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EXPLANATION-Matter enclosed in bold-faced brackets [thus] in this bill is not enacted
and is intended to be omitted in the law.
SECOND REGULAR SESSION
[PERFECTED]
SENATE SUBSTITUTE FOR
SENATE COMMITTEE SUBSTITUTE FOR
SENATE BILL NO. 1534
103RD GENERAL ASSEMBLY
INTRODUCED BY SENATOR NICOLA.
6578S.03P KRISTINA MARTIN, Secretary
AN ACT
To repeal sections 144.010, 144.014, and 144.020, RSMo, and to enact in lieu thereof three new
sections relating to the exclusion of certain transactions from sales tax.
Be it enacted by the General Assembly of the State of Missouri, as follows:
Section A. Sections 144.010, 144.014, and 144.020, RSMo, 1
are repealed and three new sections enacted in lieu thereof, to 2
be known as sections 144.010, 144.014, and 144.020, to read as 3
follows:4
144.010. 1. The following words, terms, and phrases 1
when used in sections 144.010 to 144.525 have the meanings 2
ascribed to them in this section, except when the context 3
indicates a different meaning: 4
(1) "Admission" includes seats and tables, reserved or 5
otherwise, and other similar accommodations and charges made 6
therefor and amount paid for admission, exclusive of any 7
admission tax imposed by the federal government or by 8
sections 144.010 to 144.525; 9
(2) "Business" includes any activity engaged in by any 10
person, or caused to be engaged in by him, with the object 11
of gain, benefit or advantage, either direct or indirect, 12
and the classification of which business is of such 13
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character as to be subject to the terms of sections 144.010 14
to 144.525. A person is "engaging in business" in this state 15
for purposes of sections 144.010 to 144.525 if such person 16
engages in business activities within this state or 17
maintains a place of business in this state under section 18
144.605. The isolated or occasional sale of tangible 19
personal property, service, substance, or thing, by a person 20
not engaged in such business, does not constitute engaging 21
in business within the meaning of sections 144.010 to 22
144.525 unless the total amount of the gross receipts from 23
such sales, exclusive of receipts from the sale of tangible 24
personal property by persons which property is sold in the 25
course of the partial or complete liquidation of a 26
household, farm or nonbusiness enterprise, exceeds three 27
thousand dollars in any calendar year. The provisions of 28
this subdivision shall not be construed to make any sale of 29
property which is exempt from sales tax or use tax on June 30
1, 1977, subject to that tax thereafter; 31
(3) "Captive wildlife", includes but is not limited to 32
exotic partridges, gray partridge, northern bobwhite quail, 33
ring-necked pheasant, captive waterfowl, captive white- 34
tailed deer, captive elk, and captive furbearers held under 35
permit issued by the Missouri department of conservation for 36
hunting purposes. The provisions of this subdivision shall 37
not apply to sales tax on a harvested animal; 38
(4) "Gross receipts", except as provided in section 39
144.012, means the total amount of the sale price of the 40
sales at retail including any services other than charges 41
incident to the extension of credit that are a part of such 42
sales made by the businesses herein referred to, capable of 43
being valued in money, whether received in money or 44
otherwise; except that, the term gross receipts shall not 45
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include the sale price of property returned by customers 46
when the full sale price thereof is refunded either in cash 47
or by credit. In determining any tax due under sections 48
144.010 to 144.525 on the gross receipts, charges incident 49
to the extension of credit, including credit card and debit 50
card processing fees not to exceed three percent of the 51
purchase price or the merchant discount fee, whichever is 52
less, shall be specifically exempted. For the purposes of 53
sections 144.010 to 144.525 the total amount of the sale 54
price above mentioned shall be deemed to be the amount 55
received. It shall also include the lease or rental 56
consideration where the right to continuous possession or 57
use of any article of tangible personal property is granted 58
under a lease or contract and such transfer of possession 59
would be taxable if outright sale were made and, in such 60
cases, the same shall be taxable as if outright sale were 61
made and considered as a sale of such article, and the tax 62
shall be computed and paid by the lessee upon the rentals 63
paid. The term gross receipts shall not include usual and 64
customary delivery charges that are stated separately from 65
the sale price; 66
(5) "Instructional class", includes any class, lesson, 67
or instruction intended or used for teaching; 68
