COMMITTEE ON LEGISLATIVE RESEARCH
OVERSIGHT DIVISION
FISCAL NOTE
L.R. NO.: 2447-01
BILL NO.: SB 710
SUBJECT: Funerals and Funeral Directors; Taxation and Revenue-General; Sales and Use
TYPE: Original
DATE: January 7, 2000
FISCAL SUMMARY
| FUND AFFECTED | FY 2001 | FY 2002 | FY 2003 |
| General Revenue | ($1,876,815) | ($2,885,603) | ($2,957,743) |
| School District Trust | ($625,605) | ($961,868) | ($985,914) |
| Conservation | ($78,201) | ($120,233) | ($123,239) |
| Parks and Soil | ($62,561) | ($96,187) | ($98,591) |
| Total Estimated
Net Effect on All State Funds |
($2,643,182) | ($4,063,891) | ($4,165,487) |
| FUND AFFECTED | FY 2001 | FY 2002 | FY 2003 |
| None | |||
| Total Estimated
Net Effect on All Federal Funds |
$0 | $0 | $0 |
Numbers within parentheses: ( ) indicate costs or losses.
This fiscal note contains 4 pages.
| FUND AFFECTED | FY 2001 | FY 2002 | FY 2003 |
| Local Government | ($938,408) | ($1,442,802) | ($1,478,872) |
ASSUMPTION
Officials of the Department of Revenue (DOR) state the proposal would exempt the sale of coffins, caskets, burial cases and burial vaults from sales and use taxes.
DOR staff assume 80% of all taxable sales by funeral homes and crematories involve sales of the above items. Taxable sales for businesses in the SIC category "726-Funeral Service and Crematories" in FY 98 were $108,925,594. If it is assumed that 80% of these sales represent these items, the amount of taxable sales that would be exempted in FY 98 would be $87,140,475. 2.5% inflation is assumed.
Oversight assumes fiscal impact would not occur until October 1, 2000. This is because the law would go into effect August 28, 2000, and a one month lag is assumed. This would result in eight months of fiscal impact in FY 2001. Estimates are based on 1998 sales data.
This proposal would result in a decrease in Total State Revenues since Sales and Use Tax collections are included in the calculation of Total State Revenue.
FISCAL IMPACT - State Government FY 2001 FY 2002 FY 2003
(10 Mo.)
Loss - General Revenue Fund
Elimination of sales tax on Caskets,
Coffins and Burials Cases and Vaults ($1,876,815) ($2,885,603) ($2,957,743)
ESTIMATED NET EFFECT ON
GENERAL REVENUE FUND ($1,876,815) ($2,885,603) ($2,957,743)
SCHOOL DISTRICT TRUST FUND
Loss - School District Trust Fund
Elimination of sales tax on Caskets,
Coffins, Burial Cases and Vaults ($625,605) ($961,868) ($985,914)
FISCAL IMPACT - State Government FY 2001 FY 2002 FY 2003
(Continued) (10 Mo.)
ESTIMATED NET EFFECT ON
SCHOOL DISTRICT TRUST FUND ($625,605) ($961,868) ($985,914)
CONSERVATION FUND
Loss - Conservation Fund
Elimination of sales tax on Caskets,
Coffins, Burial Cases and Vaults ($78,201) ($120,233) ($123,239)
ESTIMATED NET EFFECT ON
CONSERVATION FUND ($78,201) ($120,233) ($123,239)
PARKS AND SOIL FUND
Loss - Parks and Soil Fund
Elimination of sales tax on Caskets,
Coffins, Burial Cases and Vaults ($62,561) ($96,187) ($98,591)
ESTIMATED NET EFFECT ON
PARKS AND SOIL FUND ($62,561) ($96,187) ($98,591)
FISCAL IMPACT - Local Government FY 2001 FY 2002 FY 2003
(10 Mo.)
Loss to Cities
Elimination of sales tax on Caskets,
Coffins, Burial Cases and Vaults ($563,045) ($865,681) ($887,323)
Loss to Counties
Elimination of sales tax on Caskets,
Coffins, Burial Cases and Vaults ($375,363) ($577,121) ($591,549)
ESTIMATED NET EFFECT ON
LOCAL GOVERNMENT ($938,408) ($1,442,802) ($1,478,872)
FISCAL IMPACT - Small Business
Small businesses who sell coffins, caskets, burial case and vaults would be expected to be fiscally impacted to the extent that would no longer collect and pay sales tax on these items.
DESCRIPTION
This act exempts the sale of coffins, caskets, burial cases and vaults from sales tax.
This legislation is not federally mandated, would not duplicate any other program and would not require additional capital improvements or rental space.
SOURCES OF INFORMATION
Department of Revenue
Jeanne Jarrett, CPA
Director
January 7, 2000