HB 330

As Introduced
136th General Assembly
   Regular Session  H. B. No. 330
       2025-2026
  Representatives Deeter, Fischer
   Cosponsors: Representatives Johnson, Brennan, Williams, King, Newman
  To amend sections 5739.02, 5739.03, and 5739.05 of  1
  the Revised Code to authorize a sales tax  2
  holiday for four months each year for the sale  3
  of firearm safety and storage devices.  4
 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO:
     Section 1. That sections 5739.02, 5739.03, and 5739.05 of  5
the Revised Code be amended to read as follows:  6
     Sec. 5739.02. For the purpose of providing revenue with  7
which to meet the needs of the state, for the use of the general  8
revenue fund of the state, for the purpose of securing a  9
thorough and efficient system of common schools throughout the  10
state, for the purpose of affording revenues, in addition to  11
those from general property taxes, permitted under  12
constitutional limitations, and from other sources, for the  13
support of local governmental functions, and for the purpose of  14
reimbursing the state for the expense of administering this  15
chapter, an excise tax is hereby levied on each retail sale made  16
in this state.  17
     (A)(1) The tax shall be collected as provided in section  18
5739.025 of the Revised Code. The rate of the tax shall be five  19
H. B. No. 330  Page 2
As Introduced
and three-fourths per cent. The tax applies and is collectible  20
when the sale is made, regardless of the time when the price is  21
paid or delivered.  22
       (2) In the case of the lease or rental, with a fixed term  23
of more than thirty days or an indefinite term with a minimum  24
period of more than thirty days, of any motor vehicles designed  25
by the manufacturer to carry a load of not more than one ton,  26
watercraft, outboard motor, or aircraft, or of any tangible  27
personal property, other than motor vehicles designed by the  28
manufacturer to carry a load of more than one ton, to be used by  29
the lessee or renter primarily for business purposes, the tax  30
shall be collected by the vendor at the time the lease or rental  31
is consummated and shall be calculated by the vendor on the  32
basis of the total amount to be paid by the lessee or renter  33
under the lease agreement. If the total amount of the  34
consideration for the lease or rental includes amounts that are  35
not calculated at the time the lease or rental is executed, the  36
tax shall be calculated and collected by the vendor at the time  37
such amounts are billed to the lessee or renter. In the case of  38
an open-end lease or rental, the tax shall be calculated by the  39
vendor on the basis of the total amount to be paid during the  40
initial fixed term of the lease or rental, and for each  41
subsequent renewal period as it comes due. As used in this  42
division, "motor vehicle" has the same meaning as in section  43
4501.01 of the Revised Code, and "watercraft" includes an  44
outdrive unit attached to the watercraft.  45
       A lease with a renewal clause and a termination penalty or  46
similar provision that applies if the renewal clause is not  47
exercised is presumed to be a sham transaction. In such a case,  48
the tax shall be calculated and paid on the basis of the entire  49
length of the lease period, including any renewal periods, until  50
H. B. No. 330  Page 3
As Introduced
the termination penalty or similar provision no longer applies.  51
The taxpayer shall bear the burden, by a preponderance of the  52
evidence, that the transaction or series of transactions is not  53
a sham transaction.  54
       (3) Except as provided in division (A)(2) of this section,  55
in the case of a sale, the price of which consists in whole or  56
in part of the lease or rental of tangible personal property,  57
the tax shall be measured by the installments of that lease or  58
rental.  59
       (4) In the case of a sale of a physical fitness facility  60
service or recreation and sports club service, the price of  61
which consists in whole or in part of a membership for the  62
receipt of the benefit of the service, the tax applicable to the  63
sale shall be measured by the installments thereof.  64
       (B) The tax does not apply to the following:  65
       (1) Sales to the state or any of its political  66
subdivisions, or to any other state or its political  67
subdivisions if the laws of that state exempt from taxation  68
sales made to this state and its political subdivisions  69
including either of the following:  70
       (a) Sales or rentals of tangible personal property by  71
construction contractors or subcontractors to provide temporary  72
traffic control or temporary structures, including material and  73
equipment used to comply with the Ohio manual of uniform traffic  74
control devices adopted pursuant to section 4511.09 of the  75
Revised Code, whereby the state or any of its political  76
subdivisions take title to, or permanent or temporary possession  77
of, such tangible personal property for use by the state or any  78
of its political subdivisions, including for use by the general  79
H. B. No. 330  Page 4
As Introduced
public thereof;  80
       (b) Sales of services by construction contractors or  81
subcontractors to provide temporary traffic control or  82
structures, including labor used to comply with the Ohio manual  83
of uniform traffic control devices adopted pursuant to section  84
4511.09 of the Revised Code, whereby the state or any of its  85
political subdivisions, including the general public thereof,  86
receive the benefit of such services.  87
       As used in divisions (B)(1)(a) and (b) of this section,  88
"temporary structures" include temporary roads, bridges, drains,  89
and pavement.  90
       (2) Sales of food for human consumption off the premises  91
where sold;  92
       (3) Sales of food sold to students only in a cafeteria,  93
dormitory, fraternity, or sorority maintained in a private,  94
public, or parochial school, college, or university;  95
       (4) Sales of newspapers and sales or transfers of  96
magazines distributed as controlled circulation publications;  97
       (5) The furnishing, preparing, or serving of meals without  98
charge by an employer to an employee provided the employer  99
records the meals as part compensation for services performed or  100
work done;  101
       (6)(a) Sales of motor fuel upon receipt, use,  102
distribution, or sale of which in this state a tax is imposed by  103
the law of this state, but this exemption shall not apply to the  104
sale of motor fuel on which a refund of the tax is allowable  105
under division (A) of section 5735.14 of the Revised Code; and  106
the tax commissioner may deduct the amount of tax levied by this  107
section applicable to the price of motor fuel when granting a  108
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As Introduced
refund of motor fuel tax pursuant to division (A) of section  109
5735.14 of the Revised Code and shall cause the amount deducted  110
to be paid into the general revenue fund of this state;  111
       (b) Sales of motor fuel other than that described in  112
division (B)(6)(a) of this section and used for powering a  113
refrigeration unit on a vehicle other than one used primarily to  114
provide comfort to the operator or occupants of the vehicle.  115
       (7) Sales of natural gas by a natural gas company or  116
municipal gas utility, of water by a water-works company, or of  117
steam by a heating company, if in each case the thing sold is  118
delivered to consumers through pipes or conduits, and all sales  119
of communications services by a telegraph company, all terms as  120
defined in section 5727.01 of the Revised Code, and sales of  121
electricity delivered through wires;  122
       (8) Casual sales by a person, or auctioneer employed  123
directly by the person to conduct such sales, except as to such  124
sales of motor vehicles, watercraft or outboard motors required  125
to be titled under section 1548.06 of the Revised Code,  126
watercraft documented with the United States coast guard,  127
snowmobiles, and all-purpose vehicles as defined in section  128
4519.01 of the Revised Code;  129
       (9)(a) Sales of services or tangible personal property,  130
other than motor vehicles, mobile homes, and manufactured homes,  131
by churches, organizations exempt from taxation under section  132
501(c)(3) of the Internal Revenue Code of 1986, or nonprofit  133
organizations operated exclusively for charitable purposes as  134
defined in division (B)(12) of this section, provided that the  135
number of days on which such tangible personal property or  136
services, other than items never subject to the tax, are sold  137
does not exceed six in any calendar year, except as otherwise  138
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provided in division (B)(9)(b) of this section. If the number of  139
days on which such sales are made exceeds six in any calendar  140
year, the church or organization shall be considered to be  141
engaged in business and all subsequent sales by it shall be  142
subject to the tax. In counting the number of days, all sales by  143
groups within a church or within an organization shall be  144
