HB 162

01-07 09:49  H.B. 162
 1  Local Sales Tax Modifications
  2026 GENERAL SESSION
  STATE OF UTAH
  Chief Sponsor: Christine F. Watkins
  Senate Sponsor:
 2
 3     LONG TITLE
 4     General Description:
 5  This bill modifies local sales and use tax provisions.
 6     Highlighted Provisions:
 7  This bill:
 8  ▸ defines terms;
 9  ▸ allows certain municipalities to impose a local option sales and use tax for purposes of
10     funding infrastructure improvements for the municipality's local law enforcement
11     agency;
12  ▸ requires a municipality's legislative body to hold a public hearing before approving the
13     tax;
14  ▸ requires a municipality to deposit tax revenue into a special revenue fund that is separate
15     from the municipality's general fund;
16  ▸ provides for the reauthorization of a tax at the end of the levy period;
17  ▸ addresses the administration and collection of the tax;
18  ▸ allows the State Tax Commission to retain an administrative charge from collected tax
19     revenue; and
20  ▸ makes technical and conforming changes.
21     Money Appropriated in this Bill:
22  None
23     Other Special Clauses:
  H.B. 162
24  This bill provides a special effective date.
25     Utah Code Sections Affected:
26     AMENDS:
27  59-12-102 (Effective 05/06/26) (Superseded 07/01/26), as last amended by Laws of Utah
28  2025, First Special Session, Chapters 9, 12
29  59-12-102 (Effective 07/01/26), as last amended by Laws of Utah 2025, First Special
30  Session, Chapters 9, 12
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31    ENACTS:
32        59-12-2501 (Effective 05/06/26), Utah Code Annotated 1953
33        59-12-2502 (Effective 05/06/26), Utah Code Annotated 1953
34        59-12-2503 (Effective 05/06/26), Utah Code Annotated 1953
35        59-12-2504 (Effective 05/06/26), Utah Code Annotated 1953
36        59-12-2505 (Effective 05/06/26), Utah Code Annotated 1953
37        59-12-2506 (Effective 05/06/26), Utah Code Annotated 1953
38
39    Be it enacted by the Legislature of the state of Utah:
40  Section 1. Section 59-12-102 is amended to read:
41  59-12-102 (Effective 05/06/26) (Superseded 07/01/26). Definitions.
42       As used in this chapter:
43    (1) "800 service" means a telecommunications service that:
44        (a) allows a caller to dial a toll-free number without incurring a charge for the call; and
45        (b) is typically marketed:
46  (i) under the name 800 toll-free calling;
47  (ii) under the name 855 toll-free calling;
48  (iii) under the name 866 toll-free calling;
49  (iv) under the name 877 toll-free calling;
50  (v) under the name 888 toll-free calling; or
51  (vi) under a name similar to Subsections (1)(b)(i) through (v) as designated by the
52  Federal Communications Commission.
53    (2)(a) "900 service" means an inbound toll telecommunications service that:
54  (i) a subscriber purchases;
55  (ii) allows a customer of the subscriber described in Subsection (2)(a)(i) to call in to
56  the subscriber's:
57  (A) prerecorded announcement; or
58  (B) live service; and
59  (iii) is typically marketed:
60  (A) under the name 900 service; or
61  (B) under a name similar to Subsection (2)(a)(iii)(A) as designated by the Federal
62  Communications Commission.
63        (b) "900 service" does not include a charge for:
64  (i) a collection service a seller of a telecommunications service provides to a
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65  subscriber; or
66  (ii) the following a subscriber sells to the subscriber's customer:
67  (A) a product; or
68  (B) a service.
69     (3)(a) "Adaptive driving equipment" means mobility enhancing equipment:
70  (i) to be installed in a motor vehicle; and
71  (ii) regardless of who provides the equipment or parts.
72  (b) "Adaptive driving equipment" includes:
73  (i) a wheelchair or scooter lift;
74  (ii) equipment to secure a wheelchair;
75  (iii) a swivel seat;
76  (iv) a hand or foot control; and
77  (v) a steering aid.
78     (4)(a) "Admission or user fees" includes season passes.
79  (b) "Admission or user fees" does not include:
80  (i) annual membership dues to private organizations; or
81  (ii) a lesson, including a lesson that involves as part of the lesson equipment or a
82  facility listed in Subsection 59-12-103(1)(f).
83     (5) "Affiliate" or "affiliated person" means a person that, with respect to another person:
84  (a) has an ownership interest of more than 5%, whether direct or indirect, in that other
85  person; or
86  (b) is related to the other person because a third person, or a group of third persons who
87  are affiliated persons with respect to each other, holds an ownership interest of more
88  than 5%, whether direct or indirect, in the related persons.
89     (6) "Agreement" means the Streamlined Sales and Use Tax Agreement adopted on
90  November 12, 2002, including amendments made to the Streamlined Sales and Use Tax
91  Agreement after November 12, 2002.
92     (7) "Agreement combined tax rate" means the sum of the tax rates:
93  (a) listed under Subsection (8); and
94  (b) that are imposed within a local taxing jurisdiction.
95     (8) "Agreement sales and use tax" means a tax imposed under:
96  (a) Subsection 59-12-103(2)(a)(i)(A);
97  (b) Subsection 59-12-103(2)(b)(i);
98  (c) Subsection 59-12-103(2)(c)(i);
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 99        (d) Subsection 59-12-103(2)(d);
100        (e) Subsection 59-12-103(2)(f)(i)(A)(I);
101        (f) Section 59-12-204;
102        (g) Section 59-12-401;
103        (h) Section 59-12-402;
104        (i) Section 59-12-402.1;
105        (j) Section 59-12-703;
106        (k) Section 59-12-802;
107        (l) Section 59-12-804;
108        (m) Section 59-12-1102;
109        (n) Section 59-12-1302;
110        (o) Section 59-12-1402;
111        (p) Section 59-12-1802;
112        (q) Section 59-12-2003;
113        (r) Section 59-12-2103;
114        (s) Section 59-12-2213;
115        (t) Section 59-12-2214;
116        (u) Section 59-12-2215;
117        (v) Section 59-12-2216;
118        (w) Section 59-12-2217;
119        (x) Section 59-12-2218;
120        (y) Section 59-12-2219;
121        (z) Section 59-12-2220;[ or]
122        (aa) Section 59-12-2402[.] ; or
123        (bb) Section 59-12-2502.
124    (9) "Aircraft" means the same as that term is defined in Section 72-10-102.
125    (10) "Aircraft maintenance, repair, and overhaul provider" means a business entity:
126        (a) except for:
127  (i) an airline as defined in Section 59-2-102; or
128  (ii) an affiliated group, as defined in Section 59-7-101, except that "affiliated group"
129  includes a corporation that is qualified to do business but is not otherwise doing
130  business in the state, of an airline; and
131        (b) that has the workers, expertise, and facilities to perform the following, regardless of
132  whether the business entity performs the following in this state:
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133  (i) check, diagnose, overhaul, and repair:
134  (A) an onboard system of a fixed wing turbine powered aircraft; and
135  (B) the parts that comprise an onboard system of a fixed wing turbine powered
136  aircraft;
137  (ii) assemble, change, dismantle, inspect, and test a fixed wing turbine powered
138  aircraft engine;
139  (iii) perform at least the following maintenance on a fixed wing turbine powered
140  aircraft:
141  (A) an inspection;
142  (B) a repair, including a structural repair or modification;
143  (C) changing landing gear; and
144  (D) addressing issues related to an aging fixed wing turbine powered aircraft;
145  (iv) completely remove the existing paint of a fixed wing turbine powered aircraft
146  and completely apply new paint to the fixed wing turbine powered aircraft; and
147  (v) refurbish the interior of a fixed wing turbine powered aircraft in a manner that
148  results in a change in the fixed wing turbine powered aircraft's certification
149  requirements by the authority that certifies the fixed wing turbine powered aircraft.
150     (11) "Alcoholic beverage" means a beverage that:
151        (a) is suitable for human consumption; and
152        (b) contains .5% or more alcohol by volume.
153     (12) "Alternative energy" means:
154        (a) biomass energy;
155        (b) geothermal energy;
156        (c) hydroelectric energy;
157        (d) solar energy;
158        (e) wind energy; or
159        (f) energy that is derived from:
160  (i) coal-to-liquids;
161  (ii) nuclear fuel;
162  (iii) oil-impregnated diatomaceous earth;
163  (iv) oil sands;
164  (v) oil shale;
165  (vi) petroleum coke; or
166  (vii) waste heat from:
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167  (A) an industrial facility; or
168  (B) a power station in which an electric generator is driven through a process in
169  which water is heated, turns into steam, and spins a steam turbine.
170    (13)(a) Subject to Subsection (13)(b), "alternative energy electricity production facility"
171        means a facility that:
172  (i) uses alternative energy to produce electricity; and
173  (ii) has a production capacity of two megawatts or greater.
174        (b) A facility is an alternative energy electricity production facility regardless of whether
175  the facility is:
176  (i) connected to an electric grid; or
177  (ii) located on the premises of an electricity consumer.
178    (14)(a) "Ancillary service" means a service associated with, or incidental to, the
179        provision of telecommunications service.
180        (b) "Ancillary service" includes:
181  (i) a conference bridging service;
182  (ii) a detailed communications billing service;
183  (iii) directory assistance;
184  (iv) a vertical service; or
185  (v) a voice mail service.
186    (15) "Area agency on aging" means the same as that term is defined in Section 26B-6-101.
187    (16) "Assisted amusement device" means an amusement device, skill device, or ride device
188        that is started and stopped by an individual:
189        (a) who is not the purchaser or renter of the right to use or operate the amusement
190  device, skill device, or ride device; and
191        (b) at the direction of the seller of the right to use the amusement device, skill device, or
192  ride device.
193    (17) "Assisted cleaning or washing of tangible personal property" means cleaning or
194        washing of tangible personal property if the cleaning or washing labor is primarily
195        performed by an individual:
196        (a) who is not the purchaser of the cleaning or washing of the tangible personal property;
197  and
198        (b) at the direction of the seller of the cleaning or washing of the tangible personal
199  property.
200    (18) "Authorized carrier" means:
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201  (a) in the case of vehicles operated over public highways, the holder of credentials
202  indicating that the vehicle is or will be operated pursuant to both the International
203  Registration Plan and the International Fuel Tax Agreement;
204  (b) in the case of aircraft, the holder of a Federal Aviation Administration operating
205  certificate or air carrier's operating certificate; or
206  (c) in the case of locomotives, freight cars, railroad work equipment, or other rolling
207  stock, a person who uses locomotives, freight cars, railroad work equipment, or other
208  rolling stock in more than one state.
209     (19)(a) "Biomass energy" means any of the following that is used as the primary source
210  of energy to produce fuel or electricity:
211  (i) material from a plant or tree; or
212  (ii) other organic matter that is available on a renewable basis, including:
213  (A) slash and brush from forests and woodlands;
214  (B) animal waste;
215  (C) waste vegetable oil;
216  (D) methane or synthetic gas produced at a landfill, as a byproduct of the
217  treatment of wastewater residuals, or through the conversion of a waste
218  material through a nonincineration, thermal conversion process;
219  (E) aquatic plants; and
220  (F) agricultural products.
221  (b) "Biomass energy" does not include:
222  (i) black liquor; or
223  (ii) treated woods.
224     (20)(a) "Bundled transaction" means the sale of two or more items of tangible personal
225  property, products, or services if the tangible personal property, products, or services
226  are:
227  (i) distinct and identifiable; and
228  (ii) sold for one nonitemized price.
229  (b) "Bundled transaction" does not include:
230  (i) the sale of tangible personal property if the sales price varies, or is negotiable, on
231  the basis of the selection by the purchaser of the items of tangible personal
232  property included in the transaction;
233  (ii) the sale of real property;
234  (iii) the sale of services to real property;
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235  (iv) the retail sale of tangible personal property and a service if:
236  (A) the tangible personal property:
237  (I) is essential to the use of the service; and
238  (II) is provided exclusively in connection with the service; and
239  (B) the service is the true object of the transaction;
240  (v) the retail sale of two services if:
241  (A) one service is provided that is essential to the use or receipt of a second
242  service;
243  (B) the first service is provided exclusively in connection with the second service;
244  and
245  (C) the second service is the true object of the transaction;
246  (vi) a transaction that includes tangible personal property or a product subject to
247  taxation under this chapter and tangible personal property or a product that is not
248  subject to taxation under this chapter if the:
249  (A) seller's purchase price of the tangible personal property or product subject to
250  taxation under this chapter is de minimis; or
251  (B) seller's sales price of the tangible personal property or product subject to
252  taxation under this chapter is de minimis; and
253  (vii) the retail sale of tangible personal property that is not subject to taxation under
254  this chapter and tangible personal property that is subject to taxation under this
255  chapter if:
256  (A) that retail sale includes:
257  (I) food and food ingredients;
258  (II) a drug;
259  (III) durable medical equipment;
260  (IV) mobility enhancing equipment;
261  (V) an over-the-counter drug;
262  (VI) a prosthetic device; or
263  (VII) a medical supply; and
264  (B) subject to Subsection (20)(f):
265  (I) the seller's purchase price of the tangible personal property subject to
266  taxation under this chapter is 50% or less of the seller's total purchase price
267  of that retail sale; or
268  (II) the seller's sales price of the tangible personal property subject to taxation
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269  under this chapter is 50% or less of the seller's total sales price of that retail
270  sale.
271        (c)(i) For purposes of Subsection (20)(a)(i), tangible personal property, a product, or
272  a service that is distinct and identifiable does not include:
273  (A) packaging that:
274  (I) accompanies the sale of the tangible personal property, product, or service;
275  and
276  (II) is incidental or immaterial to the sale of the tangible personal property,
277  product, or service;
278  (B) tangible personal property, a product, or a service provided free of charge with
279  the purchase of another item of tangible personal property, a product, or a
280  service; or
281  (C) an item of tangible personal property, a product, or a service included in the
282  definition of "purchase price."
283  (ii) For purposes of Subsection (20)(c)(i)(B), an item of tangible personal property, a
284  product, or a service is provided free of charge with the purchase of another item
285  of tangible personal property, a product, or a service if the sales price of the
286  purchased item of tangible personal property, product, or service does not vary
287  depending on the inclusion of the tangible personal property, product, or service
288  provided free of charge.
289        (d)(i) For purposes of Subsection (20)(a)(ii), property sold for one nonitemized price
290  does not include a price that is separately identified by tangible personal property,
291  product, or service on the following, regardless of whether the following is in
292  paper format or electronic format:
293  (A) a binding sales document; or
294  (B) another supporting sales-related document that is available to a purchaser.
295  (ii) For purposes of Subsection (20)(d)(i), a binding sales document or another
296  supporting sales-related document that is available to a purchaser includes:
297  (A) a bill of sale;
298  (B) a contract;
299  (C) an invoice;
300  (D) a lease agreement;
301  (E) a periodic notice of rates and services;
302  (F) a price list;
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303  (G) a rate card;
304  (H) a receipt; or
305  (I) a service agreement.
306        (e)(i) For purposes of Subsection (20)(b)(vi), the sales price of tangible personal
307  property or a product subject to taxation under this chapter is de minimis if:
308  (A) the seller's purchase price of the tangible personal property or product is 10%
309  or less of the seller's total purchase price of the bundled transaction; or
310  (B) the seller's sales price of the tangible personal property or product is 10% or
311  less of the seller's total sales price of the bundled transaction.
312  (ii) For purposes of Subsection (20)(b)(vi), a seller:
313  (A) shall use the seller's purchase price or the seller's sales price to determine if
314  the purchase price or sales price of the tangible personal property or product
315  subject to taxation under this chapter is de minimis; and
316  (B) may not use a combination of the seller's purchase price and the seller's sales
317  price to determine if the purchase price or sales price of the tangible personal
318  property or product subject to taxation under this chapter is de minimis.
319  (iii) For purposes of Subsection (20)(b)(vi), a seller shall use the full term of a service
320  contract to determine if the sales price of tangible personal property or a product is
321  de minimis.
322        (f) For purposes of Subsection (20)(b)(vii)(B), a seller may not use a combination of the
323  seller's purchase price and the seller's sales price to determine if tangible personal
324  property subject to taxation under this chapter is 50% or less of the seller's total
325  purchase price or sales price of that retail sale.
326    (21) "Car sharing" means the same as that term is defined in Section 13-48a-101.
327    (22) "Car-sharing program" means the same as that term is defined in Section 13-48a-101.
328    (23) "Certified automated system" means software certified by the governing board of the
329        agreement that:
330        (a) calculates the agreement sales and use tax imposed within a local taxing jurisdiction:
331  (i) on a transaction; and
332  (ii) in the states that are members of the agreement;
333        (b) determines the amount of agreement sales and use tax to remit to a state that is a
334  member of the agreement; and
335        (c) maintains a record of the transaction described in Subsection (23)(a)(i).
336    (24) "Certified service provider" means an agent certified:
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337  (a) by the governing board of the agreement; and
338  (b) to perform a seller's sales and use tax functions for an agreement sales and use tax, as
339  outlined in the contract between the governing board of the agreement and the
340  certified service provider, other than the seller's obligation under Section 59-12-124
341  to remit a tax on the seller's own purchases.
