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28	28	STATE OF OKLAHOMA
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30	30	1st Session of the 59th Legislature (2023)
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32	32	HOUSE BILL 1039 By: Rosecrants
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38	38	AS INTRODUCED
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40	40	An Act relating to revenue and taxation; amending 68
41	41	O.S. 2021, Sections 1357.10, 1377 and 2701, which
42	42	relate to tax exemptions for certain sales; exempting
43	43	school supplies; modifying maximum per-item
44	44	allowance; defining term; directing State Board of
45	45	Education to promulgate list; clarifying citations ;
46	46	providing an effective date; and declaring an
47	47	emergency.
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54	54	BE IT ENACTED BY THE PEOPLE OF THE STATE OF OKLAHOMA:
55	55	SECTION 1. AMENDATORY 68 O.S. 20 21, Section 1357.10, is
56	56	amended to read as follows:
57	57	Section 1357.10 A. The sale of an article of clothing or
58	58	footwear designed to be worn on or about the hum an body or any
59	59	school supplies shall be exempt from th e tax imposed by Section 1354
60	60	of Title 68 of the Oklahoma Statutes this title if:
61	61	1. The sales price of the article of clothing or footwear is
62	62	less than One Hundred Dollars ($100.00) Seventy-five Dollars
63	63	($75.00) and the price of the school supply item is less than Fifty
64	64	Dollars ($50.00); and
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91	91	2. The sale takes place during a p eriod beginning at 12:01 a.m.
92	92	on the first Friday in August and ending at 12 midnight on the
93	93	following Sunday, covering a period of three (3) days.
94	94	B. Subsection A of this section s hall not apply to:
95	95	1. Any special clothing or footwear that is primarily designed
96	96	for athletic activity or protective use and that is not normally
97	97	worn except when used for athletic activity or protect ive use for
98	98	which it is designed;
99	99	2. Accessories, inc luding jewelry, handbags, luggage,
100	100	umbrellas, wallets, watches, and simila r items carried on or about
101	101	the human body, without regard to whether worn on the body in a
102	102	manner characteristic of clothing; a nd
103	103	3. The rental of clothing or footwear.
104	104	C. The Oklahoma Tax Commission shall promulgate any necessary
105	105	rules to implement the provisions of this section.
106	106	D. For purposes of subsection A of this section, school
107	107	supplies shall include binders, calculator s, cellophane tape,
108	108	colored pencils, compasses, notebo oks, construction paper, crayons,
109	109	erasers, folders, glue stick s, liquid glue, highlighters, legal
110	110	pads, lunchboxes, markers, notebook filler paper, paste, pencils,
111	111	including mechanical pencils and penci l refills, pens, including
112	112	felt pens, ballpoint pens, fountain pens, and pen refills, poster
113	113	board, poster paper, protractors, rul ers, scissors, staplers,
114	114	staples, paints, including acrylic, tempe ra, watercolors, and oil
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141	141	paints, paintbrushes for artwork, s ketch and drawing pads, reference
142	142	maps and guides, all required textbooks on an official school book
143	143	list with a sales price of mor e than Thirty Dollars ($30.00) and
144	144	less than Fifty Dollars ($50.00) and any additional items deemed
145	145	school supplies by the State Board of Education. Each year, the
146	146	State Board of Education shall promulgate an official list of school
147	147	supplies, which will additionally be treated as tax-exempt under
148	148	this section.
149	149	SECTION 2. AMENDATORY 68 O.S. 20 21, Section 1377, is
150	150	amended to read as follows:
151	151	Section 1377. The sales tax imposed by any county or authority
152	152	authorized by law to levy a sales tax shall not be imposed upon the
153	153	sale of an article of clothing or footwear designed to be worn on or
154	154	about the human body or any school supplies in accordance with and
155	155	to the extent set forth in Section 3 1357.10 of this act title.
156	156	SECTION 3. AMENDATORY 68 O.S. 2021, Section 2701, is
157	157	amended to read as follows:
158	158	Section 2701. A. Any incorporated city or town in this state
159	159	is hereby authorized to assess, levy, and c ollect taxes for general
160	160	and special purposes of municipal govern ment as the Legislature may
161	161	levy and collect for purposes of state government, subject to the
162	162	provisions of subsection F of this section, except ad valorem
163	163	property taxes. Provided:
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190	190	1. Taxes shall be uniform upon the same class subjects, and any
191	191	tax, charge, or fee levied upon or measured by income or receipts
192	192	from the sale of products or services shall be uniform upon a ll
193	193	classes of taxpayers;
194	194	2. Motor vehicles may be taxed by the city or town only when
195	195	such vehicles are primarily used or located in suc h city or town for
196	196	a period of time longer than six (6) months of a taxable year;
197	197	3. The provisions of this section sh all not be construed to
198	198	authorize imposition of any tax upon persons, fi rms, or corporations
199	199	exempted from other taxation under the provi sions of Sections 348.1,
200	200	624 and 321 of Title 36 of the Oklahoma Statutes, by reason of
201	201	payment of taxes imposed under such sections;
202	202	4. Cooperatives and communications companies are hereby
203	203	authorized to pass on to their subscribers in the incorporated ci ty
204	204	or town involved, the amount of any special municipal fee, charge or
205	205	tax hereafter assessed or levied on or collecte d from such
206	206	cooperatives or communications companies;
207	207	5. No earnings, payroll or income taxes may be levied on
208	208	nonresidents of the citie s or towns levying such tax;
209	209	6. The governing body of any city or town shall be prohibited
210	210	from proposing taxing ordin ances more often than three times in any
211	211	calendar year, or twice in any six-month period; and
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238	238	7. Any revenues derived from a tax authori zed by this
239	239	subsection not dedicated to a limited purpose shall be deposited in
240	240	the municipal general fund.
