Oklahoma 2022 2022 Regular Session

Oklahoma House Bill HB1566 Amended / Bill

Filed 02/19/2021

                     
 
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HOUSE OF REPRESENTATIVES - FLOOR VERSION 
 
STATE OF OKLAHOMA 
 
1st Session of the 58th Legislature (2021) 
 
HOUSE BILL 1566 	By: Sims of the House 
 
   and 
 
  Rader of the Senate 
 
 
 
 
 
AS INTRODUCED 
 
[ revenue and taxation - sales tax - use of taxes 
collected from certain sales - effective date ] 
 
 
 
 
BE IT ENACTED BY THE PEOPLE OF THE STATE OF OKLAHOMA: 
SECTION 1.     AMENDATORY     68 O.S. 2011, Section 1354, as 
amended by Section 2, Chapter 323, O.S.L. 2012 (68 O.S. Supp. 2020, 
Section 1354), is amended to read as follows: 
Section 1354.  A.  There is hereby levied upon all sales, not 
otherwise exempted in the Oklahoma Sales Tax Code, an excise tax of 
four and one-half percent (4.5%) of the gross receipts or gross 
proceeds of each sale of the following: 
1.  Tangible personal property, except newspapers and 
periodicals;   
 
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2.  Natural or artificial gas, electricity, ice, steam, or any 
other utility or public service, except water, sewage and refuse.  
Provided, the rate of four and one -half percent (4.5%) shall not 
apply to sales subject to the provisions of paragraph 6 of Section 
1357 of this title; 
3.  Transportation for hire to persons by common carriers, 
including railroads both steam and electric, motor transportation 
companies, pullman car comp anies, airlines, and other means of 
transportation for hire, excluding: 
a. transportation services provided by a tourism service 
broker which are incidental to the rendition of 
tourism brokerage services by such broker to a 
customer regardless of whether o r not such 
transportation services are actually owned and 
operated by the tourism service broker.  For purposes 
of this subsection, "tourism service broker " means any 
person, firm, association or corporation or any 
employee of such person, firm, associatio n or 
corporation which, for a fee, commission or other 
valuable consideration, arranges or offers to arrange 
trips, tours or other vacation or recreational travel 
plans for a customer, and   
 
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b. transportation services provided by a funeral 
establishment to family members and other persons for 
purposes of conducting a funeral in this state; 
4.  Intrastate, interstate and international telecommunications 
services sourced to this state in accordance with Section 1354.30 of 
this title and ancillary services.  Pro vided: 
a. the term "telecommunications services " shall mean the 
electronic transmission, conveyance, or routing of 
voice, data, audio, video, or any other information or 
signals to a point, or between or among points.  The 
term "telecommunications services " includes such 
transmission, conveyance, or routing in which computer 
processing applications are used to act on the form, 
code or protocol of the content for purposes of 
transmission, conveyance or routing without regard to 
whether such service is referr ed to as voice-over 
Internet protocol services or is classified by the 
Federal Communications Commission as enhanced or value 
added.  "Telecommunications services " do not include: 
(1) data processing and information services that 
allow data to be generated , acquired, stored, 
processed, or retrieved and delivered by an 
electronic transmission to a purchaser where such   
 
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purchaser's primary purpose for the underlying 
transaction is the processed data or information, 
(2) installation or maintenance of wiring or 
equipment on a customer 's premises, 
(3) tangible personal property, 
(4) advertising, including but not limited to 
directory advertising, 
(5) billing and collection services provided to third 
parties, 
(6) Internet access services , 
(7) radio and television a udio and video programming 
services, regardless of the medium, including the 
furnishing of transmission, conveyance and 
routing of such services by the programming 
service provider.  Radio and television audio and 
video programming services shall include, but not 
be limited to, cable service as defined in 47 
U.S.C. 522(6) and audio and video programming 
services delivered by commercial mobile radio 
service providers, as defined in 47 C.F.R. 20.3 ;, 
(8) ancillary services, or 
(9) digital products delivered el ectronically, 
including but not limited to, software, music, 
video, reading materials or ring tones,   
 