342     (25)(a) Subject to Subsection (25)(b), "clothing" means all human wearing apparel
343  suitable for general use.
344  (b) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
345  commission shall make rules:
346  (i) listing the items that constitute "clothing"; and
347  (ii) that are consistent with the list of items that constitute "clothing" under the
348  agreement.
349     (26) "Coal-to-liquid" means the process of converting coal into a liquid synthetic fuel.
350     (27) "Commercial use" means the use of gas, electricity, heat, coal, fuel oil, or other fuels
351  that does not constitute industrial use under Subsection (61) or residential use under
352  Subsection (117).
353     (28)(a) "Common carrier" means a person engaged in or transacting the business of
354  transporting passengers, freight, merchandise, or other property for hire within this
355  state.
356  (b)(i) "Common carrier" does not include a person that, at the time the person is
357  traveling to or from that person's place of employment, transports a passenger to
358  or from the passenger's place of employment.
359  (ii) For purposes of Subsection (28)(b)(i), in accordance with Title 63G, Chapter 3,
360  Utah Administrative Rulemaking Act, the commission may make rules defining
361  what constitutes a person's place of employment.
362  (c) "Common carrier" does not include a person that provides transportation network
363  services, as defined in Section 13-51-102.
364     (29) "Component part" includes:
365  (a) poultry, dairy, and other livestock feed, and their components;
366  (b) baling ties and twine used in the baling of hay and straw;
367  (c) fuel used for providing temperature control of orchards and commercial greenhouses
368  doing a majority of their business in wholesale sales, and for providing power for
369  off-highway type farm machinery; and
370  (d) feed, seeds, and seedlings.
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371    (30) "Computer" means an electronic device that accepts information:
372        (a)(i) in digital form; or
373  (ii) in a form similar to digital form; and
374        (b) manipulates that information for a result based on a sequence of instructions.
375    (31) "Computer software" means a set of coded instructions designed to cause:
376        (a) a computer to perform a task; or
377        (b) automatic data processing equipment to perform a task.
378    (32) "Computer software maintenance contract" means a contract that obligates a seller of
379        computer software to provide a customer with:
380        (a) future updates or upgrades to computer software;
381        (b) support services with respect to computer software; or
382        (c) a combination of Subsections (32)(a) and (b).
383    (33)(a) "Conference bridging service" means an ancillary service that links two or more
384        participants of an audio conference call or video conference call.
385        (b) "Conference bridging service" may include providing a telephone number as part of
386  the ancillary service described in Subsection (33)(a).
387        (c) "Conference bridging service" does not include a telecommunications service used to
388  reach the ancillary service described in Subsection (33)(a).
389    (34) "Construction materials" means any tangible personal property that will be converted
390        into real property.
391    (35) "Delivered electronically" means delivered to a purchaser by means other than tangible
392        storage media.
393    (36)(a) "Delivery charge" means a charge:
394  (i) by a seller of:
395  (A) tangible personal property;
396  (B) a product transferred electronically; or
397  (C) a service; and
398  (ii) for preparation and delivery of the tangible personal property, product transferred
399  electronically, or services described in Subsection (36)(a)(i) to a location
400  designated by the purchaser.
401        (b) "Delivery charge" includes a charge for the following:
402  (i) transportation;
403  (ii) shipping;
404  (iii) postage;
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405  (iv) handling;
406  (v) crating; or
407  (vi) packing.
408     (37) "Detailed telecommunications billing service" means an ancillary service of separately
409  stating information pertaining to individual calls on a customer's billing statement.
410     (38) "Dietary supplement" means a product, other than tobacco, that:
411  (a) is intended to supplement the diet;
412  (b) contains one or more of the following dietary ingredients:
413  (i) a vitamin;
414  (ii) a mineral;
415  (iii) an herb or other botanical;
416  (iv) an amino acid;
417  (v) a dietary substance for use by humans to supplement the diet by increasing the
418  total dietary intake; or
419  (vi) a concentrate, metabolite, constituent, extract, or combination of any ingredient
420  described in Subsections (38)(b)(i) through (v);
421  (c)(i) except as provided in Subsection (38)(c)(ii), is intended for ingestion in:
422  (A) tablet form;
423  (B) capsule form;
424  (C) powder form;
425  (D) softgel form;
426  (E) gelcap form; or
427  (F) liquid form; or
428  (ii) if the product is not intended for ingestion in a form described in Subsections
429  (38)(c)(i)(A) through (F), is not represented:
430  (A) as conventional food; and
431  (B) for use as a sole item of:
432  (I) a meal; or
433  (II) the diet; and
434  (d) is required to be labeled as a dietary supplement:
435  (i) identifiable by the "Supplemental Facts" box found on the label; and
436  (ii) as required by 21 C.F.R. Sec. 101.36.
437     (39)(a) "Digital audio work" means a work that results from the fixation of a series of
438  musical, spoken, or other sounds.
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439        (b) "Digital audio work" includes a ringtone.
440    (40) "Digital audio-visual work" means a series of related images which, when shown in
441        succession, imparts an impression of motion, together with accompanying sounds, if any.
442    (41) "Digital book" means a work that is generally recognized in the ordinary and usual
443        sense as a book.
444    (42)(a) "Direct mail" means printed material delivered or distributed by United States
445        mail or other delivery service:
446  (i) to:
447  (A) a mass audience; or
448  (B) addressees on a mailing list provided:
449  (I) by a purchaser of the mailing list; or
450  (II) at the discretion of the purchaser of the mailing list; and
451  (ii) if the cost of the printed material is not billed directly to the recipients.
452        (b) "Direct mail" includes tangible personal property supplied directly or indirectly by a
453  purchaser to a seller of direct mail for inclusion in a package containing the printed
454  material.
455        (c) "Direct mail" does not include multiple items of printed material delivered to a single
456  address.
457    (43) "Directory assistance" means an ancillary service of providing:
458        (a) address information; or
459        (b) telephone number information.
460    (44)(a) "Disposable home medical equipment or supplies" means medical equipment or
461        supplies that:
462  (i) cannot withstand repeated use; and
463  (ii) are purchased by, for, or on behalf of a person other than:
464  (A) a health care facility as defined in Section 26B-2-201;
465  (B) a health care provider as defined in Section 78B-3-403;
466  (C) an office of a health care provider described in Subsection (44)(a)(ii)(B); or
467  (D) a person similar to a person described in Subsections (44)(a)(ii)(A) through
468  (C).
469        (b) "Disposable home medical equipment or supplies" does not include:
470  (i) a drug;
471  (ii) durable medical equipment;
472  (iii) a hearing aid;
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473  (iv) a hearing aid accessory;
474  (v) mobility enhancing equipment; or
475  (vi) tangible personal property used to correct impaired vision, including:
476  (A) eyeglasses; or
477  (B) contact lenses.
478  (c) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
479  commission may by rule define what constitutes medical equipment or supplies.
480     (45) "Drilling equipment manufacturer" means a facility:
481  (a) located in the state;
482  (b) with respect to which 51% or more of the manufacturing activities of the facility
483  consist of manufacturing component parts of drilling equipment;
484  (c) that uses pressure of 800,000 or more pounds per square inch as part of the
485  manufacturing process; and
486  (d) that uses a temperature of 2,000 or more degrees Fahrenheit as part of the
487  manufacturing process.
488     (46)(a) "Drug" means a compound, substance, or preparation, or a component of a
489  compound, substance, or preparation that is:
490  (i) recognized in:
491  (A) the official United States Pharmacopoeia;
492  (B) the official Homeopathic Pharmacopoeia of the United States;
493  (C) the official National Formulary; or
494  (D) a supplement to a publication listed in Subsections (46)(a)(i)(A) through (C);
495  (ii) intended for use in the:
496  (A) diagnosis of disease;
497  (B) cure of disease;
498  (C) mitigation of disease;
499  (D) treatment of disease; or
500  (E) prevention of disease; or
501  (iii) intended to affect:
502  (A) the structure of the body; or
503  (B) any function of the body.
504  (b) "Drug" does not include:
505  (i) food and food ingredients;
506  (ii) a dietary supplement;
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      H.B. 162  01-07 09:49
507  (iii) an alcoholic beverage; or
508  (iv) a prosthetic device.
509    (47)(a) "Durable medical equipment" means equipment that:
510  (i) can withstand repeated use;
511  (ii) is primarily and customarily used to serve a medical purpose;
512  (iii) generally is not useful to a person in the absence of illness or injury; and
513  (iv) is not worn in or on the body.
514        (b) "Durable medical equipment" includes parts used in the repair or replacement of the
515  equipment described in Subsection (47)(a).
516        (c) "Durable medical equipment" does not include mobility enhancing equipment.
517    (48) "Electronic" means:
518        (a) relating to technology; and
519        (b) having:
520  (i) electrical capabilities;
521  (ii) digital capabilities;
522  (iii) magnetic capabilities;
523  (iv) wireless capabilities;
524  (v) optical capabilities;
525  (vi) electromagnetic capabilities; or
526  (vii) capabilities similar to Subsections (48)(b)(i) through (vi).
527    (49) "Electronic financial payment service" means an establishment:
528        (a) within NAICS Code 522320, Financial Transactions Processing, Reserve, and
529  Clearinghouse Activities, of the 2012 North American Industry Classification System
530  of the federal Executive Office of the President, Office of Management and Budget;
531  and
532        (b) that performs electronic financial payment services.
533    (50) "Employee" means the same as that term is defined in Section 59-10-401.
534    (51) "Fixed guideway" means a public transit facility that uses and occupies:
535        (a) rail for the use of public transit; or
536        (b) a separate right-of-way for the use of public transit.
537    (52) "Fixed wing turbine powered aircraft" means an aircraft that:
538        (a) is powered by turbine engines;
539        (b) operates on jet fuel; and
540        (c) has wings that are permanently attached to the fuselage of the aircraft.
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      01-07 09:49  H.B. 162
541     (53) "Fixed wireless service" means a telecommunications service that provides radio
542  communication between fixed points.
543     (54)(a) "Food and food ingredients" means substances:
544  (i) regardless of whether the substances are in:
545  (A) liquid form;
546  (B) concentrated form;
547  (C) solid form;
548  (D) frozen form;
549  (E) dried form; or
550  (F) dehydrated form; and
551  (ii) that are:
552  (A) sold for:
553  (I) ingestion by humans; or
554  (II) chewing by humans; and
555  (B) consumed for the substance's:
556  (I) taste; or
557  (II) nutritional value.
558  (b) "Food and food ingredients" includes an item described in Subsection (100)(b)(iii).
559  (c) "Food and food ingredients" does not include:
560  (i) an alcoholic beverage;
561  (ii) tobacco; or
562  (iii) prepared food.
563     (55)(a) "Fundraising sales" means sales:
564  (i)(A) made by a school; or
565  (B) made by a school student;
566  (ii) that are for the purpose of raising funds for the school to purchase equipment,
567  materials, or provide transportation; and
568  (iii) that are part of an officially sanctioned school activity.
569  (b) For purposes of Subsection (55)(a)(iii), "officially sanctioned school activity" means
570  a school activity:
571  (i) that is conducted in accordance with a formal policy adopted by the school or
572  school district governing the authorization and supervision of fundraising
573  activities;
574  (ii) that does not directly or indirectly compensate an individual teacher or other
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      H.B. 162  01-07 09:49
575  educational personnel by direct payment, commissions, or payment in kind; and
576  (iii) the net or gross revenue from which is deposited in a dedicated account
577  controlled by the school or school district.
578    (56) "Geothermal energy" means energy contained in heat that continuously flows outward
579        from the earth that is used as the sole source of energy to produce electricity.
580    (57) "Governing board of the agreement" means the governing board of the agreement that
581        is:
582        (a) authorized to administer the agreement; and
583        (b) established in accordance with the agreement.
584    (58)(a) For purposes of Subsection 59-12-104(41), "governmental entity" means:
585  (i) the executive branch of the state, including all departments, institutions, boards,
586  divisions, bureaus, offices, commissions, and committees;
587  (ii) the judicial branch of the state, including the courts, the Judicial Council, the
588  Administrative Office of the Courts, and similar administrative units in the
589  judicial branch;
590  (iii) the legislative branch of the state, including the House of Representatives, the
591  Senate, Legislative Services, the Office of Legislative Research and General
592  Counsel, the Office of the Legislative Auditor General, and the Office of the
593  Legislative Fiscal Analyst;
594  (iv) the National Guard;
595  (v) an independent entity as defined in Section 63E-1-102; or
596  (vi) a political subdivision as defined in Section 17B-1-102.
597        (b) "Governmental entity" does not include the state systems of public and higher
598  education, including:
599  (i) a school;
600  (ii) the State Board of Education;
601  (iii) the Utah Board of Higher Education; or
602  (iv) an institution of higher education listed in Section 53H-1-102.
603    (59) "Hydroelectric energy" means water used as the sole source of energy to produce
604        electricity.
605    (60) "Individual-owned shared vehicle" means the same as that term is defined in Section
606        13-48a-101.
607    (61) "Industrial use" means the use of natural gas, electricity, heat, coal, fuel oil, or other
608        fuels:
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      01-07 09:49  H.B. 162
609  (a) in mining or extraction of minerals;
610  (b) in agricultural operations to produce an agricultural product up to the time of harvest
611  or placing the agricultural product into a storage facility, including:
612  (i) commercial greenhouses;
613  (ii) irrigation pumps;
614  (iii) farm machinery;
615  (iv) implements of husbandry as defined in Section 41-1a-102 that are not registered
616  under Title 41, Chapter 1a, Part 2, Registration; and
617  (v) other farming activities;
618  (c) in manufacturing tangible personal property at an establishment described in:
619  (i) SIC Codes 2000 to 3999 of the 1987 Standard Industrial Classification Manual of
620  the federal Executive Office of the President, Office of Management and Budget;
621  or
622  (ii) a NAICS code within NAICS Sector 31-33, Manufacturing, of the 2017 North
623  American Industry Classification System of the federal Executive Office of the
624  President, Office of Management and Budget;
625  (d) by a scrap recycler if:
626  (i) from a fixed location, the scrap recycler utilizes machinery or equipment to
627  process one or more of the following items into prepared grades of processed
628  materials for use in new products:
629  (A) iron;
630  (B) steel;
631  (C) nonferrous metal;
632  (D) paper;
633  (E) glass;
634  (F) plastic;
635  (G) textile; or
636  (H) rubber; and
637  (ii) the new products under Subsection (61)(d)(i) would otherwise be made with
638  nonrecycled materials; or
639  (e) in producing a form of energy or steam described in Subsection 54-2-1(3)(a) by a
640  cogeneration facility as defined in Section 54-2-1.
641     (62)(a) "Installation charge" means a charge for installing:
642  (i) tangible personal property; or
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      H.B. 162  01-07 09:49
643  (ii) a product transferred electronically.
644        (b) "Installation charge" does not include a charge for:
645  (i) repairs or renovations of:
646  (A) tangible personal property; or
647  (B) a product transferred electronically; or
648  (ii) attaching tangible personal property or a product transferred electronically:
649  (A) to other tangible personal property; and
650  (B) as part of a manufacturing or fabrication process.
651    (63) "Institution of higher education" means an institution of higher education listed in
652        Section 53H-1-102.
653    (64)(a) "Lease" or "rental" means a transfer of possession or control of tangible personal
654        property or a product transferred electronically for:
655  (i)(A) a fixed term; or
656  (B) an indeterminate term; and
657  (ii) consideration.
658        (b) "Lease" or "rental" includes:
659  (i) an agreement covering a motor vehicle and trailer if the amount of consideration
660  may be increased or decreased by reference to the amount realized upon sale or
661  disposition of the property as defined in Section 7701(h)(1), Internal Revenue
662  Code; and
663  (ii) car sharing.
664        (c) "Lease" or "rental" does not include:
665  (i) a transfer of possession or control of property under a security agreement or
666  deferred payment plan that requires the transfer of title upon completion of the
667  required payments;
668  (ii) a transfer of possession or control of property under an agreement that requires
669  the transfer of title:
670  (A) upon completion of required payments; and
671  (B) if the payment of an option price does not exceed the greater of:
672  (I) $100; or
673  (II) 1% of the total required payments; or
674  (iii) providing tangible personal property along with an operator for a fixed period of
675  time or an indeterminate period of time if the operator is necessary for equipment
676  to perform as designed.
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      01-07 09:49  H.B. 162
677  (d) For purposes of Subsection (64)(c)(iii), an operator is necessary for equipment to
678  perform as designed if the operator's duties exceed the:
679  (i) set-up of tangible personal property;
680  (ii) maintenance of tangible personal property; or
681  (iii) inspection of tangible personal property.
682     (65) "Lesson" means a fixed period of time for the duration of which a trained instructor:
683  (a) is present with a student in person or by video; and
684  (b) actively instructs the student, including by providing observation or feedback.
685     (66) "Life science establishment" means an establishment in this state that is classified
686  under the following NAICS codes of the 2007 North American Industry Classification
687  System of the federal Executive Office of the President, Office of Management and
688  Budget:
689  (a) NAICS Code 33911, Medical Equipment and Supplies Manufacturing;
690  (b) NAICS Code 334510, Electromedical and Electrotherapeutic Apparatus
691  Manufacturing; or
692  (c) NAICS Code 334517, Irradiation Apparatus Manufacturing.