241	241	B. A sales tax authorized in subsection A of this section may
242	242	be levied for limite d purposes specified in the ordinance levying
243	243	the tax. Such ordinance shall be submitted to the voters for
244	244	approval as provided in Section 2705 of this title. Any sales tax
245	245	levied or any change in the rate of a sales tax levied pursuant to
246	246	the provisions of this section shall become effective on the first
247	247	day of the calendar quarter following approval by the voters of the
248	248	city or town unless another effective date, which shall also be on
249	249	the first day of a calendar quarter, is specified in the ordinance
250	250	levying the sales tax or changing the rate of sales tax. Such
251	251	ordinance shall describe with specificity the projects or
252	252	expenditures for which the limited -purpose tax levy would be mad e.
253	253	The municipal governing body shall create a limited -purpose fund and
254	254	deposit therein any revenue generated by any tax levied pursuant to
255	255	this subsection. Money in the fund shall be accumulated from year
256	256	to year. The fund shall be placed in an insured interest-bearing
257	257	account and the interest which accrues on the fund sha ll be retained
258	258	in the fund. The fund shall be nonfiscal and shal l not be
259	259	considered in computing any levy when the municipality makes its
260	260	estimate to the excise board for needed appro priations. Money in
261	261	the limited-purpose tax fund shall be expended only as accumulated
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288	288	and only for the purposes specifically described in the taxing
289	289	ordinance as approved by the voters.
290	290	C. The Oklahoma Tax Commission shall give notice to all vendors
291	291	of a rate change at least sixty (60) days prior to the effective
292	292	date of the rate change. Provided, for purchases from printed
293	293	catalogs wherein the purchaser computed the tax based upon local tax
294	294	rates published in the catalog, the rate change shall not be
295	295	effective until the first day of a calendar quarter after a minimum
296	296	of one hundred twenty-days' notice to vendors. Failure to give
297	297	notice as required by this section shall delay the effective date of
298	298	the rate change to the first day of the next calendar qu arter.
299	299	D. The change in the boundary of a municipality shall be
300	300	effective, for sales and use tax purposes only, on the first day of
301	301	a calendar quarter after a minimum of sixty (60) days ' notice to
302	302	vendors.
303	303	E. If the proceeds of any sales tax levied by a municipality
304	304	pursuant to subsection B of this section are being used by the
305	305	municipality for the purpose of retiring indebtedness incurre d by
306	306	the municipality or by a public trust of which the municipality is a
307	307	beneficiary for the specific purpose for whic h the sales tax was
308	308	imposed, the sales tax shall not be repealed until s uch time as the
309	309	indebtedness is retired. However, in no event sh all the life of the
310	310	tax be extended beyond the duration approved by the voters of the
311	311	municipality. The provisions of this subsection shall apply to all
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338	338	sales tax levies imposed by a municip ality and being used by the
339	339	municipality for the purposes set for th in this subsection prior to
340	340	or after July 1, 1995.
341	341	F. The sale of an article of clothing or footwear designed to
342	342	be worn on or about the human body or any school supplies shall be
343	343	exempt from the sales tax imposed by any incorporated city or town,
344	344	in accordance with and to t he extent set forth in Section 1357.10 of
345	345	this title.
346	346	G. Any municipality that levies a dedicat ed tax pursuant to a
347	347	vote of the people for the purpose of funding publi c safety or any
348	348	other governmental purpose shall not redirect all or a portion of
349	349	the dedicated tax revenue to another purpose without a vote of the
350	350	people authorizing such action.
351	351	SECTION 4. The act shall become effective July 1, 20 23.
352	352	SECTION 5. It being immediately necessary for the preservation
353	353	of the public peace, health or safety, an emergency is hereby
354	354	declared to exist, by reason whereof this act shall take effect and
355	355	be in full force from and after its pas sage and approval.
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357	357	59-1-5949 MAH 12/20/22

Oklahoma 2024 Regular Session

Oklahoma House Bill HB1039 Compare Versions