Read the full stored bill text
House
File
498
-
Introduced
HOUSE
FILE
498
BY
JACOBY
A
BILL
FOR
An
Act
eliminating
the
state
sales
and
use
taxes
and
including
1
effective
date
provisions.
2
BE
IT
ENACTED
BY
THE
GENERAL
ASSEMBLY
OF
THE
STATE
OF
IOWA:
3
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498
Section
1.
Section
423.2,
subsection
1,
unnumbered
1
paragraph
1,
Code
2025,
is
amended
to
read
as
follows:
2
There
is
imposed
a
tax
of
six
percent
at
the
rate
specified
3
in
subsection
12
upon
the
sales
price
of
all
sales
of
tangible
4
personal
property,
sold
at
retail
in
the
state
to
consumers
or
5
users
except
as
otherwise
provided
in
this
subchapter
.
6
Sec.
2.
Section
423.2,
subsections
2
and
3,
Code
2025,
are
7
amended
to
read
as
follows:
8
2.
A
tax
of
six
percent
at
the
rate
specified
in
subsection
9
12
is
imposed
upon
the
sales
price
of
the
sale
or
furnishing
10
of
gas,
electricity,
water,
heat,
pay
television
service,
and
11
communication
service,
including
the
sales
price
from
such
12
sales
by
any
municipal
corporation
or
joint
water
utility
13
furnishing
gas,
electricity,
water,
heat,
pay
television
14
service,
and
communication
service
to
the
public
in
its
15
proprietary
capacity,
except
as
otherwise
provided
in
this
16
subchapter
,
when
sold
at
retail
in
the
state
to
consumers
or
17
users.
18
3.
A
tax
of
six
percent
at
the
rate
specified
in
subsection
19
12
is
imposed
upon
the
sales
price
of
all
sales
of
tickets
20
or
admissions
to
places
of
amusement,
fairs,
and
athletic
21
events
except
those
of
elementary
and
secondary
educational
22
institutions.
A
tax
of
six
percent
at
the
rate
specified
in
23
subsection
12
is
imposed
on
the
sales
price
of
an
entry
fee
or
24
like
charge
imposed
solely
for
the
privilege
of
participating
25
in
an
activity
at
a
place
of
amusement,
fair,
or
athletic
event
26
unless
the
sales
price
of
tickets
or
admissions
charges
for
27
observing
the
same
activity
are
taxable
under
this
subchapter
.
28
A
tax
of
six
percent
at
the
rate
specified
in
subsection
12
29
is
imposed
upon
that
part
of
private
club
membership
fees
or
30
charges
paid
for
the
privilege
of
participating
in
any
athletic
31
sports
provided
club
members.
32
Sec.
3.
Section
423.2,
subsection
4,
paragraph
a,
Code
2025,
33
is
amended
to
read
as
follows:
34
a.
A
tax
of
six
percent
at
the
rate
specified
in
subsection
35
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498
12
is
imposed
upon
the
sales
price
derived
from
the
operation
1
of
all
forms
of
amusement
devices
and
games
of
skill,
games
of
2
chance,
raffles,
and
bingo
games
as
defined
in
chapter
99B
,
and
3
card
game
tournaments
conducted
under
section
99B.27
,
that
are
4
operated
or
conducted
within
the
state,
the
tax
to
be
collected
5
from
the
operator
in
the
same
manner
as
for
the
collection
of
6
taxes
upon
the
sales
price
of
tickets
or
admission
as
provided
7
in
this
section
.
Nothing
in
this
subsection
shall
legalize
any
8
games
of
skill
or
chance
or
slot-operated
devices
which
are
now
9
prohibited
by
law.
10
Sec.
4.
Section
423.2,
subsection
5,
Code
2025,
is
amended
11
to
read
as
follows:
12
5.
There
is
imposed
a
tax
of
six
percent
at
the
rate
13
specified
in
subsection
12
upon
the
sales
price
from
the
14
furnishing
of
services
as
defined
in
section
423.1
.
15
Sec.
5.
Section
423.2,
subsection
7,
paragraph
a,
16
unnumbered
paragraph
1,
Code
2025,
is
amended
to
read
as
17
follows:
18
A
tax
of
six
percent
at
the
rate
specified
in
subsection
12
19
is
imposed
upon
the
sales
price
from
the
sales,
furnishing,
or
20
service
of
solid
waste
collection
and
disposal
service.
21
Sec.
6.
Section
423.2,
subsection
8,
paragraph
a,
Code
2025,
22
is
amended
to
read
as
follows:
23
a.
A
tax
of
six
percent
at
the
rate
specified
in
subsection
24
12
is
imposed
on
the
sales
price
from
sales
of
bundled
25
transactions.
