1 STATE OF OKLAHOMA
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2 2nd Session of the 59th Legislature (2024)
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3 HOUSE BILL 3912 By: Caldwell (Chad)
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6 AS INTRODUCED
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7 An Act relating to revenue and taxation; amending 68
7 O.S. 2021, Section 1357, as last amended by Section
8 1, Chapter 344, O.S.L. 2023 (68 O.S. Supp. 2023,
8 Section 1357), which relates to sales tax exemptions;
9 providing sales tax exemption for the sale of hearing
9 aids; providing an effective date; and declaring an
10 emergency.
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13 BE IT ENACTED BY THE PEOPLE OF THE STATE OF OKLAHOMA:
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14 SECTION 1. AMENDATORY 68 O.S. 2021, Section 1357, as
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15 last amended by Section 1, Chapter 344, O.S.L. 2023 (68 O.S. Supp.
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16 2023, Section 1357), is amended to read as follows:
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17 Section 1357. Exemptions – General.
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18 There are hereby specifically exempted from the tax levied by
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19 the Oklahoma Sales Tax Code:
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20 1. Transportation of school pupils to and from elementary
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21 schools or high schools in motor or other vehicles;
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22 2. Transportation of persons where the fare of each person does
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23 not exceed One Dollar ($1.00), or local transportation of persons
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24 within the corporate limits of a municipality except by taxicabs;
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 1 3. Sales for resale to persons engaged in the business of
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2 reselling the articles purchased, whether within or without the
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3 state, provided that such sales to residents of this state are made
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4 to persons to whom sales tax permits have been issued as provided in
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5 the Oklahoma Sales Tax Code. This exemption shall not apply to the
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6 sales of articles made to persons holding permits when such persons
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7 purchase items for their use and which they are not regularly
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8 engaged in the business of reselling; neither shall this exemption
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9 apply to sales of tangible personal property to peddlers, solicitors
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10 and other salespersons who do not have an established place of
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11 business and a sales tax permit. The exemption provided by this
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12 paragraph shall apply to sales of motor fuel or diesel fuel to a
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13 Group Five vendor, but the use of such motor fuel or diesel fuel by
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14 the Group Five vendor shall not be exempt from the tax levied by the
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15 Oklahoma Sales Tax Code. The purchase of motor fuel or diesel fuel
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16 is exempt from sales tax when the motor fuel is for shipment outside
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17 this state and consumed by a common carrier by rail in the conduct
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18 of its business. The sales tax shall apply to the purchase of motor
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19 fuel or diesel fuel in Oklahoma by a common carrier by rail when
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20 such motor fuel is purchased for fueling, within this state, of any
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21 locomotive or other motorized flanged wheel equipment;
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22 4. Sales of advertising space in newspapers and periodicals;
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23 5. Sales of programs relating to sporting and entertainment
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24 events, and sales of advertising on billboards (including signage,
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 1 posters, panels, marquees or on other similar surfaces, whether
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2 indoors or outdoors) or in programs relating to sporting and
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3 entertainment events, and sales of any advertising, to be displayed
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4 at or in connection with a sporting event, via the Internet,
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5 electronic display devices or through public address or broadcast
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6 systems. The exemption authorized by this paragraph shall be
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7 effective for all sales made on or after January 1, 2001;
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8 6. Sales of any advertising, other than the advertising
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9 described by paragraph 5 of this section, via the Internet,
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10 electronic display devices or through the electronic media including
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11 radio, public address or broadcast systems, television (whether
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12 through closed circuit broadcasting systems or otherwise), and cable
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13 and satellite television, and the servicing of any advertising
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14 devices;
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15 7. Eggs, feed, supplies, machinery, and equipment purchased by
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16 persons regularly engaged in the business of raising worms, fish,
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17 any insect, or any other form of terrestrial or aquatic animal life
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18 and used for the purpose of raising same for marketing. This
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19 exemption shall only be granted and extended to the purchaser when
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20 the items are to be used and in fact are used in the raising of
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21 animal life as set out above. Each purchaser shall certify, in
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22 writing, on the invoice or sales ticket retained by the vendor that
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23 the purchaser is regularly engaged in the business of raising such
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24 animal life and that the items purchased will be used only in such
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 1 business. The vendor shall certify to the Oklahoma Tax Commission
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2 that the price of the items has been reduced to grant the full
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3 benefit of the exemption. Violation hereof by the purchaser or
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4 vendor shall be a misdemeanor;
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5 8. Sale of natural or artificial gas and electricity, and
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6 associated delivery or transmission services, when sold exclusively
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7 for residential use. Provided, this exemption shall not apply to
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8 any sales tax levied by a city or town, or a county or any other
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9 jurisdiction in this state;
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10 9. In addition to the exemptions authorized by Section 1357.6
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11 of this title, sales of drugs sold pursuant to a prescription
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12 written for the treatment of human beings by a person licensed to
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13 prescribe the drugs, and sales of insulin and medical oxygen.