considered to be sales of that church or organization.  145
       (b) The limitation on the number of days on which tax-  146
exempt sales may be made by a church or organization under  147
division (B)(9)(a) of this section does not apply to sales made  148
by student clubs and other groups of students of a primary or  149
secondary school, or a parent-teacher association, booster  150
group, or similar organization that raises money to support or  151
fund curricular or extracurricular activities of a primary or  152
secondary school.  153
       (c) Divisions (B)(9)(a) and (b) of this section do not  154
apply to sales by a noncommercial educational radio or  155
television broadcasting station.  156
       (10) Sales not within the taxing power of this state under  157
the Constitution or laws of the United States or the  158
Constitution of this state including either of the following:  159
       (a) Sales or rentals of tangible personal property by  160
construction contractors or subcontractors to provide temporary  161
traffic control or temporary structures, including material and  162
equipment used to comply with the Ohio manual of uniform traffic  163
control devices adopted pursuant to section 4511.09 of the  164
Revised Code, whereby the United States takes title to, or  165
permanent or temporary possession of, such tangible personal  166
property for use by the United States including for use by the  167
general public thereof;  168
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        (b) Sales of services by construction contractors or  169
subcontractors to provide temporary traffic control or  170
structures, including labor used to comply with the Ohio manual  171
of uniform traffic control devices adopted pursuant to section  172
4511.09 of the Revised Code, whereby the United States,  173
including the general public thereof, receives the benefit of  174
such services.  175
        As used in divisions (B)(10)(a) and (b) of this section,  176
"temporary structures" include temporary roads, bridges, drains,  177
and pavement.  178
        (11) Except for transactions that are sales under division  179
(B)(3)(p) of section 5739.01 of the Revised Code, the  180
transportation of persons or property, unless the transportation  181
is by a private investigation and security service;  182
        (12) Sales of tangible personal property or services to  183
churches, to organizations exempt from taxation under section  184
501(c)(3) of the Internal Revenue Code of 1986, and to any other  185
nonprofit organizations operated exclusively for charitable  186
purposes in this state, no part of the net income of which  187
inures to the benefit of any private shareholder or individual,  188
and no substantial part of the activities of which consists of  189
carrying on propaganda or otherwise attempting to influence  190
legislation; sales to offices administering one or more homes  191
for the aged or one or more hospital facilities exempt under  192
section 140.08 of the Revised Code; and sales to organizations  193
described in division (D) of section 5709.12 of the Revised  194
Code.  195
        "Charitable purposes" means the relief of poverty; the  196
improvement of health through the alleviation of illness,  197
disease, or injury; the operation of an organization exclusively  198
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for the provision of professional, laundry, printing, and  199
purchasing services to hospitals or charitable institutions; the  200
operation of a home for the aged, as defined in section 5701.13  201
of the Revised Code; the operation of a radio or television  202
broadcasting station that is licensed by the federal  203
communications commission as a noncommercial educational radio  204
or television station; the operation of a nonprofit animal  205
adoption service or a county humane society; the promotion of  206
education by an institution of learning that maintains a faculty  207
of qualified instructors, teaches regular continuous courses of  208
study, and confers a recognized diploma upon completion of a  209
specific curriculum; the operation of a parent-teacher  210
association, booster group, or similar organization primarily  211
engaged in the promotion and support of the curricular or  212
extracurricular activities of a primary or secondary school; the  213
operation of a community or area center in which presentations  214
in music, dramatics, the arts, and related fields are made in  215
order to foster public interest and education therein; the  216
production of performances in music, dramatics, and the arts; or  217
the promotion of education by an organization engaged in  218
carrying on research in, or the dissemination of, scientific and  219
technological knowledge and information primarily for the  220
public.  221
       Nothing in this division shall be deemed to exempt sales  222
to any organization for use in the operation or carrying on of a  223
trade or business, or sales to a home for the aged for use in  224
the operation of independent living facilities as defined in  225
division (A) of section 5709.12 of the Revised Code.  226
       (13) Building and construction materials and services sold  227
to construction contractors for incorporation into a structure  228
or improvement to real property under a construction contract  229
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As Introduced
with this state or a political subdivision of this state, or  230
with the United States government or any of its agencies;  231
building and construction materials and services sold to  232
construction contractors for incorporation into a structure or  233
improvement to real property that are accepted for ownership by  234
this state or any of its political subdivisions, or by the  235
United States government or any of its agencies at the time of  236
completion of the structures or improvements; building and  237
construction materials sold to construction contractors for  238
incorporation into a horticulture structure or livestock  239
structure for a person engaged in the business of horticulture  240
or producing livestock; building materials and services sold to  241
a construction contractor for incorporation into a house of  242
public worship or religious education, or a building used  243
exclusively for charitable purposes under a construction  244
contract with an organization whose purpose is as described in  245
division (B)(12) of this section; building materials and  246
services sold to a construction contractor for incorporation  247
into a building under a construction contract with an  248
organization exempt from taxation under section 501(c)(3) of the  249
Internal Revenue Code of 1986 when the building is to be used  250
exclusively for the organization's exempt purposes; tangible  251
personal property sold for incorporation into the construction  252
of a sports facility under section 307.696 of the Revised Code;  253
building and construction materials and services sold to a  254
construction contractor for incorporation into real property  255
outside this state if such materials and services, when sold to  256
a construction contractor in the state in which the real  257
property is located for incorporation into real property in that  258
state, would be exempt from a tax on sales levied by that state;  259
building and construction materials for incorporation into a  260
transportation facility pursuant to a public-private agreement  261
H. B. No. 330  Page 10
As Introduced
entered into under sections 5501.70 to 5501.83 of the Revised  262
Code; until one calendar year after the construction of a  263
convention center that qualifies for property tax exemption  264
under section 5709.084 of the Revised Code is completed,  265
building and construction materials and services sold to a  266
construction contractor for incorporation into the real property  267
comprising that convention center; and building and construction  268
materials sold for incorporation into a structure or improvement  269
to real property that is used primarily as, or primarily in  270
support of, a manufacturing facility or research and development  271
facility and that is to be owned by a megaproject operator upon  272
completion and located at the site of a megaproject that  273
satisfies the criteria described in division (A)(11)(a)(ii) of  274
section 122.17 of the Revised Code, provided that the sale  275
occurs during the period that the megaproject operator has an  276
agreement for such megaproject with the tax credit authority  277
under division (D) of section 122.17 of the Revised Code that  278
remains in effect and has not expired or been terminated.  279
       (14) Sales of ships or vessels or rail rolling stock used  280
or to be used principally in interstate or foreign commerce, and  281
repairs, alterations, fuel, and lubricants for such ships or  282
vessels or rail rolling stock;  283
       (15) Sales to persons primarily engaged in any of the  284
activities mentioned in division (B)(42)(a), (g), or (h) of this  285
section, to persons engaged in making retail sales, or to  286
persons who purchase for sale from a manufacturer tangible  287