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b. the term "interstate" means a "telecommunications 
service" that originates in one United States state, 
or a United States territory or possession, and 
terminates in a different United States state or a 
United States territory or possession, 
c. the term "intrastate" means a telecommunications 
service that originates in one United States state or 
a United States territory or possession, and 
terminates in the same United States state or a United 
States territory or possession, 
d. the term "ancillary services" means services that are 
associated with or incidental to the provision of 
telecommunications services, including but not limited 
to "detailed telecommunications billing", "directory 
assistance", "vertical service", and "voice mail 
services", 
e. in the case of a bundled transaction that includes 
telecommunication service, ancillary service, Internet 
access or audio or video programming service: 
(1) if the price is attributable to products that are 
taxable and products that are nontaxable, the 
portion of the price attributable to the 
nontaxable products may be subject to tax unless 
the provider can identify by reasonable and   
 
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verifiable standards such portion for its books 
and records kept in the regular course of 
business for other purposes, including, but not 
limited to, nontax purposes, and 
(2) the provisions of this paragraph shall apply 
unless otherwise provided by federal law, and 
f. a sale of prepaid ca lling service or prepaid wireless 
calling service shall be taxable at the time of sale 
to the customer; 
5.  Telecommunications nonrecurring charges, which means an 
amount billed for the installation, connection, change or initiation 
of telecommunications s ervices received by a customer; 
6.  Printing or printed matter of all types, kinds, or character 
and, except for services of printing, copying or photocopying 
performed by a privately owned scientific and educational library 
sustained by monthly or annual dues paid by members sharing the use 
of such services with students interested in the study of geology, 
petroleum engineering or related subjects, any service of printing 
or overprinting, including the copying of information by mimeograph, 
multigraph, or by otherwise duplicating written or printed matter in 
any manner, or the production of microfiche containing information 
from magnetic tapes or other media furnished by customers; 
7.  Service of furnishing rooms by hotel, apartment hotel, 
public rooming house, motel, public lodging house, or tourist camp;   
 
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8.  Service of furnishing storage or parking privileges by auto 
hotels or parking lots; 
9.  Computer hardware, software, coding sheets, cards, magnetic 
tapes or other media on which prewritten programs have been coded, 
punched, or otherwise recorded, including the gross receipts from 
the licensing of software programs; 
10.  Foods, confections, and all drinks sold or dispensed by 
hotels, restaurants, or other dispensers, and sold for immediate 
consumption upon the premises or delivered or carried away from the 
premises for consumption elsewhere; 
11.  Advertising of all kinds, types, and characters, including 
any and all devices used for advertising purposes except those 
specifically exempt pursuant to the prov isions of Section 1357 of 
this title; 
12.  Dues or fees to clubs including free or complimentary dues 
or fees which have a value equivalent to the charge that would have 
otherwise been made, including any fees paid for the use of 
facilities or services ren dered at a health spa or club or any 
similar facility or business; 
13.  Tickets for admission to or voluntary contributions made to 
places of amusement, sports, entertainment, exhibition, display, or 
other recreational events or activities, including free or 
complimentary admissions which have a value equivalent to the charge 
that would have otherwise been made; provided, that the state tax   
 
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generated from the sale of tickets for admission by an aquarium 
exempt from taxation pursuant to the provisions of the Internal 
Revenue Code, 26 U.S.C., Section 501(c)(3) , or owned or operated by 
a public trust or political subdivision of this state, shall be 
collected and disbursed to the nonprofit organization, public trust 
or political subdivision responsible for the a quarium's operations 
for use by that entity for the following purposes: 
a. servicing or aiding the servicing of debt incurred by 
the aquarium to effect the construction, enlarging or 
renovation of any facility to be used for 
entertainment, edification, edu cation, conservation or 
cultural cultivation to which entry is gained with a 
paid admission ticket, or 
b. promoting visitation primarily to out -of-state 
residents; 
14.  Charges made for the privilege of entering or engaging in 
any kind of activity, such as tennis, racquetball, or handball, when 
spectators are charged no admission fee; 
15.  Charges made for the privilege of using items for 
amusement, sports, entertainment, or recreational activity, such as 
trampolines or golf carts; 
16.  The rental of equipm ent for amusement, sports, 
entertainment, or other recreational activities, such as bowling 
shoes, skates, golf carts, or other sports or athletic equipment;   
 
