A bill for an act
relating to taxation; lawful gambling; repealing the taxes imposed on all lawful
gambling receipts; making related technical changes; amending Minnesota Statutes
2022, sections 270C.56, subdivision 1; 297A.68, subdivision 3a; 299L.03,
subdivision 1; 299L.07, subdivision 8; 349.12, subdivision 25; 349.151, subdivision
4; 349.162, subdivision 2; 349.163, subdivision 5; 349.1641; 349.19, subdivision
5; 349.2125, subdivisions 1, 3; 349.2127, subdivisions 1, 2, 4; 349.213, subdivision
1; 349.22, subdivision 2; repealing Minnesota Statutes 2022, sections 13.4967,
subdivision 6; 297E.01; 297E.02, subdivisions 1, 2, 2a, 3, 6, 6a, 7, 8, 9, 10, 11;
297E.03; 297E.031; 297E.04; 297E.05; 297E.06; 297E.07; 297E.10; 297E.11;
297E.12, subdivisions 1, 2, 4, 5, 6, 7, 8, 9; 297E.13; 297E.14; 297E.16, subdivisions
1, 2; 297E.17; 349.16, subdivision 11; Minnesota Rules, parts 8122.0100;
8122.0150; 8122.0200; 8122.0250; 8122.0300; 8122.0350; 8122.0400; 8122.0450;
8122.0500; 8122.0510; 8122.0550; 8122.0650.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

Minnesota Statutes 2022, section 270C.56, subdivision 1, is amended to read:


Subdivision 1.

Liability imposed.

A person who, either singly or jointly with others,
has the control of, supervision of, or responsibility for filing returns or reports, paying taxes,
or collecting or withholding and remitting taxes and who fails to do so, or a person who is
liable under any other law, is liable for the payment of taxes arising under chapters 295,
296A, 297A, 297F, and 297G, or deleted text beginsectionsdeleted text endnew text begin sectionnew text end 290.92 deleted text beginand 297E.02deleted text end, and the applicable
penalties and interest on those taxes.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2023.
new text end

Sec. 2.

Minnesota Statutes 2022, section 297A.68, subdivision 3a, is amended to read:


Subd. 3a.

Coin-operated entertainment and amusement devices.

Coin-operated
entertainment and amusement devices including, but not limited to, fortune-telling machines,
cranes, foosball and pool tables, video and pinball games, batting cages, rides, photo or
video booths, and jukeboxes are exempt when purchased by retailers selling admission to
places of amusement and making available amusement devices as provided in section
297A.61, subdivision 3, paragraph (g), clause (1). Coin-operated entertainment and
amusement devices do not include vending machines, lottery devices, or gaming devices
as described in deleted text beginchapters 297E anddeleted text endnew text begin chapternew text end 349.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2023.
new text end

Sec. 5.

Minnesota Statutes 2022, section 299L.03, subdivision 1, is amended to read:


Subdivision 1.

Inspections; access.

In conducting any inspection authorized under this
chapter or chapter 240, 349, or 349A, the division employees have free and open access to
all parts of the regulated business premises, and may conduct the inspection at any reasonable
time without notice and without a search warrant. For purposes of this subdivision, "regulated
business premises" means premises where:

(1) lawful gambling is conducted by an organization licensed under chapter 349 or by
an organization exempt from licensing under section 349.166;

(2) gambling equipment is manufactured, sold, distributed, or serviced by a manufacturer
or distributor licensed under chapter 349;

(3) records required to be maintained under chapter 240, deleted text begin297E,deleted text end 349, or 349A are prepared
or retained;

(4) lottery tickets are sold by a lottery retailer under chapter 349A;

(5) races are conducted by a person licensed under chapter 240; or

(6) gambling devices are manufactured, distributed, or tested, including places of storage
under section 299L.07.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2023.
new text end

Sec. 6.

Minnesota Statutes 2022, section 299L.07, subdivision 8, is amended to read:


Subd. 8.

License actions.

