EXPLANATION-Matter enclosed in bold-faced brackets [thus] in this bill is not enacted
and is intended to be omitted in the law.
FIRST REGULAR SESSION
SENATE BILL NO. 95
103RD GENERAL ASSEMBLY
INTRODUCED BY SENATOR LEWIS.
0592S.01I KRISTINA MARTIN, Secretary
AN ACT
To repeal sections 135.621 and 144.030, RSMo, and to enact in lieu thereof two new sections
relating to tax incentives for certain hygiene products.
Be it enacted by the General Assembly of the State of Missouri, as follows:
Section A. Sections 135.621 and 144.030, RSMo, are 1
repealed and two new sections enacted in lieu thereof, to be 2
known as sections 135.621 and 144.03 0, to read as follows:3
135.621. 1. As used in this section, the following 1
terms mean: 2
(1) "Contribution", a donation of cash, stock, bonds, 3
other marketable securities, or real property; 4
(2) "Department", the department of social serv ices; 5
(3) "Diaper bank", a nonprofit entity located in this 6
state [established and operating primarily for the purpose 7
of collecting or purchasing ] that meets the following 8
criteria: 9
(a) Collects, purchases, warehouses, and manages a 10
community inventory of disposable diapers or other hygiene 11
products for infants, children, or incontinent adults [and 12
that]; 13
(b) Regularly distributes a consistent and reliable 14
supply of such diapers or other hygiene products through two 15
or more schools, health care facilities, governmental 16
agencies, or other nonprofit entities for eventual 17 SB 95 2
distribution to individuals free of charge , with the 18
intention of reducing diaper need ; and 19
(c) Is a member of a national network organization 20
serving all fifty states through which certification 21
demonstrates nonprofit best practices, data -driven program 22
design, and equitable distribution focused on best serving 23
infants, children, and incontinent adults; 24
(4) "Tax credit", a credit against the tax ot herwise 25
due under chapter 143, excluding withholding tax imposed 26
under sections 143.191 to 143.265, or otherwise due under 27
chapter 148 or 153; 28
(5) "Taxpayer", a person, firm, partner in a firm, 29
corporation, or shareholder in an S corporation doin g 30
business in the state of Missouri and subject to the state 31
income tax imposed under chapter 143; an insurance company 32
paying an annual tax on its gross premium receipts in this 33
state; any other financial institution paying taxes to the 34
state of Missouri or any political subdivision of this state 35
under chapter 148; an express company that pays an annual 36
tax on its gross receipts in this state under chapter 153; 37
an individual subject to the state income tax under chapter 38
143; or any charitable orga nization that is exempt from 39
federal income tax and whose Missouri unrelated business 40
taxable income, if any, would be subject to the state income 41
tax imposed under chapter 143. 42
2. For all fiscal years beginning on or after July 1, 43
2019, a taxpayer shall be allowed to claim a tax credit 44
against the taxpayer's state tax liability in an amount 45
equal to fifty percent of the amount of such taxpayer's 46
contributions to a diaper bank. 47
3. The amount of the tax credit claimed shall not 48
exceed the amount of the taxpayer's state tax liability for 49 SB 95 3
the tax year for which the credit is claimed, and such 50
taxpayer shall not be allowed to claim a tax credit in 51
excess of fifty thousand dollars per tax year. However, any 52
tax credit that cannot be claim ed in the tax year the 53
contribution was made may be carried over only to the next 54
subsequent tax year. No tax credit issued under this 55
section shall be assigned, transferred, or sold. 56
4. Except for any excess credit that is carried over 57
under subsection 3 of this section, no taxpayer shall be 58
allowed to claim a tax credit unless the taxpayer 59
contributes at least one hundred dollars to one or more 60
diaper banks during the tax year for which the credit is 61
claimed. 62
5. The department shall d etermine, at least annually, 63
which entities in this state qualify as diaper banks. The 64
department may require of an entity seeking to be classified 65
as a diaper bank any information which is reasonably 66
necessary to make such a determination. The department 67
shall classify an entity as a diaper bank if such entity 68
satisfies the definition under subsection 1 of this section. 69
6. The department shall establish a procedure by which 70
a taxpayer can determine if an entity has been classified as 71
a diaper bank. 72
7. Diaper banks may decline a contribution from a 73
taxpayer. 74
8. The cumulative amount of tax credits that may be 75
claimed by all the taxpayers contributing to diaper banks in 76
any one fiscal year shall not exceed five hundred thousand 77
dollars. Tax credits shall be issued in the order 78
contributions are received. If the amount of tax credits 79
redeemed in a tax year is less than five hundred thousand 80
dollars, the difference shall be added to the cumulative 81 SB 95 4
limit created under this su bsection for the next fiscal year 82
and carried over to subsequent fiscal years until claimed. 83
9. The department shall establish a procedure by 84
which, from the beginning of the fiscal year until some 85
point in time later in the fiscal year to be dete rmined by 86
the department, the cumulative amount of tax credits are 87
equally apportioned among all entities classified as diaper 88
banks. If a diaper bank fails to use all, or some 89
percentage to be determined by the department, of its 90
apportioned tax credits during this predetermined period of 91
time, the department may reapportion such unused tax credits 92