(6) "Livestock", cattle, calves, sheep, swine, ratite 69
birds, including but not limited to, ostrich and emu, 70
aquatic products as described in section 277.024, llamas, 71
alpaca, buffalo, bison, elk documented as obtained from a 72
legal source and not from the wild, goats, horses, other 73
equine, honey bees, or rabbits raised in confinement for 74
human consumption; 75
(7) "Motor vehicle leasing company" [shall be], a 76
company obtaining a permit from the director of revenue to 77
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operate as a motor vehicle leasing company. Not all persons 78
renting or leasing trailers or motor vehicles need to obtain 79
such a permit; however, no person failing to obtain such a 80
permit may avail itself of the optional tax provisions of 81
subsection 5 of section 144.070, as hereinafter provided; 82
(8) "Person" includes any individual, firm, 83
copartnership, joint adventure, association, corporation, 84
municipal or private, and whether organized for profit or 85
not, state, county, political subdivision, state department, 86
commission, board, bureau or agency, except the state 87
transportation department, estate, trust, business trust, 88
receiver or trustee appointed by the state or federal court, 89
syndicate, or any other group or combination acting as a 90
unit, and the plural as well as the singular number; 91
(9) "Product which is intended to be sold ultimately 92
for final use or consumption" means tangible personal 93
property, or any service that is subject to state or local 94
sales or use taxes, or any tax that is substantially 95
equivalent thereto, in this state or any other state; 96
(10) "Purchaser" means a person who purchases tangible 97
personal property or to whom are rendered services, receipts 98
from which are taxable under sections 144.010 to 144.525; 99
(11) "Research or experimentation activities" are the 100
development of an experimental or pilot model, plant 101
process, formula, invention or similar property, and the 102
improvement of existing property of such type. Research or 103
experimentation activities do not include activities such as 104
ordinary testing or inspection of materials or products for 105
quality control, efficiency surveys, advertising promotions 106
or research in connection with literary, historical or 107
similar projects; 108
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(12) "Sale" or "sales" includes installment and credit 109
sales, and the exchange of properties as well as the sale 110
thereof for money, every closed transaction constituting a 111
sale, and means any transfer, exchange or barter, 112
conditional or otherwise, in any manner or by any means 113
whatsoever, of tangible personal property for valuable 114
consideration and the rendering, furnishing or selling for a 115
valuable consideration any of the substances, things and 116
services herein designated and defined as taxable under the 117
terms of sections 144.010 to 144.525; 118
(13) "Sale at retail" means any transfer made by any 119
person engaged in business as defined herein of the 120
ownership of, or title to, tangible personal property to the 121
purchaser, for use or consumption and not for resale in any 122
form as tangible personal property, for a valuable 123
consideration; except that, for the purposes of sections 124
144.010 to 144.525 and the tax imposed thereby: (i) 125
purchases of tangible personal property made by duly 126
licensed physicians, dentists, optometrists and 127
veterinarians and used in the practice of their professions 128
shall be deemed to be purchases for use or consumption and 129
not for resale; and (ii) the selling of computer printouts, 130
computer output or microfilm or microfiche and computer- 131
assisted photo compositions to a purchaser to enable the 132
purchaser to obtain for his or her own use the desired 133
information contained in such computer printouts, computer 134
output on microfilm or microfiche and computer-assisted 135
photo compositions shall be considered as the sale of a 136
service and not as the sale of tangible personal property. 137
Where necessary to conform to the context of sections 138
144.010 to 144.525 and the tax imposed thereby, the term 139
sale at retail shall be construed to embrace: 140
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(a) Sales of admission tickets, cash admissions, 141
charges and fees to or in places of amusement, entertainment 142
and recreation, games and athletic events, except amounts 143
paid for any instructional class; 144
(b) Sales of electricity, electrical current, water 145
and gas, natural or artificial, to domestic, commercial or 146
industrial consumers, except as provided in subdivision (12) 147
of subsection 1 of section 144.011; 148
(c) Sales of local and long distance 149
telecommunications service to telecommunications subscribers 150
