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Second Regular Session

Sixty-first General Assembly

LLS NO. 98­0272.01 JAG HOUSE BILL 98­1065

STATE OF COLORADO

BY REPRESENTATIVE McElhany;

also SENATOR Lamborn.

REREVISED

FINANCE

A BILL FOR AN ACT

CONCERNING THE ELIMINATION OF THE STATE SALES TAX ON TELEPHONE AND TELEGRAPH SERVICES.

Bill Summary

(Note: This summary applies to this bill as introduced and does not necessarily reflect any amendments that may be subsequently adopted.)

Repeals the state sales tax on telephone and telegraph services. Preserves the existing authority of local governmental entities to impose a sales tax on such services.

Be it enacted by the General Assembly of the State of Colorado:  

SECTION 1.  Repeal. 39­26­104 (1) (c), Colorado Revised Statutes, is repealed as follows:

39­26­104.  Property and services taxed. (1)  There is levied and there shall be collected and paid a tax in the amount stated in section 39­26­106 as follows:

(c)  Upon telephone and telegraph services, whether furnished by public or private corporations or enterprises for all intrastate telephone and telegraph service;

SECTION 2.  29­2­105 (1) (d), Colorado Revised Statutes, is amended to read:

29­2­105.  Contents of sales tax ordinances and proposals. (1)  The sales tax ordinance or proposal of any incorporated town, city, or county adopted pursuant to this article shall be imposed on the sale of tangible personal property at retail or the furnishing of services, as provided in paragraph (d) of this subsection (1). Any countywide or incorporated town or city sales tax ordinance or proposal shall include the following provisions:

(d)  A provision that the tangible personal property and services taxable pursuant to this article shall be the same as the tangible personal property and services taxable pursuant to section 39­26­104, C.R.S., and EXCEPT AS OTHERWISE PROVIDED IN THIS PARAGRAPH (d). THE TANGIBLE PERSONAL PROPERTY AND SERVICES TAXABLE PURSUANT TO THIS ARTICLE ARE subject to the same exemptions as those specified in section 39­26­114, C.R.S., except the exemption allowed by section 39­26­114 (11), C.R.S., for purchases of machinery or machine tools, the exemption of sales and purchases of those items in section 39­26­114 (1) (a) (XXI), C.R.S., the exemption for sales of food specified in section 39­26­114 (1) (a) (XX), C.R.S., and the exemption for occasional sales by a charitable organization set forth in section 39­26­114 (18), C.R.S. Sales of food, as defined in section 39­26­102 (4.5), C.R.S., exempted from the state sales tax pursuant to section 39­26­114 (1) (a) (XX), C.R.S., sales and purchases of those items exempted from the state sales tax pursuant to section 39­26­114 (1) (a) (XXI), C.R.S., purchases of machinery or machine tools as provided in section 39­26­114 (11), C.R.S., or occasional sales by a charitable organization as provided in section 39­26­114 (18), C.R.S., may be exempted from said town, city, or county sales tax only by the express inclusion of such exemption either at the time of adoption of the initial sales tax ordinance or resolution or by amendment thereto. Any such amendment shall be adopted in the same manner as the initial ordinance or resolution. In the absence of express provision for the exemption for sales of food, as defined in section 39­26­102 (4.5), C.R.S., or purchases of machinery or machine tools as provided in section 39­26­114 (11), C.R.S., or exemption of sales and purchases of those items in section 39­26­114 (1) (a) (XXI), C.R.S., or exemption of occasional sales by a charitable organization as provided in section 39­26­114 (18), C.R.S., all sales tax ordinances or resolutions, whether adopted prior to, on, or subsequent to July 1, 1979, which provide in substance that the tangible personal property and services taxed shall be the same as the tangible personal property and services taxable pursuant to section 39­26­104, C.R.S., or any predecessor statute, EXCEPT AS OTHERWISE PROVIDED IN THIS PARAGRAPH (d), and subject to the same exemptions as those specified in section 39­26­114, C.R.S., or any predecessor statute, shall be construed as imposing or continuing to impose the town, city, or county sales tax on food, as defined in section 39­26­102 (4.5), C.R.S., purchases of machinery and machine tools as described in section 39­26­114 (11), C.R.S., sales or purchases of those items described in section 39­26­114 (1) (a) (XXI), C.R.S., and occasional sales by a charitable organization as described in section 39­26­114 (18), C.R.S. ANY INCORPORATED TOWN, CITY, OR COUNTY THAT ADOPTS OR HAS ADOPTED A SALES TAX ORDINANCE OR RESOLUTION PURSUANT TO THIS ARTICLE SHALL LEVY A SALES TAX ON TELEPHONE AND TELEGRAPH SERVICES, WHETHER FURNISHED BY PUBLIC OR PRIVATE CORPORATIONS OR ENTERPRISES, FOR ALL INTRASTATE TELEPHONE AND TELEGRAPH SERVICES, NOTWITHSTANDING THE REMOVAL OF SUCH SERVICES FROM THE STATE SALES TAX BASE PURSUANT TO HOUSE BILL 98-1065, ENACTED AT THE SECOND REGULAR SESSION OF THE SIXTY-FIRST GENERAL ASSEMBLY, UNLESS EXEMPTED BY LOCAL ORDINANCE OR RESOLUTION. The regional transportation district may, in its discretion, continue to levy a sales tax on purchases of machinery or machine tools, as provided in section 39­26­114 (11), C.R.S.

