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STATE OF OKLAHOMA
2nd Session of the 58th Legislature (2022)
SENATE BILL 1487 By: Montgomery
AS INTRODUCED
An Act relating to sales tax code; amending 68 O.S.
2021, Sections 1355 and 1361, which relate to
exemptions and consumer to pay tax ; requiring sales
tax to be paid in one or t wo installments; requiring
installments to be paid in certain period and manner;
and providing an effec tive date.
BE IT ENACTED BY THE PEOPLE OF THE S TATE OF OKLAHOMA:
SECTION 1. AMENDATORY 68 O.S. 2021, Section 1355, is
amended to read as follows:
Section 1355. There are hereby specifically exempted from the
tax levied pursuant to the pro visions of Section 1350 et seq. of
this title:
1. Sale of gasoline, motor fuel, methano l, "M-85" which is a
mixture of methanol an d gasoline containing at least eighty -five
percent (85%) methanol, compressed natural gas, liquefied natural
gas, or liquefied petroleum gas on which the Motor Fue l Tax,
Gasoline Excise Tax, Special Fuels Tax or t he fee in lieu of Special
Fuels Tax levied in Section 500.1 et seq., Section 601 et seq. or
Section 701 et seq. of this title has been, or will be paid;
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2. For the sale of motor vehicles or any optional eq uipment or
accessories attached to motor vehicles on which the Oklahoma Motor
Vehicle Excise Tax levied in Section 2101 et seq. of this title has
been, or will be paid, all but a portion of the levy provided under
Section 1354 of this title, equal to one a nd twenty-five-hundredths
percent (1.25%) of the g ross receipts of such sales. Provided, the
sale of motor vehicles shall not be subject to any sales and use
taxes levied by cities, counties , or other jurisdictions of the
state. The portion of the tax levy provided under Section 1354 of
this title for the sale of motor vehicles or any optional equipment
or accessories attached to motor vehicles may be paid in one (1)
installment by the consumer in the same manner and time as the motor
vehicle excise tax f or the motor vehicle is due and shall include a
quarter, half, or the full amount of tax levied , but shall pe paid
in no more than two (2) installments. If paid in two (2)
installments the consumer shall pay the remaining amount of tax
levied during the first period for registration renewal pursuant to
the Oklahoma Vehicle Licens e and Registration Act, Section 1101 et
seq. of Title 47 of the Oklahoma Statutes;
3. Sale of crude petroleum or natural or c asinghead gas and
other products subject to gross prod uction tax pursuant to the
provisions of Section 1 001 et seq. and Section 1101 et seq. of this
title. This exemption shall not apply when such products are sold
to a consumer or user for consumption or use, except when used for
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injection into the earth fo r the purpose of promoting or
facilitating the pro duction of oil or gas. This paragraph shall not
operate to increase or repeal the gross production tax levied by the
laws of this state;
4. Sale of aircraft on which the tax levi ed pursuant to the
provisions of Sections 6001 through 6007 of this title ha s been, or
will be paid or which are specifically exempt from such tax pursuant
to the provisions of Section 6003 of this title;
5. Sales from coin-operated devices on which the f ee imposed by
Sections 1501 through 1512 of this title has been paid;
6. Leases of twelve (12) months or more of motor vehicles in
which the owners of the vehicles have paid the vehicle excise tax
levied by Section 2103 of this title;
7. Sales of charity game equipment on which a tax is levied
pursuant to the Oklahoma Charity Ga mes Act, Section 401 et seq. of
Title 3A of the Oklahoma Statutes, or which is sold to an
organization that is:
a. a veterans' organization exempt from taxation pursuant
to the provisions of paragraph (4), (7), (8), (10) or
(19) of subsection (c) of Sectio n 501 of the United
States Internal Revenue Code of 1986, as amended, 26
U.S.C., Section 501(c) et seq.,
b. a group home for mentally disabled individua ls exempt
from taxation pursuant to the provisions of paragraph
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(3) of subsection (c) of Section 501 of the United
States Internal Revenue Code of 1986, as amended, 26
U.S.C., Section 501(c) et seq., or
c. a charitable health care organization which is exe mpt
from taxation pursuant t o the provisions of paragr aph
(3) of subsection (c) of Section 501 of the Un ited
States Internal Revenue Code of 1986, as amended, 26
U.S.C., Section 501(c) et seq.;
8. Sales of cigarettes or tobacco products to:
