LEGISLATIVE FISCAL OFFICE
Fiscal Note
Fiscal Note On: SB 3 SLS 202ES 34
Bill Text Version: ORIGINAL
Opp. Chamb. Action:
Proposed Amd.:
Sub. Bill For.:
Date: September 28, 2020 8:07 PM Author: CATHEY
Dept./Agy.: Revenue
Subject: Sales Tax Exemption: Business Utilities Analyst: Benjamin Vincent
TAX EXEMPTIONS OR -$84,400,000 GF RV See Note Page 1 of 1
Exempts business utilities from state sales tax for businesses impacted by 2020 states of disaster or emergency. (gov sig)
(Item #26)
Present law exempts purchases of certain non-residential utilities from three of the four major sales and use tax levies,
resulting in a state rate of 2% on these purchases thru June 30, 2025.
Proposed law exempts purchases of non-residential utilities from the 2% levy from November 1, 2020 through June 30,
2021.
Effective upon governor’s signature.
EXPENDITURES 2020-21 2021-22 2022-23 2023-24 2024-25 5 -YEAR TOTAL
State Gen. Fd. $0 $0 $0 $0 $0 $0
Agy. Self-Gen. $0 $0 $0 $0 $0 $0
Ded./Other $0 $0 $0 $0 $0 $0
Federal Funds $0 $0 $0 $0 $0 $0
Local Funds $0 $0 $0 $0 $0 $0
Annual Total $0 $0 $0 $0 $0 $0
REVENUES 2020-21 2021-22 2022-23 2023-24 2024-25 5 -YEAR TOTAL
State Gen. Fd. ($84,400,000) $0 $0 $0 $0 ($84,400,000)
Agy. Self-Gen. $0 $0 $0 $0 $0 $0
Ded./Other $0 $0 $0 $0 $0 $0
Federal Funds $0 $0 $0 $0 $0 $0
Local Funds $0 $0 $0 $0 $0 $0
Annual Total ($84,400,000) $0 $0 $0 $0 ($84,400,000)
EXPENDITURE EXPLANATION
The Revenue Department indicates IT staff time costs of some $25,000 to make and test modifications to the sales tax
system.
REVENUE EXPLANATION
Proposed law exempts purchases of nonresidential utilities from a 2% state tax rate for the final eight months of FY21.Axtual
and projected general sales tax growth applied to business utilities sales tax collections for FY19 as reported in the Revenue
Department’s Tax Exemption Budget implies a partial-year revenue impact for FY21 of approximately $84.4 million.
Senate Dual Referral Rules House
13.5.1 >= $100,000 Annual Fiscal Cost {S & H} 6.8(F)(1) >= $100,000 SGF Fiscal Cost {H & S}
Gregory V. Albrecht
x 13.5.2 >= $500,000 Annual Tax or Fee 6.8(G) >= $500,000 Tax or Fee Increase
Change {S & H} Chief Economist
or a Net Fee Decrease {S}