SECTION 3.  32­9­119 (2) (a), Colorado Revised Statutes, is amended to read:

32­9­119.  Additional powers of district ­ repeal. (2) (a)  To provide revenue to finance the operations of the district, to defray the cost of construction of capital improvements and acquisition of capital equipment, and to pay the interest and principal on securities of the district, the board, for and on behalf of the district after approval by election held pursuant to articles 1 to 13 of title 1, C.R.S., shall have the power to levy uniformly throughout the district a sales tax at the rate of six­tenths of one percent upon every transaction or other incident with respect to which a sales tax is now levied by the state, pursuant to the provisions of article 26 of title 39, C.R.S. THE DISTRICT MAY ALSO, IN ITS DISCRETION, CONTINUE TO LEVY SAID SALES TAX ON AND AFTER JULY 1, 1998, UPON TELEPHONE AND TELEGRAPH SERVICES, WHETHER FURNISHED BY PUBLIC OR PRIVATE CORPORATIONS OR ENTERPRISES, FOR ALL INTRASTATE TELEPHONE AND TELEGRAPH SERVICE.

SECTION 4.  32­13­105 (1) and (4) (a), Colorado Revised Statutes, are amended to read:

32­13­105.  Authorizing elections ­ repeal. (1)  The district created in section 32­13­104 may submit to the registered electors within the geographical boundaries of the district, at one or more general elections, the question of whether the district shall be authorized to levy and collect the following sales and use taxes:

(a)  A uniform sales and use tax throughout said geographical area at a rate of sixty­five one­thousandths of one percent upon every transaction or other incident with respect to which a sales and use tax is levied by the state, pursuant to the provisions of article 26 of title 39, C.R.S., except such sales and use tax shall be levied on purchases of machinery or machine tools which are otherwise exempt pursuant to section 39­26­114 (11), C.R.S., to the extent such purchases are subject to a sales and use tax levied by the regional transportation district pursuant to section 29­2­105 (1) (d), C.R.S., AND MAY, IN THE DISCRETION OF THE DISTRICT, CONTINUE TO BE LEVIED ON AND AFTER JULY 1, 1998, UPON TELEPHONE AND TELEGRAPH SERVICES, WHETHER FURNISHED BY PUBLIC OR PRIVATE CORPORATIONS OR ENTERPRISES, FOR ALL INTRASTATE TELEPHONE AND TELEGRAPH SERVICES, to be distributed to the Denver museum of natural history, the Denver zoological gardens, the Denver art museum, and the Denver botanical gardens, pursuant to the provisions of section 32­13­107 (3) (a);

