public, or parochial school, college, or university;
(4) Sales of newspapers and sales or transfers of magazines
distributed as controlled circulation publications;
(5) The furnishing, preparing, or serving of meals without
charge by an employer to an employee provided the employer records
the meals as part compensation for services performed or work
done;
(6) Sales of motor fuel upon receipt, use, distribution, or
sale of which in this state a tax is imposed by the law of this
state, but this exemption shall not apply to the sale of motor
fuel on which a refund of the tax is allowable under division (A)
of section 5735.14 of the Revised Code; and the tax commissioner
may deduct the amount of tax levied by this section applicable to
the price of motor fuel when granting a refund of motor fuel tax
pursuant to division (A) of section 5735.14 of the Revised Code
and shall cause the amount deducted to be paid into the general
revenue fund of this state;
(7) Sales of natural gas by a natural gas company, of water
by a water-works company, or of steam by a heating company, if in
each case the thing sold is delivered to consumers through pipes
or conduits, and all sales of communications services by a
telegraph company, all terms as defined in section 5727.01 of the
Revised Code, and sales of electricity delivered through wires;
(8) Casual sales by a person, or auctioneer employed directly
by the person to conduct such sales, except as to such sales of
motor vehicles, watercraft or outboard motors required to be
titled under section 1548.06 of the Revised Code, watercraft
documented with the United States coast guard, snowmobiles, and
all-purpose vehicles as defined in section 4519.01 of the Revised
Code;
(9)(a) Sales of services or tangible personal property, other
than motor vehicles, mobile homes, and manufactured homes, by
churches, organizations exempt from taxation under section
501(c)(3) of the Internal Revenue Code of 1986, or nonprofit
organizations operated exclusively for charitable purposes as
defined in division (B)(12) of this section, provided that the
number of days on which such tangible personal property or
services, other than items never subject to the tax, are sold does
not exceed six in any calendar year, except as otherwise provided
in division (B)(9)(b) of this section. If the number of days on
which such sales are made exceeds six in any calendar year, the
church or organization shall be considered to be engaged in
business and all subsequent sales by it shall be subject to the
tax. In counting the number of days, all sales by groups within a
church or within an organization shall be considered to be sales
of that church or organization.
(b) The limitation on the number of days on which tax-exempt
sales may be made by a church or organization under division
(B)(9)(a) of this section does not apply to sales made by student
clubs and other groups of students of a primary or secondary
school, or a parent-teacher association, booster group, or similar
organization that raises money to support or fund curricular or
extracurricular activities of a primary or secondary school.
(c) Divisions (B)(9)(a) and (b) of this section do not apply
to sales by a noncommercial educational radio or television
broadcasting station.
(10) Sales not within the taxing power of this state under
the Constitution or laws of the United States or the Constitution
of this state;
(11) Except for transactions that are sales under division
(B)(3)(r) of section 5739.01 of the Revised Code, the
transportation of persons or property, unless the transportation
is by a private investigation and security service;
(12) Sales of tangible personal property or services to
churches, to organizations exempt from taxation under section
501(c)(3) of the Internal Revenue Code of 1986, and to any other
nonprofit organizations operated exclusively for charitable
purposes in this state, no part of the net income of which inures
to the benefit of any private shareholder or individual, and no
substantial part of the activities of which consists of carrying
on propaganda or otherwise attempting to influence legislation;
sales to offices administering one or more homes for the aged or
one or more hospital facilities exempt under section 140.08 of the
Revised Code; and sales to organizations described in division (D)
of section 5709.12 of the Revised Code.