to diaper banks that have used all, or some percentage to be 93
determined by the department, of their apportioned tax 94
credits during this predetermined period of time. The 95
department may establish multiple periods each fiscal year 96
and reapportion accordingly. To the maximum extent 97
possible, the department shall establish the procedure 98
described under this subsection in such a manner as to 99
ensure that taxpayers can claim as many of the tax credits 100
as possible, up to the cumulative limit created under 101
subsection 8 of this section. 102
10. Each diaper bank shall provide information to the 103
department concerning the identity of each taxpayer making a 104
contribution and the amount of the contribution. The 105
department shall provide the information to the department 106
of revenue. The department shall be subject to the 107
confidentiality and penalty provisions of section 32.057 108
relating to the disclosure of tax information. 109
11. Under section 23.253 of the Missouri sunset act: 110
(1) The provisions of the program authorized under 111
this section shall automatically sunset on December thirty - 112 SB 95 5
first six years after August 28, [2018] 2025, unless 113
reauthorized by an act of the general assembly; 114
(2) If such program is reauthorized, the program 115
authorized under this section shall automatically sunset on 116
December thirty-first six years after the effective date of 117
the reauthorization of this section ; 118
(3) This section shall terminate on September first of 119
the calendar year immediately following the calendar year in 120
which the program authorized under this section is sunset; 121
and 122
(4) The provisions of this subsection shall not be 123
construed to limit or in any way impair the department's 124
ability to issue tax credits authorized on or before the 125
date the program authorized under this section expires or a 126
taxpayer's ability to redeem such tax credits. 127
144.030. 1. There is hereby specifically exempted 1
from the provisions of sections 144.010 to 144.525 and from 2
the computation of the tax levied, assessed or payable 3
pursuant to sections 144.010 to 144.525 such retail sales as 4
may be made in commerce between this state an d any other 5
state of the United States, or between this state and any 6
foreign country, and any retail sale which the state of 7
Missouri is prohibited from taxing pursuant to the 8
Constitution or laws of the United States of America, and 9
such retail sales of tangible personal property which the 10
general assembly of the state of Missouri is prohibited from 11
taxing or further taxing by the constitution of this state. 12
2. There are also specifically exempted from the 13
provisions of the local sales tax l aw as defined in section 14
32.085, section 238.235, and sections 144.010 to 144.525 and 15
144.600 to 144.761 and from the computation of the tax 16
levied, assessed or payable pursuant to the local sales tax 17 SB 95 6
law as defined in section 32.085, section 238.235, and 18
sections 144.010 to 144.525 and 144.600 to 144.745: 19
(1) Motor fuel or special fuel subject to an excise 20
tax of this state, unless all or part of such excise tax is 21
refunded pursuant to section 142.824; or upon the sale at 22
retail of fuel to be consumed in manufacturing or creating 23
gas, power, steam, electrical current or in furnishing water 24
to be sold ultimately at retail; or feed for livestock or 25
poultry; or grain to be converted into foodstuffs which are 26
to be sold ultimately in processed form at retail; or seed, 27
limestone or fertilizer which is to be used for seeding, 28
liming or fertilizing crops which when harvested will be 29
sold at retail or will be fed to livestock or poultry to be 30
sold ultimately in processed form at retail; economi c 31
poisons registered pursuant to the provisions of the 32
Missouri pesticide registration [law] act, sections 33
[281.220] 281.210 to 281.310, which are to be used in 34
connection with the growth or production of crops, fruit 35
trees or orchards applied before, during, or after planting, 36
the crop of which when harvested will be sold at retail or 37
will be converted into foodstuffs which are to be sold 38
ultimately in processed form at retail; 39
(2) Materials, manufactured goods, machinery and parts 40
which when used in manufacturing, processing, compounding, 41
mining, producing or fabricating become a component part or 42
ingredient of the new personal property resulting from such 43
manufacturing, processing, compounding, mining, producing or 44
fabricating and which new personal property is intended to 45
be sold ultimately for final use or consumption; and 46
materials, including without limitation, gases and 47
manufactured goods, including without limitation slagging 48
materials and firebrick, which are ultimately consum ed in 49 SB 95 7
the manufacturing process by blending, reacting or 50
interacting with or by becoming, in whole or in part, 51
component parts or ingredients of steel products intended to 52
be sold ultimately for final use or consumption; 53
(3) Materials, replacemen t parts and equipment 54
purchased for use directly upon, and for the repair and 55
maintenance or manufacture of, motor vehicles, watercraft, 56
railroad rolling stock or aircraft engaged as common 57
carriers of persons or property; 58
(4) Replacement machinery, equipment, and parts and 59
the materials and supplies solely required for the 60
installation or construction of such replacement machinery, 61
equipment, and parts, used directly in manufacturing, 62
mining, fabricating or producing a product which is intend ed 63
to be sold ultimately for final use or consumption; and 64