(b)  A uniform sales and use tax throughout said geographical area at a rate of twenty­five one­thousandths of one percent upon every transaction or other incident with respect to which a sales and use tax is levied by the state, pursuant to the provisions of article 26 of title 39, C.R.S., except such sales and use tax shall be levied on purchases of machinery or machine tools which are otherwise exempt pursuant to section 39­26­114 (11), C.R.S., to the extent such purchases are subject to a sales and use tax levied by the regional transportation district pursuant to section 29­2­105 (1) (d), C.R.S., AND MAY, IN THE DISCRETION OF THE DISTRICT, CONTINUE TO BE LEVIED ON AND AFTER JULY 1, 1998, UPON TELEPHONE AND TELEGRAPH SERVICES, WHETHER FURNISHED BY PUBLIC OR PRIVATE CORPORATIONS OR ENTERPRISES, FOR ALL INTRASTATE TELEPHONE AND TELEGRAPH SERVICES, to be distributed to scientific and cultural facilities pursuant to the provisions of section 32­13­107 (3) (b);

(c)  A uniform sales and use tax throughout said geographical area at a rate of ten one­thousandths of one percent upon every transaction or other incident with respect to which a sales and use tax is levied by the state, pursuant to the provisions of article 26 of title 39, C.R.S., except such sales and use tax shall be levied on purchases of machinery or machine tools which are otherwise exempt pursuant to section 39­26­114 (11), C.R.S., to the extent such purchases are subject to a sales and use tax levied by the regional transportation district pursuant to section 29­2­105 (1) (d), C.R.S., AND MAY, IN THE DISCRETION OF THE DISTRICT, CONTINUE TO BE LEVIED ON AND AFTER JULY 1, 1998, UPON TELEPHONE AND TELEGRAPH SERVICES, WHETHER FURNISHED BY PUBLIC OR PRIVATE CORPORATIONS OR ENTERPRISES, FOR ALL INTRASTATE TELEPHONE AND TELEGRAPH SERVICE, to be distributed to scientific and cultural facilities pursuant to the provisions of section 32­13­107 (3) (c).

(4) (a)  For purposes of complying with the provisions of section 20 (4) of article X of the state constitution and upon proper submittal of a valid initiative petition to or upon the adoption of a resolution by the board of the district created in section 32­13­104, the district may submit to the registered electors within the geographical boundaries of the district, at a general election or an election held on the first Tuesday in November of an odd­numbered year, the question of whether the district shall be authorized to levy and collect the following sales and use taxes in lieu of the sales and use taxes specified in subsection (1) of this section for a period of time not to exceed ten years from the date upon which the authority of the district to levy and collect the sales and use taxes specified in subsection (1) of this section is scheduled to expire:

(I)  A uniform sales and use tax throughout said geographical area at a rate of fifty­nine one­thousandths of one percent upon every transaction or other incident with respect to which a sales and use tax is levied by the state, pursuant to the provisions of article 26 of title 39, C.R.S., except such sales and use tax shall be levied on purchases of machinery or machine tools which are otherwise exempt pursuant to section 39­26­114 (11), C.R.S., to the extent such purchases are subject to a sales and use tax levied by the regional transportation district pursuant to section 29­2­105 (1) (d), C.R.S., AND MAY, IN THE DISCRETION OF THE DISTRICT, CONTINUE TO BE LEVIED ON AND AFTER JULY 1, 1998, UPON TELEPHONE AND TELEGRAPH SERVICES, WHETHER FURNISHED BY PUBLIC OR PRIVATE CORPORATIONS OR ENTERPRISES, FOR ALL INTRASTATE TELEPHONE AND TELEGRAPH SERVICE, to be distributed to the Denver museum of natural history, the Denver zoological gardens, the Denver art museum, and the Denver botanical gardens pursuant to the provisions of section 32­13­107 (3) (a);