personal property that was produced by the manufacturer in  288
accordance with specific designs provided by the purchaser, of  289
packages, including material, labels, and parts for packages,  290
and of machinery, equipment, and material for use primarily in  291
packaging tangible personal property produced for sale,  292
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As Introduced
including any machinery, equipment, and supplies used to make  293
labels or packages, to prepare packages or products for  294
labeling, or to label packages or products, by or on the order  295
of the person doing the packaging, or sold at retail. "Packages"  296
includes bags, baskets, cartons, crates, boxes, cans, bottles,  297
bindings, wrappings, and other similar devices and containers,  298
but does not include motor vehicles or bulk tanks, trailers, or  299
similar devices attached to motor vehicles. "Packaging" means  300
placing in a package. Division (B)(15) of this section does not  301
apply to persons engaged in highway transportation for hire.  302
       (16) Sales of food to persons using supplemental nutrition  303
assistance program benefits to purchase the food. As used in  304
this division, "food" has the same meaning as in 7 U.S.C. 2012  305
and federal regulations adopted pursuant to the Food and  306
Nutrition Act of 2008.  307
       (17) Sales to persons engaged in farming, agriculture,  308
horticulture, or floriculture, of tangible personal property for  309
use or consumption primarily in the production by farming,  310
agriculture, horticulture, or floriculture of other tangible  311
personal property for use or consumption primarily in the  312
production of tangible personal property for sale by farming,  313
agriculture, horticulture, or floriculture; or material and  314
parts for incorporation into any such tangible personal property  315
for use or consumption in production; and of tangible personal  316
property for such use or consumption in the conditioning or  317
holding of products produced by and for such use, consumption,  318
or sale by persons engaged in farming, agriculture,  319
horticulture, or floriculture, except where such property is  320
incorporated into real property;  321
       (18) Sales of drugs for a human being that may be  322
H. B. No. 330  Page 12
As Introduced
dispensed only pursuant to a prescription; insulin as recognized  323
in the official United States pharmacopoeia; urine and blood  324
testing materials when used by diabetics or persons with  325
hypoglycemia to test for glucose or acetone; hypodermic syringes  326
and needles when used by diabetics for insulin injections;  327
epoetin alfa when purchased for use in the treatment of persons  328
with medical disease; hospital beds when purchased by hospitals,  329
nursing homes, or other medical facilities; and medical oxygen  330
and medical oxygen-dispensing equipment when purchased by  331
hospitals, nursing homes, or other medical facilities;  332
       (19) Sales of prosthetic devices, durable medical  333
equipment for home use, or mobility enhancing equipment, when  334
made pursuant to a prescription and when such devices or  335
equipment are for use by a human being.  336
       (20) Sales of emergency and fire protection vehicles and  337
equipment to nonprofit organizations for use solely in providing  338
fire protection and emergency services, including trauma care  339
and emergency medical services, for political subdivisions of  340
the state;  341
       (21) Sales of tangible personal property manufactured in  342
this state, if sold by the manufacturer in this state to a  343
retailer for use in the retail business of the retailer outside  344
of this state and if possession is taken from the manufacturer  345
by the purchaser within this state for the sole purpose of  346
immediately removing the same from this state in a vehicle owned  347
by the purchaser;  348
       (22) Sales of services provided by the state or any of its  349
political subdivisions, agencies, instrumentalities,  350
institutions, or authorities, or by governmental entities of the  351
state or any of its political subdivisions, agencies,  352
H. B. No. 330  Page 13
As Introduced
instrumentalities, institutions, or authorities;  353
       (23) Sales of motor vehicles to nonresidents of this state  354
under the circumstances described in division (B) of section  355
5739.029 of the Revised Code;  356
       (24) Sales to persons engaged in the preparation of eggs  357
for sale of tangible personal property used or consumed directly  358
in such preparation, including such tangible personal property  359
used for cleaning, sanitizing, preserving, grading, sorting, and  360
classifying by size; packages, including material and parts for  361
packages, and machinery, equipment, and material for use in  362
packaging eggs for sale; and handling and transportation  363
equipment and parts therefor, except motor vehicles licensed to  364
operate on public highways, used in intraplant or interplant  365
transfers or shipment of eggs in the process of preparation for  366
sale, when the plant or plants within or between which such  367
transfers or shipments occur are operated by the same person.  368
"Packages" includes containers, cases, baskets, flats, fillers,  369
filler flats, cartons, closure materials, labels, and labeling  370
materials, and "packaging" means placing therein.  371
       (25)(a) Sales of water to a consumer for residential use;  372
       (b) Sales of water by a nonprofit corporation engaged  373
exclusively in the treatment, distribution, and sale of water to  374
consumers, if such water is delivered to consumers through pipes  375
or tubing.  376
       (26) Fees charged for inspection or reinspection of motor  377
vehicles under section 3704.14 of the Revised Code;  378
       (27) Sales to persons licensed to conduct a food service  379
operation pursuant to section 3717.43 of the Revised Code, of  380
tangible personal property primarily used directly for the  381
H. B. No. 330  Page 14
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following:  382
        (a) To prepare food for human consumption for sale;  383
        (b) To preserve food that has been or will be prepared for  384
human consumption for sale by the food service operator, not  385
including tangible personal property used to display food for  386
selection by the consumer;  387
        (c) To clean tangible personal property used to prepare or  388
serve food for human consumption for sale.  389
        (28) Sales of animals by nonprofit animal adoption  390
services or county humane societies;  391
        (29) Sales of services to a corporation described in  392
division (A) of section 5709.72 of the Revised Code, and sales  393
of tangible personal property that qualifies for exemption from  394
taxation under section 5709.72 of the Revised Code;  395
        (30) Sales and installation of agricultural land tile, as  396
defined in division (B)(5)(a) of section 5739.01 of the Revised  397
Code;  398
        (31) Sales and erection or installation of portable grain  399
bins, as defined in division (B)(5)(b) of section 5739.01 of the  400
Revised Code;  401
        (32) The sale, lease, repair, and maintenance of, parts  402
for, or items attached to or incorporated in, motor vehicles  403
that are primarily used for transporting tangible personal  404
property belonging to others by a person engaged in highway  405
transportation for hire, except for packages and packaging used  406
for the transportation of tangible personal property;  407
        (33) Sales to the state headquarters of any veterans'  408
organization in this state that is either incorporated and  409
H. B. No. 330  Page 15
As Introduced
issued a charter by the congress of the United States or is  410
recognized by the United States veterans administration, for use  411
by the headquarters;  412
       (34) Sales to a telecommunications service vendor, mobile  413
telecommunications service vendor, or satellite broadcasting  414
service vendor of tangible personal property and services used  415
directly and primarily in transmitting, receiving, switching, or  416
recording any interactive, one- or two-way electromagnetic  417
communications, including voice, image, data, and information,  418
through the use of any medium, including, but not limited to,  419
poles, wires, cables, switching equipment, computers, and record  420
storage devices and media, and component parts for the tangible  421
personal property. The exemption provided in this division shall  422
be in lieu of all other exemptions under division (B)(42)(a) or  423
(n) of this section to which the vendor may otherwise be  424
entitled, based upon the use of the thing purchased in providing  425
the telecommunications, mobile telecommunications, or satellite  426
broadcasting service.  427
       (35)(a) Sales where the purpose of the consumer is to use  428
or consume the things transferred in making retail sales and  429
consisting of newspaper inserts, catalogues, coupons, flyers,  430
gift certificates, or other advertising material that prices and  431
describes tangible personal property offered for retail sale.  432