machinery and equipment, and the materials and supplies 65
required solely for the operation, installation or 66
construction of such machinery and equipment, purchased and 67
used to establish new, or to replace or expand existing, 68
material recovery processing plants in this state. For the 69
purposes of this subdivision, a "material recovery 70
processing plant" means a facility that has as its primary 71
purpose the recovery of materials into a usable pr oduct or a 72
different form which is used in producing a new product and 73
shall include a facility or equipment which are used 74
exclusively for the collection of recovered materials for 75
delivery to a material recovery processing plant but shall 76
not include motor vehicles used on highways. For purposes 77
of this section, the terms motor vehicle and highway shall 78
have the same meaning pursuant to section 301.010. For the 79
purposes of this subdivision, subdivision (5) of this 80
subsection, and section 144.05 4, as well as the definition 81 SB 95 8
in subdivision (9) of subsection 1 of section 144.010, the 82
term "product" includes telecommunications services and the 83
term "manufacturing" shall include the production, or 84
production and transmission, of telecommunications 85
services. The preceding sentence does not make a 86
substantive change in the law and is intended to clarify 87
that the term "manufacturing" has included and continues to 88
include the production and transmission of 89
"telecommunications services", as enacte d in this 90
subdivision and subdivision (5) of this subsection, as well 91
as the definition in subdivision (9) of subsection 1 of 92
section 144.010. The preceding two sentences reaffirm 93
legislative intent consistent with the interpretation of 94
this subdivision and subdivision (5) of this subsection in 95
Southwestern Bell Tel. Co. v. Director of Revenue, 78 S.W.3d 96
763 (Mo. banc 2002) and Southwestern Bell Tel. Co. v. 97
Director of Revenue, 182 S.W.3d 226 (Mo. banc 2005), and 98
accordingly abrogates the Missouri supreme court's 99
interpretation of those exemptions in IBM Corporation v. 100
Director of Revenue, 491 S.W.3d 535 (Mo. banc 2016) to the 101
extent inconsistent with this section and Southwestern Bell 102
Tel. Co. v. Director of Revenue, 78 S.W.3d 763 (Mo. banc 103
2002) and Southwestern Bell Tel. Co. v. Director of Revenue, 104
182 S.W.3d 226 (Mo. banc 2005). The construction and 105
application of this subdivision as expressed by the Missouri 106
supreme court in DST Systems, Inc. v. Director of Revenue, 107
43 S.W.3d 799 (Mo. banc 2001); Southwestern Bell Tel. Co. v. 108
Director of Revenue, 78 S.W.3d 763 (Mo. banc 2002); and 109
Southwestern Bell Tel. Co. v. Director of Revenue, 182 110
S.W.3d 226 (Mo. banc 2005), is hereby affirmed. Material 111
recovery is not the reuse of materials w ithin a 112
manufacturing process or the use of a product previously 113 SB 95 9
recovered. The material recovery processing plant shall 114
qualify under the provisions of this section regardless of 115
ownership of the material being recovered; 116
(5) Machinery and equipment, and parts and the 117
materials and supplies solely required for the installation 118
or construction of such machinery and equipment, purchased 119
and used to establish new or to expand existing 120
manufacturing, mining or fabricating plants in the state if 121
such machinery and equipment is used directly in 122
manufacturing, mining or fabricating a product which is 123
intended to be sold ultimately for final use or 124
consumption. The construction and application of this 125
subdivision as expressed by the Missouri su preme court in 126
DST Systems, Inc. v. Director of Revenue, 43 S.W.3d 799 (Mo. 127
banc 2001); Southwestern Bell Tel. Co. v. Director of 128
Revenue, 78 S.W.3d 763 (Mo. banc 2002); and Southwestern 129
Bell Tel. Co. v. Director of Revenue, 182 S.W.3d 226 (Mo. 130
banc 2005), is hereby affirmed; 131
(6) Tangible personal property which is used 132
exclusively in the manufacturing, processing, modification 133
or assembling of products sold to the United States 134
government or to any agency of the United States government; 135
(7) Animals or poultry used for breeding or feeding 136
purposes, or captive wildlife; 137
(8) Newsprint, ink, computers, photosensitive paper 138
and film, toner, printing plates and other machinery, 139
equipment, replacement parts and supplies used in produc ing 140
newspapers published for dissemination of news to the 141
general public; 142
(9) The rentals of films, records or any type of sound 143
or picture transcriptions for public commercial display; 144 SB 95 10
(10) Pumping machinery and equipment used to propel 145
products delivered by pipelines engaged as common carriers; 146
(11) Railroad rolling stock for use in transporting 147
persons or property in interstate commerce and motor 148
vehicles licensed for a gross weight of twenty -four thousand 149
pounds or more or trail ers used by common carriers, as 150
defined in section 390.020, in the transportation of persons 151
or property; 152
(12) Electrical energy used in the actual primary 153
manufacture, processing, compounding, mining or producing of 154
a product, or electrical ener gy used in the actual secondary 155
processing or fabricating of the product, or a material 156
recovery processing plant as defined in subdivision (4) of 157
this subsection, in facilities owned or leased by the 158
taxpayer, if the total cost of electrical energy so used 159
exceeds ten percent of the total cost of production, either 160
primary or secondary, exclusive of the cost of electrical 161
