SESSION OF 2023
SUPPLEMENTAL NOTE ON HOUSE BILL NO. 2041
As Recommended by House Committee on
Taxation

Brief*
HB 2041 would enact a sales tax exemption for
purchases of tangible personal property made by certain not-
for-profit theaters.
In order to qualify for the exemption, theaters would be
required to provide for:
● The creation and production of novel works for
concerts or productions;
● The employment of full-time theater staff;
● Governance by a board of directors that provides a
partnership between the board and theater staff
and a connection to the community by ensuring
sound business and financial practices and a
commitment to bringing new thoughts and ideas to
the governance of the organization;
● The dedication to providing strong educational
commitments to the community in which the
theater is located; and
● The commitment to providing ongoing live theater
as an art form using available local resources.


____________________
*Supplemental notes are prepared by the Legislative Research
Department and do not express legislative intent. The supplemental
note and fiscal note for this bill may be accessed on the Internet at
http://www.kslegislature.org
Background
The bill was introduced by the House Committee on
Taxation at the request of Representative Sanders.

House Committee on Taxation
In the House Committee hearing, proponent testimony
was provided by representatives of Music Theatre of Wichita
and Theatre Lawrence. Proponents generally stated nonprofit
theater revenues were reduced by the COVID-19 pandemic
and the bill would provide sales tax relief.
Written-only proponent testimony was provided by
representatives of Great Plains Theatre, Salina Community
Theatre, Theatre Atchison, and Topeka Civic Theatre.
Written-only opponent testimony was provided by a
representative of the League of Kansas Municipalities.

Fiscal Information
According the fiscal note prepared by the Division of the
Budget, the Department of Revenue indicates enactment of
the bill would reduce state receipts by $155,500 per year, of
which $129,000 would be from the State General Fund and
the balance from the State Highway Fund. Additionally,
enactment of the bill would reduce local sales tax collections
by approximately $54,500. Any fiscal effect associated with
the bill is not reflected in The FY 2024 Governor’s Budget
Report.
Taxation; sales tax; exemption; theater


2- 2041


Statutes affected:
As introduced: 79-3606