"Charitable purposes" means the relief of poverty; the
improvement of health through the alleviation of illness, disease,
or injury; the operation of an organization exclusively for the
provision of professional, laundry, printing, and purchasing
services to hospitals or charitable institutions; the operation of
a home for the aged, as defined in section 5701.13 of the Revised
Code; the operation of a radio or television broadcasting station
that is licensed by the federal communications commission as a
noncommercial educational radio or television station; the
operation of a nonprofit animal adoption service or a county
humane society; the promotion of education by an institution of
learning that maintains a faculty of qualified instructors,
teaches regular continuous courses of study, and confers a
recognized diploma upon completion of a specific curriculum; the
operation of a parent-teacher association, booster group, or
similar organization primarily engaged in the promotion and
support of the curricular or extracurricular activities of a
primary or secondary school; the operation of a community or area
center in which presentations in music, dramatics, the arts, and
related fields are made in order to foster public interest and
education therein; the production of performances in music,
dramatics, and the arts; or the promotion of education by an
organization engaged in carrying on research in, or the
dissemination of, scientific and technological knowledge and
information primarily for the public.
Nothing in this division shall be deemed to exempt sales to
any organization for use in the operation or carrying on of a
trade or business, or sales to a home for the aged for use in the
operation of independent living facilities as defined in division
(A) of section 5709.12 of the Revised Code.
(13) Building and construction materials and services sold to
construction contractors for incorporation into a structure or
improvement to real property under a construction contract with
this state or a political subdivision of this state, or with the
United States government or any of its agencies; building and
construction materials and services sold to construction
contractors for incorporation into a structure or improvement to
real property that are accepted for ownership by this state or any
of its political subdivisions, or by the United States government
or any of its agencies at the time of completion of the structures
or improvements; building and construction materials sold to
construction contractors for incorporation into a horticulture
structure or livestock structure for a person engaged in the
business of horticulture or producing livestock; building
materials and services sold to a construction contractor for
incorporation into a house of public worship or religious
education, or a building used exclusively for charitable purposes
under a construction contract with an organization whose purpose
is as described in division (B)(12) of this section; building
materials and services sold to a construction contractor for
incorporation into a building under a construction contract with
an organization exempt from taxation under section 501(c)(3) of
the Internal Revenue Code of 1986 when the building is to be used
exclusively for the organization's exempt purposes; building and
construction materials sold for incorporation into the original
construction of a sports facility under section 307.696 of the
Revised Code; building and construction materials and services
sold to a construction contractor for incorporation into real
property outside this state if such materials and services, when
sold to a construction contractor in the state in which the real
property is located for incorporation into real property in that
state, would be exempt from a tax on sales levied by that state;
and, until one calendar year after the construction of a
convention center that qualifies for property tax exemption under
section 5709.084 of the Revised Code is completed, building and
construction materials and services sold to a construction
contractor for incorporation into the real property comprising
that convention center;
(14) Sales of ships or vessels or rail rolling stock used or
to be used principally in interstate or foreign commerce, and
repairs, alterations, fuel, and lubricants for such ships or
vessels or rail rolling stock;
(15) Sales to persons primarily engaged in any of the
activities mentioned in division (B)(42)(a), (g), or (h) of this
section, to persons engaged in making retail sales, or to persons
who purchase for sale from a manufacturer tangible personal
property that was produced by the manufacturer in accordance with
specific designs provided by the purchaser, of packages, including
material, labels, and parts for packages, and of machinery,
equipment, and material for use primarily in packaging tangible
personal property produced for sale, including any machinery,
equipment, and supplies used to make labels or packages, to
prepare packages or products for labeling, or to label packages or
products, by or on the order of the person doing the packaging, or
sold at retail. "Packages" includes bags, baskets, cartons,
crates, boxes, cans, bottles, bindings, wrappings, and other
similar devices and containers, but does not include motor
vehicles or bulk tanks, trailers, or similar devices attached to
motor vehicles. "Packaging" means placing in a package. Division
(B)(15) of this section does not apply to persons engaged in
highway transportation for hire.
(16) Sales of food to persons using supplemental nutrition
assistance program benefits to purchase the food. As used in this
division, "food" has the same meaning as in 7 U.S.C. 2012 and
federal regulations adopted pursuant to the Food and Nutrition Act
of 2008.