693     (67) "Life science research and development facility" means a facility owned, leased, or
694  rented by a life science establishment if research and development is performed in 51%
695  or more of the total area of the facility.
696     (68) "Load and leave" means delivery to a purchaser by use of a tangible storage media if
697  the tangible storage media is not physically transferred to the purchaser.
698     (69) "Local taxing jurisdiction" means a:
699  (a) county that is authorized to impose an agreement sales and use tax;
700  (b) city that is authorized to impose an agreement sales and use tax; or
701  (c) town that is authorized to impose an agreement sales and use tax.
702     (70) "Manufactured home" means the same as that term is defined in Section 15A-1-302.
703     (71) "Manufacturing facility" means:
704  (a) an establishment described in:
705  (i) SIC Codes 2000 to 3999 of the 1987 Standard Industrial Classification Manual of
706  the federal Executive Office of the President, Office of Management and Budget;
707  or
708  (ii) a NAICS code within NAICS Sector 31-33, Manufacturing, of the 2017 North
709  American Industry Classification System of the federal Executive Office of the
710  President, Office of Management and Budget;
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      H.B. 162  01-07 09:49
711        (b) a scrap recycler if:
712  (i) from a fixed location, the scrap recycler utilizes machinery or equipment to
713  process one or more of the following items into prepared grades of processed
714  materials for use in new products:
715  (A) iron;
716  (B) steel;
717  (C) nonferrous metal;
718  (D) paper;
719  (E) glass;
720  (F) plastic;
721  (G) textile; or
722  (H) rubber; and
723  (ii) the new products under Subsection (71)(b)(i) would otherwise be made with
724  nonrecycled materials; or
725        (c) a cogeneration facility as defined in Section 54-2-1 if the cogeneration facility is
726  placed in service on or after May 1, 2006.
727    (72)(a) "Marketplace" means a physical or electronic place, platform, or forum where
728        tangible personal property, a product transferred electronically, or a service is offered
729        for sale.
730        (b) "Marketplace" includes a store, a booth, an Internet website, a catalog, or a dedicated
731  sales software application.
732    (73)(a) "Marketplace facilitator" means a person, including an affiliate of the person,
733        that enters into a contract, an agreement, or otherwise with sellers, for consideration,
734        to facilitate the sale of a seller's product through a marketplace that the person owns,
735        operates, or controls and that directly or indirectly:
736  (i) does any of the following:
737  (A) lists, makes available, or advertises tangible personal property, a product
738  transferred electronically, or a service for sale by a marketplace seller on a
739  marketplace that the person owns, operates, or controls;
740  (B) facilitates the sale of a marketplace seller's tangible personal property, product
741  transferred electronically, or service by transmitting or otherwise
742  communicating an offer or acceptance of a retail sale between the marketplace
743  seller and a purchaser using the marketplace;
744  (C) owns, rents, licenses, makes available, or operates any electronic or physical
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      01-07 09:49  H.B. 162
745  infrastructure or any property, process, method, copyright, trademark, or patent
746  that connects a marketplace seller to a purchaser for the purpose of making a
747  retail sale of tangible personal property, a product transferred electronically, or
748  a service;
749  (D) provides a marketplace for making, or otherwise facilitates, a retail sale of
750  tangible personal property, a product transferred electronically, or a service,
751  regardless of ownership or control of the tangible personal property, the
752  product transferred electronically, or the service that is the subject of the retail
753  sale;
754  (E) provides software development or research and development activities related
755  to any activity described in this Subsection (73)(a)(i), if the software
756  development or research and development activity is directly related to the
757  person's marketplace;
758  (F) provides or offers fulfillment or storage services for a marketplace seller;
759  (G) sets prices for the sale of tangible personal property, a product transferred
760  electronically, or a service by a marketplace seller;
761  (H) provides or offers customer service to a marketplace seller or a marketplace
762  seller's purchaser or accepts or assists with taking orders, returns, or exchanges
763  of tangible personal property, a product transferred electronically, or a service
764  sold by a marketplace seller on the person's marketplace; or
765  (I) brands or otherwise identifies sales as those of the person; and
766  (ii) does any of the following:
767  (A) collects the sales price or purchase price of a retail sale of tangible personal
768  property, a product transferred electronically, or a service;
769  (B) provides payment processing services for a retail sale of tangible personal
770  property, a product transferred electronically, or a service;
771  (C) charges, collects, or otherwise receives a selling fee, listing fee, referral fee,
772  closing fee, a fee for inserting or making available tangible personal property, a
773  product transferred electronically, or a service on the person's marketplace, or
774  other consideration for the facilitation of a retail sale of tangible personal
775  property, a product transferred electronically, or a service, regardless of
776  ownership or control of the tangible personal property, the product transferred
777  electronically, or the service that is the subject of the retail sale;
778  (D) through terms and conditions, an agreement, or another arrangement with a
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      H.B. 162  01-07 09:49
779  third person, collects payment from a purchase for a retail sale of tangible
780  personal property, a product transferred electronically, or a service and
781  transmits that payment to the marketplace seller, regardless of whether the
782  third person receives compensation or other consideration in exchange for the
783  service; or
784  (E) provides a virtual currency for a purchaser to use to purchase tangible personal
785  property, a product transferred electronically, or service offered for sale.
786        (b) "Marketplace facilitator" does not include:
787  (i) a person that only provides payment processing services; or
788  (ii) a person described in Subsection (73)(a) to the extent the person is facilitating a
789  sale for a seller that is a restaurant as defined in Section 59-12-602.
790    (74) "Marketplace seller" means a seller that makes one or more retail sales through a
791        marketplace that a marketplace facilitator owns, operates, or controls, regardless of
792        whether the seller is required to be registered to collect and remit the tax under this part.
793    (75) "Member of the immediate family of the producer" means a person who is related to a
794        producer described in Subsection 59-12-104(20)(a) as a:
795        (a) child or stepchild, regardless of whether the child or stepchild is:
796  (i) an adopted child or adopted stepchild; or
797  (ii) a foster child or foster stepchild;
798        (b) grandchild or stepgrandchild;
799        (c) grandparent or stepgrandparent;
800        (d) nephew or stepnephew;
801        (e) niece or stepniece;
802        (f) parent or stepparent;
803        (g) sibling or stepsibling;
804        (h) spouse;
805        (i) person who is the spouse of a person described in Subsections (75)(a) through (g); or
806        (j) person similar to a person described in Subsections (75)(a) through (i) as determined
807  by the commission by rule made in accordance with Title 63G, Chapter 3, Utah
808  Administrative Rulemaking Act.
809    (76) "Mobile home" means the same as that term is defined in Section 15A-1-302.
810    (77) "Mobile telecommunications service" means the same as that term is defined in the
811        Mobile Telecommunications Sourcing Act, 4 U.S.C. Sec. 124.
812    (78)(a) "Mobile wireless service" means a telecommunications service, regardless of the
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      01-07 09:49  H.B. 162
813  technology used, if:
814  (i) the origination point of the conveyance, routing, or transmission is not fixed;
815  (ii) the termination point of the conveyance, routing, or transmission is not fixed; or
816  (iii) the origination point described in Subsection (78)(a)(i) and the termination point
817  described in Subsection (78)(a)(ii) are not fixed.
818  (b) "Mobile wireless service" includes a telecommunications service that is provided by
819  a commercial mobile radio service provider.
820  (c) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
821  commission may by rule define "commercial mobile radio service provider."
822     (79)(a) "Mobility enhancing equipment" means equipment that is:
823  (i) primarily and customarily used to provide or increase the ability to move from one
824  place to another;
825  (ii) appropriate for use in a:
826  (A) home; or
827  (B) motor vehicle; and
828  (iii) not generally used by persons with normal mobility.
829  (b) "Mobility enhancing equipment" includes parts used in the repair or replacement of
830  the equipment described in Subsection (79)(a).
831  (c) "Mobility enhancing equipment" does not include:
832  (i) a motor vehicle;
833  (ii) equipment on a motor vehicle if that equipment is normally provided by the
834  motor vehicle manufacturer;
835  (iii) durable medical equipment; or
836  (iv) a prosthetic device.
837     (80) "Model 1 seller" means a seller registered under the agreement that has selected a
838  certified service provider as the seller's agent to perform the seller's sales and use tax
839  functions for agreement sales and use taxes, as outlined in the contract between the
840  governing board of the agreement and the certified service provider, other than the
841  seller's obligation under Section 59-12-124 to remit a tax on the seller's own purchases.
842     (81) "Model 2 seller" means a seller registered under the agreement that:
843  (a) except as provided in Subsection (81)(b), has selected a certified automated system
844  to perform the seller's sales tax functions for agreement sales and use taxes; and
845  (b) retains responsibility for remitting all of the sales tax:
846  (i) collected by the seller; and
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      H.B. 162  01-07 09:49
847  (ii) to the appropriate local taxing jurisdiction.
848    (82)(a) Subject to Subsection (82)(b), "model 3 seller" means a seller registered under
849        the agreement that has:
850  (i) sales in at least five states that are members of the agreement;
851  (ii) total annual sales revenue of at least $500,000,000;
852  (iii) a proprietary system that calculates the amount of tax:
853  (A) for an agreement sales and use tax; and
854  (B) due to each local taxing jurisdiction; and
855  (iv) entered into a performance agreement with the governing board of the agreement.
856        (b) For purposes of Subsection (82)(a), "model 3 seller" includes an affiliated group of
857  sellers using the same proprietary system.
858    (83) "Model 4 seller" means a seller that is registered under the agreement and is not a
859        model 1 seller, model 2 seller, or model 3 seller.
860    (84) "Modular home" means a modular unit as defined in Section 15A-1-302.
861    (85) "Motor vehicle" means the same as that term is defined in Section 41-1a-102.
862    (86) "Oil sands" means impregnated bituminous sands that:
863        (a) contain a heavy, thick form of petroleum that is released when heated, mixed with
864  other hydrocarbons, or otherwise treated;
865        (b) yield mixtures of liquid hydrocarbon; and
866        (c) require further processing other than mechanical blending before becoming finished
867  petroleum products.
868    (87) "Oil shale" means a group of fine black to dark brown shales containing kerogen
869        material that yields petroleum upon heating and distillation.
870    (88) "Optional computer software maintenance contract" means a computer software
871        maintenance contract that a customer is not obligated to purchase as a condition to the
872        retail sale of computer software.
873    (89)(a) "Other fuels" means products that burn independently to produce heat or energy.
874        (b) "Other fuels" includes oxygen when it is used in the manufacturing of tangible
875  personal property.
876    (90)(a) "Paging service" means a telecommunications service that provides transmission
877        of a coded radio signal for the purpose of activating a specific pager.
878        (b) For purposes of Subsection (90)(a), the transmission of a coded radio signal includes
879  a transmission by message or sound.
880    (91) "Pawn transaction" means the same as that term is defined in Section 13-32a-102.
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      01-07 09:49  H.B. 162
881     (92) "Pawnbroker" means the same as that term is defined in Section 13-32a-102.
882     (93)(a) "Permanently attached to real property" means that for tangible personal property
883  attached to real property:
884  (i) the attachment of the tangible personal property to the real property:
885  (A) is essential to the use of the tangible personal property; and
886  (B) suggests that the tangible personal property will remain attached to the real
887  property in the same place over the useful life of the tangible personal
888  property; or
889  (ii) if the tangible personal property is detached from the real property, the
890  detachment would:
891  (A) cause substantial damage to the tangible personal property; or
892  (B) require substantial alteration or repair of the real property to which the
893  tangible personal property is attached.
894  (b) "Permanently attached to real property" includes:
895  (i) the attachment of an accessory to the tangible personal property if the accessory is:
896  (A) essential to the operation of the tangible personal property; and
897  (B) attached only to facilitate the operation of the tangible personal property;
898  (ii) a temporary detachment of tangible personal property from real property for a
899  repair or renovation if the repair or renovation is performed where the tangible
900  personal property and real property are located; or
901  (iii) property attached to oil, gas, or water pipelines, except for the property listed in
902  Subsection (93)(c)(iii) or (iv).
903  (c) "Permanently attached to real property" does not include:
904  (i) the attachment of portable or movable tangible personal property to real property
905  if that portable or movable tangible personal property is attached to real property
906  only for:
907  (A) convenience;
908  (B) stability; or
909  (C) for an obvious temporary purpose;
910  (ii) the detachment of tangible personal property from real property except for the
911  detachment described in Subsection (93)(b)(ii);
912  (iii) an attachment of the following tangible personal property to real property if the
913  attachment to real property is only through a line that supplies water, electricity,
914  gas, telecommunications, cable, or supplies a similar item as determined by the
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      H.B. 162  01-07 09:49
915  commission by rule made in accordance with Title 63G, Chapter 3, Utah
916  Administrative Rulemaking Act:
917  (A) a computer;
918  (B) a telephone;
919  (C) a television; or
920  (D) tangible personal property similar to Subsections (93)(c)(iii)(A) through (C)
921  as determined by the commission by rule made in accordance with Title 63G,
922  Chapter 3, Utah Administrative Rulemaking Act; or
923  (iv) an item listed in Subsection (139)(c).
924    (94) "Person" includes any individual, firm, partnership, joint venture, association,
925        corporation, estate, trust, business trust, receiver, syndicate, this state, any county, city,
926        municipality, district, or other local governmental entity of the state, or any group or
927        combination acting as a unit.
928    (95) "Place of primary use":
929        (a) for telecommunications service other than mobile telecommunications service,
930  means the street address representative of where the customer's use of the
931  telecommunications service primarily occurs, which shall be:
932  (i) the residential street address of the customer; or
933  (ii) the primary business street address of the customer; or
934        (b) for mobile telecommunications service, means the same as that term is defined in the
935  Mobile Telecommunications Sourcing Act, 4 U.S.C. Sec. 124.
936    (96)(a) "Postpaid calling service" means a telecommunications service a person obtains
937        by making a payment on a call-by-call basis:
938  (i) through the use of a:
939  (A) bank card;
940  (B) credit card;
941  (C) debit card; or
942  (D) travel card; or
943  (ii) by a charge made to a telephone number that is not associated with the origination
944  or termination of the telecommunications service.
945        (b) "Postpaid calling service" includes a service, except for a prepaid wireless calling
946  service, that would be a prepaid wireless calling service if the service were
947  exclusively a telecommunications service.
948    (97) "Postproduction" means an activity related to the finishing or duplication of a medium
  - 28 -
      01-07 09:49  H.B. 162
949  described in Subsection 59-12-104(54)(a).
950     (98) "Prepaid calling service" means a telecommunications service:
951  (a) that allows a purchaser access to telecommunications service that is exclusively
952  telecommunications service;
953  (b) that:
954  (i) is paid for in advance; and
955  (ii) enables the origination of a call using an:
956  (A) access number; or
957  (B) authorization code;
958  (c) that is dialed:
959  (i) manually; or
960  (ii) electronically; and
961  (d) sold in predetermined units or dollars that decline:
962  (i) by a known amount; and
963  (ii) with use.
964     (99) "Prepaid wireless calling service" means a telecommunications service:
965  (a) that provides the right to utilize:
966  (i) mobile wireless service; and
967  (ii) other service that is not a telecommunications service, including:
968  (A) the download of a product transferred electronically;
969  (B) a content service; or
970  (C) an ancillary service;
971  (b) that:
972  (i) is paid for in advance; and
973  (ii) enables the origination of a call using an:
974  (A) access number; or
975  (B) authorization code;
976  (c) that is dialed:
977  (i) manually; or
978  (ii) electronically; and
979  (d) sold in predetermined units or dollars that decline:
980  (i) by a known amount; and
981  (ii) with use.
982     (100)(a) "Prepared food" means:
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       H.B. 162  01-07 09:49
 983  (i) food:
 984  (A) sold in a heated state; or
 985  (B) heated by a seller;
 986  (ii) two or more food ingredients mixed or combined by the seller for sale as a single
 987  item; or
 988  (iii) except as provided in Subsection (100)(c), food sold with an eating utensil
 989  provided by the seller, including a:
 990  (A) plate;
 991  (B) knife;
 992  (C) fork;
 993  (D) spoon;
 994  (E) glass;
 995  (F) cup;
 996  (G) napkin; or
 997  (H) straw.