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14 Provided, this exemption shall not apply to over-the-counter drugs;
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15 10. Transfers of title or possession of empty, partially
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16 filled, or filled returnable oil and chemical drums to any person
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17 who is not regularly engaged in the business of selling, reselling
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18 or otherwise transferring empty, partially filled or filled
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19 returnable oil drums;
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20 11. Sales of one-way utensils, paper napkins, paper cups,
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21 disposable hot containers, and other one-way carry out materials to
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22 a vendor of meals or beverages;
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23 12. Sales of food or food products for home consumption which
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24 are purchased in whole or in part with coupons issued pursuant to
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 1 the federal food stamp program as authorized by Sections 2011
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2 through 2029 of Title 7 of the United States Code, as to that
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3 portion purchased with such coupons. The exemption provided for
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4 such sales shall be inapplicable to such sales upon the effective
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5 date of any federal law that removes the requirement of the
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6 exemption as a condition for participation by the state in the
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7 federal food stamp program;
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8 13. Sales of food or food products, or any equipment or
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9 supplies used in the preparation of the food or food products to or
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10 by an organization which:
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11 a. is exempt from taxation pursuant to the provisions of
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12 Section 501(c)(3) of the Internal Revenue Code, 26
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13 U.S.C., Section 501(c)(3), and which provides and
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14 delivers prepared meals for home consumption to
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15 elderly or homebound persons as part of a program
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16 commonly known as "Meals on Wheels" or "Mobile Meals",
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17 or
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18 b. is exempt from taxation pursuant to the provisions of
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19 Section 501(c)(3) of the Internal Revenue Code, 26
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20 U.S.C., Section 501(c)(3), and which receives federal
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21 funding pursuant to the Older Americans Act of 1965,
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22 as amended, for the purpose of providing nutrition
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23 programs for the care and benefit of elderly persons;
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 1 14. a. Sales of tangible personal property or services to or
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2 by organizations which are exempt from taxation
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3 pursuant to the provisions of Section 501(c)(3) of the
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4 Internal Revenue Code, 26 U.S.C., Section 501(c)(3),
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5 and:
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6 (1) are primarily involved in the collection and
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7 distribution of food and other household products
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8 to other organizations that facilitate the
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9 distribution of such products to the needy and
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10 such distributee organizations are exempt from
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11 taxation pursuant to the provisions of Section
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12 501(c)(3) of the Internal Revenue Code, 26
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13 U.S.C., Section 501(c)(3), or
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14 (2) facilitate the distribution of such products to
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15 the needy.