       (b) Sales to direct marketing vendors of preliminary  433
materials such as photographs, artwork, and typesetting that  434
will be used in printing advertising material; and of printed  435
matter that offers free merchandise or chances to win sweepstake  436
prizes and that is mailed to potential customers with  437
advertising material described in division (B)(35)(a) of this  438
section;  439
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       (c) Sales of equipment such as telephones, computers,  440
facsimile machines, and similar tangible personal property  441
primarily used to accept orders for direct marketing retail  442
sales.  443
       (d) Sales of automatic food vending machines that preserve  444
food with a shelf life of forty-five days or less by  445
refrigeration and dispense it to the consumer.  446
       For purposes of division (B)(35) of this section, "direct  447
marketing" means the method of selling where consumers order  448
tangible personal property by United States mail, delivery  449
service, or telecommunication and the vendor delivers or ships  450
the tangible personal property sold to the consumer from a  451
warehouse, catalogue distribution center, or similar fulfillment  452
facility by means of the United States mail, delivery service,  453
or common carrier.  454
       (36) Sales to a person engaged in the business of  455
horticulture or producing livestock of materials to be  456
incorporated into a horticulture structure or livestock  457
structure;  458
       (37) Sales of personal computers, computer monitors,  459
computer keyboards, modems, and other peripheral computer  460
equipment to an individual who is licensed or certified to teach  461
in an elementary or a secondary school in this state for use by  462
that individual in preparation for teaching elementary or  463
secondary school students;  464
       (38) Sales of tangible personal property that is not  465
required to be registered or licensed under the laws of this  466
state to a citizen of a foreign nation that is not a citizen of  467
the United States, provided the property is delivered to a  468
H. B. No. 330  Page 17
As Introduced
person in this state that is not a related member of the  469
purchaser, is physically present in this state for the sole  470
purpose of temporary storage and package consolidation, and is  471
subsequently delivered to the purchaser at a delivery address in  472
a foreign nation. As used in division (B)(38) of this section,  473
"related member" has the same meaning as in section 5733.042 of  474
the Revised Code, and "temporary storage" means the storage of  475
tangible personal property for a period of not more than sixty  476
days.  477
        (39) Sales of used manufactured homes and used mobile  478
homes, as defined in section 5739.0210 of the Revised Code, made  479
on or after January 1, 2000;  480
        (40) Sales of tangible personal property and services to a  481
provider of electricity used or consumed directly and primarily  482
in generating, transmitting, or distributing electricity for use  483
by others, including property that is or is to be incorporated  484
into and will become a part of the consumer's production,  485
transmission, or distribution system and that retains its  486
classification as tangible personal property after  487
incorporation; fuel or power used in the production,  488
transmission, or distribution of electricity; energy conversion  489
equipment as defined in section 5727.01 of the Revised Code; and  490
tangible personal property and services used in the repair and  491
maintenance of the production, transmission, or distribution  492
system, including only those motor vehicles as are specially  493
designed and equipped for such use. The exemption provided in  494
this division shall be in lieu of all other exemptions in  495
division (B)(42)(a) or (n) of this section to which a provider  496
of electricity may otherwise be entitled based on the use of the  497
tangible personal property or service purchased in generating,  498
transmitting, or distributing electricity.  499
H. B. No. 330  Page 18
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       (41) Sales to a person providing services under division  500
(B)(3)(p) of section 5739.01 of the Revised Code of tangible  501
personal property and services used directly and primarily in  502
providing taxable services under that section.  503
       (42) Sales where the purpose of the purchaser is to do any  504
of the following:  505
       (a) To incorporate the thing transferred as a material or  506
a part into tangible personal property to be produced for sale  507
by manufacturing, assembling, processing, or refining; or to use  508
or consume the thing transferred directly in producing tangible  509
personal property for sale by mining, including, without  510
limitation, the extraction from the earth of all substances that  511
are classed geologically as minerals, or directly in the  512
rendition of a public utility service, except that the sales tax  513
levied by this section shall be collected upon all meals,  514
drinks, and food for human consumption sold when transporting  515
persons. This paragraph does not exempt from "retail sale" or  516
"sales at retail" the sale of tangible personal property that is  517
to be incorporated into a structure or improvement to real  518
property.  519
       (b) To hold the thing transferred as security for the  520
performance of an obligation of the vendor;  521
       (c) To resell, hold, use, or consume the thing transferred  522
as evidence of a contract of insurance;  523
       (d) To use or consume the thing directly in commercial  524
fishing;  525
       (e) To incorporate the thing transferred as a material or  526
a part into, or to use or consume the thing transferred directly  527
in the production of, magazines distributed as controlled  528
H. B. No. 330  Page 19
As Introduced
circulation publications;  529
       (f) To use or consume the thing transferred in the  530
production and preparation in suitable condition for market and  531
sale of printed, imprinted, overprinted, lithographic,  532
multilithic, blueprinted, photostatic, or other productions or  533
reproductions of written or graphic matter;  534
       (g) To use the thing transferred, as described in section  535
5739.011 of the Revised Code, primarily in a manufacturing  536
operation to produce tangible personal property for sale;  537
       (h) To use the benefit of a warranty, maintenance or  538
service contract, or similar agreement, as described in division  539
(B)(7) of section 5739.01 of the Revised Code, to repair or  540
maintain tangible personal property, if all of the property that  541
is the subject of the warranty, contract, or agreement would not  542
be subject to the tax imposed by this section;  543
       (i) To use the thing transferred as qualified research and  544
development equipment;  545
       (j) To use or consume the thing transferred primarily in  546
storing, transporting, mailing, or otherwise handling purchased  547
sales inventory in a warehouse, distribution center, or similar  548
facility when the inventory is primarily distributed outside  549
this state to retail stores of the person who owns or controls  550
the warehouse, distribution center, or similar facility, to  551
retail stores of an affiliated group of which that person is a  552
member, or by means of direct marketing. This division does not  553
apply to motor vehicles registered for operation on the public  554
highways. As used in this division, "affiliated group" has the  555
same meaning as in division (B)(3)(e) of section 5739.01 of the  556
Revised Code and "direct marketing" has the same meaning as in  557
H. B. No. 330  Page 20
As Introduced
division (B)(35) of this section.  558
       (k) To use or consume the thing transferred to fulfill a  559
contractual obligation incurred by a warrantor pursuant to a  560
warranty provided as a part of the price of the tangible  561
personal property sold or by a vendor of a warranty, maintenance  562
or service contract, or similar agreement the provision of which  563
is defined as a sale under division (B)(7) of section 5739.01 of  564
the Revised Code;  565
       (l) To use or consume the thing transferred in the  566
production of a newspaper for distribution to the public;  567
       (m) To use tangible personal property to perform a service  568
listed in division (B)(3) of section 5739.01 of the Revised  569
Code, if the property is or is to be permanently transferred to  570
the consumer of the service as an integral part of the  571
performance of the service;  572
       (n) To use or consume the thing transferred primarily in  573
producing tangible personal property for sale by farming,  574
agriculture, horticulture, or floriculture. Persons engaged in  575
rendering farming, agriculture, horticulture, or floriculture  576
services for others are deemed engaged primarily in farming,  577
agriculture, horticulture, or floriculture. This paragraph does  578
not exempt from "retail sale" or "sales at retail" the sale of  579
tangible personal property that is to be incorporated into a  580
structure or improvement to real property.  581
