Introduced Version






HOUSE BILL No. 1350

_____


DIGEST OF INTRODUCED BILL



Citations Affected: IC 4-31-8-7; IC 6-2.5.

Synopsis: Sales and use taxes. Provides that a person may not claim a race horse unless the person has on deposit with a permit holder an amount sufficient to pay the use tax on the claimed horse. Provides for the collection and remittance of the use tax on claimed horses for claiming transactions occurring after June 30, 2013. Provides that when a race horse is claimed for a subsequent time, the use tax rate is applied to the increase in the claiming price from the previous claiming transaction, if any. Requires the department of state revenue to establish an amnesty program for collecting the use tax on claiming transactions occurring before June 1, 2012.

Effective: July 1, 2013.





Cherry




    January 17, 2013, read first time and referred to Committee on Ways and Means.







Introduced

First Regular Session 118th General Assembly (2013)


PRINTING CODE. Amendments: Whenever an existing statute (or a section of the Indiana Constitution) is being amended, the text of the existing provision will appear in this style type, additions will appear in this style type, and deletions will appear in this style type.
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HOUSE BILL No. 1350



    A BILL FOR AN ACT to amend the Indiana Code concerning taxation.

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

SOURCE: IC 4-31-8-7; (13)IN1350.1.1. -->     SECTION 1. IC 4-31-8-7 IS ADDED TO THE INDIANA CODE AS A NEW SECTION TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2013]: Sec. 7. A person may not claim a horse unless the person has on deposit with the permit holder:
        (1) the amount required to make a claim under the rules of the commission; and
        (2) an amount sufficient to pay the use tax imposed on the claiming transaction under IC 6-2.5-14.

SOURCE: IC 6-2.5-3-3; (13)IN1350.1.2. -->     SECTION 2. IC 6-2.5-3-3 IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2013]: Sec. 3. Except as provided in IC 6-2.5-14, the use tax is measured by the gross retail income received in a retail unitary transaction and is imposed at the same rates as the state gross retail tax under IC 6-2.5-2-2. For purposes of this chapter, transactions described in IC 6-2.5-3-2(b) and (c) section 2(b) and 2(c) of this chapter shall be treated as retail transactions within the meaning of IC 6-2.5-1-2.
SOURCE: IC 6-2.5-6-7; (13)IN1350.1.3. -->     SECTION 3. IC 6-2.5-6-7, AS AMENDED BY P.L.146-2008,

SECTION 311, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2013]: Sec. 7. Except as otherwise provided in IC 6-2.5-7, or in this chapter, or IC 6-2.5-14, a retail merchant shall pay to the department, for a particular reporting period, an amount equal to the product of:
        (1) seven percent (7%); multiplied by
        (2) the retail merchant's total gross retail income from taxable transactions made during the reporting period.
The amount determined under this section is the retail merchant's state gross retail and use tax liability regardless of the amount of tax the retail merchant actually collects.

SOURCE: IC 6-2.5-14; (13)IN1350.1.4. -->     SECTION 4. IC 6-2.5-14 IS ADDED TO THE INDIANA CODE AS A NEW CHAPTER TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2013]:
     Chapter 14. Collection and Remittance of Use Tax on Claimed Race Horses
    Sec. 1. (a) This chapter applies to a claiming transaction made after June 30, 2013, at an Indiana race track.
    (b) The department shall disregard any claiming transaction occurring before July 1, 2013, when determining the use tax liability under this chapter for a claiming transaction occurring after June 30, 2013.
    Sec. 2. As used in this chapter, "base claiming price" refers to the claiming price for a race horse in a claiming transaction that occurs:
        (1) after June 30, 2013; and
        (2) immediately preceding the particular claiming transaction for which the purchaser's use tax liability is being determined under this chapter.
    Sec. 3. As used in this chapter, "claiming transaction" refers to the sale and purchase of a race horse under the procedures set forth in 71 IAC 6-1 or 71 IAC 6.5-1.
    Sec. 4. As used in this chapter, "Indiana race track" refers to a race track operated by a permit holder for the purpose of conducting a pari-mutuel horse racing meeting under IC 4-31.
    Sec. 5. As used in this chapter, "permit holder" has the meaning set forth in IC 4-31-2-14.
    Sec. 6. A person acquiring a race horse in a claiming transaction at an Indiana race track is subject to the use tax imposed under IC 6-2.5-3. However, the amount of the person's use tax liability is determined under section 7 of this chapter.
    Sec. 7. (a) The use tax imposed on the first claiming transaction

involving a particular race horse occurring after June 30, 2013, is equal to the product of:
        (1) seven percent (7%); multiplied by
        (2) the claiming price of the race horse.
    (b) Except as provided in subsection (c), the use tax imposed on each subsequent claiming transaction involving a race horse previously claimed in a transaction described in subsection (a) is equal to the product of:
         (1) seven percent (7%); multiplied by
         (2) the remainder of:
            (A) the claiming price of the race horse; minus
            (B) the base claiming price of the race horse.
    (c) If the claiming price of a race horse does not exceed the base claiming price of that race horse, no use tax is imposed on the claiming transaction.
    Sec. 8. A person acquiring a race horse in a claiming transaction shall pay the use tax liability, if any, incurred in the claiming transaction to the permit holder operating the race track at which the claiming transaction occurs. The person shall pay the use tax from money placed on deposit with the permit holder. The tax is due at the same time that the claiming price for the race horse is paid.
    Sec. 9. The permit holder operating the race track at which the claiming transaction occurs shall collect the use tax from each person required to pay the use tax under section 8 of this chapter.
    Sec. 10. A permit holder shall remit use taxes collected under this chapter to the department in the manner required by IC 6-2.5-6.
    Sec. 11.
(a) The department shall establish an amnesty program for taxpayers having an unpaid use tax liability for a claiming transaction occurring before June 1, 2012. This section does not apply to a taxpayer's state gross retail or use tax liability from any other type of transaction.
    (b) The time in which a voluntary payment of tax liability may be made (or the taxpayer may enter into a payment program acceptable to the department for the payment of the unpaid use taxes in full in the manner and time established in a written payment program agreement between the department and the taxpayer) under the amnesty program is limited to the period ending before January 1, 2014.
    (c) The amnesty program must require the following:
        (1) That a taxpayer who enters an agreement described in

subsection (b) is not eligible for any other amnesty program that may be established.
        (2) That the taxpayer shall comply with all other amnesty conditions adopted under a rule of the department in effect on the date the voluntary payment is made.
    (d) Upon payment by a taxpayer to the department of all use taxes due from the taxpayer for a tax period (or payment of the unpaid use taxes in full in the manner and time established in a written payment program agreement between the department and the taxpayer), the department:
        (1) shall abate and not seek to collect any interest, penalties, collection fees, or costs that would otherwise be applicable;
        (2) shall release any liens imposed;
        (3) shall not seek civil or criminal prosecution against any individual or entity; and
        (4) shall not issue, or, if issued, shall withdraw, an assessment, a demand notice, or a warrant for payment under IC 6-8.1-5-3, IC 6-8.1-8-2, or another law against any individual or entity;
for use taxes due from the taxpayer for the tax period for which amnesty has been granted to the taxpayer.
    (e) Amnesty granted under this section is binding on the state and its agents. However, failure to pay the department all use taxes due for a tax period invalidates any amnesty granted under this section for that tax period.
    (f) The department shall enforce an agreement with a taxpayer that prohibits the taxpayer from receiving amnesty in another amnesty program.