 998       (b) "Prepared food" does not include:
 999  (i) food that a seller only:
1000  (A) cuts;
1001  (B) repackages; or
1002  (C) pasteurizes;
1003  (ii)(A) the following:
1004  (I) raw egg;
1005  (II) raw fish;
1006  (III) raw meat;
1007  (IV) raw poultry; or
1008  (V) a food containing an item described in Subsections (100)(b)(ii)(A)(I)
1009  through (IV); and
1010  (B) if the Food and Drug Administration recommends in Chapter 3, Part 401.11 of
1011  the Food and Drug Administration's Food Code that a consumer cook the items
1012  described in Subsection (100)(b)(ii)(A) to prevent food borne illness; or
1013  (iii) the following if sold without eating utensils provided by the seller:
1014  (A) food and food ingredients sold by a seller if the seller's proper primary
1015  classification under the 2002 North American Industry Classification System
1016  of the federal Executive Office of the President, Office of Management and
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       01-07 09:49  H.B. 162
1017  Budget, is manufacturing in Sector 311, Food Manufacturing, except for
1018  Subsector 3118, Bakeries and Tortilla Manufacturing;
1019  (B) food and food ingredients sold in an unheated state:
1020  (I) by weight or volume; and
1021  (II) as a single item; or
1022  (C) a bakery item, including:
1023  (I) a bagel;
1024  (II) a bar;
1025  (III) a biscuit;
1026  (IV) bread;
1027  (V) a bun;
1028  (VI) a cake;
1029  (VII) a cookie;
1030  (VIII) a croissant;
1031  (IX) a danish;
1032  (X) a donut;
1033  (XI) a muffin;
1034  (XII) a pastry;
1035  (XIII) a pie;
1036  (XIV) a roll;
1037  (XV) a tart;
1038  (XVI) a torte; or
1039  (XVII) a tortilla.
1040  (c) An eating utensil provided by the seller does not include the following used to
1041  transport the food:
1042  (i) a container; or
1043  (ii) packaging.
1044     (101) "Prescription" means an order, formula, or recipe that is issued:
1045  (a)(i) orally;
1046  (ii) in writing;
1047  (iii) electronically; or
1048  (iv) by any other manner of transmission; and
1049  (b) by a licensed practitioner authorized by the laws of a state.
1050     (102)(a) "Prewritten computer software" means computer software that is not designed
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       H.B. 162  01-07 09:49
1051       and developed:
1052  (i) by the author or other creator of the computer software; and
1053  (ii) to the specifications of a specific purchaser.
1054       (b) "Prewritten computer software" includes:
1055  (i) a prewritten upgrade to computer software if the prewritten upgrade to the
1056  computer software is not designed and developed:
1057  (A) by the author or other creator of the computer software; and
1058  (B) to the specifications of a specific purchaser;
1059  (ii) computer software designed and developed by the author or other creator of the
1060  computer software to the specifications of a specific purchaser if the computer
1061  software is sold to a person other than the purchaser; or
1062  (iii) except as provided in Subsection (102)(c), prewritten computer software or a
1063  prewritten portion of prewritten computer software:
1064  (A) that is modified or enhanced to any degree; and
1065  (B) if the modification or enhancement described in Subsection (102)(b)(iii)(A) is
1066  designed and developed to the specifications of a specific purchaser.
1067       (c) "Prewritten computer software" does not include a modification or enhancement
1068  described in Subsection (102)(b)(iii) if the charges for the modification or
1069  enhancement are:
1070  (i) reasonable; and
1071  (ii) subject to Subsections 59-12-103(2)(f)(ii) and (2)(g)(i), separately stated on the
1072  invoice or other statement of price provided to the purchaser at the time of sale or
1073  later, as demonstrated by:
1074  (A) the books and records the seller keeps at the time of the transaction in the
1075  regular course of business, including books and records the seller keeps at the
1076  time of the transaction in the regular course of business for nontax purposes;
1077  (B) a preponderance of the facts and circumstances at the time of the transaction;
1078  and
1079  (C) the understanding of all of the parties to the transaction.
1080    (103)(a) "Private communications service" means a telecommunications service:
1081  (i) that entitles a customer to exclusive or priority use of one or more
1082  communications channels between or among termination points; and
1083  (ii) regardless of the manner in which the one or more communications channels are
1084  connected.
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       01-07 09:49  H.B. 162
1085  (b) "Private communications service" includes the following provided in connection
1086  with the use of one or more communications channels:
1087  (i) an extension line;
1088  (ii) a station;
1089  (iii) switching capacity; or
1090  (iv) another associated service that is provided in connection with the use of one or
1091  more communications channels as defined in Section 59-12-215.
1092     (104)(a) "Product transferred electronically" means a product transferred electronically
1093  that would be subject to a tax under this chapter if that product was transferred in a
1094  manner other than electronically.
1095  (b) "Product transferred electronically" does not include:
1096  (i) an ancillary service;
1097  (ii) computer software; or
1098  (iii) a telecommunications service.
1099     (105)(a) "Prosthetic device" means a device that is worn on or in the body to:
1100  (i) artificially replace a missing portion of the body;
1101  (ii) prevent or correct a physical deformity or physical malfunction; or
1102  (iii) support a weak or deformed portion of the body.
1103  (b) "Prosthetic device" includes:
1104  (i) parts used in the repairs or renovation of a prosthetic device;
1105  (ii) replacement parts for a prosthetic device;
1106  (iii) a dental prosthesis; or
1107  (iv) a hearing aid.
1108  (c) "Prosthetic device" does not include:
1109  (i) corrective eyeglasses; or
1110  (ii) contact lenses.
1111     (106)(a) "Protective equipment" means an item:
1112  (i) for human wear; and
1113  (ii) that is:
1114  (A) designed as protection:
1115  (I) to the wearer against injury or disease; or
1116  (II) against damage or injury of other persons or property; and
1117  (B) not suitable for general use.
1118  (b) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
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       H.B. 162  01-07 09:49
1119  commission shall make rules:
1120  (i) listing the items that constitute "protective equipment"; and
1121  (ii) that are consistent with the list of items that constitute "protective equipment"
1122  under the agreement.
1123    (107)(a) For purposes of Subsection 59-12-104(41), "publication" means any written or
1124        printed matter, other than a photocopy:
1125  (i) regardless of:
1126  (A) characteristics;
1127  (B) copyright;
1128  (C) form;
1129  (D) format;
1130  (E) method of reproduction; or
1131  (F) source; and
1132  (ii) made available in printed or electronic format.
1133        (b) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
1134  commission may by rule define the term "photocopy."
1135    (108)(a) "Purchase price" and "sales price" mean the total amount of consideration:
1136  (i) valued in money; and
1137  (ii) for which tangible personal property, a product transferred electronically, or
1138  services are:
1139  (A) sold;
1140  (B) leased; or
1141  (C) rented.
1142        (b) "Purchase price" and "sales price" include:
1143  (i) the seller's cost of the tangible personal property, a product transferred
1144  electronically, or services sold;
1145  (ii) expenses of the seller, including:
1146  (A) the cost of materials used;
1147  (B) a labor cost;
1148  (C) a service cost;
1149  (D) interest;
1150  (E) a loss;
1151  (F) the cost of transportation to the seller; or
1152  (G) a tax imposed on the seller;
  - 34 -
       01-07 09:49  H.B. 162
1153  (iii) a charge by the seller for any service necessary to complete the sale; or
1154  (iv) consideration a seller receives from a person other than the purchaser if:
1155  (A)(I) the seller actually receives consideration from a person other than the
1156  purchaser; and
1157  (II) the consideration described in Subsection (108)(b)(iv)(A)(I) is directly
1158  related to a price reduction or discount on the sale;
1159  (B) the seller has an obligation to pass the price reduction or discount through to
1160  the purchaser;
1161  (C) the amount of the consideration attributable to the sale is fixed and
1162  determinable by the seller at the time of the sale to the purchaser; and
1163  (D)(I)(Aa) the purchaser presents a certificate, coupon, or other
1164  documentation to the seller to claim a price reduction or discount; and
1165  (Bb) a person other than the seller authorizes, distributes, or grants the
1166  certificate, coupon, or other documentation with the understanding that
1167  the person other than the seller will reimburse any seller to whom the
1168  certificate, coupon, or other documentation is presented;
1169  (II) the purchaser identifies that purchaser to the seller as a member of a group
1170  or organization allowed a price reduction or discount, except that a
1171  preferred customer card that is available to any patron of a seller does not
1172  constitute membership in a group or organization allowed a price reduction
1173  or discount; or
1174  (III) the price reduction or discount is identified as a third party price reduction
1175  or discount on the:
1176  (Aa) invoice the purchaser receives; or
1177  (Bb) certificate, coupon, or other documentation the purchaser presents.
1178        (c) "Purchase price" and "sales price" do not include:
1179  (i) a discount:
1180  (A) in a form including:
1181  (I) cash;
1182  (II) term; or
1183  (III) coupon;
1184  (B) that is allowed by a seller;
1185  (C) taken by a purchaser on a sale; and
1186  (D) that is not reimbursed by a third party; or
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       H.B. 162  01-07 09:49
1187  (ii) subject to Subsections 59-12-103(2)(f)(ii) and (2)(g)(i), the following if
1188  separately stated on an invoice, bill of sale, or similar document provided to the
1189  purchaser at the time of sale or later, as demonstrated by the books and records the
1190  seller keeps at the time of the transaction in the regular course of business,
1191  including books and records the seller keeps at the time of the transaction in the
1192  regular course of business for nontax purposes, by a preponderance of the facts
1193  and circumstances at the time of the transaction, and by the understanding of all of
1194  the parties to the transaction:
1195  (A) the following from credit extended on the sale of tangible personal property or
1196  services:
1197  (I) a carrying charge;
1198  (II) a financing charge; or
1199  (III) an interest charge;
1200  (B) a delivery charge;
1201  (C) an installation charge;
1202  (D) a manufacturer rebate on a motor vehicle; or
1203  (E) a tax or fee legally imposed directly on the consumer.
1204    (109) "Purchaser" means a person to whom:
1205        (a) a sale of tangible personal property is made;
1206        (b) a product is transferred electronically; or
1207        (c) a service is furnished.
1208    (110) "Qualifying data center" means a data center facility that:
1209        (a) houses a group of networked server computers in one physical location in order to
1210  disseminate, manage, and store data and information;
1211        (b) is located in the state;
1212        (c) is a new operation constructed on or after July 1, 2016;
1213        (d) consists of one or more buildings that total 150,000 or more square feet;
1214        (e) is owned or leased by:
1215  (i) the operator of the data center facility; or
1216  (ii) a person under common ownership, as defined in Section 59-7-101, of the
1217  operator of the data center facility; and
1218        (f) is located on one or more parcels of land that are owned or leased by:
1219  (i) the operator of the data center facility; or
1220  (ii) a person under common ownership, as defined in Section 59-7-101, of the
  - 36 -
       01-07 09:49  H.B. 162
1221  operator of the data center facility.
1222     (111) "Qualifying energy storage manufacturing facility" means a facility that
1223  manufactures, in the state, equipment or devices that store and discharge energy for the
1224  purpose of providing electrical power.
1225     (112) "Regularly rented" means:
1226  (a) rented to a guest for value three or more times during a calendar year; or
1227  (b) advertised or held out to the public as a place that is regularly rented to guests for
1228  value.
1229     (113) "Rental" means the same as that term is defined in Subsection (64).
1230     (114)(a) "Repairs or renovations of tangible personal property" means:
1231  (i) a repair or renovation of tangible personal property that is not permanently
1232  attached to real property; or
1233  (ii) attaching tangible personal property or a product transferred electronically to
1234  other tangible personal property or detaching tangible personal property or a
1235  product transferred electronically from other tangible personal property if:
1236  (A) the other tangible personal property to which the tangible personal property or
1237  product transferred electronically is attached or from which the tangible
1238  personal property or product transferred electronically is detached is not
1239  permanently attached to real property; and
1240  (B) the attachment of tangible personal property or a product transferred
1241  electronically to other tangible personal property or detachment of tangible
1242  personal property or a product transferred electronically from other tangible
1243  personal property is made in conjunction with a repair or replacement of
1244  tangible personal property or a product transferred electronically.
1245  (b) "Repairs or renovations of tangible personal property" does not include:
1246  (i) attaching prewritten computer software to other tangible personal property if the
1247  other tangible personal property to which the prewritten computer software is
1248  attached is not permanently attached to real property; or
1249  (ii) detaching prewritten computer software from other tangible personal property if
1250  the other tangible personal property from which the prewritten computer software
1251  is detached is not permanently attached to real property.
1252     (115) "Research and development" means the process of inquiry or experimentation aimed
1253  at the discovery of facts, devices, technologies, or applications and the process of
1254  preparing those devices, technologies, or applications for marketing.
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       H.B. 162  01-07 09:49
1255    (116)(a) "Residential telecommunications services" means a telecommunications service
1256        or an ancillary service that is provided to an individual for personal use:
1257  (i) at a residential address; or
1258  (ii) at an institution, including a nursing home or a school, if the telecommunications
1259  service or ancillary service is provided to and paid for by the individual residing at
1260  the institution rather than the institution.
1261        (b) For purposes of Subsection (116)(a)(i), a residential address includes an:
1262  (i) apartment; or
1263  (ii) other individual dwelling unit.
1264    (117) "Residential use" means the use in or around a home, apartment building, sleeping
1265        quarters, and similar facilities or accommodations.
1266    (118) "Retail sale" or "sale at retail" means a sale, lease, or rental for a purpose other than:
1267        (a) resale;
1268        (b) sublease; or
1269        (c) subrent.
1270    (119)(a) "Retailer" means any person, unless prohibited by the Constitution of the
1271        United States or federal law, that is engaged in a regularly organized business in
1272        tangible personal property or any other taxable transaction under Subsection
1273        59-12-103(1), and who is selling to the user or consumer and not for resale.
1274        (b) "Retailer" includes commission merchants, auctioneers, and any person regularly
1275  engaged in the business of selling to users or consumers within the state.
1276    (120)(a) "Sale" means any transfer of title, exchange, or barter, conditional or otherwise,
1277        in any manner, of tangible personal property or any other taxable transaction under
1278        Subsection 59-12-103(1), for consideration.
1279        (b) "Sale" includes:
1280  (i) installment and credit sales;
1281  (ii) any closed transaction constituting a sale;
1282  (iii) any sale of electrical energy, gas, services, or entertainment taxable under this
1283  chapter;
1284  (iv) any transaction if the possession of property is transferred but the seller retains
1285  the title as security for the payment of the price; and
1286  (v) any transaction under which right to possession, operation, or use of any article of
1287  tangible personal property is granted under a lease or contract and the transfer of
1288  possession would be taxable if an outright sale were made.
  - 38 -
       01-07 09:49  H.B. 162
1289     (121) "Sale at retail" means the same as that term is defined in Subsection (118).
1290     (122) "Sale-leaseback transaction" means a transaction by which title to tangible personal
1291  property or a product transferred electronically that is subject to a tax under this chapter
1292  is transferred:
1293  (a) by a purchaser-lessee;
1294  (b) to a lessor;
1295  (c) for consideration; and
1296  (d) if:
1297  (i) the purchaser-lessee paid sales and use tax on the purchaser-lessee's initial
1298  purchase of the tangible personal property or product transferred electronically;
1299  (ii) the sale of the tangible personal property or product transferred electronically to
1300  the lessor is intended as a form of financing:
1301  (A) for the tangible personal property or product transferred electronically; and
1302  (B) to the purchaser-lessee; and
1303  (iii) in accordance with generally accepted accounting principles, the
1304  purchaser-lessee is required to:
1305  (A) capitalize the tangible personal property or product transferred electronically
1306  for financial reporting purposes; and
1307  (B) account for the lease payments as payments made under a financing
1308  arrangement.
1309     (123) "Sales price" means the same as that term is defined in Subsection (108).
1310     (124)(a) "Sales relating to schools" means the following sales by, amounts paid to, or
1311  amounts charged by a school:
1312  (i) sales that are directly related to the school's educational functions or activities
1313  including:
1314  (A) the sale of:
1315  (I) textbooks;
1316  (II) textbook fees;
1317  (III) laboratory fees;
1318  (IV) laboratory supplies; or
1319  (V) safety equipment;
1320  (B) the sale of a uniform, protective equipment, or sports or recreational
1321  equipment that:
1322  (I) a student is specifically required to wear as a condition of participation in a
  - 39 -
       H.B. 162  01-07 09:49
1323  school-related event or school-related activity; and
1324  (II) is not readily adaptable to general or continued usage to the extent that it
1325  takes the place of ordinary clothing;
1326  (C) sales of the following if the net or gross revenue generated by the sales is
1327  deposited into a school district fund or school fund dedicated to school meals:
1328  (I) food and food ingredients; or
1329  (II) prepared food; or
1330  (D) transportation charges for official school activities; or
1331  (ii) amounts paid to or amounts charged by a school for admission to a school-related
1332  event or school-related activity.
1333        (b) "Sales relating to schools" does not include:
1334  (i) bookstore sales of items that are not educational materials or supplies;
1335  (ii) except as provided in Subsection (124)(a)(i)(B):
1336  (A) clothing;
1337  (B) clothing accessories or equipment;
1338  (C) protective equipment; or
1339  (D) sports or recreational equipment; or
1340  (iii) amounts paid to or amounts charged by a school for admission to a
1341  school-related event or school-related activity if the amounts paid or charged are
1342  passed through to a person:
1343  (A) other than a:
1344  (I) school;
1345  (II) nonprofit organization authorized by a school board or a governing body of
1346  a private school to organize and direct a competitive secondary school
1347  activity; or
1348  (III) nonprofit association authorized by a school board or a governing body of
1349  a private school to organize and direct a competitive secondary school
1350  activity; and
1351  (B) that is required to collect sales and use taxes under this chapter.
1352        (c) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
1353  commission may make rules defining the term "passed through."