and to others through equipment of telecommunications 151
subscribers for the transmission of messages and 152
conversations, and the sale, rental or leasing of all 153
equipment or services pertaining or incidental thereto; 154
(d) Sales of service for transmission of messages by 155
telegraph companies; 156
(e) Sales or charges for all rooms, meals and drinks 157
furnished at any hotel, motel, tavern, inn, restaurant, 158
eating house, drugstore, dining car, tourist camp, tourist 159
cabin, or other place in which rooms, meals or drinks are 160
regularly served to the public; 161
(f) Sales of tickets by every person operating a 162
railroad, sleeping car, dining car, express car, boat, 163
airplane, and such buses and trucks as are licensed by the 164
division of motor carrier and railroad safety of the 165
department of economic development of Missouri, engaged in 166
the transportation of persons for hire; 167
(14) "Seller" means a person selling or furnishing 168
tangible personal property or rendering services, on the 169
receipts from which a tax is imposed pursuant to section 170
144.020; 171
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(15) The noun "tax" means either the tax payable by 172
the purchaser of a commodity or service subject to tax, or 173
the aggregate amount of taxes due from the vendor of such 174
commodities or services during the period for which he or 175
she is required to report his or her collections, as the 176
context may require; and 177
(16) "Telecommunications service", for the purpose of 178
this chapter, the transmission of information by wire, 179
radio, optical cable, coaxial cable, electronic impulses, or 180
other similar means. As used in this definition, 181
"information" means knowledge or intelligence represented by 182
any form of writing, signs, signals, pictures, sounds, or 183
any other symbols. Telecommunications service does not 184
include the following if such services are separately stated 185
on the customer's bill or on records of the seller 186
maintained in the ordinary course of business: 187
(a) Access to the internet, access to interactive 188
computer services or electronic publishing services, except 189
the amount paid for the telecommunications service used to 190
provide such access; 191
(b) Answering services and one-way paging services; 192
(c) Private mobile radio services which are not two- 193
way commercial mobile radio services such as wireless 194
telephone, personal communications services or enhanced 195
specialized mobile radio services as defined pursuant to 196
federal law; or 197
(d) Cable or satellite television or music services. 198
2. For purposes of the taxes imposed under sections 199
144.010 to 144.525, and any other provisions of law 200
pertaining to sales or use taxes which incorporate the 201
provisions of sections 144.010 to 144.525 by reference, the 202
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term manufactured homes shall have the same meaning given it 203
in section 700.010. 204
3. Sections 144.010 to 144.525 may be known and quoted 205
as the "Sales Tax Law". 206
4. Any business that charges a credit or debit card 207
processing fee that is excluded from gross receipts shall 208
provide notice to a purchaser of such charges. Such notice 209
shall be posted at a physical point of sale or on the 210
business's webpage on which a sales transaction is completed 211
in a font size no smaller than twelve-point, or the 212
equivalent for digital displays, and shall include the 213
following language: 214
"NOTICE: PURSUANT TO MISSOURI LAW, PAYMENTS MADE 215
BY A CREDIT AND/OR DEBIT CARD ARE SUBJECT TO A 216
PROCESSING FEE NOT TO EXCEED THREE PERCENT OF 217
THE ACTUAL PURCHASE PRICE." 218
144.014. 1. Notwithstanding other provisions of law 1
to the contrary, [beginning October 1, 1997, the tax levied 2
and imposed under this chapter on] all retail sales of food 3
shall be [at the rate of one percent. The revenue derived 4
from the one percent rate pursuant to this section shall be 5
deposited by the state treasurer in the school district 6
trust fund and shall be distributed as provided in section 7
144.701] exempted from the provisions of and from the 8
computation of the tax levied, assessed, or payable pursuant 9
to this chapter. The provisions of this subsection are 10
intended to exempt the sale of food from the state sales tax 11
imposed pursuant to this chapter, and the department of 12
revenue shall not construe the provisions of this subsection 13
as an exemption from the local sales tax law, as defined in 14
section 32.085. As required in sections 43(a) and 47(a) of 15
article IV of the Missouri constitution, the sales tax 16
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imposed pursuant to such sections shall be imposed upon the 17
