HB 2008-8_ Filed 03/03/2003, 07:29 Hinkle

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    PREVAILED      Roll Call No. _______
    FAILED        Ayes _______
    WITHDRAWN        Noes _______





    I move that House Bill 2008 be amended to read as follows:

SOURCE: Page 50, line 16; (03)MO200822.50. -->     Page 50, between lines 16 and 17, begin a new paragraph and insert:
SOURCE: IC 6-2.5-5-39; (03)MO200822.28. -->     "SECTION 28. IC 6-2.5-5-39 IS ADDED TO THE INDIANA CODE AS A NEW SECTION TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2003]: Sec. 39. (a) As used in this section, "product" includes a pilot model, a process, a formula, an invention, a technique, a patent, or a similar property. The term includes property to be used in a taxpayer's trade or business and property to be held for sale, lease, or license, regardless of whether the property is ultimately placed in service, sold, leased, or licensed.
    (b) As used in this section, "research and development" means laboratory or experimental activity to develop or improve a product or to discover information that would eliminate uncertainty concerning the development or improvement of a product.
    (c) The term "research and development" does not include any of the following:
        (1) The ordinary testing or inspection of materials or products for quality control. The quality control testing to which this subdivision applies includes testing or inspection to determine whether particular units of materials or products conform to specified parameters. Quality control

testing does not include testing to determine if the design of a product is appropriate.
        (2) Efficiency surveys.
        (3) Management studies.
        (4) Consumer surveys.
        (5) Advertising or promotions.
        (6) The acquisition of another's patent, model, production, process, or other product.
        (7) Research in connection with literary, historical, or similar projects.
        (8) Activities to ascertain the existence, location, extent, or quality of any deposit of oil, gas, ore, or other mineral.
        (9) Assembly, construction, or installation of property that is placed in service or held for sale, lease, or license.
    (d) As used in this section, "uncertainty" means the unavailability to the taxpayer of information necessary to establish the capability or method for developing or improving the product or the appropriate design of the product.
    (e) Transactions involving tangible personal property are exempt from the state gross retail tax if the person acquiring the property acquires it for direct use in research and development.

SOURCE: Page 82, line 27; (03)MO200822.82. -->     Page 82, between lines 27 and 28, begin a new paragraph and insert:
SOURCE: ; (03)MO200822.65. -->     "SECTION 65. [EFFECTIVE JULY 1, 2003] For purposes of IC 6-2.5-5-39, as added by this act, all transactions shall be considered as having occurred after June 30, 2003, to the extent that delivery of the property or services constituting selling at retail is made after that date to the purchaser or to the place of delivery designated by the purchaser. However, a transaction shall be considered as having occurred before July 1, 2003, to the extent that the agreement of the parties to the transaction was entered into before July 1, 2003, and payment for the property or services furnished in the transaction is made before July 1, 2003, notwithstanding the delivery of the property or services after June 30, 2003.".
    Renumber all SECTIONS consecutively.
    (Reference is to HB 2008 as printed February 26, 2003.)


Representative Hinkle

MO200822/DI 44     2003