Citations Affected: IC 6-8.1-1-1 ; IC 6-9-18-4 ; IC 6-10.
Synopsis: Uniform food and beverage and innkeepers taxes. Provides
that taxes imposed under the uniform county innkeeper's tax law may
be used to enhance and conserve natural resources, promote and
encourage economic and industrial development, and promote and
encourage the development of the arts. Authorizes a county, city, or
town to adopt a 1% local food and beverage tax under a uniform
procedure. Provides that the tax may be used for reduction of the unit's
property tax levy, targeted property tax relief, debt service or lease
rentals, capital projects, operating revenue, pension liabilities, or any
other purpose that the fiscal body determines is in the best interests of
Effective: July 1, 2003.
January 21, 2003, read first time and referred to Committee on Ways and Means.
A BILL FOR AN ACT to amend the Indiana Code concerning
(IC 6-6-5.5); the hazardous waste disposal tax (IC 6-6-6.6); the
cigarette tax (IC 6-7-1); the beer excise tax (IC 7.1-4-2); the liquor
excise tax (IC 7.1-4-3); the wine excise tax (IC 7.1-4-4); the hard cider
excise tax (IC 7.1-4-4.5); the malt excise tax (IC 7.1-4-5); the
petroleum severance tax (IC 6-8-1); the various innkeeper's taxes
(IC 6-9); the various
county food and beverage taxes (IC 6-9 and
IC 6-10); the county admissions tax (IC 6-9-13 and
); the oil
inspection fee (IC 16-44-2); the emergency and hazardous chemical
inventory form fee (IC 6-6-10); the penalties assessed for oversize
vehicles (IC 9-20-3 and IC 9-30); the fees and penalties assessed for
overweight vehicles (IC 9-20-4 and IC 9-30); the underground storage
tank fee (IC 13-23); the solid waste management fee (IC 13-20-22);
and any other tax or fee that the department is required to collect or
county shall continue to expend money from the fund for that purpose
until the bond is paid.
and beverage tax, the fiscal body must hold a public hearing on the
proposed ordinance, with notice of the time, date, and place of the
public hearing given in accordance with
(c) If a fiscal body adopts an ordinance under this chapter, the ordinance takes effect January 1 of the year following the year in which the ordinance is adopted.
(d) This subsection does not apply to a county governed under IC 36-2-3.5. If the fiscal body of a county adopts an ordinance to impose a food and beverage tax under this chapter, the county executive must also adopt a substantially similar ordinance to impose the tax.
(e) This subsection applies to a county governed under IC 36-2-3.5. If the fiscal body of a county adopts an ordinance to impose a food and beverage tax under this chapter, the county executive must approve the ordinance in the manner prescribed by IC 36-2-4-8 to impose the tax.
(f) If an ordinance is adopted under subsection (d) or approved under subsection (e), the county executive shall immediately send a certified copy of the ordinance to the department.
Sec. 2. (a) Except as provided in subsection (c), a food and beverage tax imposed under section 1 of this chapter applies to any transaction in which food or a beverage is furnished, prepared, or served:
(1) for consumption at a location, or on equipment, provided by a retail merchant;
(2) in the unit in which the tax is imposed; and
(3) by the retail merchant for consideration.
(b) Transactions described in subsection (a)(1) include transactions in which food or a beverage is:
(1) served by a retail merchant off the merchant's premises;
(2) sold by a retail merchant who ordinarily bags, wraps, or packages the food or beverage for immediate consumption on or near the retail merchant's premises, including food or beverages sold on a "take out" or "to go" basis; or
(3) sold by a street vendor.
(c) A food and beverage tax imposed under this chapter does not apply to furnishing, preparing, or serving of any food or beverage in a transaction that is exempt, or to the extent the transaction is exempt, from the state gross retail tax imposed under IC 6-2.5.
Sec. 3. The food and beverage tax imposed on a food or beverage transaction described in section 2 of this chapter equals one percent (1%) of the gross retail income received by the retail
merchant from the transaction. For purposes of this chapter, the
gross retail income received by the retail merchant from such a
transaction does not include the amount of tax imposed on the
transaction under IC 6-2.5.
Sec. 4. If no bonds, leases, obligations, or other evidences of indebtedness of a unit that are payable from a food and beverage tax imposed under this chapter are outstanding, the fiscal body that imposed the local food and beverage tax may adopt an ordinance to repeal the food and beverage tax under this chapter. The ordinance must be adopted after January 1 but before September 1 of a year. The fiscal body shall send a certified copy of the ordinance repealing the food and beverage tax to the department.
Chapter 4. Collection Procedures for Food and Beverage Taxes
Sec. 1. A food and beverage tax imposed under IC 6-10-3 shall be imposed, paid, and collected in the same manner that the state gross retail tax is imposed, paid, and collected under IC 6-2.5. However, the return that is filed for the payment of the tax may be made on a separate return or may be combined with the return filed for the payment of the state gross retail tax as prescribed by the department.
Sec. 2. A food and beverage tax imposed under IC 6-10-3 is a listed tax for the purposes of IC 6-8.1.
Sec. 3. (a) The department shall notify the fiscal officer of a unit that imposes a food and beverage tax under IC 6-10-3 of the amount of tax paid in the unit.
(b) The amounts received from a food and beverage tax imposed under IC 6-10-3 shall be paid monthly by the treasurer of state on warrants issued by the auditor of state to the fiscal officer of the unit that imposed the tax.
Sec. 4. A unit's fiscal officer shall establish a local food and beverage tax revenue fund into which all amounts received monthly from the treasurer of state under this chapter shall be deposited.
Chapter 5. Use of Revenue
Sec. 1. Revenue derived from the imposition of a tax under this article may be treated by each unit as additional revenue for the purpose of fixing its budget for the budget year during which the revenues are to be distributed to the unit.
Sec. 2. A unit may use revenues from the imposition of a tax under this article for one (1) or more of the following purposes:
(1) Reducing the unit's property tax levy for the ensuing
(2) Providing property tax relief to taxpayers or classes of taxpayers, to the extent permitted by the Constitution of the State of Indiana.
(3) Paying debt service or lease rentals on:
(C) obligations; or
(D) any other evidence of indebtedness of the unit.
(4) Paying the costs of any capital project.
(5) Use as operating revenue.
(6) Paying pension liabilities of the unit.
(7) For any other purpose that the fiscal body determines is necessary, wise, and in the best interests of the residents of the unit.
Sec. 3. The department of local government finance may not reduce a unit's property tax levy by the amount of revenue received from a tax imposed under this article.
Chapter 6. Covenants
Sec. 1. The general assembly covenants with the respective units and the purchasers and owners of bonds, leases, obligations, or any other evidences of indebtedness of a unit payable from a tax imposed under this article that this article will not be repealed or amended in any manner that will adversely affect the imposition or collection of a tax imposed under this article so long as the principal, interest, or lease rentals due under those bonds, leases, obligations, or other evidences of indebtedness of a unit that are payable from a tax imposed under this article remain unpaid.