2024 House Bill 5863

AI Analysis – Experimental

The bill aims to refine definitions and provisions related to the use tax, including terms such as "person," "use," "storage," "seller," "purchase," and "purchase price." It clarifies the scope of taxable transactions and the responsibilities of sellers and consumers in the context of tangible personal property and services. Notably, the bill addresses the inclusion and exclusion of various charges in the purchase price, such as delivery, installation, and credit card surcharges, and specifies conditions under which these charges are taxable.

The legislation mandates the Department of Treasury to cancel outstanding balances related to delivery and installation charges on notices of intent to assess and final assessments issued before April 26, 2023. This cancellation must occur by July 25, 2023. Additionally, the department is prohibited from issuing new assessments for such charges for any tax period before April 26, 2023, that remains open under the statute of limitations. The bill also retroactively applies the exclusion of credit card surcharges from the taxable purchase price to all periods open under the statute of limitations.

The amendments impact various stakeholders, including businesses, consumers, and the Department of Treasury. Businesses may benefit from clearer definitions and exclusions, potentially reducing their tax liabilities. Consumers could see changes in the tax treatment of certain charges, affecting the overall cost of goods and services. The Department of Treasury will need to adjust its assessment and collection processes in line with the new provisions.

The bill sets specific deadlines for the cancellation of outstanding tax balances and establishes a clear timeline for the non-issuance of new assessments related to delivery and installation charges. These measures aim to provide clarity and fairness in the administration of the use tax, ensuring that past ambiguities are resolved and future tax liabilities are clearly defined.