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16 b. Sales made in the course of business for profit or
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17 savings, competing with other persons engaged in the
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18 same or similar business shall not be exempt under
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19 this paragraph;
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20 15. Sales of tangible personal property or services to
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21 children's homes which are located on church-owned property and are
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22 operated by organizations exempt from taxation pursuant to the
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23 provisions of the Internal Revenue Code, 26 U.S.C., Section
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24 501(c)(3);
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 1 16. Sales of computers, data processing equipment, related
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2 peripherals, and telephone, telegraph or telecommunications service
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3 and equipment for use in a qualified aircraft maintenance or
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4 manufacturing facility. For purposes of this paragraph, "qualified
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5 aircraft maintenance or manufacturing facility" means a new or
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6 expanding facility primarily engaged in aircraft repair, building or
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7 rebuilding whether or not on a factory basis, whose total cost of
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8 construction exceeds the sum of Five Million Dollars ($5,000,000.00)
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9 and which employs at least two hundred fifty (250) new full-time-
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10 equivalent employees, as certified by the Oklahoma Employment
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11 Security Commission, upon completion of the facility. In order to
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12 qualify for the exemption provided for by this paragraph, the cost
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13 of the items purchased by the qualified aircraft maintenance or
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14 manufacturing facility shall equal or exceed the sum of Two Million
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15 Dollars ($2,000,000.00);
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16 17. Sales of tangible personal property consumed or
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17 incorporated in the construction or expansion of a qualified
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18 aircraft maintenance or manufacturing facility as defined in
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19 paragraph 16 of this section. For purposes of this paragraph, sales
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20 made to a contractor or subcontractor that has previously entered
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21 into a contractual relationship with a qualified aircraft
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22 maintenance or manufacturing facility for construction or expansion
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23 of such a facility shall be considered sales made to a qualified
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24 aircraft maintenance or manufacturing facility;
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 1 18. Sales of the following telecommunications services:
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2 a. Interstate and International "800 service". "800
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3 service" means a "telecommunications service" that
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4 allows a caller to dial a toll-free number without
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5 incurring a charge for the call. The service is
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6 typically marketed under the name "800", "855", "866",
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7 "877" and "888" toll-free calling, and any subsequent
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8 numbers designated by the Federal Communications
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9 Commission,
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10 b. Interstate and International "900 service". "900
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11 service" means an inbound toll "telecommunications
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12 service" purchased by a subscriber that allows the
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13 subscriber's customers to call in to the subscriber's
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14 prerecorded announcement or live service. "900
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15 service" does not include the charge for: collection
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16 services provided by the seller of the
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17 "telecommunications services" to the subscriber, or
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18 service or product sold by the subscriber to the
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19 subscriber's customer. The service is typically
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20 marketed under the name "900" service, and any
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21 subsequent numbers designated by the Federal
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22 Communications Commission,
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23 c. Interstate and International "private communications
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24 service". "Private communications service" means a
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 1 "telecommunications service" that entitles the
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2 customer to exclusive or priority use of a
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3 communications channel or group of channels between or
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4 among termination points, regardless of the manner in
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5 which such channel or channels are connected, and
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6 includes switching capacity, extension lines, stations
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7 and any other associated services that are provided in
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8 connection with the use of such channel or channels,
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9 d. "Value-added nonvoice data service". "Value-added
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10 nonvoice data service" means a service that otherwise
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11 meets the definition of "telecommunications services"
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12 in which computer processing applications are used to
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13 act on the form, content, code or protocol of the
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14 information or data primarily for a purpose other than
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15 transmission, conveyance, or routing,
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16 e. Interstate and International telecommunications
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17 service which is:
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18 (1) rendered by a company for private use within its
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19 organization, or
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20 (2) used, allocated or distributed by a company to
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21 its affiliated group,
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22 f. Regulatory assessments and charges including charges
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23 to fund the Oklahoma Universal Service Fund, the
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 1 Oklahoma Lifeline Fund and the Oklahoma High Cost
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2 Fund, and
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3 g. Telecommunications nonrecurring charges including but
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4 not limited to the installation, connection, change,
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5 or initiation of telecommunications services which are
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6 not associated with a retail consumer sale;
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7 19. Sales of railroad track spikes manufactured and sold for
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8 use in this state in the construction or repair of railroad tracks,
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9 switches, sidings, and turnouts;
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10 20. Sales of aircraft and aircraft parts provided such sales
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11 occur at a qualified aircraft maintenance facility. As used in this
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12 paragraph, "qualified aircraft maintenance facility" means a
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13 facility operated by an air common carrier including one or more
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14 component overhaul support buildings or structures in an area owned,
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15 leased, or controlled by the air common carrier, at which there were
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16 employed at least two thousand (2,000) full-time-equivalent
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17 employees in the preceding year as certified by the Oklahoma
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18 Employment Security Commission and which is primarily related to the
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19 fabrication, repair, alteration, modification, refurbishing,
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20 maintenance, building, or rebuilding of commercial aircraft or
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21 aircraft parts used in air common carriage. For purposes of this
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22 paragraph, "air co