       (o) To use or consume the thing transferred in acquiring,  582
formatting, editing, storing, and disseminating data or  583
information by electronic publishing;  584
       (p) To provide the thing transferred to the owner or  585
lessee of a motor vehicle that is being repaired or serviced, if  586
H. B. No. 330  Page 21
As Introduced
the thing transferred is a rented motor vehicle and the  587
purchaser is reimbursed for the cost of the rented motor vehicle  588
by a manufacturer, warrantor, or provider of a maintenance,  589
service, or other similar contract or agreement, with respect to  590
the motor vehicle that is being repaired or serviced;  591
       (q) To use or consume the thing transferred directly in  592
production of crude oil and natural gas for sale. Persons  593
engaged in rendering production services for others are deemed  594
engaged in production.  595
       As used in division (B)(42)(q) of this section,  596
"production" means operations and tangible personal property  597
directly used to expose and evaluate an underground reservoir  598
that may contain hydrocarbon resources, prepare the wellbore for  599
production, and lift and control all substances yielded by the  600
reservoir to the surface of the earth.  601
       (i) For the purposes of division (B)(42)(q) of this  602
section, the "thing transferred" includes, but is not limited  603
to, any of the following:  604
       (I) Services provided in the construction of permanent  605
access roads, services provided in the construction of the well  606
site, and services provided in the construction of temporary  607
impoundments;  608
       (II) Equipment and rigging used for the specific purpose  609
of creating with integrity a wellbore pathway to underground  610
reservoirs;  611
       (III) Drilling and workover services used to work within a  612
subsurface wellbore, and tangible personal property directly  613
used in providing such services;  614
       (IV) Casing, tubulars, and float and centralizing  615
H. B. No. 330  Page 22
As Introduced
equipment;  616
       (V) Trailers to which production equipment is attached;  617
       (VI) Well completion services, including cementing of  618
casing, and tangible personal property directly used in  619
providing such services;  620
       (VII) Wireline evaluation, mud logging, and perforation  621
services, and tangible personal property directly used in  622
providing such services;  623
       (VIII) Reservoir stimulation, hydraulic fracturing, and  624
acidizing services, and tangible personal property directly used  625
in providing such services, including all material pumped  626
downhole;  627
       (IX) Pressure pumping equipment;  628
       (X) Artificial lift systems equipment;  629
       (XI) Wellhead equipment and well site equipment used to  630
separate, stabilize, and control hydrocarbon phases and produced  631
water;  632
       (XII) Tangible personal property directly used to control  633
production equipment.  634
       (ii) For the purposes of division (B)(42)(q) of this  635
section, the "thing transferred" does not include any of the  636
following:  637
       (I) Tangible personal property used primarily in the  638
exploration and production of any mineral resource regulated  639
under Chapter 1509. of the Revised Code other than oil or gas;  640
       (II) Tangible personal property used primarily in storing,  641
holding, or delivering solutions or chemicals used in well  642
H. B. No. 330  Page 23
As Introduced
stimulation as defined in section 1509.01 of the Revised Code;  643
        (III) Tangible personal property used primarily in  644
preparing, installing, or reclaiming foundations for drilling or  645
pumping equipment or well stimulation material tanks;  646
        (IV) Tangible personal property used primarily in  647
transporting, delivering, or removing equipment to or from the  648
well site or storing such equipment before its use at the well  649
site;  650
        (V) Tangible personal property used primarily in gathering  651
operations occurring off the well site, including gathering  652
pipelines transporting hydrocarbon gas or liquids away from a  653
crude oil or natural gas production facility;  654
        (VI) Tangible personal property that is to be incorporated  655
into a structure or improvement to real property;  656
        (VII) Well site fencing, lighting, or security systems;  657
        (VIII) Communication devices or services;  658
        (IX) Office supplies;  659
        (X) Trailers used as offices or lodging;  660
        (XI) Motor vehicles of any kind;  661
        (XII) Tangible personal property used primarily for the  662
storage of drilling byproducts and fuel not used for production;  663
        (XIII) Tangible personal property used primarily as a  664
safety device;  665
        (XIV) Data collection or monitoring devices;  666
        (XV) Access ladders, stairs, or platforms attached to  667
storage tanks.  668
H. B. No. 330  Page 24
As Introduced
       The enumeration of tangible personal property in division  669
(B)(42)(q)(ii) of this section is not intended to be exhaustive,  670
and any tangible personal property not so enumerated shall not  671
necessarily be construed to be a "thing transferred" for the  672
purposes of division (B)(42)(q) of this section.  673
       The commissioner shall adopt and promulgate rules under  674
sections 119.01 to 119.13 of the Revised Code that the  675
commissioner deems necessary to administer division (B)(42)(q)  676
of this section.  677
       As used in division (B)(42) of this section, "thing"  678
includes all transactions included in divisions (B)(3)(a), (b),  679
and (e) of section 5739.01 of the Revised Code.  680
       (43) Sales conducted through a coin operated device that  681
activates vacuum equipment or equipment that dispenses water,  682
whether or not in combination with soap or other cleaning agents  683
or wax, to the consumer for the consumer's use on the premises  684
in washing, cleaning, or waxing a motor vehicle, provided no  685
other personal property or personal service is provided as part  686
of the transaction.  687
       (44) Sales of replacement and modification parts for  688
engines, airframes, instruments, and interiors in, and paint  689
for, aircraft used primarily in a fractional aircraft ownership  690
program, and sales of services for the repair, modification, and  691
maintenance of such aircraft, and machinery, equipment, and  692
supplies primarily used to provide those services.  693
       (45) Sales of telecommunications service that is used  694
directly and primarily to perform the functions of a call  695
center. As used in this division, "call center" means any  696
physical location where telephone calls are placed or received  697
H. B. No. 330  Page 25
As Introduced
in high volume for the purpose of making sales, marketing,  698
customer service, technical support, or other specialized  699
business activity, and that employs at least fifty individuals  700
that engage in call center activities on a full-time basis, or  701
sufficient individuals to fill fifty full-time equivalent  702
positions.  703
       (46) Sales by a telecommunications service vendor of 900  704
service to a subscriber. This division does not apply to  705
information services.  706
       (47) Sales of value-added non-voice data service. This  707
division does not apply to any similar service that is not  708
otherwise a telecommunications service.  709
       (48) Sales of feminine hygiene products.  710
       (49) Sales of materials, parts, equipment, or engines used  711
in the repair or maintenance of aircraft or avionics systems of  712
such aircraft, and sales of repair, remodeling, replacement, or  713
maintenance services in this state performed on aircraft or on  714
an aircraft's avionics, engine, or component materials or parts.  715
As used in division (B)(49) of this section, "aircraft" means  716
aircraft of more than six thousand pounds maximum certified  717
takeoff weight or used exclusively in general aviation.  718
       (50) Sales of full flight simulators that are used for  719
pilot or flight-crew training, sales of repair or replacement  720
parts or components, and sales of repair or maintenance services  721
for such full flight simulators. "Full flight simulator" means a  722
replica of a specific type, or make, model, and series of  723
aircraft cockpit. It includes the assemblage of equipment and  724
computer programs necessary to represent aircraft operations in  725
ground and flight conditions, a visual system providing an out-  726
H. B. No. 330  Page 26
As Introduced
of-the-cockpit view, and a system that provides cues at least  727
equivalent to those of a three-degree-of-freedom motion system,  728
and has the full range of capabilities of the systems installed  729
in the device as described in appendices A and B of part 60 of  730
chapter 1 of title 14 of the Code of Federal Regulations.  731
       (51) Any transfer or lease of tangible personal property  732
between the state and JobsOhio in accordance with section  733
4313.02 of the Revised Code.  734
       (52)(a) Sales to a qualifying corporation.  735