(17) Sales to persons engaged in farming, agriculture,
horticulture, or floriculture, of tangible personal property for
use or consumption primarily in the production by farming,
agriculture, horticulture, or floriculture of other tangible
personal property for use or consumption primarily in the
production of tangible personal property for sale by farming,
agriculture, horticulture, or floriculture; or material and parts
for incorporation into any such tangible personal property for use
or consumption in production; and of tangible personal property
for such use or consumption in the conditioning or holding of
products produced by and for such use, consumption, or sale by
persons engaged in farming, agriculture, horticulture, or
floriculture, except where such property is incorporated into real
property;
(18) Sales of drugs for a human being that may be dispensed
only pursuant to a prescription; insulin as recognized in the
official United States pharmacopoeia; urine and blood testing
materials when used by diabetics or persons with hypoglycemia to
test for glucose or acetone; hypodermic syringes and needles when
used by diabetics for insulin injections; epoetin alfa when
purchased for use in the treatment of persons with medical
disease; hospital beds when purchased by hospitals, nursing homes,
or other medical facilities; and medical oxygen and medical
oxygen-dispensing equipment when purchased by hospitals, nursing
homes, or other medical facilities;
(19) Sales of prosthetic devices, durable medical equipment
for home use, or mobility enhancing equipment, when made pursuant
to a prescription and when such devices or equipment are for use
by a human being.
(20) Sales of emergency and fire protection vehicles and
equipment to nonprofit organizations for use solely in providing
fire protection and emergency services, including trauma care and
emergency medical services, for political subdivisions of the
state;
(21) Sales of tangible personal property manufactured in this
state, if sold by the manufacturer in this state to a retailer for
use in the retail business of the retailer outside of this state
and if possession is taken from the manufacturer by the purchaser
within this state for the sole purpose of immediately removing the
same from this state in a vehicle owned by the purchaser;
(22) Sales of services provided by the state or any of its
political subdivisions, agencies, instrumentalities, institutions,
or authorities, or by governmental entities of the state or any of
its political subdivisions, agencies, instrumentalities,
institutions, or authorities;
(23) Sales of motor vehicles to nonresidents of this state
under the circumstances described in division (B) of section
5739.029 of the Revised Code;
(24) Sales to persons engaged in the preparation of eggs for
sale of tangible personal property used or consumed directly in
such preparation, including such tangible personal property used
for cleaning, sanitizing, preserving, grading, sorting, and
classifying by size; packages, including material and parts for
packages, and machinery, equipment, and material for use in
packaging eggs for sale; and handling and transportation equipment
and parts therefor, except motor vehicles licensed to operate on
public highways, used in intraplant or interplant transfers or
shipment of eggs in the process of preparation for sale, when the
plant or plants within or between which such transfers or
shipments occur are operated by the same person. "Packages"
includes containers, cases, baskets, flats, fillers, filler flats,
cartons, closure materials, labels, and labeling materials, and
"packaging" means placing therein.
(25)(a) Sales of water to a consumer for residential use;
(b) Sales of water by a nonprofit corporation engaged
exclusively in the treatment, distribution, and sale of water to
consumers, if such water is delivered to consumers through pipes
or tubing.
(26) Fees charged for inspection or reinspection of motor
vehicles under section 3704.14 of the Revised Code;
(27) Sales to persons licensed to conduct a food service
operation pursuant to section 3717.43 of the Revised Code, of
tangible personal property primarily used directly for the
following:
(a) To prepare food for human consumption for sale;
(b) To preserve food that has been or will be prepared for
human consumption for sale by the food service operator, not
including tangible personal property used to display food for
selection by the consumer;
(c) To clean tangible personal property used to prepare or
serve food for human consumption for sale.