1354    (125) For purposes of this section and Section 59-12-104, "school" means:
1355        (a) an elementary school or a secondary school that:
1356  (i) is a:
  - 40 -
       01-07 09:49  H.B. 162
1357  (A) public school; or
1358  (B) private school; and
1359  (ii) provides instruction for one or more grades kindergarten through 12; or
1360  (b) a public school district.
1361     (126)(a) "Seller" means a person that makes a sale, lease, or rental of:
1362  (i) tangible personal property;
1363  (ii) a product transferred electronically; or
1364  (iii) a service.
1365  (b) "Seller" includes a marketplace facilitator.
1366     (127)(a) "Semiconductor fabricating, processing, research, or development materials"
1367  means tangible personal property or a product transferred electronically if the
1368  tangible personal property or product transferred electronically is:
1369  (i) used primarily in the process of:
1370  (A)(I) manufacturing a semiconductor;
1371  (II) fabricating a semiconductor; or
1372  (III) research or development of a:
1373  (Aa) semiconductor; or
1374  (Bb) semiconductor manufacturing process; or
1375  (B) maintaining an environment suitable for a semiconductor; or
1376  (ii) consumed primarily in the process of:
1377  (A)(I) manufacturing a semiconductor;
1378  (II) fabricating a semiconductor; or
1379  (III) research or development of a:
1380  (Aa) semiconductor; or
1381  (Bb) semiconductor manufacturing process; or
1382  (B) maintaining an environment suitable for a semiconductor.
1383  (b) "Semiconductor fabricating, processing, research, or development materials"
1384  includes:
1385  (i) parts used in the repairs or renovations of tangible personal property or a product
1386  transferred electronically described in Subsection (127)(a); or
1387  (ii) a chemical, catalyst, or other material used to:
1388  (A) produce or induce in a semiconductor a:
1389  (I) chemical change; or
1390  (II) physical change;
  - 41 -
       H.B. 162  01-07 09:49
1391  (B) remove impurities from a semiconductor; or
1392  (C) improve the marketable condition of a semiconductor.
1393    (128) "Senior citizen center" means a facility having the primary purpose of providing
1394        services to the aged as defined in Section 26B-6-101.
1395    (129) "Shared vehicle" means the same as that term is defined in Section 13-48a-101.
1396    (130) "Shared vehicle driver" means the same as that term is defined in Section 13-48a-101.
1397    (131) "Shared vehicle owner" means the same as that term is defined in Section 13-48a-101.
1398    (132)(a) Subject to Subsections (132)(b) and (c), "short-term lodging consumable"
1399        means tangible personal property that:
1400  (i) a business that provides accommodations and services described in Subsection
1401  59-12-103(1)(i) purchases as part of a transaction to provide the accommodations
1402  and services to a purchaser;
1403  (ii) is intended to be consumed by the purchaser; and
1404  (iii) is:
1405  (A) included in the purchase price of the accommodations and services; and
1406  (B) not separately stated on an invoice, bill of sale, or other similar document
1407  provided to the purchaser.
1408        (b) "Short-term lodging consumable" includes:
1409  (i) a beverage;
1410  (ii) a brush or comb;
1411  (iii) a cosmetic;
1412  (iv) a hair care product;
1413  (v) lotion;
1414  (vi) a magazine;
1415  (vii) makeup;
1416  (viii) a meal;
1417  (ix) mouthwash;
1418  (x) nail polish remover;
1419  (xi) a newspaper;
1420  (xii) a notepad;
1421  (xiii) a pen;
1422  (xiv) a pencil;
1423  (xv) a razor;
1424  (xvi) saline solution;
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       01-07 09:49  H.B. 162
1425  (xvii) a sewing kit;
1426  (xviii) shaving cream;
1427  (xix) a shoe shine kit;
1428  (xx) a shower cap;
1429  (xxi) a snack item;
1430  (xxii) soap;
1431  (xxiii) toilet paper;
1432  (xxiv) a toothbrush;
1433  (xxv) toothpaste; or
1434  (xxvi) an item similar to Subsections (132)(b)(i) through (xxv) as the commission
1435  may provide by rule made in accordance with Title 63G, Chapter 3, Utah
1436  Administrative Rulemaking Act.
1437  (c) "Short-term lodging consumable" does not include:
1438  (i) tangible personal property that is cleaned or washed to allow the tangible personal
1439  property to be reused; or
1440  (ii) a product transferred electronically.
1441     (133)(a) "Short-term rental" means a lease or rental for less than 30 consecutive days.
1442  (b) "Short-term rental" does not include car sharing.
1443     (134) "Simplified electronic return" means the electronic return:
1444  (a) described in Section 318(C) of the agreement; and
1445  (b) approved by the governing board of the agreement.
1446     (135) "Solar energy" means the sun used as the sole source of energy for producing
1447  electricity.
1448     (136)(a) "Sports or recreational equipment" means an item:
1449  (i) designed for human use; and
1450  (ii) that is:
1451  (A) worn in conjunction with:
1452  (I) an athletic activity; or
1453  (II) a recreational activity; and
1454  (B) not suitable for general use.
1455  (b) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
1456  commission shall make rules:
1457  (i) listing the items that constitute "sports or recreational equipment"; and
1458  (ii) that are consistent with the list of items that constitute "sports or recreational
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       H.B. 162  01-07 09:49
1459  equipment" under the agreement.
1460    (137) "State" means the state of Utah, its departments, and agencies.
1461    (138) "Storage" means any keeping or retention of tangible personal property or any other
1462        taxable transaction under Subsection 59-12-103(1), in this state for any purpose except
1463        sale in the regular course of business.
1464    (139)(a) "Tangible personal property" means personal property that:
1465  (i) may be:
1466  (A) seen;
1467  (B) weighed;
1468  (C) measured;
1469  (D) felt; or
1470  (E) touched; or
1471  (ii) is in any manner perceptible to the senses.
1472        (b) "Tangible personal property" includes:
1473  (i) electricity;
1474  (ii) water;
1475  (iii) gas;
1476  (iv) steam; or
1477  (v) prewritten computer software, regardless of the manner in which the prewritten
1478  computer software is transferred.
1479        (c) "Tangible personal property" includes the following regardless of whether the item is
1480  attached to real property:
1481  (i) a dishwasher;
1482  (ii) a dryer;
1483  (iii) a freezer;
1484  (iv) a microwave;
1485  (v) a refrigerator;
1486  (vi) a stove;
1487  (vii) a washer; or
1488  (viii) an item similar to Subsections (139)(c)(i) through (vii) as determined by the
1489  commission by rule made in accordance with Title 63G, Chapter 3, Utah
1490  Administrative Rulemaking Act.
1491        (d) "Tangible personal property" does not include a product that is transferred
1492  electronically.
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       01-07 09:49  H.B. 162
1493  (e) "Tangible personal property" does not include the following if attached to real
1494  property, regardless of whether the attachment to real property is only through a line
1495  that supplies water, electricity, gas, telephone, cable, or supplies a similar item as
1496  determined by the commission by rule made in accordance with Title 63G, Chapter 3,
1497  Utah Administrative Rulemaking Act:
1498  (i) a hot water heater;
1499  (ii) a water filtration system; or
1500  (iii) a water softener system.
1501     (140)(a) "Telecommunications enabling or facilitating equipment, machinery, or
1502  software" means an item listed in Subsection (140)(b) if that item is purchased or
1503  leased primarily to enable or facilitate one or more of the following to function:
1504  (i) telecommunications switching or routing equipment, machinery, or software; or
1505  (ii) telecommunications transmission equipment, machinery, or software.
1506  (b) The following apply to Subsection (140)(a):
1507  (i) a pole;
1508  (ii) software;
1509  (iii) a supplementary power supply;
1510  (iv) temperature or environmental equipment or machinery;
1511  (v) test equipment;
1512  (vi) a tower; or
1513  (vii) equipment, machinery, or software that functions similarly to an item listed in
1514  Subsections (140)(b)(i) through (vi) as determined by the commission by rule
1515  made in accordance with Subsection (140)(c).
1516  (c) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
1517  commission may by rule define what constitutes equipment, machinery, or software
1518  that functions similarly to an item listed in Subsections (140)(b)(i) through (vi).
1519     (141) "Telecommunications equipment, machinery, or software required for 911 service"
1520  means equipment, machinery, or software that is required to comply with 47 C.F.R. Sec.
1521  20.18.
1522     (142) "Telecommunications maintenance or repair equipment, machinery, or software"
1523  means equipment, machinery, or software purchased or leased primarily to maintain or
1524  repair one or more of the following, regardless of whether the equipment, machinery, or
1525  software is purchased or leased as a spare part or as an upgrade or modification to one or
1526  more of the following:
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       H.B. 162  01-07 09:49
1527       (a) telecommunications enabling or facilitating equipment, machinery, or software;
1528       (b) telecommunications switching or routing equipment, machinery, or software; or
1529       (c) telecommunications transmission equipment, machinery, or software.
1530    (143)(a) "Telecommunications service" means the electronic conveyance, routing, or
1531       transmission of audio, data, video, voice, or any other information or signal to a
1532       point, or among or between points.
1533       (b) "Telecommunications service" includes:
1534  (i) an electronic conveyance, routing, or transmission with respect to which a
1535  computer processing application is used to act:
1536  (A) on the code, form, or protocol of the content;
1537  (B) for the purpose of electronic conveyance, routing, or transmission; and
1538  (C) regardless of whether the service:
1539  (I) is referred to as voice over Internet protocol service; or
1540  (II) is classified by the Federal Communications Commission as enhanced or
1541  value added;
1542  (ii) an 800 service;
1543  (iii) a 900 service;
1544  (iv) a fixed wireless service;
1545  (v) a mobile wireless service;
1546  (vi) a postpaid calling service;
1547  (vii) a prepaid calling service;
1548  (viii) a prepaid wireless calling service; or
1549  (ix) a private communications service.
1550       (c) "Telecommunications service" does not include:
1551  (i) advertising, including directory advertising;
1552  (ii) an ancillary service;
1553  (iii) a billing and collection service provided to a third party;
1554  (iv) a data processing and information service if:
1555  (A) the data processing and information service allows data to be:
1556  (I)(Aa) acquired;
1557  (Bb) generated;
1558  (Cc) processed;
1559  (Dd) retrieved; or
1560  (Ee) stored; and
  - 46 -
       01-07 09:49  H.B. 162
1561  (II) delivered by an electronic transmission to a purchaser; and
1562  (B) the purchaser's primary purpose for the underlying transaction is the processed
1563  data or information;
1564  (v) installation or maintenance of the following on a customer's premises:
1565  (A) equipment; or
1566  (B) wiring;
1567  (vi) Internet access service;
1568  (vii) a paging service;
1569  (viii) a product transferred electronically, including:
1570  (A) music;
1571  (B) reading material;
1572  (C) a ring tone;
1573  (D) software; or
1574  (E) video;
1575  (ix) a radio and television audio and video programming service:
1576  (A) regardless of the medium; and
1577  (B) including:
1578  (I) furnishing conveyance, routing, or transmission of a television audio and
1579  video programming service by a programming service provider;
1580  (II) cable service as defined in 47 U.S.C. Sec. 522(6); or
1581  (III) audio and video programming services delivered by a commercial mobile
1582  radio service provider as defined in 47 C.F.R. Sec. 20.3;
1583  (x) a value-added nonvoice data service; or
1584  (xi) tangible personal property.
1585     (144)(a) "Telecommunications service provider" means a person that:
1586  (i) owns, controls, operates, or manages a telecommunications service; and
1587  (ii) engages in an activity described in Subsection (144)(a)(i) for the shared use with
1588  or resale to any person of the telecommunications service.
1589        (b) A person described in Subsection (144)(a) is a telecommunications service provider
1590  whether or not the Public Service Commission of Utah regulates:
1591  (i) that person; or
1592  (ii) the telecommunications service that the person owns, controls, operates, or
1593  manages.
1594     (145)(a) "Telecommunications switching or routing equipment, machinery, or software"
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       H.B. 162  01-07 09:49
1595       means an item listed in Subsection (145)(b) if that item is purchased or leased
1596       primarily for switching or routing:
1597  (i) an ancillary service;
1598  (ii) data communications;
1599  (iii) voice communications; or
1600  (iv) telecommunications service.
1601       (b) The following apply to Subsection (145)(a):
1602  (i) a bridge;
1603  (ii) a computer;
1604  (iii) a cross connect;
1605  (iv) a modem;
1606  (v) a multiplexer;
1607  (vi) plug in circuitry;
1608  (vii) a router;
1609  (viii) software;
1610  (ix) a switch; or
1611  (x) equipment, machinery, or software that functions similarly to an item listed in
1612  Subsections (145)(b)(i) through (ix) as determined by the commission by rule
1613  made in accordance with Subsection (145)(c).
1614       (c) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
1615  commission may by rule define what constitutes equipment, machinery, or software
1616  that functions similarly to an item listed in Subsections (145)(b)(i) through (ix).
1617    (146)(a) "Telecommunications transmission equipment, machinery, or software" means
1618       an item listed in Subsection (146)(b) if that item is purchased or leased primarily for
1619       sending, receiving, or transporting:
1620  (i) an ancillary service;
1621  (ii) data communications;
1622  (iii) voice communications; or
1623  (iv) telecommunications service.
1624       (b) The following apply to Subsection (146)(a):
1625  (i) an amplifier;
1626  (ii) a cable;
1627  (iii) a closure;
1628  (iv) a conduit;
  - 48 -
       01-07 09:49  H.B. 162
1629  (v) a controller;
1630  (vi) a duplexer;
1631  (vii) a filter;
1632  (viii) an input device;
1633  (ix) an input/output device;
1634  (x) an insulator;
1635  (xi) microwave machinery or equipment;
1636  (xii) an oscillator;
1637  (xiii) an output device;
1638  (xiv) a pedestal;
1639  (xv) a power converter;
1640  (xvi) a power supply;
1641  (xvii) a radio channel;
1642  (xviii) a radio receiver;
1643  (xix) a radio transmitter;
1644  (xx) a repeater;
1645  (xxi) software;
1646  (xxii) a terminal;
1647  (xxiii) a timing unit;
1648  (xxiv) a transformer;
1649  (xxv) a wire; or
1650  (xxvi) equipment, machinery, or software that functions similarly to an item listed in
1651  Subsections (146)(b)(i) through (xxv) as the commission determines by rule made
1652  in accordance with Subsection (146)(c).
1653  (c) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
1654  commission may by rule define what constitutes equipment, machinery, or software
1655  that functions similarly to an item listed in Subsections (146)(b)(i) through (xxv).
1656     (147)(a) "Textbook for a higher education course" means a textbook or other printed
1657  material that is required for a course:
1658  (i) offered by an institution of higher education; and
1659  (ii) that the purchaser of the textbook or other printed material attends or will attend.
1660  (b) "Textbook for a higher education course" includes a textbook in electronic format.
1661     (148) "Tobacco" means:
1662  (a) a cigarette;
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       H.B. 162  01-07 09:49
1663        (b) a cigar;
1664        (c) chewing tobacco;
1665        (d) pipe tobacco; or
1666        (e) any other item that contains tobacco.
1667    (149) "Unassisted amusement device" means an amusement device, skill device, or ride
1668        device that is started and stopped by the purchaser or renter of the right to use or operate
1669        the amusement device, skill device, or ride device.
1670    (150)(a) "Use" means the exercise of any right or power over tangible personal property,
1671        a product transferred electronically, or a service under Subsection 59-12-103(1),
1672        incident to the ownership or the leasing of that tangible personal property, product
1673        transferred electronically, or service.
1674        (b) "Use" does not include the sale, display, demonstration, or trial of tangible personal
1675  property, a product transferred electronically, or a service in the regular course of
1676  business and held for resale.
1677    (151) "Value-added nonvoice data service" means a service:
1678        (a) that otherwise meets the definition of a telecommunications service except that a
1679  computer processing application is used to act primarily for a purpose other than
1680  conveyance, routing, or transmission; and
1681        (b) with respect to which a computer processing application is used to act on data or
1682  information:
1683  (i) code;
1684  (ii) content;
1685  (iii) form; or
1686  (iv) protocol.
1687    (152)(a) Subject to Subsection (152)(b), "vehicle" means the following that are required
1688        to be titled, registered, or titled and registered:
1689  (i) an aircraft as defined in Section 72-10-102;
1690  (ii) a vehicle as defined in Section 41-1a-102;
1691  (iii) an off-highway vehicle as defined in Section 41-22-2; or
1692  (iv) a vessel as defined in Section 41-1a-102.
1693        (b) For purposes of Subsection 59-12-104(33) only, "vehicle" includes:
1694  (i) a vehicle described in Subsection (152)(a); or
1695  (ii)(A) a locomotive;
1696  (B) a freight car;
  - 50 -
       01-07 09:49  H.B. 162
1697  (C) railroad work equipment; or
1698  (D) other railroad rolling stock.
1699     (153) "Vehicle dealer" means a person engaged in the business of buying, selling, or
1700  exchanging a vehicle as defined in Subsection (152).
1701     (154)(a) "Vertical service" means an ancillary service that:
1702  (i) is offered in connection with one or more telecommunications services; and
1703  (ii) offers an advanced calling feature that allows a customer to:
1704  (A) identify a caller; and
1705  (B) manage multiple calls and call connections.