energy so used or if the raw materials used in such 162
processing contain at least twenty -five percent recovered 163
materials as defined in section 260.200. There shall be a 164
rebuttable presumption that the raw materials used in the 165
primary manufacture of automobiles contain at least twenty - 166
five percent recovered materials. For purposes of this 167
subdivision, "processing" means any m ode of treatment, act 168
or series of acts performed upon materials to transform and 169
reduce them to a different state or thing, including 170
treatment necessary to maintain or preserve such processing 171
by the producer at the production facility; 172
(13) Anodes which are used or consumed in 173
manufacturing, processing, compounding, mining, producing or 174
fabricating and which have a useful life of less than one 175
year; 176 SB 95 11
(14) Machinery, equipment, appliances and devices 177
purchased or leased and used solely for the purpose of 178
preventing, abating or monitoring air pollution, and 179
materials and supplies solely required for the installation, 180
construction or reconstruction of such machinery, equipment, 181
appliances and devices; 182
(15) Machinery, equipment, a ppliances and devices 183
purchased or leased and used solely for the purpose of 184
preventing, abating or monitoring water pollution, and 185
materials and supplies solely required for the installation, 186
construction or reconstruction of such machinery, equipment , 187
appliances and devices; 188
(16) Tangible personal property purchased by a rural 189
water district; 190
(17) All amounts paid or charged for admission or 191
participation or other fees paid by or other charges to 192
individuals in or for any place of amus ement, entertainment 193
or recreation, games or athletic events, including museums, 194
fairs, zoos and planetariums, owned or operated by a 195
municipality or other political subdivision where all the 196
proceeds derived therefrom benefit the municipality or other 197
political subdivision and do not inure to any private 198
person, firm, or corporation, provided, however, that a 199
municipality or other political subdivision may enter into 200
revenue-sharing agreements with private persons, firms, or 201
corporations providing goods or services, including 202
management services, in or for the place of amusement, 203
entertainment or recreation, games or athletic events, and 204
provided further that nothing in this subdivision shall 205
exempt from tax any amounts retained by any private person, 206
firm, or corporation under such revenue -sharing agreement; 207 SB 95 12
(18) All sales of insulin, and all sales, rentals, 208
repairs, and parts of durable medical equipment, prosthetic 209
devices, and orthopedic devices as defined on January 1, 210
1980, by the federal Medicare program pursuant to Title 211
XVIII of the Social Security Act of 1965, including the 212
items specified in Section 1862(a)(12) of that act (42 213
U.S.C. Section 1395y, as amended) , and also specifically 214
including hearing aids and hearing aid supplies and all 215
sales of drugs which may be legally dispensed by a licensed 216
pharmacist only upon a lawful prescription of a practitioner 217
licensed to administer those items, including samples and 218
materials used to manufacture samples which may be dispe nsed 219
by a practitioner authorized to dispense such samples and 220
all sales or rental of medical oxygen, home respiratory 221
equipment and accessories including parts, and hospital beds 222
and accessories and ambulatory aids including parts, and all 223
sales or rental of manual and powered wheelchairs including 224
parts, and stairway lifts, Braille writers, electronic 225
Braille equipment and, if purchased or rented by or on 226
behalf of a person with one or more physical or mental 227
disabilities to enable them to functi on more independently, 228
all sales or rental of scooters including parts, and reading 229
machines, electronic print enlargers and magnifiers, 230
electronic alternative and augmentative communication 231
devices, and items used solely to modify motor vehicles to 232
permit the use of such motor vehicles by individuals with 233
disabilities or sales of over -the-counter or nonprescription 234
drugs to individuals with disabilities, and drugs required 235
by the Food and Drug Administration to meet the over -the- 236
counter drug product labeling requirements in 21 CFR 201.66, 237
or its successor, as prescribed by a health care 238
practitioner licensed to prescribe; 239 SB 95 13
(19) All sales made by or to religious and charitable 240
organizations and institutions in their religious, 241
charitable or educational functions and activities and all 242
sales made by or to all elementary and secondary schools 243
operated at public expense in their educational functions 244
and activities; 245
(20) All sales of aircraft to common carriers for 246
storage or for use in interstate commerce and all sales made 247
by or to not-for-profit civic, social, service or fraternal 248
organizations, including fraternal organizations which have 249
been declared tax-exempt organizations pursuant to Section 250
501(c)(8) or (10) of the 1986 I nternal Revenue Code, as 251
amended, in their civic or charitable functions and 252
activities and all sales made to eleemosynary and penal 253
institutions and industries of the state, and all sales made 254
to any private not-for-profit institution of higher 255
education not otherwise excluded pursuant to subdivision 256
(19) of this subsection or any institution of higher 257
education supported by public funds, and all sales made to a 258
state relief agency in the exercise of relief functions and 259
