Missouri State Senate

Truly Agreed to and Finally Passed

CCS/SCS/SB 612 - This act modifies provisions relating to taxation.

NONRESIDENT ENTERTAINER AND ATHLETE INCOME TAX (143.183)

Current allocations of tax revenues derived from the nonresident entertainer and athlete tax to the Missouri arts council trust fund, the Missouri humanities council trust fund, the Missouri state library networking fund, the Missouri public television broadcasting corporation special fund, and the Missouri historic preservation revolving fund are authorized to be made for all taxable years beginning on or after January 1, 1999, but ending on or before December 31, 2015. This act allows such allocations until December 31, 2020. The act also specifies that such allocations are subject to appropriations.

This provision is similar to HB 1237 (2014), SB 166 (2013), SB 530 (2012), SB 293 (2011) and HB 429 (2011).

ALLOCATION OF INTERSTATE INCOME FOR CORPORATE INCOME TAXES (143.451)

Currently, in determining what portion of a corporation's income is taxable in Missouri, the business may use a method whereby the ratio of instate sales to total sales is multiplied by the net income. A method for determining whether sales of tangible property are to be considered instate is already established in current law. This act specifies a process for all other sales.

For sales of real property or rentals of tangible personal property, the portion of the property sold or rented that is located in this state will be considered an instate sale. For sales of service, the portion of the benefits delivered to purchasers in this state will be considered an instate sale.

For rentals or licenses of intangible property, the portion used in this state by the rentee or licensee will be considered an instate sale. Intangible property used for marketing will be considered used in this state if the good or service being marketed is purchased by a consumer in this state. Franchise fees or royalties for intangible property are considered used in this state if the franchise is located in this state.

For sales of intangible property, the portion of the sale used in this state will be considered an instate sale. If the sale is for the right to conduct business activity in a certain geographic area, the sale will be instate if the geographic area is in this state. If receipts for sales of intangible property are dependent on use or productivity, such sale shall be considered a lease or rental of intangible property. All sales of intangible property other than the right to conduct business in a specific area or sales with receipts contingent on productivity or use will be excluded from the sales factor when determining corporate income tax.

If it can not be determined or reasonably approximated that a sale occurs in this state, such sale shall excluded from the sales factor for corporate income taxation.

This provision is similar to HB 2215 (2014). This provision is similar to a provision contained in SCS/HCS/HB 1296 (2014), SS/SCS/HB 1865 (2014), CCS/HCS/SB 584 (2014), CCS/HCS/SB 662 (2014), CCS#2/HCS/SB 693 (2014), and HCS#2/SCS/SB 777 (2014).

NOTICE OF SALES TAX LAW CHANGES (144.021)

This act requires the Department of Revenue to notify sellers if there has been a change in the interpretation of sales tax laws that modifies which items of personal property or services are taxable. If the Department fails to notify a seller of the change, the seller will not be liable for the additional taxes to be collected until the seller is notified.

This provision is similar to HB 2149 (2014) and SB 662 (2014).

SALES TAX EXEMPTION FOR COMMERCIAL LAUNDRIES (144.054)

This act creates a state and local sales and use tax exemption for material, machinery, and energy used by commercial laundries in treating or cleaning textiles. The facility must process at least 500 pounds per hour and 60,000 pounds per week to qualify for the exemption.

MIKE HAMMANN

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