       (b) As used in division (B)(52) of this section:  736
       (i) "Qualifying corporation" means a nonprofit corporation  737
organized in this state that leases from an eligible county  738
land, buildings, structures, fixtures, and improvements to the  739
land that are part of or used in a public recreational facility  740
used by a major league professional athletic team or a class A  741
to class AAA minor league affiliate of a major league  742
professional athletic team for a significant portion of the  743
team's home schedule, provided the following apply:  744
       (I) The facility is leased from the eligible county  745
pursuant to a lease that requires substantially all of the  746
revenue from the operation of the business or activity conducted  747
by the nonprofit corporation at the facility in excess of  748
operating costs, capital expenditures, and reserves to be paid  749
to the eligible county at least once per calendar year.  750
       (II) Upon dissolution and liquidation of the nonprofit  751
corporation, all of its net assets are distributable to the  752
board of commissioners of the eligible county from which the  753
corporation leases the facility.  754
       (ii) "Eligible county" has the same meaning as in section  755
H. B. No. 330  Page 27
As Introduced
307.695 of the Revised Code.  756
       (53) Sales to or by a cable service provider, video  757
service provider, or radio or television broadcast station  758
regulated by the federal government of cable service or  759
programming, video service or programming, audio service or  760
programming, or electronically transferred digital audiovisual  761
or audio work. As used in division (B)(53) of this section,  762
"cable service" and "cable service provider" have the same  763
meanings as in section 1332.01 of the Revised Code, and "video  764
service," "video service provider," and "video programming" have  765
the same meanings as in section 1332.21 of the Revised Code.  766
       (54) Sales of a digital audio work electronically  767
transferred for delivery through use of a machine, such as a  768
juke box, that does all of the following:  769
       (a) Accepts direct payments to operate;  770
       (b) Automatically plays a selected digital audio work for  771
a single play upon receipt of a payment described in division  772
(B)(54)(a) of this section;  773
       (c) Operates exclusively for the purpose of playing  774
digital audio works in a commercial establishment.  775
       (55)(a) Sales of the following occurring on the first  776
Friday of August and the following Saturday and Sunday of any  777
year, except in 2024 or any subsequent year in which a sales tax  778
holiday is held pursuant to section 5739.41 of the Revised Code:  779
       (i) An item of clothing, the price of which is seventy-  780
five dollars or less;  781
       (ii) An item of school supplies, the price of which is  782
twenty dollars or less;  783
H. B. No. 330  Page 28
As Introduced
       (iii) An item of school instructional material, the price  784
of which is twenty dollars or less.  785
       (b) As used in division (B)(55) of this section:  786
       (i) "Clothing" means all human wearing apparel suitable  787
for general use. "Clothing" includes, but is not limited to,  788
aprons, household and shop; athletic supporters; baby receiving  789
blankets; bathing suits and caps; beach capes and coats; belts  790
and suspenders; boots; coats and jackets; costumes; diapers,  791
children and adult, including disposable diapers; earmuffs;  792
footlets; formal wear; garters and garter belts; girdles; gloves  793
and mittens for general use; hats and caps; hosiery; insoles for  794
shoes; lab coats; neckties; overshoes; pantyhose; rainwear;  795
rubber pants; sandals; scarves; shoes and shoe laces; slippers;  796
sneakers; socks and stockings; steel-toed shoes; underwear;  797
uniforms, athletic and nonathletic; and wedding apparel.  798
"Clothing" does not include items purchased for use in a trade  799
or business; clothing accessories or equipment; protective  800
equipment; sports or recreational equipment; belt buckles sold  801
separately; costume masks sold separately; patches and emblems  802
sold separately; sewing equipment and supplies including, but  803
not limited to, knitting needles, patterns, pins, scissors,  804
sewing machines, sewing needles, tape measures, and thimbles;  805
and sewing materials that become part of "clothing" including,  806
but not limited to, buttons, fabric, lace, thread, yarn, and  807
zippers.  808
       (ii) "School supplies" means items commonly used by a  809
student in a course of study. "School supplies" includes only  810
the following items: binders; book bags; calculators; cellophane  811
tape; blackboard chalk; compasses; composition books; crayons;  812
erasers; folders, expandable, pocket, plastic, and manila; glue,  813
H. B. No. 330  Page 29
As Introduced
paste, and paste sticks; highlighters; index cards; index card  814
boxes; legal pads; lunch boxes; markers; notebooks; paper,  815
loose-leaf ruled notebook paper, copy paper, graph paper,  816
tracing paper, manila paper, colored paper, poster board, and  817
construction paper; pencil boxes and other school supply boxes;  818
pencil sharpeners; pencils; pens; protractors; rulers; scissors;  819
and writing tablets. "School supplies" does not include any item  820
purchased for use in a trade or business.  821
       (iii) "School instructional material" means written  822
material commonly used by a student in a course of study as a  823
reference and to learn the subject being taught. "School  824
instructional material" includes only the following items:  825
reference books, reference maps and globes, textbooks, and  826
workbooks. "School instructional material" does not include any  827
material purchased for use in a trade or business.  828
       (56)(a) Sales of adult diapers or incontinence underpads  829
sold pursuant to a prescription, for the benefit of a medicaid  830
recipient with a diagnosis of incontinence, and by a medicaid  831
provider that maintains a valid provider agreement under section  832
5164.30 of the Revised Code with the department of medicaid,  833
provided that the medicaid program covers diapers or  834
incontinence underpads as an incontinence garment.  835
       (b) As used in division (B)(56)(a) of this section,  836
"incontinence underpad" means an absorbent product, not worn on  837
the body, designed to protect furniture or other tangible  838
personal property from soiling or damage due to human  839
incontinence.  840
       (57) Sales of investment metal bullion and investment  841
coins. "Investment metal bullion" means any bullion described in  842
section 408(m)(3)(B) of the Internal Revenue Code, regardless of  843
H. B. No. 330  Page 30
As Introduced
whether that bullion is in the physical possession of a trustee.  844
"Investment coin" means any coin composed primarily of gold,  845
silver, platinum, or palladium.  846
       (58) Sales of tangible personal property used primarily  847
for any of the following purposes by a megaproject operator at  848
the site of a megaproject that satisfies the criteria described  849
in division (A)(11)(a)(ii) of section 122.17 of the Revised  850
Code, provided that the sale occurs during the period that the  851
megaproject operator has an agreement for such megaproject with  852
the tax credit authority under division (D) of section 122.17 of  853
the Revised Code that remains in effect and has not expired or  854
been terminated:  855
       (a) To store, transmit, convey, distribute, recycle,  856
circulate, or clean water, steam, or other gases used in or  857
produced as a result of manufacturing activity, including items  858
that support or aid in the operation of such property;  859
       (b) To clean or prepare inventory, at any stage of storage  860
or production, or equipment used in a manufacturing activity,  861
including chemicals, solvents, catalysts, soaps, and other items  862
that support or aid in the operation of property;  863
       (c) To regulate, treat, filter, condition, improve, clean,  864
maintain, or monitor environmental conditions within areas where  865
manufacturing activities take place;  866
       (d) To handle, transport, or convey inventory during  867
production or manufacturing.  868
       (59) Documentary services charges imposed pursuant to  869
section 4517.261 or 4781.24 of the Revised Code.  870
       (60) Sales of children's diapers.  871
H. B. No. 330  Page 31
As Introduced
       (61) Sales of therapeutic or preventative creams and wipes  872
marketed primarily for use on the skin of children.  873
       (62) Sales of a child restraint device or booster seat  874
that meets the national highway traffic safety administration  875
standard for child restraint systems under 49 C.F.R. 571.213.  876
       (63) Sales of cribs intended to provide sleeping  877
accommodations for children that comply with the United States  878
consumer product safety commission's safety standard for full-  879
size baby cribs under 16 C.F.R. 1219 or the commission's safety  880
standard for non-full-size baby cribs under 16 C.F.R. 1220.  881
       (64) Sales of strollers meant for transporting children  882