activities; 260
(21) All ticket sales made by benevolent, scientific 261
and educational associations which are formed to foster, 262
encourage, and promote progress and improvement in the 263
science of agriculture and in the raising and breeding of 264
animals, and by nonprofit summer thea ter organizations if 265
such organizations are exempt from federal tax pursuant to 266
the provisions of the Internal Revenue Code and all 267
admission charges and entry fees to the Missouri state fair 268
or any fair conducted by a county agricultural and 269
mechanical society organized and operated pursuant to 270
sections 262.290 to 262.530; 271 SB 95 14
(22) All sales made to any private not -for-profit 272
elementary or secondary school, all sales of feed additives, 273
medications or vaccines administered to livestock or poultry 274
in the production of food or fiber, all sales of pesticides 275
used in the production of crops, livestock or poultry for 276
food or fiber, all sales of bedding used in the production 277
of livestock or poultry for food or fiber, all sales of 278
propane or natural gas, electricity or diesel fuel used 279
exclusively for drying agricultural crops, natural gas used 280
in the primary manufacture or processing of fuel ethanol as 281
defined in section 142.028, natural gas, propane, and 282
electricity used by an eligible new gene ration cooperative 283
or an eligible new generation processing entity as defined 284
in section 348.432, and all sales of farm machinery and 285
equipment, other than airplanes, motor vehicles and 286
trailers, and any freight charges on any exempt item. As 287
used in this subdivision, the term "feed additives" means 288
tangible personal property which, when mixed with feed for 289
livestock or poultry, is to be used in the feeding of 290
livestock or poultry. As used in this subdivision, the term 291
"pesticides" includes adjuv ants such as crop oils, 292
surfactants, wetting agents and other assorted pesticide 293
carriers used to improve or enhance the effect of a 294
pesticide and the foam used to mark the application of 295
pesticides and herbicides for the production of crops, 296
livestock or poultry. As used in this subdivision, the term 297
"farm machinery and equipment" shall mean: 298
(a) New or used farm tractors and such other new or 299
used farm machinery and equipment, including utility 300
vehicles used for any agricultural use, and re pair or 301
replacement parts thereon and any accessories for and 302
upgrades to such farm machinery and equipment and rotary 303 SB 95 15
mowers used for any agricultural purposes. For the purposes 304
of this subdivision, "utility vehicle" shall mean any 305
motorized vehicle manufactured and used exclusively for off - 306
highway use which is more than fifty inches but no more than 307
eighty inches in width, measured from outside of tire rim to 308
outside of tire rim, with an unladen dry weight of three 309
thousand five hundred pounds o r less, traveling on four or 310
six wheels; 311
(b) Supplies and lubricants used exclusively, solely, 312
and directly for producing crops, raising and feeding 313
livestock, fish, poultry, pheasants, chukar, quail, or for 314
producing milk for ultimate sale at re tail, including field 315
drain tile; and 316
(c) One-half of each purchaser's purchase of diesel 317
fuel therefor which is: 318
a. Used exclusively for agricultural purposes; 319
b. Used on land owned or leased for the purpose of 320
producing farm products ; and 321
c. Used directly in producing farm products to be sold 322
ultimately in processed form or otherwise at retail or in 323
producing farm products to be fed to livestock or poultry to 324
be sold ultimately in processed form at retail; 325
(23) Except as otherwise provided in section 144.032, 326
all sales of metered water service, electricity, electrical 327
current, natural, artificial or propane gas, wood, coal or 328
home heating oil for domestic use and in any city not within 329
a county, all sales of metered or unmetered water service 330
for domestic use: 331
(a) "Domestic use" means that portion of metered water 332
service, electricity, electrical current, natural, 333
artificial or propane gas, wood, coal or home heating oil, 334
and in any city not within a county, metered or unmetered 335 SB 95 16
water service, which an individual occupant of a residential 336
premises uses for nonbusiness, noncommercial or 337
nonindustrial purposes. Utility service through a single or 338
master meter for residential apartments or condominiums, 339
including service for common areas and facilities and vacant 340
units, shall be deemed to be for domestic use. Each seller 341
shall establish and maintain a system whereby individual 342
purchases are determined as exempt or nonexempt; 343
(b) Regulated utility sellers shall determine whether 344
individual purchases are exempt or nonexempt based upon the 345
seller's utility service rate classifications as contained 346
in tariffs on file with and approved by the Missouri public 347
service commission. Sales and purchases made pursuant to 348
the rate classification "residential" and sales to and 349
purchases made by or on behalf of the occupants of 350
residential apartments or condominiums through a single or 351
master meter, including service for common areas and 352
facilities and vacant units, shall be considered as sales 353
made for domestic use and such sales shall be exempt from 354
sales tax. Sellers shall charge sales tax upon the entire 355
amount of purchases classified as nondomestic use. The 356
seller's utility service rate classif ication and the 357