(28) Sales of animals by nonprofit animal adoption services
or county humane societies;
(29) Sales of services to a corporation described in division
(A) of section 5709.72 of the Revised Code, and sales of tangible
personal property that qualifies for exemption from taxation under
section 5709.72 of the Revised Code;
(30) Sales and installation of agricultural land tile, as
defined in division (B)(5)(a) of section 5739.01 of the Revised
Code;
(31) Sales and erection or installation of portable grain
bins, as defined in division (B)(5)(b) of section 5739.01 of the
Revised Code;
(32) The sale, lease, repair, and maintenance of, parts for,
or items attached to or incorporated in, motor vehicles that are
primarily used for transporting tangible personal property
belonging to others by a person engaged in highway transportation
for hire, except for packages and packaging used for the
transportation of tangible personal property;
(33) Sales to the state headquarters of any veterans'
organization in this state that is either incorporated and issued
a charter by the congress of the United States or is recognized by
the United States veterans administration, for use by the
headquarters;
(34) Sales to a telecommunications service vendor, mobile
telecommunications service vendor, or satellite broadcasting
service vendor of tangible personal property and services used
directly and primarily in transmitting, receiving, switching, or
recording any interactive, one- or two-way electromagnetic
communications, including voice, image, data, and information,
through the use of any medium, including, but not limited to,
poles, wires, cables, switching equipment, computers, and record
storage devices and media, and component parts for the tangible
personal property. The exemption provided in this division shall
be in lieu of all other exemptions under division (B)(42)(a) or
(n) of this section to which the vendor may otherwise be entitled,
based upon the use of the thing purchased in providing the
telecommunications, mobile telecommunications, or satellite
broadcasting service.
(35)(a) Sales where the purpose of the consumer is to use or
consume the things transferred in making retail sales and
consisting of newspaper inserts, catalogues, coupons, flyers, gift
certificates, or other advertising material that prices and
describes tangible personal property offered for retail sale.
(b) Sales to direct marketing vendors of preliminary
materials such as photographs, artwork, and typesetting that will
be used in printing advertising material; and of printed matter
that offers free merchandise or chances to win sweepstake prizes
and that is mailed to potential customers with advertising
material described in division (B)(35)(a) of this section;
(c) Sales of equipment such as telephones, computers,
facsimile machines, and similar tangible personal property
primarily used to accept orders for direct marketing retail sales.
(d) Sales of automatic food vending machines that preserve
food with a shelf life of forty-five days or less by refrigeration
and dispense it to the consumer.
For purposes of division (B)(35) of this section, "direct
marketing" means the method of selling where consumers order
tangible personal property by United States mail, delivery
service, or telecommunication and the vendor delivers or ships the
tangible personal property sold to the consumer from a warehouse,
catalogue distribution center, or similar fulfillment facility by
means of the United States mail, delivery service, or common
carrier.
(36) Sales to a person engaged in the business of
horticulture or producing livestock of materials to be
incorporated into a horticulture structure or livestock structure;
(37) Sales of personal computers, computer monitors, computer
keyboards, modems, and other peripheral computer equipment to an
individual who is licensed or certified to teach in an elementary
or a secondary school in this state for use by that individual in
preparation for teaching elementary or secondary school students;
(38) Sales to a professional racing team of any of the
following:
(a) Motor racing vehicles;
(b) Repair services for motor racing vehicles;
(c) Items of property that are attached to or incorporated in
motor racing vehicles, including engines, chassis, and all other
components of the vehicles, and all spare, replacement, and
rebuilt parts or components of the vehicles; except not including
tires, consumable fluids, paint, and accessories consisting of
instrumentation sensors and related items added to the vehicle to
collect and transmit data by means of telemetry and other forms of
communication.
