REFERENCE TITLE: sales tax holidays

State of Arizona House of Representatives Fifty-first Legislature First Regular Session 2013

HB 2384

Introduced by Representatives Pierce, Forese

 

AN ACT

 

relating to TRANSACTION PRIVILEGE AND USE TAX EXEMPTIONS.

 

 

(TEXT OF BILL BEGINS ON NEXT PAGE)

 

Be it enacted by the Legislature of the State of Arizona:

Section 1.  Transaction privilege tax; holidays; terms and conditions; definition

A.  Notwithstanding title 42, chapter 5, Arizona Revised Statutes, transaction privilege tax and use tax are not imposed with respect to gross proceeds of sales or gross income from sales of tangible personal property at retail or from the transient lodging classification on the following sales tax holiday dates:

1.  August 31, September 1 and September 2, 2013.

2.  July 4, July 5 and July 6, 2014.

B.  On the sales tax holiday dates, a person conducting business that is subject to transaction privilege tax under the retail classification pursuant to section 42-5061, Arizona Revised Statutes, or under the transient lodging classification pursuant to section 42‑5070, Arizona Revised Statutes, and retailers subject to use tax under section 42-5155, Arizona Revised Statutes, shall not add to the sales price or collect from any customer any amount denominated as tax with respect to the transaction.  Any amounts erroneously collected from customers on those days as tax with respect to exempt transactions shall be remitted to the department of revenue in the normal course as required by section 42-5014, Arizona Revised Statutes.  If a person remits to the department an amount erroneously collected from a customer and thereafter refunds to the customer the amount so collected and remitted, the person may apply to the department to refund that amount to the person.  The person must provide satisfactory evidence of having credited or refunded the tax to the customer.

C.  The application of this section is subject to the following terms and conditions:

1.  If a customer purchases an item of eligible property on a sales tax holiday date and subsequently exchanges the item for another of the same price, tax is not due with respect to the exchange transaction.

2.  A layaway sale qualifies as an exempt transaction only if the final installment payment is made on a sales tax holiday date.  If the prior installment payments included an amount designated as tax, that amount must be credited or returned to the customer when the final payment is made, and the retailer may apply to the department for a refund of any amount already remitted to the department as tax.  The retailer must provide satisfactory evidence of having credited or refunded the tax to the customer.

3.  A special order transaction qualifies as an exempt transaction only if the order is paid in full on a sales tax holiday date and the transaction otherwise qualifies under this section, even if the delivery is later.  A special order transaction made before the sales tax holiday dates qualifies as an exempt transaction only if the customer pays the entire balance due on a sales tax holiday date.

4.  If a customer places an order for eligible property by mail or telephone or via the internet, the transaction qualifies as an exempt transaction only if the order is completed, submitted and paid for on a sales tax holiday date, mountain standard time, even if the delivery is later.

5.  Tangible personal property purchased using a rain check qualifies as an exempt transaction only if the property is actually purchased on a sales tax holiday date, regardless of when the rain check was issued.

6.  Rentals of tangible personal property do not qualify as exempt transactions under this section.

D.  The reporting requirements of title 42, chapter 5, article 1, Arizona Revised Statutes, remain in effect for all gross proceeds of sales and gross income from the business on sales tax holiday dates, but except as provided by subsection B of this section, the department of revenue shall not require the business to pay transaction privilege tax on the gross proceeds of sales or gross income from exempt transactions.

E.  For the purposes of this section:

1.  "Tangible personal property" has the same meaning prescribed in section 42-5001, Arizona Revised Statutes, and consists solely of items with respect to which the transaction privilege tax on the retail classification applies pursuant to section 42-5061, Arizona Revised Statutes.

2.  Payment is considered to occur when the business receives payment in full, whether by cash, a credit card number, a debit authorization, a check or a money order, or the customer and business enter into financing arrangements.