provision of service thereunder shall be conclusive as to 358
whether or not the utility must charge sales tax; 359
(c) Each person making domestic use purchases of 360
services or property and who uses any portion of the 361
services or property so purchased for a nondomestic use 362
shall, by the fifteenth day of the fourth month following 363
the year of purchase, and without assessment, notice or 364
demand, file a return and pay sales tax on that portion of 365
nondomestic purchases. Each person making nondomestic 366
purchases of services or property and who uses any portion 367 SB 95 17
of the services or property so purchased for domestic use, 368
and each person making domestic purchases on behalf of 369
occupants of residential apartments or condominiums through 370
a single or master meter, including service for common areas 371
and facilities and vacant units, under a nonresidential 372
utility service rate classification may, between the first 373
day of the first month and the fifteenth day of the fourth 374
month following the yea r of purchase, apply for credit or 375
refund to the director of revenue and the director shall 376
give credit or make refund for taxes paid on the domestic 377
use portion of the purchase. The person making such 378
purchases on behalf of occupants of residential a partments 379
or condominiums shall have standing to apply to the director 380
of revenue for such credit or refund; 381
(24) All sales of handicraft items made by the seller 382
or the seller's spouse if the seller or the seller's spouse 383
is at least sixty-five years of age, and if the total gross 384
proceeds from such sales do not constitute a majority of the 385
annual gross income of the seller; 386
(25) Excise taxes, collected on sales at retail, 387
imposed by Sections 4041, 4071, 4081, [4091,] 4161, 4181, 388
4251, 4261 and 4271 of Title 26, United States Code. The 389
director of revenue shall promulgate rules pursuant to 390
chapter 536 to eliminate all state and local sales taxes on 391
such excise taxes; 392
(26) Sales of fuel consumed or used in the operation 393
of ships, barges, or waterborne vessels which are used 394
primarily in or for the transportation of property or cargo, 395
or the conveyance of persons for hire, on navigable rivers 396
bordering on or located in part in this state, if such fuel 397
is delivered by the sell er to the purchaser's barge, ship, 398
or waterborne vessel while it is afloat upon such river; 399 SB 95 18
(27) All sales made to an interstate compact agency 400
created pursuant to sections 70.370 to 70.441 or sections 401
238.010 to 238.100 in the exercise of the fun ctions and 402
activities of such agency as provided pursuant to the 403
compact; 404
(28) Computers, computer software and computer 405
security systems purchased for use by architectural or 406
engineering firms headquartered in this state. For the 407
purposes of this subdivision, "headquartered in this state" 408
means the office for the administrative management of at 409
least four integrated facilities operated by the taxpayer is 410
located in the state of Missouri; 411
(29) All livestock sales when either the seller is 412
engaged in the growing, producing or feeding of such 413
livestock, or the seller is engaged in the business of 414
buying and selling, bartering or leasing of such livestock; 415
(30) All sales of barges which are to be used 416
primarily in the transportati on of property or cargo on 417
interstate waterways; 418
(31) Electrical energy or gas, whether natural, 419
artificial or propane, water, or other utilities which are 420
ultimately consumed in connection with the manufacturing of 421
cellular glass products or in any material recovery 422
processing plant as defined in subdivision (4) of this 423
subsection; 424
(32) Notwithstanding other provisions of law to the 425
contrary, all sales of pesticides or herbicides used in the 426
production of crops, aquaculture, livestock o r poultry; 427
(33) Tangible personal property and utilities 428
purchased for use or consumption directly or exclusively in 429
the research and development of agricultural/biotechnology 430 SB 95 19
and plant genomics products and prescription pharmaceuticals 431
consumed by humans or animals; 432
(34) All sales of grain bins for storage of grain for 433
resale; 434
(35) All sales of feed which are developed for and 435
used in the feeding of pets owned by a commercial breeder 436
when such sales are made to a commercial breeder , as defined 437
in section 273.325, and licensed pursuant to sections 438
273.325 to 273.357; 439
(36) All purchases by a contractor on behalf of an 440
entity located in another state, provided that the entity is 441
authorized to issue a certificate of exemption for purchases 442
to a contractor under the provisions of that state's laws. 443
For purposes of this subdivision, the term "certificate of 444
exemption" shall mean any document evidencing that the 445
entity is exempt from sales and use taxes on purchases 446
pursuant to the laws of the state in which the entity is 447
located. Any contractor making purchases on behalf of such 448
entity shall maintain a copy of the entity's exemption 449
certificate as evidence of the exemption. If the exemption 450
certificate issued by the ex empt entity to the contractor is 451
later determined by the director of revenue to be invalid 452
for any reason and the contractor has accepted the 453
certificate in good faith, neither the contractor or the 454
exempt entity shall be liable for the payment of any taxes, 455
interest and penalty due as the result of use of the invalid 456
exemption certificate. Materials shall be exempt from all 457