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17.  The gross receipts from sales from any vending machine 
without any deduction for rental to lo cate the vending machine on 
the premises of a person who is not the owner or any other 
deductions therefrom; 
18.  The gross receipts or gross proceeds from the rental or 
lease of tangible personal property, including rental or lease of 
personal property wh en the rental or lease agreement requires the 
vendor to launder, clean, repair, or otherwise service the rented or 
leased property on a regular basis, without any deduction for the 
cost of the service rendered.  If the rental or lease charge is 
based on the retail value of the property at the time of making the 
rental or lease agreement and the expected life of the property, and 
the rental or lease charge is separately stated from the service 
cost in the statement, bill, or invoice delivered to the consumer , 
the cost of services rendered shall be deducted from the gross 
receipts or gross proceeds; 
19.  Flowers, plants, shrubs, trees, and other floral items, 
whether or not produced by the vendor, sold by persons engaged in 
florist or nursery business in this state, including all orders 
taken by an Oklahoma business for delivery in another state.  All 
orders taken outside this state for delivery within this state shall 
not be subject to the taxes levied in this section; 
20.  Tangible personal property sold to p ersons, peddlers, 
solicitors, or other salesmen, for resale when there is likelihood   
 
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that this state will lose tax revenue due to the difficulty of 
enforcing the provisions of the Oklahoma Sales Tax Code because of: 
a. the operation of the business, 
b. the nature of the business, 
c. the turnover of independent contractors, 
d. the lack of place of business in which to display a 
permit or keep records, 
e. lack of adequate records, 
f. the fact that the persons are minors or transients, 
g. the fact that the per sons are engaged in service 
businesses, or 
h. any other reasonable reason; 
21.  Any taxable services and tangible personal property 
including materials, supplies, and equipment sold to contractors for 
the purpose of developing and improving real estate eve n though said 
real estate is intended for resale as real property, hereby declared 
to be sales to consumers or users, however, taxable materials, 
supplies and equipment sold to contractors as provided by this 
subsection which are purchased as a result of a nd subsequent to the 
date of a contract entered into either prior to the effective date 
of any law increasing the rate of sales tax imposed by this article, 
or entered into prior to the effective date of an ordinance or other 
measure increasing the sales t ax levy of a political subdivision 
shall be subject to the rate of sales tax applicable, as of the date   
 
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such contract was entered into, to sales of such materials, supplies 
and equipment if such purchases are required in order to complete 
the contract.  Such rate shall be applicable to purchases made 
pursuant to the contract or any change order under the contract 
until the contract or any change order has been completed, accepted 
and the contractor has been discharged from any further obligation 
under the contract or change order or until two (2) years from the 
date on which the contract was entered into whichever occurs first.  
The increased sales tax rate shall be applicable to all such 
purchases at the time of sale and the contractor shall file a claim 
for refund before the expiration of three (3) years after the date 
of contract completion or five (5) years after the contract was 
entered into, whichever occurs earlier.  However, the Oklahoma Tax 
Commission shall prescribe rules and regulations and shall p rovide 
procedures for the refund to a contractor of sales taxes collected 
on purchases eligible for the lower sales tax rate authorized by 
this subsection; 
22.  Any taxable services and tangible personal property sold to 
persons who are primarily engaged i n selling their services, such as 
repairmen, hereby declared to be sales to consumers or users; and 
23.  Canoes and paddleboats as defined in Section 4002 of Title 
63 of the Oklahoma Statutes. 
B.  All solicitations or advertisements in print or electronic 
media by Group Three vendors, for the sale of tangible property to   
 
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be delivered within this state, shall contain a notice that the sale 
is subject to Oklahoma sales tax, unless the sale is exempt from 
such taxation. 
SECTION 2.  This act shall become effective November 1, 2021. 
 
COMMITTEE REPORT BY: COMMITTEE ON APPROPRIATIONS AND BUDGET, dated 
02/18/2021 - DO PASS, As Amended and Coauthored.