(39) Sales of used manufactured homes and used mobile homes,
as defined in section 5739.0210 of the Revised Code, made on or
after January 1, 2000;
(40) Sales of tangible personal property and services to a
provider of electricity used or consumed directly and primarily in
generating, transmitting, or distributing electricity for use by
others, including property that is or is to be incorporated into
and will become a part of the consumer's production, transmission,
or distribution system and that retains its classification as
tangible personal property after incorporation; fuel or power used
in the production, transmission, or distribution of electricity;
energy conversion equipment as defined in section 5727.01 of the
Revised Code; and tangible personal property and services used in
the repair and maintenance of the production, transmission, or
distribution system, including only those motor vehicles as are
specially designed and equipped for such use. The exemption
provided in this division shall be in lieu of all other exemptions
in division (B)(42)(a) or (n) of this section to which a provider
of electricity may otherwise be entitled based on the use of the
tangible personal property or service purchased in generating,
transmitting, or distributing electricity.
(41) Sales to a person providing services under division
(B)(3)(r) of section 5739.01 of the Revised Code of tangible
personal property and services used directly and primarily in
providing taxable services under that section.
(42) Sales where the purpose of the purchaser is to do any of
the following:
(a) To incorporate the thing transferred as a material or a
part into tangible personal property to be produced for sale by
manufacturing, assembling, processing, or refining; or to use or
consume the thing transferred directly in producing tangible
personal property for sale by mining, including, without
limitation, the extraction from the earth of all substances that
are classed geologically as minerals, production of crude oil and
natural gas, or directly in the rendition of a public utility
service, except that the sales tax levied by this section shall be
collected upon all meals, drinks, and food for human consumption
sold when transporting persons. Persons engaged in rendering
services in the exploration for, and production of, crude oil and
natural gas for others are deemed engaged directly in the
exploration for, and production of, crude oil and natural gas.
This paragraph does not exempt from "retail sale" or "sales at
retail" the sale of tangible personal property that is to be
incorporated into a structure or improvement to real property.
(b) To hold the thing transferred as security for the
performance of an obligation of the vendor;
(c) To resell, hold, use, or consume the thing transferred as
evidence of a contract of insurance;
(d) To use or consume the thing directly in commercial
fishing;
(e) To incorporate the thing transferred as a material or a
part into, or to use or consume the thing transferred directly in
the production of, magazines distributed as controlled circulation
publications;
(f) To use or consume the thing transferred in the production
and preparation in suitable condition for market and sale of
printed, imprinted, overprinted, lithographic, multilithic,
blueprinted, photostatic, or other productions or reproductions of
written or graphic matter;
(g) To use the thing transferred, as described in section
5739.011 of the Revised Code, primarily in a manufacturing
operation to produce tangible personal property for sale;
(h) To use the benefit of a warranty, maintenance or service
contract, or similar agreement, as described in division (B)(7) of
section 5739.01 of the Revised Code, to repair or maintain
tangible personal property, if all of the property that is the
subject of the warranty, contract, or agreement would not be
subject to the tax imposed by this section;
(i) To use the thing transferred as qualified research and
development equipment;
(j) To use or consume the thing transferred primarily in
storing, transporting, mailing, or otherwise handling purchased
sales inventory in a warehouse, distribution center, or similar
facility when the inventory is primarily distributed outside this
state to retail stores of the person who owns or controls the
warehouse, distribution center, or similar facility, to retail
stores of an affiliated group of which that person is a member, or
by means of direct marketing. This division does not apply to
motor vehicles registered for operation on the public highways. As
used in this division, "affiliated group" has the same meaning as
in division (B)(3)(e) of section 5739.01 of the Revised Code and
"direct marketing" has the same meaning as in division (B)(35) of
this section.
(k) To use or consume the thing transferred to fulfill a
contractual obligation incurred by a warrantor pursuant to a
warranty provided as a part of the price of the tangible personal
property sold or by a vendor of a warranty, maintenance or service
contract, or similar agreement the provision of which is defined
as a sale under division (B)(7) of section 5739.01 of the Revised
Code;
(l) To use or consume the thing transferred in the production
of a newspaper for distribution to the public;
(m) To use tangible personal property to perform a service
listed in division (B)(3) of section 5739.01 of the Revised Code,
if the property is or is to be permanently transferred to the
consumer of the service as an integral part of the performance of
the service;
(n) To use or consume the thing transferred primarily in
producing tangible personal property for sale by farming,
agriculture, horticulture, or floriculture. Persons engaged in
rendering farming, agriculture, horticulture, or floriculture
services for others are deemed engaged primarily in farming,
agriculture, horticulture, or floriculture. This paragraph does
not exempt from "retail sale" or "sales at retail" the sale of
tangible personal property that is to be incorporated into a
structure or improvement to real property.