a. a federally recognized Indian tribe or nation which
has entered into a compact with the State of Oklahoma
pursuant to the provisions of subsection C of Section
346 of this title or to a licensee of such a tribe or
nation, upon which the payment in lieu of taxes
required by the compact has been paid, or
b. a federally recognized Indian tribe or nation or to a
licensee of such a tribe or nation upon which the tax
levied pursuant to the provisions of Section 349.1 or
Section 426 of this title has been paid;
9. Leases of aircraft upon which the own ers have paid the
aircraft excise tax levied by Section 6001 et seq. of this title or
which are specifically exempt from such tax pursuant to the
provisions of Section 6003 of this title;
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10. The sale of low -speed or medium-speed electrical vehicles
on which the Oklahoma Motor Veh icle Excise Tax levied in Section
2101 et seq. of this title has been or will be paid;
11. Effective January 1, 2005, sales of cigarettes on which the
tax levied in Section 301 et seq. of this title o r tobacco products
on which the tax levied in Section 4 01 et seq. of this title has
been paid; and
12. Sales of electricity at charging stations as defined by
Section 2 of this act 6502 of this title when the electricity is
sold by a charging station owne r or operator for purposes o f
charging an electric vehi cle as defined by Section 2 of this act
6502 of this title and the tax imposed pursuant to Section 4 of this
act 6504 of this title is collected and remitted to the Oklahoma Tax
Commission.
SECTION 2. AMENDATORY 68 O.S. 2021, Sect ion 1361, is
amended to read as follows:
Section 1361. A. 1. Except as otherwise provided by
subsection C of this section, the tax levied by Section 1350 et seq.
of this title shall be paid by the c onsumer or user to the vendor as
trustee for and on acc ount of this state. Except as otherwise
provided by subsection C of this section, each and every vendor in
this state shall collect from the consumer or user the full amount
of the tax levied by Secti on 1350 et seq. of this title, or an
amount equal as nearly as possible or practicable to the average
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equivalent thereof. Every person required to collect any tax
imposed by Section 1350 et seq. of this title shall be personally
liable for the tax.
2. However, the Oklahoma Tax Commission shall relieve seller s
or certified service providers that follow the r equirements of this
section from the tax otherwise applicable if it is determined that
the purchaser improperly claimed an exemption and to hold the
purchaser liable for the nonpayment of tax. This relief from
liability does not apply to:
a. a seller or certified service provider (CSP) who
fraudulently fails to collect tax,
b. a seller who solicits purchasers to participate in the
unlawful claim of an e xemption, or
c. a seller who accepts an exemption certi ficate when the
purchaser claims an entity -based exemption when:
(1) the subject of the transaction sought to be
covered by the exemption certificate is actually
received by the purchaser at a location operated
by the seller, and
(2) the Tax Commission pro vides an exemption
certificate that clearly and af firmatively
indicates that the claimed exemption is not
available in this state.
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3. The Tax Commission shall relieve a seller or CSP of the tax
otherwise applicable if the seller obtains a fully completed
exemption certificate or captures the relevant dat a elements
required by the Tax Commission within ninety (90) days subsequent to
the date of sale.
If the seller or CSP has not obtained an exemption ce rtificate
or all relevant data elements as provided by the Tax Commission, the
seller may, within one hun dred twenty (120) days subsequent to a
request for substantiation, either prove that the transaction was
not subject to tax by other means or obtain a fully completed
exemption certificate from the purchase r, taken in good faith.
The Tax Commission shall r elieve a seller or CSP of the tax
otherwise applicable if it obtains a blanket exemption certificate
for a purchaser with which the seller has a recurr ing business
relationship. The Tax Commission shall no t request from the seller
or CSP renewal of blanke t certificates or updates of exemption
certificate information or data elements when there is a recurring
business relationship between the buyer and s eller. For purposes of
this section, a recurring busin ess relationship exists when a period
of no more than twelve (12) months elapses between sales
transactions.