1706  (b) "Vertical service" includes an ancillary service that allows a customer to manage a
1707  conference bridging service.
1708     (155)(a) "Voice mail service" means an ancillary service that enables a customer to
1709  receive, send, or store a recorded message.
1710  (b) "Voice mail service" does not include a vertical service that a customer is required to
1711  have in order to utilize a voice mail service.
1712     (156)(a) "Waste energy facility" means a facility that generates electricity:
1713  (i) using as the primary source of energy waste materials that would be placed in a
1714  landfill or refuse pit if it were not used to generate electricity, including:
1715  (A) tires;
1716  (B) waste coal;
1717  (C) oil shale; or
1718  (D) municipal solid waste; and
1719  (ii) in amounts greater than actually required for the operation of the facility.
1720  (b) "Waste energy facility" does not include a facility that incinerates:
1721  (i) hospital waste as defined in 40 C.F.R. 60.51c; or
1722  (ii) medical/infectious waste as defined in 40 C.F.R. 60.51c.
1723     (157) "Watercraft" means a vessel as defined in Section 73-18-2.
1724     (158) "Wind energy" means wind used as the sole source of energy to produce electricity.
1725     (159) "ZIP Code" means a Zoning Improvement Plan Code assigned to a geographic
1726  location by the United States Postal Service.
1727  Section 2. Section 59-12-102 is amended to read:
1728  59-12-102 (Effective 07/01/26). Definitions.
1729        As used in this chapter:
1730     (1) "800 service" means a telecommunications service that:
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       H.B. 162  01-07 09:49
1731        (a) allows a caller to dial a toll-free number without incurring a charge for the call; and
1732        (b) is typically marketed:
1733  (i) under the name 800 toll-free calling;
1734  (ii) under the name 855 toll-free calling;
1735  (iii) under the name 866 toll-free calling;
1736  (iv) under the name 877 toll-free calling;
1737  (v) under the name 888 toll-free calling; or
1738  (vi) under a name similar to Subsections (1)(b)(i) through (v) as designated by the
1739  Federal Communications Commission.
1740    (2)(a) "900 service" means an inbound toll telecommunications service that:
1741  (i) a subscriber purchases;
1742  (ii) allows a customer of the subscriber described in Subsection (2)(a)(i) to call in to
1743  the subscriber's:
1744  (A) prerecorded announcement; or
1745  (B) live service; and
1746  (iii) is typically marketed:
1747  (A) under the name 900 service; or
1748  (B) under a name similar to Subsection (2)(a)(iii)(A) as designated by the Federal
1749  Communications Commission.
1750        (b) "900 service" does not include a charge for:
1751  (i) a collection service a seller of a telecommunications service provides to a
1752  subscriber; or
1753  (ii) the following a subscriber sells to the subscriber's customer:
1754  (A) a product; or
1755  (B) a service.
1756    (3)(a) "Adaptive driving equipment" means mobility enhancing equipment:
1757  (i) to be installed in a motor vehicle; and
1758  (ii) regardless of who provides the equipment or parts.
1759        (b) "Adaptive driving equipment" includes:
1760  (i) a wheelchair or scooter lift;
1761  (ii) equipment to secure a wheelchair;
1762  (iii) a swivel seat;
1763  (iv) a hand or foot control; and
1764  (v) a steering aid.
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       01-07 09:49  H.B. 162
1765     (4)(a) "Admission or user fees" includes season passes.
1766  (b) "Admission or user fees" does not include:
1767  (i) annual membership dues to private organizations; or
1768  (ii) a lesson, including a lesson that involves as part of the lesson equipment or a
1769  facility listed in Subsection 59-12-103(1)(f).
1770     (5) "Affiliate" or "affiliated person" means a person that, with respect to another person:
1771  (a) has an ownership interest of more than 5%, whether direct or indirect, in that other
1772  person; or
1773  (b) is related to the other person because a third person, or a group of third persons who
1774  are affiliated persons with respect to each other, holds an ownership interest of more
1775  than 5%, whether direct or indirect, in the related persons.
1776     (6) "Agreement" means the Streamlined Sales and Use Tax Agreement adopted on
1777  November 12, 2002, including amendments made to the Streamlined Sales and Use Tax
1778  Agreement after November 12, 2002.
1779     (7) "Agreement combined tax rate" means the sum of the tax rates:
1780  (a) listed under Subsection (8); and
1781  (b) that are imposed within a local taxing jurisdiction.
1782     (8) "Agreement sales and use tax" means a tax imposed under:
1783  (a) Subsection 59-12-103(2)(a)(i)(A);
1784  (b) Subsection 59-12-103(2)(a)(i)(B);
1785  (c) Subsection 59-12-103(2)(b)(i);
1786  (d) Subsection 59-12-103(2)(c)(i);
1787  (e) Subsection 59-12-103(2)(d);
1788  (f) Subsection 59-12-103(2)(e)(i)(A);
1789  (g) Section 59-12-204;
1790  (h) Section 59-12-401;
1791  (i) Section 59-12-402;
1792  (j) Section 59-12-402.1;
1793  (k) Section 59-12-703;
1794  (l) Section 59-12-802;
1795  (m) Section 59-12-804;
1796  (n) Section 59-12-1102;
1797  (o) Section 59-12-1302;
1798  (p) Section 59-12-1402;
  - 53 -
       H.B. 162  01-07 09:49
1799        (q) Section 59-12-1802;
1800        (r) Section 59-12-2003;
1801        (s) Section 59-12-2103;
1802        (t) Section 59-12-2213;
1803        (u) Section 59-12-2214;
1804        (v) Section 59-12-2215;
1805        (w) Section 59-12-2216;
1806        (x) Section 59-12-2217;
1807        (y) Section 59-12-2218;
1808        (z) Section 59-12-2219;
1809        (aa) Section 59-12-2220;[ or]
1810        (bb) Section 59-12-2402[.] ; or
1811        (cc) Section 59-12-2502.
1812    (9) "Aircraft" means the same as that term is defined in Section 72-10-102.
1813    (10) "Aircraft maintenance, repair, and overhaul provider" means a business entity:
1814        (a) except for:
1815  (i) an airline as defined in Section 59-2-102; or
1816  (ii) an affiliated group, as defined in Section 59-7-101, except that "affiliated group"
1817  includes a corporation that is qualified to do business but is not otherwise doing
1818  business in the state, of an airline; and
1819        (b) that has the workers, expertise, and facilities to perform the following, regardless of
1820  whether the business entity performs the following in this state:
1821  (i) check, diagnose, overhaul, and repair:
1822  (A) an onboard system of a fixed wing turbine powered aircraft; and
1823  (B) the parts that comprise an onboard system of a fixed wing turbine powered
1824  aircraft;
1825  (ii) assemble, change, dismantle, inspect, and test a fixed wing turbine powered
1826  aircraft engine;
1827  (iii) perform at least the following maintenance on a fixed wing turbine powered
1828  aircraft:
1829  (A) an inspection;
1830  (B) a repair, including a structural repair or modification;
1831  (C) changing landing gear; and
1832  (D) addressing issues related to an aging fixed wing turbine powered aircraft;
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       01-07 09:49  H.B. 162
1833  (iv) completely remove the existing paint of a fixed wing turbine powered aircraft
1834  and completely apply new paint to the fixed wing turbine powered aircraft; and
1835  (v) refurbish the interior of a fixed wing turbine powered aircraft in a manner that
1836  results in a change in the fixed wing turbine powered aircraft's certification
1837  requirements by the authority that certifies the fixed wing turbine powered aircraft.
1838     (11) "Alcoholic beverage" means a beverage that:
1839  (a) is suitable for human consumption; and
1840  (b) contains .5% or more alcohol by volume.
1841     (12) "Alternative energy" means:
1842  (a) biomass energy;
1843  (b) geothermal energy;
1844  (c) hydroelectric energy;
1845  (d) solar energy;
1846  (e) wind energy; or
1847  (f) energy that is derived from:
1848  (i) coal-to-liquids;
1849  (ii) nuclear fuel;
1850  (iii) oil-impregnated diatomaceous earth;
1851  (iv) oil sands;
1852  (v) oil shale;
1853  (vi) petroleum coke; or
1854  (vii) waste heat from:
1855  (A) an industrial facility; or
1856  (B) a power station in which an electric generator is driven through a process in
1857  which water is heated, turns into steam, and spins a steam turbine.
1858     (13)(a) Subject to Subsection (13)(b), "alternative energy electricity production facility"
1859  means a facility that:
1860  (i) uses alternative energy to produce electricity; and
1861  (ii) has a production capacity of two megawatts or greater.
1862  (b) A facility is an alternative energy electricity production facility regardless of whether
1863  the facility is:
1864  (i) connected to an electric grid; or
1865  (ii) located on the premises of an electricity consumer.
1866     (14)(a) "Ancillary service" means a service associated with, or incidental to, the
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       H.B. 162  01-07 09:49
1867        provision of telecommunications service.
1868        (b) "Ancillary service" includes:
1869  (i) a conference bridging service;
1870  (ii) a detailed communications billing service;
1871  (iii) directory assistance;
1872  (iv) a vertical service; or
1873  (v) a voice mail service.
1874    (15) "Area agency on aging" means the same as that term is defined in Section 26B-6-101.
1875    (16) "Assisted amusement device" means an amusement device, skill device, or ride device
1876        that is started and stopped by an individual:
1877        (a) who is not the purchaser or renter of the right to use or operate the amusement
1878  device, skill device, or ride device; and
1879        (b) at the direction of the seller of the right to use the amusement device, skill device, or
1880  ride device.
1881    (17) "Assisted cleaning or washing of tangible personal property" means cleaning or
1882        washing of tangible personal property if the cleaning or washing labor is primarily
1883        performed by an individual:
1884        (a) who is not the purchaser of the cleaning or washing of the tangible personal property;
1885  and
1886        (b) at the direction of the seller of the cleaning or washing of the tangible personal
1887  property.
1888    (18) "Authorized carrier" means:
1889        (a) in the case of vehicles operated over public highways, the holder of credentials
1890  indicating that the vehicle is or will be operated pursuant to both the International
1891  Registration Plan and the International Fuel Tax Agreement;
1892        (b) in the case of aircraft, the holder of a Federal Aviation Administration operating
1893  certificate or air carrier's operating certificate; or
1894        (c) in the case of locomotives, freight cars, railroad work equipment, or other rolling
1895  stock, a person who uses locomotives, freight cars, railroad work equipment, or other
1896  rolling stock in more than one state.
1897    (19)(a) "Biomass energy" means any of the following that is used as the primary source
1898        of energy to produce fuel or electricity:
1899  (i) material from a plant or tree; or
1900  (ii) other organic matter that is available on a renewable basis, including:
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       01-07 09:49  H.B. 162
1901  (A) slash and brush from forests and woodlands;
1902  (B) animal waste;
1903  (C) waste vegetable oil;
1904  (D) methane or synthetic gas produced at a landfill, as a byproduct of the
1905  treatment of wastewater residuals, or through the conversion of a waste
1906  material through a nonincineration, thermal conversion process;
1907  (E) aquatic plants; and
1908  (F) agricultural products.
1909  (b) "Biomass energy" does not include:
1910  (i) black liquor; or
1911  (ii) treated woods.
1912     (20)(a) "Bundled transaction" means the sale of two or more items of tangible personal
1913  property, products, or services if the tangible personal property, products, or services
1914  are:
1915  (i) distinct and identifiable; and
1916  (ii) sold for one nonitemized price.
1917  (b) "Bundled transaction" does not include:
1918  (i) the sale of tangible personal property if the sales price varies, or is negotiable, on
1919  the basis of the selection by the purchaser of the items of tangible personal
1920  property included in the transaction;
1921  (ii) the sale of real property;
1922  (iii) the sale of services to real property;
1923  (iv) the retail sale of tangible personal property and a service if:
1924  (A) the tangible personal property:
1925  (I) is essential to the use of the service; and
1926  (II) is provided exclusively in connection with the service; and
1927  (B) the service is the true object of the transaction;
1928  (v) the retail sale of two services if:
1929  (A) one service is provided that is essential to the use or receipt of a second
1930  service;
1931  (B) the first service is provided exclusively in connection with the second service;
1932  and
1933  (C) the second service is the true object of the transaction;
1934  (vi) a transaction that includes tangible personal property or a product subject to
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       H.B. 162  01-07 09:49
1935  taxation under this chapter and tangible personal property or a product that is not
1936  subject to taxation under this chapter if the:
1937  (A) seller's purchase price of the tangible personal property or product subject to
1938  taxation under this chapter is de minimis; or
1939  (B) seller's sales price of the tangible personal property or product subject to
1940  taxation under this chapter is de minimis; and
1941  (vii) the retail sale of tangible personal property that is not subject to taxation under
1942  this chapter and tangible personal property that is subject to taxation under this
1943  chapter if:
1944  (A) that retail sale includes:
1945  (I) food and food ingredients;
1946  (II) a drug;
1947  (III) durable medical equipment;
1948  (IV) mobility enhancing equipment;
1949  (V) an over-the-counter drug;
1950  (VI) a prosthetic device; or
1951  (VII) a medical supply; and
1952  (B) subject to Subsection (20)(f):
1953  (I) the seller's purchase price of the tangible personal property subject to
1954  taxation under this chapter is 50% or less of the seller's total purchase price
1955  of that retail sale; or
1956  (II) the seller's sales price of the tangible personal property subject to taxation
1957  under this chapter is 50% or less of the seller's total sales price of that retail
1958  sale.
1959       (c)(i) For purposes of Subsection (20)(a)(i), tangible personal property, a product, or
1960  a service that is distinct and identifiable does not include:
1961  (A) packaging that:
1962  (I) accompanies the sale of the tangible personal property, product, or service;
1963  and
1964  (II) is incidental or immaterial to the sale of the tangible personal property,
1965  product, or service;
1966  (B) tangible personal property, a product, or a service provided free of charge with
1967  the purchase of another item of tangible personal property, a product, or a
1968  service; or
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       01-07 09:49  H.B. 162
1969  (C) an item of tangible personal property, a product, or a service included in the
1970  definition of "purchase price."
1971  (ii) For purposes of Subsection (20)(c)(i)(B), an item of tangible personal property, a
1972  product, or a service is provided free of charge with the purchase of another item
1973  of tangible personal property, a product, or a service if the sales price of the
1974  purchased item of tangible personal property, product, or service does not vary
1975  depending on the inclusion of the tangible personal property, product, or service
1976  provided free of charge.
1977        (d)(i) For purposes of Subsection (20)(a)(ii), property sold for one nonitemized price
1978  does not include a price that is separately identified by tangible personal property,
1979  product, or service on the following, regardless of whether the following is in
1980  paper format or electronic format:
1981  (A) a binding sales document; or
1982  (B) another supporting sales-related document that is available to a purchaser.
1983  (ii) For purposes of Subsection (20)(d)(i), a binding sales document or another
1984  supporting sales-related document that is available to a purchaser includes:
1985  (A) a bill of sale;
1986  (B) a contract;
1987  (C) an invoice;
1988  (D) a lease agreement;
1989  (E) a periodic notice of rates and services;
1990  (F) a price list;
1991  (G) a rate card;
1992  (H) a receipt; or
1993  (I) a service agreement.
1994        (e)(i) For purposes of Subsection (20)(b)(vi), the sales price of tangible personal
1995  property or a product subject to taxation under this chapter is de minimis if:
1996  (A) the seller's purchase price of the tangible personal property or product is 10%
1997  or less of the seller's total purchase price of the bundled transaction; or
1998  (B) the seller's sales price of the tangible personal property or product is 10% or
1999  less of the seller's total sales price of the bundled transaction.
2000  (ii) For purposes of Subsection (20)(b)(vi), a seller:
2001  (A) shall use the seller's purchase price or the seller's sales price to determine if
2002  the purchase price or sales price of the tangible personal property or product
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       H.B. 162  01-07 09:49
2003  subject to taxation under this chapter is de minimis; and
2004  (B) may not use a combination of the seller's purchase price and the seller's sales
2005  price to determine if the purchase price or sales price of the tangible personal
2006  property or product subject to taxation under this chapter is de minimis.
2007  (iii) For purposes of Subsection (20)(b)(vi), a seller shall use the full term of a service
2008  contract to determine if the sales price of tangible personal property or a product is
2009  de minimis.
2010        (f) For purposes of Subsection (20)(b)(vii)(B), a seller may not use a combination of the
2011  seller's purchase price and the seller's sales price to determine if tangible personal
2012  property subject to taxation under this chapter is 50% or less of the seller's total
2013  purchase price or sales price of that retail sale.
2014    (21) "Car sharing" means the same as that term is defined in Section 13-48a-101.
2015    (22) "Car-sharing program" means the same as that term is defined in Section 13-48a-101.
2016    (23) "Certified automated system" means software certified by the governing board of the
2017        agreement that:
2018        (a) calculates the agreement sales and use tax imposed within a local taxing jurisdiction:
2019  (i) on a transaction; and
2020  (ii) in the states that are members of the agreement;
2021        (b) determines the amount of agreement sales and use tax to remit to a state that is a
2022  member of the agreement; and
2023        (c) maintains a record of the transaction described in Subsection (23)(a)(i).
