This bill designates nonprofit rural water districts organized under Code chapter 504, as provided in chapter 357A, as exempt entities for sales and use tax purposes. Specifically, it allows these districts to apply for refunds on sales and use tax for building materials, supplies, and equipment, as well as services provided by contractors under certain contractual conditions. This change aims to streamline the tax exemption process for rural water districts and enhance their financial efficiency in construction projects.

To implement this designation, the bill introduces a new subparagraph in Section 423.4, subsection 1, paragraph a, while simultaneously striking the existing exemption provision in Section 423.3, subsection 38. This deletion ensures that there is no overlap between the two sales tax exemptions, thereby clarifying the tax status of rural water districts and simplifying the legal framework governing their tax exemptions.

Statutes affected:
Introduced: 423.4, 423.3