4. Upon the granting of relief from liability to the vendor as
provided in this section, th e purchaser shall be liable for the
remittance of the tax, interest and penalty due thereon and the Tax
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Commission shall pursue collection thereof from the purchaser in any
manner in which sales tax may be collected from a vendor.
B. Except as otherwise p rovided by subsection C of this
section, vendors shall add the tax imposed by Section 1350 et seq.
of this title, or the average equivalent thereof, to the sales
price, charge, consideration, gross receipts or gross proceeds of
the sale of tangible persona l property or services taxed by Section
1350 et seq. of this title, and when added such tax shall constit ute
a part of such price or charge, shall be a debt from the consumer or
user to vendor until paid, and shall be recoverable at law in the
same manner as other debts.
C. A person who has obtained a direct payment permit as
provided in Section 1364.1 of th is title shall accrue all taxes
imposed pursuant to Section 1354 or 1402 of this title on all
purchases made by the person pursuant to the permit at th e time the
purchased items are first used or consumed i n a taxable manner and
pay the accrued tax directl y to the Oklahoma Tax Commission on
reports as required by Section 1365 of this title.
D. Except as otherwise provided by subsection C of this
section, a vendor who willfully or intentionally fails, neglec ts or
refuses to collect the full amount of the ta x levied by Section 1350
et seq. of this title, or willfully or intentionally fails, neglects
or refuses to comply with the provisions of Section 1350 et seq. of
this title, or remits or rebates to a consum er or user, either
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directly or indirectly, and by whatsoever means, all or any part of
the tax levied by Section 1350 et seq. of this title, or makes in
any form of advertising, verbally or otherwise, any statement which
implies that the vendor is absorbin g the tax, or paying the tax for
the consumer or user by an adjustment of prices or at a price
including the tax, or in any manner whatsoever, shall be deemed
guilty of a misdemeanor, and upon convicti on thereof shall be fined
not more than Five Hundred Do llars ($500.00), and upon conviction
for a second or other subsequent offense shall be fined not more
than One Thousand Dollars ($1,000.00), or incarcerated for not more
than sixty (60) days, or both. Provided, sales by vending machines
may be made at a stated price which includes state and any municipal
sales tax.
E. A consumer or user who willfully or intentionally fails,
neglects or refuses to pay the full amount of tax levied by Section
1350 et seq. of this title or willfully or intentionally uses a
sales tax permit or direct payment permit which is invalid, expired,
revoked, canceled or otherwise limited to a specific line of
business or willfully or intentionally issues a resale certificate
to a vendor to evade the tax levied by Section 1350 et seq. of this
title shall be subject to a penalty in the amount of Five Hundred
Dollars ($500.00) per reporting period upon determination thereof,
which shall be apportioned as provided for the apportionment of the
tax.
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F. Any sum or sums collected or accrued o r required to be
collected or accrued in Section 1 350 et seq. of this title shall be
deemed to be held in trust for the State of Oklahoma, and, as
trustee, the collecting vendor or holder of a direct p ayment permit
as provided for in Section 1364.1 of this title shall have a
fiduciary duty to the State of Oklahoma in regards to such sums and
shall be subject to the trust laws of this state.
G. Notwithstanding the provisions of this section, the sales
tax associated with the purchase of a motor vehicle shall may be
paid by the consumer in the same manner and time as the motor
vehicle excise tax for said motor vehicle is due in one (1)
installment in the same manner and time as the motor vehicle excise
tax for the motor vehicle is d ue and shall include a quarter, half,
or the full amount of tax levied, but s hall pe paid in no more than
two (2) installments. If paid in two (2) instal lments the consumer
shall pay the remaining amount of tax levied during the first period
for registration renewal pursuant to the Oklahoma Vehicle Licens e
and Registration Act, Se ction 1101 et seq. of Title 47 of the
Oklahoma Statutes.
SECTION 3. This act shall become effective November 1, 2022.
58-2-2694 QD 1/20/2022 8:03:51 AM