(a) The commissioner may not issue or renew a license under
this chapter, and shall revoke a license under this chapter, if the applicant or licensee, or a
director, officer, partner, governor, person in a supervisory or management position of the
applicant or licensee, an employee eligible to make sales on behalf of the applicant or
licensee, or direct or indirect holder of more than a five percent financial interest in the
applicant or licensee:

(1) has ever been convicted of a felony, or of a crime involving gambling;

(2) has ever been convicted of (i) assault, (ii) a criminal violation involving the use of
a firearm, or (iii) making terroristic threats;

(3) is or has ever connected with or engaged in an illegal business;

(4) owes $500 or more in delinquent taxes as defined in section 270C.72;

(5) had a sales and use tax permit revoked by the commissioner of revenue within the
past two years;

(6) after demand, has not filed tax returns required by the commissioner of revenue; or

(7) had a license or permit revoked or denied by another jurisdiction for a violation of
law or rule relating to gambling.

The commissioner may deny or refuse to renew a license under this chapter, and may
revoke a license under this chapter, if any of the conditions in this subdivision is applicable
to an affiliate of or a direct or indirect holder of more than a five percent financial interest
in the applicant or licensee.

(b) The commissioner may by order deny, suspend, revoke, refuse to renew a license or
premises permit, or censure a licensee or applicant, if the commissioner finds that the order
is in the public interest and that the applicant or licensee, or a director, officer, partner,
person in a supervisory or management position of the applicant or licensee, or an employee
eligible to make sales on behalf of the applicant or licensee:

(1) has violated or failed to comply with any provision of this chapterdeleted text begin, chapter 297E,deleted text end ornew text begin
chapter
new text end 349, or any rule adopted or order issued thereunder;

(2) has filed an application for a license that is incomplete in any material respect, or
contains a statement that, in light of the circumstances under which it was made, is false,
misleading, fraudulent, or a misrepresentation;

(3) has made a false statement in a document or report required to be submitted to the
director, the commissioner, or the commissioner of revenue, or has made a false statement
in a statement made to the director or commissioner;

(4) has been convicted of a crime in another jurisdiction that would be a felony if
committed in Minnesota;

(5) is permanently or temporarily enjoined by any gambling regulatory agency from
engaging in or continuing any conduct or practice involving any aspect of gambling;

(6) has had a gambling-related license revoked or suspended, or has paid or been required
to pay a monetary penalty of $2,500 or more, by a gambling regulator in another state or
jurisdiction, or has violated or failed to comply with an order of such a regulator that imposed
those actions;

(7) has been the subject of any of the following actions by the director or commissioner:
(i) had a license under this chapter denied, suspended or revoked, (ii) been censured,
reprimanded, has paid or been required to pay a monetary penalty or fine, or (iii) has been
the subject of any other discipline by the director;

(8) has engaged in conduct that is contrary to the public health, welfare, or safety, or to
the integrity of gambling; or

(9) based on the licensee's past activities or criminal record, poses a threat to the public
interest or to the effective regulation and control of gambling, or creates or enhances the
danger of unsuitable, unfair, or illegal practices, methods, and activities in the conduct of
gambling or the carrying on of the business and financial arrangements incidental to the
conduct of gambling.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2023.
new text end

Sec. 7.

Minnesota Statutes 2022, section 349.12, subdivision 25, is amended to read:


Subd. 25.

Lawful purpose.

(a) "Lawful purpose" means one or more of the following:

(1) any expenditure by or contribution to a 501(c)(3) or festival organization, as defined
in subdivision 15c, provided that the organization and expenditure or contribution are in
conformity with standards prescribed by the board under section 349.154, which standards
must apply to both types of organizations in the same manner and to the same extent;

(2) a contribution to or expenditure for goods and services for an individual or family
suffering from poverty, homelessness, or disability, which is used to relieve the effects of
that suffering;

(3) a contribution to a program recognized by the Minnesota Department of Human
Services for the education, prevention, or treatment of problem gambling;

(4) a contribution to or expenditure on a public or private nonprofit educational institution
registered with or accredited by this state or any other state;

(5) a contribution to an individual, public or private nonprofit educational institution
registered with or accredited by this state or any other state, or to a scholarship fund of a
nonprofit organization whose primary mission is to award scholarships, for defraying the
cost of education to individuals where the funds are awarded through an open and fair
selection process;

(6) activities by an organization or a government entity which recognize military service
to the United States, the state of Minnesota, or a community, subject to rules of the board,
provided that the rules must not include mileage reimbursements in the computation of the
per diem reimbursement limit and must impose no aggregate annual limit on the amount of
reasonable and necessary expenditures made to support:

(i) members of a military marching or color guard unit for activities conducted within
the state;

(ii) members of an organization solely for services performed by the members at funeral
services;

(iii) memb