state and local sales and use taxes when purchased by a 458
contractor for the purpose of fabricating tangible personal 459
property which is used in fulfilling a contract for the 460
purpose of constructing, repairing or remodeling facilities 461
for the following: 462 SB 95 20
(a) An exempt entity located in this state, if the 463
entity is one of those entities able to issue project 464
exemption certificates in accordance with the provisions of 465
section 144.062; or 466
(b) An exempt entity located outside the state if the 467
exempt entity is authorized to issue an exemption 468
certificate to contractors in accordance with the provisions 469
of that state's law and the applicable provisions of this 470
section; 471
(37) All sales or other transfers of tangible personal 472
property to a lessor who leases the property under a lease 473
of one year or longer executed or in effect at the time of 474
the sale or other tra nsfer to an interstate compact agency 475
created pursuant to sections 70.370 to 70.441 or sections 476
238.010 to 238.100; 477
(38) Sales of tickets to any collegiate athletic 478
championship event that is held in a facility owned or 479
operated by a governmental authority or commission, a quasi - 480
governmental agency, a state university or college or by the 481
state or any political subdivision thereof, including a 482
municipality, and that is played on a neutral site and may 483
reasonably be played at a site located out side the state of 484
Missouri. For purposes of this subdivision, "neutral site" 485
means any site that is not located on the campus of a 486
conference member institution participating in the event; 487
(39) All purchases by a sports complex authority 488
created under section 64.920, and all sales of utilities by 489
such authority at the authority's cost that are consumed in 490
connection with the operation of a sports complex leased to 491
a professional sports team; 492
(40) All materials, replacement parts, and equ ipment 493
purchased for use directly upon, and for the modification, 494 SB 95 21
replacement, repair, and maintenance of aircraft, aircraft 495
power plants, and aircraft accessories; 496
(41) Sales of sporting clays, wobble, skeet, and trap 497
targets to any shooting ran ge or similar places of business 498
for use in the normal course of business and money received 499
by a shooting range or similar places of business from 500
patrons and held by a shooting range or similar place of 501
business for redistribution to patrons at the c onclusion of 502
a shooting event; 503
(42) All sales of motor fuel, as defined in section 504
142.800, used in any watercraft, as defined in section 505
306.010; 506
(43) Any new or used aircraft sold or delivered in 507
this state to a person who is not a reside nt of this state 508
or a corporation that is not incorporated in this state, and 509
such aircraft is not to be based in this state and shall not 510
remain in this state more than ten business days subsequent 511
to the last to occur of: 512
(a) The transfer of title to the aircraft to a person 513
who is not a resident of this state or a corporation that is 514
not incorporated in this state; or 515
(b) The date of the return to service of the aircraft 516
in accordance with 14 CFR 91.407 for any maintenance, 517
preventive maintenance, rebuilding, alterations, repairs, or 518
installations that are completed contemporaneously with the 519
transfer of title to the aircraft to a person who is not a 520
resident of this state or a corporation that is not 521
incorporated in this state; 522
(44) Motor vehicles registered in excess of fifty -four 523
thousand pounds, and the trailers pulled by such motor 524
vehicles, that are actually used in the normal course of 525
business to haul property on the public highways of the 526 SB 95 22
state, and that are capab le of hauling loads commensurate 527
with the motor vehicle's registered weight; and the 528
materials, replacement parts, and equipment purchased for 529
use directly upon, and for the repair and maintenance or 530
manufacture of such vehicles. For purposes of this 531
subdivision, "motor vehicle" and "public highway" shall have 532
the meaning as ascribed in section 390.020; 533
(45) All internet access or the use of internet access 534
regardless of whether the tax is imposed on a provider of 535
internet access or a buyer o f internet access. For purposes 536
of this subdivision, the following terms shall mean: 537
(a) "Direct costs", costs incurred by a governmental 538
authority solely because of an internet service provider's 539
use of the public right -of-way. The term shall not include 540
costs that the governmental authority would have incurred if 541
the internet service provider did not make such use of the 542
public right-of-way. Direct costs shall be determined in a 543
manner consistent with generally accepted accounting 544
principles; 545
(b) "Internet", computer and telecommunications 546
facilities, including equipment and operating software, that 547
comprises the interconnected worldwide network that employ 548
the transmission control protocol or internet protocol, or 549
any predecessor or successor protocols to that protocol, to 550
communicate information of all kinds by wire or radio; 551
(c) "Internet access", a service that enables users to 552
connect to the internet to access content, information, or 553
other services without regard to whether the service is 554
referred to as telecommunications, communications, 555
transmission, or similar services, and without regard to 556
whether a provider of the service is subject to regulation 557
by the Federal Communications Commission as a common carrier 558 SB 95 23