For
the
purposes
of
this
subsection
,
a
“bundled
26
transaction”
is
the
retail
sale
of
two
or
more
distinct
and
27
identifiable
products,
except
real
property
and
services
to
28
real
property,
which
are
sold
for
one
nonitemized
price.
A
29
“bundled
transaction”
does
not
include
the
sale
of
any
products
30
in
which
the
sales
price
varies,
or
is
negotiable,
based
on
31
the
selection
by
the
purchaser
of
the
products
included
in
the
32
transaction.
33
Sec.
7.
Section
423.2,
subsection
9,
Code
2025,
is
amended
34
to
read
as
follows:
35
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498
9.
A
tax
of
six
percent
at
the
rate
specified
in
1
subsection
12
is
imposed
upon
the
sales
price
from
any
mobile
2
telecommunications
service,
including
all
paging
services,
3
that
this
state
is
allowed
to
tax
pursuant
to
the
provisions
4
of
the
federal
Mobile
Telecommunications
Sourcing
Act,
Pub.
5
L.
No.
106-252,
4
U.S.C.
§116
et
seq.
For
purposes
of
this
6
subsection
,
taxes
on
mobile
telecommunications
service,
as
7
defined
under
the
federal
Mobile
Telecommunications
Sourcing
8
Act
that
are
deemed
to
be
provided
by
the
customer’s
home
9
service
provider,
shall
be
paid
to
the
taxing
jurisdiction
10
whose
territorial
limits
encompass
the
customer’s
place
of
11
primary
use,
regardless
of
where
the
mobile
telecommunications
12
service
originates,
terminates,
or
passes
through
and
13
shall
in
all
other
respects
be
taxed
in
conformity
with
14
the
federal
Mobile
Telecommunications
Sourcing
Act.
All
15
other
provisions
of
the
federal
Mobile
Telecommunications
16
Sourcing
Act
are
adopted
by
the
state
of
Iowa
and
incorporated
17
into
this
subsection
by
reference.
With
respect
to
mobile
18
telecommunications
service
under
the
federal
Mobile
19
Telecommunications
Sourcing
Act,
the
director
shall,
if
20
requested,
enter
into
agreements
consistent
with
the
provisions
21
of
the
federal
Act.
22
Sec.
8.
Section
423.2,
subsection
10,
paragraph
a,
Code
23
2025,
is
amended
to
read
as
follows:
24
a.
A
tax
of
six
percent
at
the
rate
specified
in
subsection
25
12
is
imposed
on
the
sales
price
of
specified
digital
products
26
sold
at
retail
in
the
state.
The
tax
applies
whether
the
27
purchaser
obtains
permanent
use
or
less
than
permanent
use
of
28
the
specified
digital
product,
whether
the
sale
is
conditioned
29
or
not
conditioned
upon
continued
payment
from
the
purchaser,
30
and
whether
the
sale
is
on
a
subscription
basis
or
is
not
on
a
31
subscription
basis.
32
Sec.
9.
Section
423.2,
subsection
12,
Code
2025,
is
amended
33
by
striking
the
subsection
and
inserting
in
lieu
thereof
the
34
following:
35
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12.
The
sales
tax
rate
of
seven
percent
is
reduced
to
zero
1
beginning
on
or
after
January
1,
2026.
2
Sec.
10.
Section
423.5,
subsection
1,
unnumbered
paragraph
3
1,
Code
2025,
is
amended
to
read
as
follows:
4
Except
as
provided
in
paragraph
“b”
,
an
excise
tax
at
the
5
rate
of
six
percent
of
the
purchase
price
or
installed
purchase
6
price
is
imposed
on
the
following:
is
reduced
to
zero
beginning
7
on
or
after
January
1,
2026.
8
Sec.
11.
Section
423.5,
subsection
4,
Code
2025,
is
amended
9
by
striking
the
subsection.
10
Sec.
12.
EFFECTIVE
DATE.
This
Act
takes
effect
January
1,
11
2026.
12
EXPLANATION
13
The
inclusion
of
this
explanation
does
not
constitute
agreement
with
14
the
explanation’s
substance
by
the
members
of
the
general
assembly.
15
Beginning
on
after
January
1,
2026,
this
bill
reduces
the
16
statewide
sales
and
use
tax
from
6
percent
to
0.
By
reducing
17
the
statewide
sales
tax
to
zero,
the
bill
also
eliminates
the
1
18
percent
sales
tax
dedicated
to
the
secure
an
advanced
vision
19
for
education
fund
(SAVE).
A
local
option
tax
adopted
pursuant
20
to
Code
chapter
423B
is
not
reduced
by
the
bill.
21
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