(o) To use or consume the thing transferred in acquiring,
formatting, editing, storing, and disseminating data or
information by electronic publishing.
As used in division (B)(42) of this section, "thing" includes
all transactions included in divisions (B)(3)(a), (b), and (e) of
section 5739.01 of the Revised Code.
(43) Sales conducted through a coin operated device that
activates vacuum equipment or equipment that dispenses water,
whether or not in combination with soap or other cleaning agents
or wax, to the consumer for the consumer's use on the premises in
washing, cleaning, or waxing a motor vehicle, provided no other
personal property or personal service is provided as part of the
transaction.
(44) Sales of replacement and modification parts for engines,
airframes, instruments, and interiors in, and paint for, aircraft
used primarily in a fractional aircraft ownership program, and
sales of services for the repair, modification, and maintenance of
such aircraft, and machinery, equipment, and supplies primarily
used to provide those services.
(45) Sales of telecommunications service that is used
directly and primarily to perform the functions of a call center.
As used in this division, "call center" means any physical
location where telephone calls are placed or received in high
volume for the purpose of making sales, marketing, customer
service, technical support, or other specialized business
activity, and that employs at least fifty individuals that engage
in call center activities on a full-time basis, or sufficient
individuals to fill fifty full-time equivalent positions.
(46) Sales by a telecommunications service vendor of 900
service to a subscriber. This division does not apply to
information services, as defined in division (FF) of section
5739.01 of the Revised Code.
(47) Sales of value-added non-voice data service. This
division does not apply to any similar service that is not
otherwise a telecommunications service.
(48)(a) Sales of machinery, equipment, and software to a
qualified direct selling entity for use in a warehouse or
distribution center primarily for storing, transporting, or
otherwise handling inventory that is held for sale to independent
salespersons who operate as direct sellers and that is held
primarily for distribution outside this state;
(b) As used in division (B)(48)(a) of this section:
(i) "Direct seller" means a person selling consumer products
to individuals for personal or household use and not from a fixed
retail location, including selling such product at in-home product
demonstrations, parties, and other one-on-one selling.
(ii) "Qualified direct selling entity" means an entity
selling to direct sellers at the time the entity enters into a tax
credit agreement with the tax credit authority pursuant to section
122.17 of the Revised Code, provided that the agreement was
entered into on or after January 1, 2007. Neither contingencies
relevant to the granting of, nor later developments with respect
to, the tax credit shall impair the status of the qualified direct
selling entity under division (B)(48) of this section after
execution of the tax credit agreement by the tax credit authority.
(c) Division (B)(48) of this section is limited to machinery,
equipment, and software first stored, used, or consumed in this
state within the period commencing June 24, 2008, and ending on
the date that is five years after that date.
(49) Sales of materials, parts, equipment, or engines used in
the repair or maintenance of aircraft or avionics systems of such
aircraft, and sales of repair, remodeling, replacement, or
maintenance services in this state performed on aircraft or on an
aircraft's avionics, engine, or component materials or parts. As
used in division (B)(49) of this section, "aircraft" means
aircraft of more than six thousand pounds maximum certified
takeoff weight or used exclusively in general aviation.
(50) Sales of full flight simulators that are used for pilot
or flight-crew training, sales of repair or replacement parts or
components, and sales of repair or maintenance services for such
full flight simulators. "Full flight simulator" means a replica of
a specific type, or make, model, and series of aircraft cockpit.