under 47 U.S.C. Section 201, et seq. For purposes of this 559
subdivision, internet access also includes: the purchase, 560
use, or sale of communications services, including 561
telecommunications services as defined in section 144.010, 562
to the extent the commu nications services are purchased, 563
used, or sold to provide the service described in this 564
subdivision or to otherwise enable users to access content, 565
information, or other services offered over the internet; 566
services that are incidental to the provision of a service 567
described in this subdivision, when furnished to users as 568
part of such service, including a home page, electronic 569
mail, and instant messaging, including voice -capable and 570
video-capable electronic mail and instant messaging, video 571
clips, and personal electronic storage capacity; a home page 572
electronic mail and instant messaging, including voice - 573
capable and video-capable electronic mail and instant 574
messaging, video clips, and personal electronic storage 575
capacity that are provided indepe ndently or that are not 576
packed with internet access. As used in this subdivision, 577
internet access does not include voice, audio, and video 578
programming or other products and services, except services 579
described in this paragraph or this subdivision, tha t use 580
internet protocol or any successor protocol and for which 581
there is a charge, regardless of whether the charge is 582
separately stated or aggregated with the charge for services 583
described in this paragraph or this subdivision; 584
(d) "Tax", any charge imposed by the state or a 585
political subdivision of the state for the purpose of 586
generating revenues for governmental purposes and that is 587
not a fee imposed for a specific privilege, service, or 588
benefit conferred, except as described as otherwise u nder 589
this subdivision, or any obligation imposed on a seller to 590 SB 95 24
collect and to remit to the state or a political subdivision 591
of the state any gross retail tax, sales tax, or use tax 592
imposed on a buyer by such a governmental entity. The term 593
tax shall not include any franchise fee or similar fee 594
imposed or authorized under sections 67.1830 to 67.1846 or 595
section 67.2689; Section 622 or 653 of the Communications 596
Act of 1934, 47 U.S.C. Section 542 and 47 U.S.C. Section 597
573; or any other fee related to obligations of 598
telecommunications carriers under the Communications Act of 599
1934, 47 U.S.C. Section 151, et seq., except to the extent 600
that: 601
a. The fee is not imposed for the purpose of 602
recovering direct costs incurred by the franchising or other 603
governmental authority from providing the specific 604
privilege, service, or benefit conferred to the payer of the 605
fee; or 606
b. The fee is imposed for the use of a public right -of- 607
way based on a percentage of the service revenue, and the 608
fee exceeds the incremental direct costs incurred by the 609
governmental authority associated with the provision of that 610
right-of-way to the provider of internet access service. 611
Nothing in this subdivision shall be interpreted as an 612
exemption from taxes due on goods or services that were 613
subject to tax on January 1, 2016; 614
(46) All purchases by a company of solar photovoltaic 615
energy systems, components used to construct a solar 616
photovoltaic energy system, and all purchases of materials 617
and supplies used direc tly to construct or make improvements 618
to such systems, provided that such systems: 619
(a) Are sold or leased to an end user; or 620 SB 95 25
(b) Are used to produce, collect and transmit 621
electricity for resale or retail ; 622
(47) All sales of diapers, inco ntinence products, and 623
feminine hygiene products. The exemptions in this 624
subdivision shall apply only to the provisions of and the 625
computation of the tax levied, assessed, or payable pursuant 626
to this chapter. For the purposes of this subdivision, the 627
following terms mean: 628
(a) "Diapers", absorbent garments worn by infants or 629
toddlers who are not toilet -trained or by individuals who 630
are incapable of controlling their bladder or bowel 631
movements; 632
(b) "Feminine hygiene products", personal c are 633
products used to manage menstrual flow including, but not 634
limited to, tampons, pads, liners, and cups; 635
(c) "Incontinence products", products designed 636
specifically for hygiene matters related to urinary 637
incontinence. 638
3. Any ruling, agreement, or contract, whether written 639
or oral, express or implied, between a person and this 640
state's executive branch, or any other state agency or 641
department, stating, agreeing, or ruling that such person is 642
not required to collect sales and use tax in t his state 643
despite the presence of a warehouse, distribution center, or 644
fulfillment center in this state that is owned or operated 645
by the person or an affiliated person shall be null and void 646
unless it is specifically approved by a majority vote of 647
each of the houses of the general assembly. For purposes of 648
this subsection, an "affiliated person" means any person 649
that is a member of the same controlled group of 650
corporations as defined in Section 1563(a) of the Internal 651
Revenue Code of 1986, as amen ded, as the vendor or any other 652 SB 95 26
entity that, notwithstanding its form of organization, bears 653
the same ownership relationship to the vendor as a 654
corporation that is a member of the same controlled group of 655
corporations as defined in Section 1563(a) of t he Internal 656
Revenue Code, as amended. 657