2024    (24) "Certified service provider" means an agent certified:
2025        (a) by the governing board of the agreement; and
2026        (b) to perform a seller's sales and use tax functions for an agreement sales and use tax, as
2027  outlined in the contract between the governing board of the agreement and the
2028  certified service provider, other than the seller's obligation under Section 59-12-124
2029  to remit a tax on the seller's own purchases.
2030    (25)(a) Subject to Subsection (25)(b), "clothing" means all human wearing apparel
2031        suitable for general use.
2032        (b) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
2033  commission shall make rules:
2034  (i) listing the items that constitute "clothing"; and
2035  (ii) that are consistent with the list of items that constitute "clothing" under the
2036  agreement.
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       01-07 09:49  H.B. 162
2037     (26) "Coal-to-liquid" means the process of converting coal into a liquid synthetic fuel.
2038     (27) "Commercial use" means the use of gas, electricity, heat, coal, fuel oil, or other fuels
2039  that does not constitute industrial use under Subsection (61) or residential use under
2040  Subsection (117).
2041     (28)(a) "Common carrier" means a person engaged in or transacting the business of
2042  transporting passengers, freight, merchandise, or other property for hire within this
2043  state.
2044  (b)(i) "Common carrier" does not include a person that, at the time the person is
2045  traveling to or from that person's place of employment, transports a passenger to
2046  or from the passenger's place of employment.
2047  (ii) For purposes of Subsection (28)(b)(i), in accordance with Title 63G, Chapter 3,
2048  Utah Administrative Rulemaking Act, the commission may make rules defining
2049  what constitutes a person's place of employment.
2050  (c) "Common carrier" does not include a person that provides transportation network
2051  services, as defined in Section 13-51-102.
2052     (29) "Component part" includes:
2053  (a) poultry, dairy, and other livestock feed, and their components;
2054  (b) baling ties and twine used in the baling of hay and straw;
2055  (c) fuel used for providing temperature control of orchards and commercial greenhouses
2056  doing a majority of their business in wholesale sales, and for providing power for
2057  off-highway type farm machinery; and
2058  (d) feed, seeds, and seedlings.
2059     (30) "Computer" means an electronic device that accepts information:
2060  (a)(i) in digital form; or
2061  (ii) in a form similar to digital form; and
2062  (b) manipulates that information for a result based on a sequence of instructions.
2063     (31) "Computer software" means a set of coded instructions designed to cause:
2064  (a) a computer to perform a task; or
2065  (b) automatic data processing equipment to perform a task.
2066     (32) "Computer software maintenance contract" means a contract that obligates a seller of
2067  computer software to provide a customer with:
2068  (a) future updates or upgrades to computer software;
2069  (b) support services with respect to computer software; or
2070  (c) a combination of Subsections (32)(a) and (b).
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       H.B. 162  01-07 09:49
2071    (33)(a) "Conference bridging service" means an ancillary service that links two or more
2072        participants of an audio conference call or video conference call.
2073        (b) "Conference bridging service" may include providing a telephone number as part of
2074  the ancillary service described in Subsection (33)(a).
2075        (c) "Conference bridging service" does not include a telecommunications service used to
2076  reach the ancillary service described in Subsection (33)(a).
2077    (34) "Construction materials" means any tangible personal property that will be converted
2078        into real property.
2079    (35) "Delivered electronically" means delivered to a purchaser by means other than tangible
2080        storage media.
2081    (36)(a) "Delivery charge" means a charge:
2082  (i) by a seller of:
2083  (A) tangible personal property;
2084  (B) a product transferred electronically; or
2085  (C) a service; and
2086  (ii) for preparation and delivery of the tangible personal property, product transferred
2087  electronically, or services described in Subsection (36)(a)(i) to a location
2088  designated by the purchaser.
2089        (b) "Delivery charge" includes a charge for the following:
2090  (i) transportation;
2091  (ii) shipping;
2092  (iii) postage;
2093  (iv) handling;
2094  (v) crating; or
2095  (vi) packing.
2096    (37) "Detailed telecommunications billing service" means an ancillary service of separately
2097        stating information pertaining to individual calls on a customer's billing statement.
2098    (38) "Dietary supplement" means a product, other than tobacco, that:
2099        (a) is intended to supplement the diet;
2100        (b) contains one or more of the following dietary ingredients:
2101  (i) a vitamin;
2102  (ii) a mineral;
2103  (iii) an herb or other botanical;
2104  (iv) an amino acid;
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       01-07 09:49  H.B. 162
2105  (v) a dietary substance for use by humans to supplement the diet by increasing the
2106  total dietary intake; or
2107  (vi) a concentrate, metabolite, constituent, extract, or combination of any ingredient
2108  described in Subsections (38)(b)(i) through (v);
2109  (c)(i) except as provided in Subsection (38)(c)(ii), is intended for ingestion in:
2110  (A) tablet form;
2111  (B) capsule form;
2112  (C) powder form;
2113  (D) softgel form;
2114  (E) gelcap form; or
2115  (F) liquid form; or
2116  (ii) if the product is not intended for ingestion in a form described in Subsections
2117  (38)(c)(i)(A) through (F), is not represented:
2118  (A) as conventional food; and
2119  (B) for use as a sole item of:
2120  (I) a meal; or
2121  (II) the diet; and
2122  (d) is required to be labeled as a dietary supplement:
2123  (i) identifiable by the "Supplemental Facts" box found on the label; and
2124  (ii) as required by 21 C.F.R. Sec. 101.36.
2125     (39)(a) "Digital audio work" means a work that results from the fixation of a series of
2126  musical, spoken, or other sounds.
2127  (b) "Digital audio work" includes a ringtone.
2128     (40) "Digital audio-visual work" means a series of related images which, when shown in
2129  succession, imparts an impression of motion, together with accompanying sounds, if any.
2130     (41) "Digital book" means a work that is generally recognized in the ordinary and usual
2131  sense as a book.
2132     (42)(a) "Direct mail" means printed material delivered or distributed by United States
2133  mail or other delivery service:
2134  (i) to:
2135  (A) a mass audience; or
2136  (B) addressees on a mailing list provided:
2137  (I) by a purchaser of the mailing list; or
2138  (II) at the discretion of the purchaser of the mailing list; and
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       H.B. 162  01-07 09:49
2139  (ii) if the cost of the printed material is not billed directly to the recipients.
2140        (b) "Direct mail" includes tangible personal property supplied directly or indirectly by a
2141  purchaser to a seller of direct mail for inclusion in a package containing the printed
2142  material.
2143        (c) "Direct mail" does not include multiple items of printed material delivered to a single
2144  address.
2145    (43) "Directory assistance" means an ancillary service of providing:
2146        (a) address information; or
2147        (b) telephone number information.
2148    (44)(a) "Disposable home medical equipment or supplies" means medical equipment or
2149        supplies that:
2150  (i) cannot withstand repeated use; and
2151  (ii) are purchased by, for, or on behalf of a person other than:
2152  (A) a health care facility as defined in Section 26B-2-201;
2153  (B) a health care provider as defined in Section 78B-3-403;
2154  (C) an office of a health care provider described in Subsection (44)(a)(ii)(B); or
2155  (D) a person similar to a person described in Subsections (44)(a)(ii)(A) through
2156  (C).
2157        (b) "Disposable home medical equipment or supplies" does not include:
2158  (i) a drug;
2159  (ii) durable medical equipment;
2160  (iii) a hearing aid;
2161  (iv) a hearing aid accessory;
2162  (v) mobility enhancing equipment; or
2163  (vi) tangible personal property used to correct impaired vision, including:
2164  (A) eyeglasses; or
2165  (B) contact lenses.
2166        (c) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
2167  commission may by rule define what constitutes medical equipment or supplies.
2168    (45) "Drilling equipment manufacturer" means a facility:
2169        (a) located in the state;
2170        (b) with respect to which 51% or more of the manufacturing activities of the facility
2171  consist of manufacturing component parts of drilling equipment;
2172        (c) that uses pressure of 800,000 or more pounds per square inch as part of the
  - 64 -
       01-07 09:49  H.B. 162
2173  manufacturing process; and
2174        (d) that uses a temperature of 2,000 or more degrees Fahrenheit as part of the
2175  manufacturing process.
2176     (46)(a) "Drug" means a compound, substance, or preparation, or a component of a
2177        compound, substance, or preparation that is:
2178  (i) recognized in:
2179  (A) the official United States Pharmacopoeia;
2180  (B) the official Homeopathic Pharmacopoeia of the United States;
2181  (C) the official National Formulary; or
2182  (D) a supplement to a publication listed in Subsections (46)(a)(i)(A) through (C);
2183  (ii) intended for use in the:
2184  (A) diagnosis of disease;
2185  (B) cure of disease;
2186  (C) mitigation of disease;
2187  (D) treatment of disease; or
2188  (E) prevention of disease; or
2189  (iii) intended to affect:
2190  (A) the structure of the body; or
2191  (B) any function of the body.
2192        (b) "Drug" does not include:
2193  (i) food and food ingredients;
2194  (ii) a dietary supplement;
2195  (iii) an alcoholic beverage; or
2196  (iv) a prosthetic device.
2197     (47)(a) "Durable medical equipment" means equipment that:
2198  (i) can withstand repeated use;
2199  (ii) is primarily and customarily used to serve a medical purpose;
2200  (iii) generally is not useful to a person in the absence of illness or injury; and
2201  (iv) is not worn in or on the body.
2202        (b) "Durable medical equipment" includes parts used in the repair or replacement of the
2203  equipment described in Subsection (47)(a).
2204        (c) "Durable medical equipment" does not include mobility enhancing equipment.
2205     (48) "Electronic" means:
2206        (a) relating to technology; and
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       H.B. 162  01-07 09:49
2207        (b) having:
2208  (i) electrical capabilities;
2209  (ii) digital capabilities;
2210  (iii) magnetic capabilities;
2211  (iv) wireless capabilities;
2212  (v) optical capabilities;
2213  (vi) electromagnetic capabilities; or
2214  (vii) capabilities similar to Subsections (48)(b)(i) through (vi).
2215    (49) "Electronic financial payment service" means an establishment:
2216        (a) within NAICS Code 522320, Financial Transactions Processing, Reserve, and
2217  Clearinghouse Activities, of the 2012 North American Industry Classification System
2218  of the federal Executive Office of the President, Office of Management and Budget;
2219  and
2220        (b) that performs electronic financial payment services.
2221    (50) "Employee" means the same as that term is defined in Section 59-10-401.
2222    (51) "Fixed guideway" means a public transit facility that uses and occupies:
2223        (a) rail for the use of public transit; or
2224        (b) a separate right-of-way for the use of public transit.
2225    (52) "Fixed wing turbine powered aircraft" means an aircraft that:
2226        (a) is powered by turbine engines;
2227        (b) operates on jet fuel; and
2228        (c) has wings that are permanently attached to the fuselage of the aircraft.
2229    (53) "Fixed wireless service" means a telecommunications service that provides radio
2230        communication between fixed points.
2231    (54)(a) "Food and food ingredients" means substances:
2232  (i) regardless of whether the substances are in:
2233  (A) liquid form;
2234  (B) concentrated form;
2235  (C) solid form;
2236  (D) frozen form;
2237  (E) dried form; or
2238  (F) dehydrated form; and
2239  (ii) that are:
2240  (A) sold for:
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       01-07 09:49  H.B. 162
2241  (I) ingestion by humans; or
2242  (II) chewing by humans; and
2243  (B) consumed for the substance's:
2244  (I) taste; or
2245  (II) nutritional value.
2246  (b) "Food and food ingredients" includes an item described in Subsection (100)(b)(iii).
2247  (c) "Food and food ingredients" does not include:
2248  (i) an alcoholic beverage;
2249  (ii) tobacco; or
2250  (iii) prepared food.
2251     (55)(a) "Fundraising sales" means sales:
2252  (i)(A) made by a school; or
2253  (B) made by a school student;
2254  (ii) that are for the purpose of raising funds for the school to purchase equipment,
2255  materials, or provide transportation; and
2256  (iii) that are part of an officially sanctioned school activity.
2257  (b) For purposes of Subsection (55)(a)(iii), "officially sanctioned school activity" means
2258  a school activity:
2259  (i) that is conducted in accordance with a formal policy adopted by the school or
2260  school district governing the authorization and supervision of fundraising
2261  activities;
2262  (ii) that does not directly or indirectly compensate an individual teacher or other
2263  educational personnel by direct payment, commissions, or payment in kind; and
2264  (iii) the net or gross revenue from which is deposited in a dedicated account
2265  controlled by the school or school district.
2266     (56) "Geothermal energy" means energy contained in heat that continuously flows outward
2267  from the earth that is used as the sole source of energy to produce electricity.
2268     (57) "Governing board of the agreement" means the governing board of the agreement that
2269  is:
2270  (a) authorized to administer the agreement; and
2271  (b) established in accordance with the agreement.
2272     (58)(a) For purposes of Subsection 59-12-104(41), "governmental entity" means:
2273  (i) the executive branch of the state, including all departments, institutions, boards,
2274  divisions, bureaus, offices, commissions, and committees;
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       H.B. 162  01-07 09:49
2275  (ii) the judicial branch of the state, including the courts, the Judicial Council, the
2276  Administrative Office of the Courts, and similar administrative units in the
2277  judicial branch;
2278  (iii) the legislative branch of the state, including the House of Representatives, the
2279  Senate, Legislative Services, the Office of Legislative Research and General
2280  Counsel, the Office of the Legislative Auditor General, and the Office of the
2281  Legislative Fiscal Analyst;
2282  (iv) the National Guard;
2283  (v) an independent entity as defined in Section 63E-1-102; or
2284  (vi) a political subdivision as defined in Section 17B-1-102.
2285        (b) "Governmental entity" does not include the state systems of public and higher
2286  education, including:
2287  (i) a school;
2288  (ii) the State Board of Education;
2289  (iii) the Utah Board of Higher Education; or
2290  (iv) an institution of higher education listed in Section 53H-1-102.
2291    (59) "Hydroelectric energy" means water used as the sole source of energy to produce
2292        electricity.
2293    (60) "Individual-owned shared vehicle" means the same as that term is defined in Section
2294        13-48a-101.
2295    (61) "Industrial use" means the use of natural gas, electricity, heat, coal, fuel oil, or other
2296        fuels:
2297        (a) in mining or extraction of minerals;
2298        (b) in agricultural operations to produce an agricultural product up to the time of harvest
2299  or placing the agricultural product into a storage facility, including:
2300  (i) commercial greenhouses;
2301  (ii) irrigation pumps;
2302  (iii) farm machinery;
2303  (iv) implements of husbandry as defined in Section 41-1a-102 that are not registered
2304  under Title 41, Chapter 1a, Part 2, Registration; and
2305  (v) other farming activities;
2306        (c) in manufacturing tangible personal property at an establishment described in:
2307  (i) SIC Codes 2000 to 3999 of the 1987 Standard Industrial Classification Manual of
2308  the federal Executive Office of the President, Office of Management and Budget;
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       01-07 09:49  H.B. 162
2309  or
2310  (ii) a NAICS code within NAICS Sector 31-33, Manufacturing, of the 2017 North
2311  American Industry Classification System of the federal Executive Office of the
2312  President, Office of Management and Budget;
2313  (d) by a scrap recycler if:
2314  (i) from a fixed location, the scrap recycler utilizes machinery or equipment to
2315  process one or more of the following items into prepared grades of processed
2316  materials for use in new products:
2317  (A) iron;
2318  (B) steel;
2319  (C) nonferrous metal;
2320  (D) paper;
2321  (E) glass;
2322  (F) plastic;
2323  (G) textile; or
2324  (H) rubber; and
2325  (ii) the new products under Subsection (61)(d)(i) would otherwise be made with
2326  nonrecycled materials; or
2327  (e) in producing a form of energy or steam described in Subsection 54-2-1(3)(a) by a
2328  cogeneration facility as defined in Section 54-2-1.
2329     (62)(a) "Installation charge" means a charge for installing:
2330  (i) tangible personal property; or
2331  (ii) a product transferred electronically.
2332  (b) "Installation charge" does not include a charge for:
2333  (i) repairs or renovations of:
2334  (A) tangible personal property; or
2335  (B) a product transferred electronically; or
2336  (ii) attaching tangible personal property or a product transferred electronically:
2337  (A) to other tangible personal property; and
2338  (B) as part of a manufacturing or fabrication process.
2339     (63) "Institution of higher education" means an institution of higher education listed in
2340  Section 53H-1-102.
2341     (64)(a) "Lease" or "rental" means a transfer of possession or control of tangible personal
2342  property or a product transferred electronically for:
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       H.B. 162  01-07 09:49
2343  (i)(A) a fixed term; or
2344  (B) an indeterminate term; and
2345  (ii) consideration.
2346        (b) "Lease" or "rental" includes:
2347  (i) an agreement covering a motor vehicle and trailer if the amount of consideration
2348  may be increased or decreased by reference to the amount realized upon sale or
2349  disposition of the property as defined in Section 7701(h)(1), Internal Revenue
2350  Code; and
2351  (ii) car sharing.