(II)  A uniform sales and use tax throughout said geographical area at a rate of twenty­eight one­thousandths of one percent upon every transaction or other incident with respect to which a sales and use tax is levied by the state, pursuant to the provisions of article 26 of title 39, C.R.S., except such sales and use tax shall be levied on purchases of machinery or machine tools which are otherwise exempt pursuant to section 39­26­114 (11), C.R.S., to the extent such purchases are subject to a sales and use tax levied by the regional transportation district pursuant to section 29­2­105 (1) (d), C.R.S., AND MAY, IN THE DISCRETION OF THE DISTRICT, CONTINUE TO BE LEVIED ON AND AFTER JULY 1, 1998, UPON TELEPHONE AND TELEGRAPH SERVICES, WHETHER FURNISHED BY PUBLIC OR PRIVATE CORPORATIONS OR ENTERPRISES, FOR ALL INTRASTATE TELEPHONE AND TELEGRAPH SERVICES, to be distributed to scientific and cultural facilities pursuant to the provisions of section 32­13­107 (3) (b);

(III)  A uniform sales and use tax throughout said geographical area at a rate of thirteen one­thousandths of one percent upon every transaction or other incident with respect to which a sales and use tax is levied by the state, pursuant to the provisions of article 26 of title 39, C.R.S., except such sales and use tax shall be levied on purchases of machinery or machine tools which are otherwise exempt pursuant to section 39­26­114 (11), C.R.S., to the extent such purchases are subject to a sales and use tax levied by the regional transportation district pursuant to section 29­2­105 (1) (d), C.R.S., AND MAY, IN THE DISCRETION OF THE DISTRICT, CONTINUE TO BE LEVIED ON AND AFTER JULY 1, 1998, UPON TELEPHONE AND TELEGRAPH SERVICES, WHETHER FURNISHED BY PUBLIC OR PRIVATE CORPORATIONS OR ENTERPRISES, FOR ALL INTRASTATE TELEPHONE AND TELEGRAPH SERVICES, to be distributed to scientific and cultural facilities pursuant to the provisions of section 32­13­107 (3) (c).

SECTION 5.  32­13­107 (1) (a), Colorado Revised Statutes, is amended to read:

32­13­107.  Sales and use tax imposed ­ collection ­ administration of tax ­ use. (1) (a)  Except as otherwise provided in paragraph (b) of this subsection (1), upon the approval of the registered electors pursuant to the provisions of section 32­13­105, the board shall have the power to levy such uniform sales and use taxes throughout the district created in section 32­13­104 upon every transaction or other incident with respect to which a sales and use tax is levied by the state, pursuant to the provisions of article 26 of title 39, C.R.S., except such sales and use tax shall be levied on purchases of machinery or machine tools which are otherwise exempt pursuant to section 39­26­114 (11), C.R.S., to the extent such purchases are subject to a sales and use tax levied by the regional transportation district pursuant to section 29­2­105 (1) (d), C.R.S., AND MAY, IN THE DISCRETION OF THE DISTRICT, CONTINUE TO BE LEVIED ON AND AFTER JULY 1, 1998, UPON TELEPHONE AND TELEGRAPH SERVICES, WHETHER FURNISHED BY PUBLIC OR PRIVATE CORPORATIONS OR ENTERPRISES, FOR ALL INTRASTATE TELEPHONE AND TELEGRAPH SERVICES, after the January 1 following the election in which such sales and use taxes were approved.

SECTION 6.  32­14­105 (1), Colorado Revised Statutes, is amended to read:

32­14­105.  Authorizing election. (1)  The board created in section 32­14­106 may submit to the registered electors within the geographical boundaries of the district, at a general election, at a special election not paid for with public funds, or at a primary election for which the additional cost of the ballot question is prepaid and is not paid with public funds, the question of whether, upon the granting of a major league baseball franchise by major league baseball to be located in the district, the district shall be authorized to levy and collect for a period not to exceed twenty years a uniform sales tax throughout the district at a rate not to exceed one­tenth of one percent upon every transaction or other incident with respect to which a sales tax is levied by the state, pursuant to the provisions of article 26 of title 39, C.R.S.; except that such sales tax shall be levied on purchases of machinery or machine tools which are otherwise exempt pursuant to section 39­26­114 (11), C.R.S., to the extent that such purchases are subject to the sales tax levied by the regional transportation district pursuant to section 29­2­105 (1) (d), C.R.S., AND MAY, IN THE DISCRETION OF THE DISTRICT, CONTINUE TO BE LEVIED ON AND AFTER JULY 1, 1998, UPON TELEPHONE AND TELEGRAPH SERVICES, WHETHER FURNISHED BY PUBLIC OR PRIVATE CORPORATIONS OR ENTERPRISES, FOR ALL INTRASTATE TELEPHONE AND TELEGRAPH SERVICES, to be held and distributed pursuant to the provisions of section 32­14­115.

SECTION 7.  32­15­107 (1) (a) (I), Colorado Revised Statutes, is amended to read:

32­15­107.  Authorizing election. (1) (a)  For purposes of complying with the provisions of section 20 (4) of article X of the state constitution and upon receipt of a notice from the secretary of state stating that a valid petition has been filed and verified and the adoption of a resolution by the board as set forth in section 32­15­106 (1) (f), the board may submit to the registered electors within the geographical boundaries of the district, at a general election or an election held on the first Tuesday in November of an odd­numbered year the question of whether the district shall be authorized:

(I)  To levy and collect, for a period commencing after the termination of the sales tax levied and collected by the Denver metropolitan major league baseball stadium district pursuant to section 32­14­105 and continuing for a period not to extend beyond January 1, 2012, a uniform sales tax throughout the district at a rate not to exceed one­tenth of one percent upon every transaction or other incident with respect to which a sales tax is levied by the state, pursuant to the provisions of article 26 of title 39, C.R.S.; except that such sales tax shall be levied on purchases of machinery or machine tools that are otherwise exempt pursuant to section 39­26­114 (11), C.R.S., to the extent that such purchases are subject to the sales tax levied by the regional transportation district pursuant to section 29­2­105 (1) (d), C.R.S., AND MAY, IN THE DISCRETION OF THE DISTRICT, BE LEVIED UPON TELEPHONE AND TELEGRAPH SERVICES, WHETHER FURNISHED BY PUBLIC OR PRIVATE CORPORATIONS OR ENTERPRISES, FOR ALL INTRASTATE TELEPHONE AND TELEGRAPH SERVICES, to be held and distributed pursuant to the provisions of section 32­15­111; and

SECTION 8.  32­15­110 (1), Colorado Revised Statutes, is amended to read:

32­15­110.  Sales tax imposed ­ collection ­ administration of tax ­ discontinuance. (1)  Upon the approval of the registered electors pursuant to the provisions of section 32­15­107, the board shall have the power to levy such uniform sales tax upon the adoption of a resolution for a period commencing after the termination of the sales tax levied and collected by the Denver metropolitan major league baseball stadium district pursuant to section 32­14­105 and continuing for a period not to extend beyond January 1, 2012, throughout the district created in section 32­15­104 upon every transaction or other incident with respect to which a sales tax is levied by the state, pursuant to the provisions of article 26 of title 39, C.R.S.; except that such sales tax shall be levied on purchases of machinery or machine tools that are otherwise exempt pursuant to section 39­26­114 (11), C.R.S., to the extent that such purchases are subject to the sales tax levied by the regional transportation district pursuant to section 29­2­105 (1) (d), C.R.S., AND MAY, IN THE DISCRETION OF THE DISTRICT, BE LEVIED UPON TELEPHONE AND TELEGRAPH SERVICES, WHETHER FURNISHED BY PUBLIC OR PRIVATE CORPORATIONS OR ENTERPRISES FOR ALL INTRASTATE TELEPHONE AND TELEGRAPH SERVICES.

SECTION 9.  Effective date.  This act shall take effect July 1, 1998.

SECTION 10.  Safety clause.  The general assembly hereby finds, determines, and declares that this act is necessary for the immediate preservation of the public peace, health, and safety.