sales and services that are taxable pursuant to this 18
chapter, which shall not include the retail sale of food as 19
exempted in this section. 20
2. For the purposes of this section, the term "food" 21
shall include only those products and types of food for 22
which food stamps may be redeemed pursuant to the provisions 23
of the Federal Food Stamp Program as contained in 7 U.S.C. 24
Section 2012, as that section now reads or as it may be 25
amended hereafter, and shall include food dispensed by or 26
through vending machines. For the purpose of this section, 27
except for vending machine sales, the term "food" shall not 28
include food or drink sold by any establishment where the 29
gross receipts derived from the sale of food prepared by 30
such establishment for immediate consumption on or off the 31
premises of the establishment constitutes more than eighty 32
percent of the total gross receipts of that establishment, 33
regardless of whether such prepared food is consumed on the 34
premises of that establishment, including, but not limited 35
to, sales of food by any restaurant, fast food restaurant, 36
delicatessen, eating house, or café. 37
144.020. 1. A tax is hereby levied and imposed for 1
the privilege of titling new and used motor vehicles, 2
trailers, boats, and outboard motors purchased or acquired 3
for use on the highways or waters of this state which are 4
required to be titled under the laws of the state of 5
Missouri and, except as provided in subdivision (9) of this 6
subsection, upon all sellers for the privilege of engaging 7
in the business of selling tangible personal property or 8
rendering taxable service at retail in this state. The rate 9
of tax shall be as follows: 10
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(1) Upon every retail sale in this state of tangible 11
personal property, excluding motor vehicles, trailers, 12
motorcycles, mopeds, motortricycles, boats and outboard 13
motors required to be titled under the laws of the state of 14
Missouri and subject to tax under subdivision (9) of this 15
subsection, a tax equivalent to four percent of the purchase 16
price paid or charged, or in case such sale involves the 17
exchange of property, a tax equivalent to four percent of 18
the consideration paid or charged, including the fair market 19
value of the property exchanged at the time and place of the 20
exchange, except as otherwise provided in section 144.025; 21
(2) A tax equivalent to four percent of the amount 22
paid for admission and seating accommodations, or fees paid 23
to, or in any place of amusement, entertainment or 24
recreation, games and athletic events, except amounts paid 25
for any instructional class; 26
(3) A tax equivalent to four percent of the basic rate 27
paid or charged on all sales of electricity or electrical 28
current, water and gas, natural or artificial, to domestic, 29
commercial or industrial consumers; 30
(4) (a) A tax equivalent to four percent on the basic 31
rate paid or charged on all sales of local and long distance 32
telecommunications service to telecommunications subscribers 33
and to others through equipment of telecommunications 34
subscribers for the transmission of messages and 35
conversations and upon the sale, rental or leasing of all 36
equipment or services pertaining or incidental thereto; 37
except that, the payment made by telecommunications 38
subscribers or others, pursuant to section 144.060, and any 39
amounts paid for access to the internet or interactive 40
computer services shall not be considered as amounts paid 41
for telecommunications services; 42
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(b) If local and long distance telecommunications 43
services subject to tax under this subdivision are 44
aggregated with and not separately stated from charges for 45
telecommunications service or other services not subject to 46
tax under this subdivision, including, but not limited to, 47
interstate or international telecommunications services, 48
then the charges for nontaxable services may be subject to 49
taxation unless the telecommunications provider can identify 50
by reasonable and verifiable standards such portion of the 51
charges not subject to such tax from its books and records 52
that are kept in the regular course of business, including, 53
but not limited to, financial statement, general ledgers, 54
invoice and billing systems and reports, and reports for 55
regulatory tariffs and other regulatory matters; 56
(c) A telecommunications provider shall notify the 57
director of revenue of its intention to utilize the 58
standards described in paragraph (b) of this subdivision to 59
determine the charges that are subject to sales tax under 60
this subdivision. Such notification shall be in writing and 61
shall meet standardized criteria established by the 62
department regarding the form and format of such notice; 63