from infancy to about thirty-six months of age that meet the  883
United States consumer product safety commission safety standard  884
for carriages and strollers under 16 C.F.R. 1227.2.  885
       (65) The fee imposed by section 3743.22 of the Revised  886
Code, if it is separately stated on the invoice, bill of sale,  887
or similar document given by the vendor to the consumer for a  888
retail sale made in this state.  889
       (66) Sales of eligible tangible personal property  890
occurring during the period of a sales tax holiday held pursuant  891
to section 5739.41 of the Revised Code.  892
       (67)(a) Sales of a firearm safety device or firearm  893
storage device occurring in March, April, November, or December  894
of any year, excluding a firearm safety device already installed  895
on a firearm, which shall be treated as the sale of a firearm  896
and not the firearm safety device.  897
       (b) As used in division (B)(67) of this section:  898
       (i) "Firearm safety device" means a device to be equipped  899
H. B. No. 330  Page 32
As Introduced
or installed on a firearm designed to prevent unauthorized  900
access to the firearm or to prevent it from being operated  901
without first deactivating the device.  902
       (ii) "Firearm storage device" means a container or  903
enclosure designed for the principal purpose of safely storing a  904
firearm and secured by a combination lock, key lock, or lock  905
based on biometric information which, once locked is incapable  906
of being opened without the combination, key, or biometric  907
information, respectively.  908
       (C) For the purpose of the proper administration of this  909
chapter, and to prevent the evasion of the tax, it is presumed  910
that all sales made in this state are subject to the tax until  911
the contrary is established.  912
       (D) The tax collected by the vendor from the consumer  913
under this chapter is not part of the price, but is a tax  914
collection for the benefit of the state, and of counties levying  915
an additional sales tax pursuant to section 5739.021 or 5739.026  916
of the Revised Code and of transit authorities levying an  917
additional sales tax pursuant to section 5739.023 of the Revised  918
Code. Except for the discount authorized under section 5739.12  919
of the Revised Code and the effects of any rounding pursuant to  920
section 5703.055 of the Revised Code, no person other than the  921
state or such a county or transit authority shall derive any  922
benefit from the collection or payment of the tax levied by this  923
section or section 5739.021, 5739.023, or 5739.026 of the  924
Revised Code.  925
       Sec. 5739.03. (A) Except as provided in section 5739.05 or  926
section 5739.051 of the Revised Code, the tax imposed by or  927
pursuant to section 5739.02, 5739.021, 5739.023, or 5739.026 of  928
the Revised Code shall be paid by the consumer to the vendor,  929
H. B. No. 330  Page 33
As Introduced
and each vendor shall collect from the consumer, as a trustee  930
for the state of Ohio, the full and exact amount of the tax  931
payable on each taxable sale, in the manner and at the times  932
provided as follows:  933
       (1) If the price is, at or prior to the provision of the  934
service or the delivery of possession of the thing sold to the  935
consumer, paid in currency passed from hand to hand by the  936
consumer or the consumer's agent to the vendor or the vendor's  937
agent, the vendor or the vendor's agent shall collect the tax  938
with and at the same time as the price;  939
       (2) If the price is otherwise paid or to be paid, the  940
vendor or the vendor's agent shall, at or prior to the provision  941
of the service or the delivery of possession of the thing sold  942
to the consumer, charge the tax imposed by or pursuant to  943
section 5739.02, 5739.021, 5739.023, or 5739.026 of the Revised  944
Code to the account of the consumer, which amount shall be  945
collected by the vendor from the consumer in addition to the  946
price. Such sale shall be reported on and the amount of the tax  947
applicable thereto shall be remitted with the return for the  948
period in which the sale is made, and the amount of the tax  949
shall become a legal charge in favor of the vendor and against  950
the consumer.  951
       (B)(1)(a) If any sale is claimed to be exempt under  952
division (E) of section 5739.01 of the Revised Code or under  953
section 5739.02 of the Revised Code, with the exception of  954
divisions (B)(1) to (11), (28), (48), (55), (59), or (66), or  955
(67) of section 5739.02 of the Revised Code, the consumer must  956
provide to the vendor, and the vendor must obtain from the  957
consumer, a certificate specifying the reason that the sale is  958
not legally subject to the tax. The certificate shall be in such  959
H. B. No. 330  Page 34
As Introduced
form, and shall be provided either in a hard copy form or  960
electronic form, as the tax commissioner prescribes.  961
       (b) A vendor that obtains a fully completed exemption  962
certificate from a consumer is relieved of liability for  963
collecting and remitting tax on any sale covered by that  964
certificate. If it is determined the exemption was improperly  965
claimed, the consumer shall be liable for any tax due on that  966
sale under section 5739.02, 5739.021, 5739.023, or 5739.026 or  967
Chapter 5741. of the Revised Code. Relief under this division  968
from liability does not apply to any of the following:  969
       (i) A vendor that fraudulently fails to collect tax;  970
       (ii) A vendor that solicits consumers to participate in  971
the unlawful claim of an exemption;  972
       (iii) A vendor that accepts an exemption certificate from  973
a consumer that claims an exemption based on who purchases or  974
who sells property or a service, when the subject of the  975
transaction sought to be covered by the exemption certificate is  976
actually received by the consumer at a location operated by the  977
vendor in this state, and this state has posted to its web site  978
an exemption certificate form that clearly and affirmatively  979
indicates that the claimed exemption is not available in this  980
state;  981
       (iv) A vendor that accepts an exemption certificate from a  982
consumer who claims a multiple points of use exemption under  983
division (D) of section 5739.033 of the Revised Code, if the  984
item purchased is tangible personal property, other than  985
prewritten computer software.  986
       (2) The vendor shall maintain records, including exemption  987
certificates, of all sales on which a consumer has claimed an  988
H. B. No. 330  Page 35
As Introduced
exemption, and provide them to the tax commissioner on request.  989
       (3) The tax commissioner may establish an identification  990
system whereby the commissioner issues an identification number  991
to a consumer that is exempt from payment of the tax. The  992
consumer must present the number to the vendor, if any sale is  993
claimed to be exempt as provided in this section.  994
       (4) If no certificate is provided or obtained within  995
ninety days after the date on which such sale is consummated, it  996
shall be presumed that the tax applies. Failure to have so  997
provided or obtained a certificate shall not preclude a vendor,  998
within one hundred twenty days after the tax commissioner gives  999
written notice of intent to levy an assessment, from either  1000
establishing that the sale is not subject to the tax, or  1001
obtaining, in good faith, a fully completed exemption  1002
certificate.  1003
       (5) Certificates need not be obtained nor provided where  1004
the identity of the consumer is such that the transaction is  1005
never subject to the tax imposed or where the item of tangible  1006
personal property sold or the service provided is never subject  1007
to the tax imposed, regardless of use, or when the sale is in  1008
interstate commerce.  1009
       (6) If a transaction is claimed to be exempt under  1010
division (B)(13) of section 5739.02 of the Revised Code, the  1011
contractor shall obtain certification of the claimed exemption  1012
from the contractee. This certification shall be in addition to  1013
an exemption certificate provided by the contractor to the  1014
vendor. A contractee that provides a certification under this  1015
division shall be deemed to be the consumer of all items  1016
purchased by the contractor under the claim of exemption, if it  1017
is subsequently determined that the exemption is not properly  1018
H. B. No. 330  Page 36
As Introduced
claimed. The certification shall be in such form as the tax  1019
commissioner prescribes.  1020
       (7) If a transaction is claimed to be exempt under  1021
division (B)(13) of section 5739.02 of the Revised Code, the  1022
person that leases a sports facility, as defined in section  1023
307.696 of the Revised Code, wholly owned by a county may  1024
provide and sign, on behalf of the county, an exemption  1025
certificate required under this section for that exemption.  1026
       (C) As used in this division, "contractee" means a person  1027
who seeks to enter or enters into a contract or agreement with a  1028