It includes the assemblage of equipment and computer programs
necessary to represent aircraft operations in ground and flight
conditions, a visual system providing an out-of-the-cockpit view,
and a system that provides cues at least equivalent to those of a
three-degree-of-freedom motion system, and has the full range of
capabilities of the systems installed in the device as described
in appendices A and B of part 60 of chapter 1 of title 14 of the
Code of Federal Regulations.
(51) Any transfer or lease of tangible personal property
between the state and JobsOhio in accordance with section 4313.02
of the Revised Code.
(52)(a) Sales to a qualifying corporation.
(b) As used in division (B)(52) of this section:
(i) "Qualifying corporation" means a nonprofit corporation
organized in this state that leases from an eligible county land,
buildings, structures, fixtures, and improvements to the land that
are part of or used in a public recreational facility used by a
major league professional athletic team or a class A to class AAA
minor league affiliate of a major league professional athletic
team for a significant portion of the team's home schedule,
provided the following apply:
(I) The facility is leased from the eligible county pursuant
to a lease that requires substantially all of the revenue from the
operation of the business or activity conducted by the nonprofit
corporation at the facility in excess of operating costs, capital
expenditures, and reserves to be paid to the eligible county at
least once per calendar year.
(II) Upon dissolution and liquidation of the nonprofit
corporation, all of its net assets are distributable to the board
of commissioners of the eligible county from which the corporation
leases the facility.
(ii) "Eligible county" has the same meaning as in section
307.695 of the Revised Code.
(53) Sales to or by a cable service provider, video service
provider, or radio or television broadcast station regulated by
the federal government of cable service or programming, video
service or programming, audio service or programming, or
electronically transferred digital audiovisual or audio work. As
used in division (B)(53) of this section, "cable service" and
"cable service provider" have the same meanings as in section
1332.01 of the Revised Code, and "video service," "video service
provider," and "video programming" have the same meanings as in
section 1332.21 of the Revised Code.
(54)(a) Sales of the following occurring on the first Friday
of August and the following Saturday and Sunday of each year:
(i) An item of clothing, the price of which is one hundred
dollars or less;
(ii) An item of school supplies, the price of which is twenty
dollars or less;
(iii) An item of school instructional material, the price of
which is twenty dollars or less;
(iv) A computer, the price of which, less any manufacturer's
rebate, is one thousand dollars or less;
(v) An item of school computer supplies, the price of which,
less any manufacturer's rebate, is seven hundred fifty dollars or
less.
(b) As used in division (B)(54) of this section:
(i) "Clothing" means all human wearing apparel suitable for
general use. "Clothing" does not include clothing accessories or
equipment, protective equipment, or sports or recreational
equipment.
(ii) "School supplies" means items commonly used by a student
in a course of study.
(iii) "Computer" means an electronic device that accepts
information in digital or similar form and manipulates it for a
result based on a sequence of instructions. "Computer" includes
any electronic book reader, laptop, desktop, handheld, tablet, or
tower computer but does not include cellular telephones, video
game consoles, digital media receivers, or devices that are not
primarily designed to process data.
(iv) "School computer supplies" means items commonly used by
a student in a course of study in which a computer is used.
(v) "School instructional material" means written material
commonly used by a student in a course of study as a reference and
to learn the subject being taught.
(C) For the purpose of the proper administration of this
chapter, and to prevent the evasion of the tax, it is presumed
that all sales made in this state are subject to the tax until the
contrary is established.
(D) The levy of this tax on retail sales of recreation and
sports club service shall not prevent a municipal corporation from
levying any tax on recreation and sports club dues or on any
income generated by recreation and sports club dues.