(d) The director of revenue may promulgate and enforce 64
reasonable rules and regulations for the administration and 65
enforcement of the provisions of this subdivision. Any rule 66
or portion of a rule, as that term is defined in section 67
536.010, that is created under the authority delegated in 68
this section shall become effective only if it complies with 69
and is subject to all of the provisions of chapter 536 and, 70
if applicable, section 536.028. This section and chapter 71
536 are nonseverable and if any of the powers vested with 72
the general assembly pursuant to chapter 536 to review, to 73
delay the effective date, or to disapprove and annul a rule 74
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are subsequently held unconstitutional, then the grant of 75
rulemaking authority and any rule proposed or adopted after 76
August 28, 2019, shall be invalid and void; 77
(5) A tax equivalent to four percent of the basic rate 78
paid or charged for all sales of services for transmission 79
of messages of telegraph companies; 80
(6) A tax equivalent to four percent on the amount of 81
sales or charges for all rooms, meals and drinks furnished 82
at any hotel, motel, tavern, inn, restaurant, eating house, 83
drugstore, dining car, tourist cabin, tourist camp or other 84
place in which rooms, meals or drinks are regularly served 85
to the public. The tax imposed under this subdivision shall 86
not apply to any automatic mandatory gratuity for a large 87
group imposed by a restaurant when such gratuity is reported 88
as employee tip income and the restaurant withholds income 89
tax under section 143.191 on such gratuity; 90
(7) A tax equivalent to four percent of the amount 91
paid or charged for intrastate tickets by every person 92
operating a railroad, sleeping car, dining car, express car, 93
boat, airplane and such buses and trucks as are licensed by 94
the division of motor carrier and railroad safety of the 95
department of economic development of Missouri, engaged in 96
the transportation of persons for hire; 97
(8) A tax equivalent to four percent of the amount 98
paid or charged for rental or lease of tangible personal 99
property, provided that if the lessor or renter of any 100
tangible personal property had previously purchased the 101
property under the conditions of sale at retail or leased or 102
rented the property and the tax was paid at the time of 103
purchase, lease or rental, the lessor, sublessor, renter or 104
subrenter shall not apply or collect the tax on the 105
subsequent lease, sublease, rental or subrental receipts 106
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from that property. The purchase, rental or lease of motor 107
vehicles, trailers, motorcycles, mopeds, motortricycles, 108
boats, and outboard motors shall be taxed and the tax paid 109
as provided in this section and section 144.070. In no 110
event shall the rental or lease of boats and outboard motors 111
be considered a sale, charge, or fee to, for or in places of 112
amusement, entertainment or recreation nor shall any such 113
rental or lease be subject to any tax imposed to, for, or in 114
such places of amusement, entertainment or recreation. 115
Rental and leased boats or outboard motors shall be taxed 116
under the provisions of the sales tax laws as provided under 117
such laws for motor vehicles and trailers. Tangible 118
personal property which is exempt from the sales or use tax 119
under section 144.030 upon a sale thereof is likewise exempt 120
from the sales or use tax upon the lease or rental thereof; 121
(9) A tax equivalent to four percent of the purchase 122
price, as defined in section 144.070, of new and used motor 123
vehicles, trailers, boats, and outboard motors purchased or 124
acquired for use on the highways or waters of this state 125
which are required to be registered under the laws of the 126
state of Missouri. This tax is imposed on the person 127
titling such property, and shall be paid according to the 128
procedures in section 144.070 or 144.440. 129
2. All tickets sold which are sold under the 130
provisions of this chapter which are subject to the sales 131
tax shall have printed, stamped or otherwise endorsed 132
thereon, the words "This ticket is subject to a sales tax.". 133
3. Notwithstanding any provision of law to the 134
contrary, of the four percent rate imposed pursuant to this 135
section, the revenue derived from a rate of two tenths of 136
one percent shall be deposited by the state treasurer in the 137
school district trust fund and shall be distributed as 138
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provided in section 144.701. The remaining portion of the 139
revenue derived from the rate imposed pursuant to this 140
section shall be deposited in the general revenue fund. 141
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