contractor or vendor for the construction of real property or  1029
for the sale and installation onto real property of tangible  1030
personal property.  1031
       Any contractor or vendor may request from any contractee a  1032
certification of what portion of the property to be transferred  1033
under such contract or agreement is to be incorporated into the  1034
realty and what portion will retain its status as tangible  1035
personal property after installation is completed. The  1036
contractor or vendor shall request the certification by  1037
certified mail delivered to the contractee, return receipt  1038
requested. Upon receipt of such request and prior to entering  1039
into the contract or agreement, the contractee shall provide to  1040
the contractor or vendor a certification sufficiently detailed  1041
to enable the contractor or vendor to ascertain the resulting  1042
classification of all materials purchased or fabricated by the  1043
contractor or vendor and transferred to the contractee. This  1044
requirement applies to a contractee regardless of whether the  1045
contractee holds a direct payment permit under section 5739.031  1046
of the Revised Code or provides to the contractor or vendor an  1047
exemption certificate as provided under this section.  1048
H. B. No. 330  Page 37
As Introduced
       For the purposes of the taxes levied by this chapter and  1049
Chapter 5741. of the Revised Code, the contractor or vendor may  1050
in good faith rely on the contractee's certification.  1051
Notwithstanding division (B) of section 5739.01 of the Revised  1052
Code, if the tax commissioner determines that certain property  1053
certified by the contractee as tangible personal property  1054
pursuant to this division is, in fact, real property, the  1055
contractee shall be considered to be the consumer of all  1056
materials so incorporated into that real property and shall be  1057
liable for the applicable tax, and the contractor or vendor  1058
shall be excused from any liability on those materials.  1059
       If a contractee fails to provide such certification upon  1060
the request of the contractor or vendor, the contractor or  1061
vendor shall comply with the provisions of this chapter and  1062
Chapter 5741. of the Revised Code without the certification. If  1063
the tax commissioner determines that such compliance has been  1064
performed in good faith and that certain property treated as  1065
tangible personal property by the contractor or vendor is, in  1066
fact, real property, the contractee shall be considered to be  1067
the consumer of all materials so incorporated into that real  1068
property and shall be liable for the applicable tax, and the  1069
construction contractor or vendor shall be excused from any  1070
liability on those materials.  1071
       This division does not apply to any contract or agreement  1072
where the tax commissioner determines as a fact that a  1073
certification under this division was made solely on the  1074
decision or advice of the contractor or vendor.  1075
       (D) Notwithstanding division (B) of section 5739.01 of the  1076
Revised Code, whenever the total rate of tax imposed under this  1077
chapter is increased after the date after a construction  1078
H. B. No. 330  Page 38
As Introduced
contract is entered into, the contractee shall reimburse the  1079
construction contractor for any additional tax paid on tangible  1080
property consumed or services received pursuant to the contract.  1081
       (E) A vendor who files a petition for reassessment  1082
contesting the assessment of tax on sales for which the vendor  1083
obtained no valid exemption certificates and for which the  1084
vendor failed to establish that the sales were properly not  1085
subject to the tax during the one-hundred-twenty-day period  1086
allowed under division (B) of this section, may present to the  1087
tax commissioner additional evidence to prove that the sales  1088
were properly subject to a claim of exception or exemption. The  1089
vendor shall file such evidence within ninety days of the  1090
receipt by the vendor of the notice of assessment, except that,  1091
upon application and for reasonable cause, the period for  1092
submitting such evidence shall be extended thirty days.  1093
       The commissioner shall consider such additional evidence  1094
in reaching the final determination on the assessment and  1095
petition for reassessment.  1096
       (F) Whenever a vendor refunds the price, minus any  1097
separately stated delivery charge, of an item of tangible  1098
personal property on which the tax imposed under this chapter  1099
has been paid, the vendor shall also refund the amount of tax  1100
paid, minus the amount of tax attributable to the delivery  1101
charge.  1102
       Sec. 5739.05. (A)(1) The tax commissioner shall enforce  1103
and administer sections 5739.01 to 5739.31 of the Revised Code,  1104
which are hereby declared to be sections which the commissioner  1105
is required to administer within the meaning of sections 5703.17  1106
to 5703.37, 5703.39, 5703.41, and 5703.45 of the Revised Code.  1107
The commissioner may adopt and promulgate, in accordance with  1108
H. B. No. 330  Page 39
As Introduced
sections 119.01 to 119.13 of the Revised Code, such rules as the  1109
commissioner deems necessary to administer sections 5739.01 to  1110
5739.31 of the Revised Code.  1111
       (2) On or before the first day of May of each year, the  1112
commissioner shall make available to vendors a notice explaining  1113
the three-day exemption period required under division (B)(55)  1114
of section 5739.02 of the Revised Code.  1115
       (3) On or before first day of December and August of each  1116
year, the commissioner shall make available to vendors a notice  1117
explaining the two-month exemption period required under  1118
division (B)(67) of section 5739.02 of the Revised Code  1119
commencing on the following first day of March or November,  1120
respectively.  1121
       (B) Upon application, the commissioner may authorize a  1122
vendor to pay on a predetermined basis the tax levied by or  1123
pursuant to section 5739.02, 5739.021, 5739.023, or 5739.026 of  1124
the Revised Code upon sales of things produced or distributed or  1125
services provided by such vendor, and the commissioner may waive  1126
the collection of the tax from the consumer. The commissioner  1127
shall not grant such authority unless the commissioner finds  1128
that the granting of the authority would improve compliance and  1129
increase the efficiency of the administration of the tax. The  1130
person to whom such authority is granted shall post a notice, if  1131
required by the commissioner, at the location where the product  1132
is offered for sale that the tax is included in the selling  1133
price. The commissioner may adopt rules to administer this  1134
division.  1135
       (C) Upon application, the commissioner may authorize a  1136
vendor to remit, on the basis of a prearranged agreement under  1137
this division, the tax levied by section 5739.02 or pursuant to  1138
H. B. No. 330  Page 40
As Introduced
section 5739.021, 5739.023, or 5739.026 of the Revised Code. The  1139
proportions and ratios in a prearranged agreement shall be  1140
determined either by a test check conducted by the commissioner  1141
under terms and conditions agreed to by the commissioner and the  1142
vendor or by any other method agreed upon by the vendor and the  1143
commissioner. If the parties are unable to agree to the terms  1144
and conditions of the test check or other method, the  1145
application shall be denied.  1146
       If used, the test check shall determine the proportion  1147
that taxable retail sales bear to all of the vendor's retail  1148
sales and the ratio which the tax required to be collected under  1149
sections 5739.02, 5739.021, 5739.023, and 5739.026 of the  1150
Revised Code bears to the receipts from the vendor's taxable  1151
retail sales.  1152
       The vendor's liability for remitting the tax shall be  1153
based solely upon the proportions and ratios established in the  1154
agreement until such time that the vendor or the commissioner  1155
believes that the nature of the vendor's business has so changed  1156
as to make the agreement no longer representative. The  1157
commissioner may give notice to the vendor at any time that the  1158
authorization is revoked or the vendor may notify the  1159
commissioner that the vendor no longer elects to report under  1160
the authorization. Such notice shall be delivered to the other  1161
party in the manner provided in section 5703.37 of the Revised  1162
Code. The revocation or cancellation is effective the last day  1163
of the month in which the vendor or the commissioner receives  1164
the notice.  1165
       Section 2. That existing sections 5739.02, 5739.03, and  1166
5739.05 of the Revised Code are hereby repealed.  1167
       Section 3. The amendment by this act of section 5739.02 of  1168
H. B. No. 330  Page 41
As Introduced
the Revised Code applies on and after the first day of March,  1169
April, November, or December occurring after the effective date  1170
of this section, whichever comes first.  1171