(E) The tax collected by the vendor from the consumer under
this chapter is not part of the price, but is a tax collection for
the benefit of the state, and of counties levying an additional
sales tax pursuant to section 5739.021 or 5739.026 of the Revised
Code and of transit authorities levying an additional sales tax
pursuant to section 5739.023 of the Revised Code. Except for the
discount authorized under section 5739.12 of the Revised Code and
the effects of any rounding pursuant to section 5703.055 of the
Revised Code, no person other than the state or such a county or
transit authority shall derive any benefit from the collection or
payment of the tax levied by this section or section 5739.021,
5739.023, or 5739.026 of the Revised Code.
Sec. 5739.05. (A)(1) The tax commissioner shall enforce and
administer sections 5739.01 to 5739.31 of the Revised Code, which
are hereby declared to be sections which that the commissioner is
required to administer within the meaning of sections 5703.17 to
5703.37, 5703.39, 5703.41, and 5703.45 of the Revised Code. The
commissioner may adopt and promulgate, in accordance with sections
119.01 to 119.13 of the Revised Code, such rules as the
commissioner deems necessary to administer sections 5739.01 to
5739.31 of the Revised Code.
(2) Before each exemption period required under that
division, the commissioner shall make available to vendors
informational bulletins explaining the exemption.
(B) Upon application, the commissioner may authorize a vendor
to pay on a predetermined basis the tax levied by or pursuant to
section 5739.02, 5739.021, 5739.023, or 5739.026 of the Revised
Code upon sales of things produced or distributed or services
provided by such vendor, and the commissioner may waive the
collection of the tax from the consumer. The commissioner shall
not grant such authority unless the commissioner finds that the
granting of the authority would improve compliance and increase
the efficiency of the administration of the tax. The person to
whom such authority is granted shall post a notice, if required by
the commissioner, at the location where the product is offered for
sale, that the tax is included in the selling price. The
comissioner commissioner may adopt rules to administer this
division.
(C) The commissioner may authorize a vendor to pay, on the
basis of a prearranged agreement under this division, the tax
levied by section 5739.02 or pursuant to section 5739.021,
5739.023, or 5739.026 of the Revised Code, and waive the
requirement that the vendor maintain the complete and accurate
record of individual taxable sales and tax collected thereon
required by section 5739.11 of the Revised Code, upon application
of the vendor, if the commissioner finds that the conditions of
the vendor-applicant's business are such that the maintenance of
such records of individual taxable sales and tax collected thereon
would impose an unreasonable burden upon the vendor. If the
commissioner determines that such unreasonable burden has been
imposed, the vendor and the commissioner shall agree to the terms
and conditions of a test check to be conducted. If the parties are
unable to agree to the terms and conditions of the test check, the
application shall be denied. The test check conducted shall
determine the proportion that taxable retail sales bear to all of
the vendor's retail sales and the ratio which the tax required to
be collected under sections 5739.02, 5739.021, and 5739.023 of the
Revised Code bears to the receipts from the vendor's taxable
retail sales.
The vendor shall collect the tax on the vendor's taxable
sales and the vendor's liability for collecting or remitting shall
be based upon the proportions and ratios established by the test
check, and not upon any other basis of determination, until such
time as a subsequent test check is made at the request of either
the vendor or the commissioner where either party believes that
the nature of the vendor's business has so changed as to make the
prior or existing test check no longer representative. The
commissioner may give notice to the vendor at any time that the
authorization is revoked or the vendor may notify the commissioner
that the vendor no longer elects to report under the
authorization. Such notice shall be delivered to the other party
personally or by registered mail. The revocation or cancellation
is not effective prior to the date of receipt of such notice.
Section 2. That existing sections 5739.02 and 5739.05 of the
Revised Code are hereby repealed.
Section 3. Section 5739.02 of the Revised Code is presented
in this act as a composite of the section as amended by both Am.
Sub. H.B. 51 and Am. Sub. H.B. 59 of the 130th General Assembly.
The General Assembly, applying the principle stated in division
(B) of section 1.52 of the Revised Code that amendments are to be
harmonized if reasonably capable of simultaneous operation, finds
that the composite is the resulting version of the section in
effect prior to the effective date of the section as presented in
this act.
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