2352        (c) "Lease" or "rental" does not include:
2353  (i) a transfer of possession or control of property under a security agreement or
2354  deferred payment plan that requires the transfer of title upon completion of the
2355  required payments;
2356  (ii) a transfer of possession or control of property under an agreement that requires
2357  the transfer of title:
2358  (A) upon completion of required payments; and
2359  (B) if the payment of an option price does not exceed the greater of:
2360  (I) $100; or
2361  (II) 1% of the total required payments; or
2362  (iii) providing tangible personal property along with an operator for a fixed period of
2363  time or an indeterminate period of time if the operator is necessary for equipment
2364  to perform as designed.
2365        (d) For purposes of Subsection (64)(c)(iii), an operator is necessary for equipment to
2366  perform as designed if the operator's duties exceed the:
2367  (i) set-up of tangible personal property;
2368  (ii) maintenance of tangible personal property; or
2369  (iii) inspection of tangible personal property.
2370    (65) "Lesson" means a fixed period of time for the duration of which a trained instructor:
2371        (a) is present with a student in person or by video; and
2372        (b) actively instructs the student, including by providing observation or feedback.
2373    (66) "Life science establishment" means an establishment in this state that is classified
2374        under the following NAICS codes of the 2007 North American Industry Classification
2375        System of the federal Executive Office of the President, Office of Management and
2376        Budget:
  - 70 -
       01-07 09:49  H.B. 162
2377  (a) NAICS Code 33911, Medical Equipment and Supplies Manufacturing;
2378  (b) NAICS Code 334510, Electromedical and Electrotherapeutic Apparatus
2379  Manufacturing; or
2380  (c) NAICS Code 334517, Irradiation Apparatus Manufacturing.
2381     (67) "Life science research and development facility" means a facility owned, leased, or
2382  rented by a life science establishment if research and development is performed in 51%
2383  or more of the total area of the facility.
2384     (68) "Load and leave" means delivery to a purchaser by use of a tangible storage media if
2385  the tangible storage media is not physically transferred to the purchaser.
2386     (69) "Local taxing jurisdiction" means a:
2387  (a) county that is authorized to impose an agreement sales and use tax;
2388  (b) city that is authorized to impose an agreement sales and use tax; or
2389  (c) town that is authorized to impose an agreement sales and use tax.
2390     (70) "Manufactured home" means the same as that term is defined in Section 15A-1-302.
2391     (71) "Manufacturing facility" means:
2392  (a) an establishment described in:
2393  (i) SIC Codes 2000 to 3999 of the 1987 Standard Industrial Classification Manual of
2394  the federal Executive Office of the President, Office of Management and Budget;
2395  or
2396  (ii) a NAICS code within NAICS Sector 31-33, Manufacturing, of the 2017 North
2397  American Industry Classification System of the federal Executive Office of the
2398  President, Office of Management and Budget;
2399  (b) a scrap recycler if:
2400  (i) from a fixed location, the scrap recycler utilizes machinery or equipment to
2401  process one or more of the following items into prepared grades of processed
2402  materials for use in new products:
2403  (A) iron;
2404  (B) steel;
2405  (C) nonferrous metal;
2406  (D) paper;
2407  (E) glass;
2408  (F) plastic;
2409  (G) textile; or
2410  (H) rubber; and
  - 71 -
       H.B. 162  01-07 09:49
2411  (ii) the new products under Subsection (71)(b)(i) would otherwise be made with
2412  nonrecycled materials; or
2413        (c) a cogeneration facility as defined in Section 54-2-1 if the cogeneration facility is
2414  placed in service on or after May 1, 2006.
2415    (72)(a) "Marketplace" means a physical or electronic place, platform, or forum where
2416        tangible personal property, a product transferred electronically, or a service is offered
2417        for sale.
2418        (b) "Marketplace" includes a store, a booth, an Internet website, a catalog, or a dedicated
2419  sales software application.
2420    (73)(a) "Marketplace facilitator" means a person, including an affiliate of the person,
2421        that enters into a contract, an agreement, or otherwise with sellers, for consideration,
2422        to facilitate the sale of a seller's product through a marketplace that the person owns,
2423        operates, or controls and that directly or indirectly:
2424  (i) does any of the following:
2425  (A) lists, makes available, or advertises tangible personal property, a product
2426  transferred electronically, or a service for sale by a marketplace seller on a
2427  marketplace that the person owns, operates, or controls;
2428  (B) facilitates the sale of a marketplace seller's tangible personal property, product
2429  transferred electronically, or service by transmitting or otherwise
2430  communicating an offer or acceptance of a retail sale between the marketplace
2431  seller and a purchaser using the marketplace;
2432  (C) owns, rents, licenses, makes available, or operates any electronic or physical
2433  infrastructure or any property, process, method, copyright, trademark, or patent
2434  that connects a marketplace seller to a purchaser for the purpose of making a
2435  retail sale of tangible personal property, a product transferred electronically, or
2436  a service;
2437  (D) provides a marketplace for making, or otherwise facilitates, a retail sale of
2438  tangible personal property, a product transferred electronically, or a service,
2439  regardless of ownership or control of the tangible personal property, the
2440  product transferred electronically, or the service that is the subject of the retail
2441  sale;
2442  (E) provides software development or research and development activities related
2443  to any activity described in this Subsection (73)(a)(i), if the software
2444  development or research and development activity is directly related to the
  - 72 -
       01-07 09:49  H.B. 162
2445  person's marketplace;
2446  (F) provides or offers fulfillment or storage services for a marketplace seller;
2447  (G) sets prices for the sale of tangible personal property, a product transferred
2448  electronically, or a service by a marketplace seller;
2449  (H) provides or offers customer service to a marketplace seller or a marketplace
2450  seller's purchaser or accepts or assists with taking orders, returns, or exchanges
2451  of tangible personal property, a product transferred electronically, or a service
2452  sold by a marketplace seller on the person's marketplace; or
2453  (I) brands or otherwise identifies sales as those of the person; and
2454  (ii) does any of the following:
2455  (A) collects the sales price or purchase price of a retail sale of tangible personal
2456  property, a product transferred electronically, or a service;
2457  (B) provides payment processing services for a retail sale of tangible personal
2458  property, a product transferred electronically, or a service;
2459  (C) charges, collects, or otherwise receives a selling fee, listing fee, referral fee,
2460  closing fee, a fee for inserting or making available tangible personal property, a
2461  product transferred electronically, or a service on the person's marketplace, or
2462  other consideration for the facilitation of a retail sale of tangible personal
2463  property, a product transferred electronically, or a service, regardless of
2464  ownership or control of the tangible personal property, the product transferred
2465  electronically, or the service that is the subject of the retail sale;
2466  (D) through terms and conditions, an agreement, or another arrangement with a
2467  third person, collects payment from a purchase for a retail sale of tangible
2468  personal property, a product transferred electronically, or a service and
2469  transmits that payment to the marketplace seller, regardless of whether the
2470  third person receives compensation or other consideration in exchange for the
2471  service; or
2472  (E) provides a virtual currency for a purchaser to use to purchase tangible personal
2473  property, a product transferred electronically, or service offered for sale.
2474  (b) "Marketplace facilitator" does not include:
2475  (i) a person that only provides payment processing services; or
2476  (ii) a person described in Subsection (73)(a) to the extent the person is facilitating a
2477  sale for a seller that is a restaurant as defined in Section 59-12-602.
2478     (74) "Marketplace seller" means a seller that makes one or more retail sales through a
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       H.B. 162  01-07 09:49
2479        marketplace that a marketplace facilitator owns, operates, or controls, regardless of
2480        whether the seller is required to be registered to collect and remit the tax under this part.
2481    (75) "Member of the immediate family of the producer" means a person who is related to a
2482        producer described in Subsection 59-12-104(20)(a) as a:
2483        (a) child or stepchild, regardless of whether the child or stepchild is:
2484  (i) an adopted child or adopted stepchild; or
2485  (ii) a foster child or foster stepchild;
2486        (b) grandchild or stepgrandchild;
2487        (c) grandparent or stepgrandparent;
2488        (d) nephew or stepnephew;
2489        (e) niece or stepniece;
2490        (f) parent or stepparent;
2491        (g) sibling or stepsibling;
2492        (h) spouse;
2493        (i) person who is the spouse of a person described in Subsections (75)(a) through (g); or
2494        (j) person similar to a person described in Subsections (75)(a) through (i) as determined
2495  by the commission by rule made in accordance with Title 63G, Chapter 3, Utah
2496  Administrative Rulemaking Act.
2497    (76) "Mobile home" means the same as that term is defined in Section 15A-1-302.
2498    (77) "Mobile telecommunications service" means the same as that term is defined in the
2499        Mobile Telecommunications Sourcing Act, 4 U.S.C. Sec. 124.
2500    (78)(a) "Mobile wireless service" means a telecommunications service, regardless of the
2501        technology used, if:
2502  (i) the origination point of the conveyance, routing, or transmission is not fixed;
2503  (ii) the termination point of the conveyance, routing, or transmission is not fixed; or
2504  (iii) the origination point described in Subsection (78)(a)(i) and the termination point
2505  described in Subsection (78)(a)(ii) are not fixed.
2506        (b) "Mobile wireless service" includes a telecommunications service that is provided by
2507  a commercial mobile radio service provider.
2508        (c) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
2509  commission may by rule define "commercial mobile radio service provider."
2510    (79)(a) "Mobility enhancing equipment" means equipment that is:
2511  (i) primarily and customarily used to provide or increase the ability to move from one
2512  place to another;
  - 74 -
       01-07 09:49  H.B. 162
2513  (ii) appropriate for use in a:
2514  (A) home; or
2515  (B) motor vehicle; and
2516  (iii) not generally used by persons with normal mobility.
2517  (b) "Mobility enhancing equipment" includes parts used in the repair or replacement of
2518  the equipment described in Subsection (79)(a).
2519  (c) "Mobility enhancing equipment" does not include:
2520  (i) a motor vehicle;
2521  (ii) equipment on a motor vehicle if that equipment is normally provided by the
2522  motor vehicle manufacturer;
2523  (iii) durable medical equipment; or
2524  (iv) a prosthetic device.
2525     (80) "Model 1 seller" means a seller registered under the agreement that has selected a
2526  certified service provider as the seller's agent to perform the seller's sales and use tax
2527  functions for agreement sales and use taxes, as outlined in the contract between the
2528  governing board of the agreement and the certified service provider, other than the
2529  seller's obligation under Section 59-12-124 to remit a tax on the seller's own purchases.
2530     (81) "Model 2 seller" means a seller registered under the agreement that:
2531  (a) except as provided in Subsection (81)(b), has selected a certified automated system
2532  to perform the seller's sales tax functions for agreement sales and use taxes; and
2533  (b) retains responsibility for remitting all of the sales tax:
2534  (i) collected by the seller; and
2535  (ii) to the appropriate local taxing jurisdiction.
2536     (82)(a) Subject to Subsection (82)(b), "model 3 seller" means a seller registered under
2537  the agreement that has:
2538  (i) sales in at least five states that are members of the agreement;
2539  (ii) total annual sales revenue of at least $500,000,000;
2540  (iii) a proprietary system that calculates the amount of tax:
2541  (A) for an agreement sales and use tax; and
2542  (B) due to each local taxing jurisdiction; and
2543  (iv) entered into a performance agreement with the governing board of the agreement.
2544  (b) For purposes of Subsection (82)(a), "model 3 seller" includes an affiliated group of
2545  sellers using the same proprietary system.
2546     (83) "Model 4 seller" means a seller that is registered under the agreement and is not a
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       H.B. 162  01-07 09:49
2547        model 1 seller, model 2 seller, or model 3 seller.
2548    (84) "Modular home" means a modular unit as defined in Section 15A-1-302.
2549    (85) "Motor vehicle" means the same as that term is defined in Section 41-1a-102.
2550    (86) "Oil sands" means impregnated bituminous sands that:
2551        (a) contain a heavy, thick form of petroleum that is released when heated, mixed with
2552  other hydrocarbons, or otherwise treated;
2553        (b) yield mixtures of liquid hydrocarbon; and
2554        (c) require further processing other than mechanical blending before becoming finished
2555  petroleum products.
2556    (87) "Oil shale" means a group of fine black to dark brown shales containing kerogen
2557        material that yields petroleum upon heating and distillation.
2558    (88) "Optional computer software maintenance contract" means a computer software
2559        maintenance contract that a customer is not obligated to purchase as a condition to the
2560        retail sale of computer software.
2561    (89)(a) "Other fuels" means products that burn independently to produce heat or energy.
2562        (b) "Other fuels" includes oxygen when it is used in the manufacturing of tangible
2563  personal property.
2564    (90)(a) "Paging service" means a telecommunications service that provides transmission
2565        of a coded radio signal for the purpose of activating a specific pager.
2566        (b) For purposes of Subsection (90)(a), the transmission of a coded radio signal includes
2567  a transmission by message or sound.
2568    (91) "Pawn transaction" means the same as that term is defined in Section 13-32a-102.
2569    (92) "Pawnbroker" means the same as that term is defined in Section 13-32a-102.
2570    (93)(a) "Permanently attached to real property" means that for tangible personal property
2571        attached to real property:
2572  (i) the attachment of the tangible personal property to the real property:
2573  (A) is essential to the use of the tangible personal property; and
2574  (B) suggests that the tangible personal property will remain attached to the real
2575  property in the same place over the useful life of the tangible personal
2576  property; or
2577  (ii) if the tangible personal property is detached from the real property, the
2578  detachment would:
2579  (A) cause substantial damage to the tangible personal property; or
2580  (B) require substantial alteration or repair of the real property to which the
  - 76 -
       01-07 09:49  H.B. 162
2581  tangible personal property is attached.
2582  (b) "Permanently attached to real property" includes:
2583  (i) the attachment of an accessory to the tangible personal property if the accessory is:
2584  (A) essential to the operation of the tangible personal property; and
2585  (B) attached only to facilitate the operation of the tangible personal property;
2586  (ii) a temporary detachment of tangible personal property from real property for a
2587  repair or renovation if the repair or renovation is performed where the tangible
2588  personal property and real property are located; or
2589  (iii) property attached to oil, gas, or water pipelines, except for the property listed in
2590  Subsection (93)(c)(iii) or (iv).
2591  (c) "Permanently attached to real property" does not include:
2592  (i) the attachment of portable or movable tangible personal property to real property
2593  if that portable or movable tangible personal property is attached to real property
2594  only for:
2595  (A) convenience;
2596  (B) stability; or
2597  (C) for an obvious temporary purpose;
2598  (ii) the detachment of tangible personal property from real property except for the
2599  detachment described in Subsection (93)(b)(ii);
2600  (iii) an attachment of the following tangible personal property to real property if the
2601  attachment to real property is only through a line that supplies water, electricity,
2602  gas, telecommunications, cable, or supplies a similar item as determined by the
2603  commission by rule made in accordance with Title 63G, Chapter 3, Utah
2604  Administrative Rulemaking Act:
2605  (A) a computer;
2606  (B) a telephone;
2607  (C) a television; or
2608  (D) tangible personal property similar to Subsections (93)(c)(iii)(A) through (C)
2609  as determined by the commission by rule made in accordance with Title 63G,
2610  Chapter 3, Utah Administrative Rulemaking Act; or
2611  (iv) an item listed in Subsection (139)(c).
2612     (94) "Person" includes any individual, firm, partnership, joint venture, association,
2613  corporation, estate, trust, business trust, receiver, syndicate, this state, any county, city,
2614  municipality, district, or other local governmental entity of the state, or any group or
  - 77 -
       H.B. 162  01-07 09:49
2615        combination acting as a unit.
2616    (95) "Place of primary use":
2617        (a) for telecommunications service other than mobile telecommunications service,
2618  means the street address representative of where the customer's use of the
2619  telecommunications service primarily occurs, which shall be:
2620  (i) the residential street address of the customer; or
2621  (ii) the primary business street address of the customer; or
2622        (b) for mobile telecommunications service, means the same as that term is defined in the
2623  Mobile Telecommunications Sourcing Act, 4 U.S.C. Sec. 124.
2624    (96)(a) "Postpaid calling service" means a telecommunications service a person obtains
2625        by making a payment on a call-by-call basis:
2626  (i) through the use of a:
2627  (A) bank card;
2628  (B) credit card;
2629  (C) debit card; or
2630  (D) travel card; or
2631  (ii) by a charge made to a telephone number that is not associated with the origination
2632  or termination of the telecommunications service.
2633        (b) "Postpaid calling service" includes a service, except for a prepaid wireless calling
2634  service, that would be a prepaid wireless calling service if the service were
2635  exclusively a telecommunications service.
2636    (97) "Postproduction" means an activity related to the finishing or duplication of a medium
2637        described in Subsection 59-12-104(54)(a).
2638    (98) "Prepaid calling service" means a telecommunications service:
2639        (a) that allows a purchaser access to telecommunications service that is exclusively
2640  telecommunications service;
2641        (b) that:
2642  (i) is paid for in advance; and
2643  (ii) enables the origination of a call using an:
2644  (A) access number; or
2645  (B) authorization code;
2646        (c) that is dialed:
2647  (i) manually; or
2648  (ii) electronically; and
  - 78 -
       01-07 09:49  H.B. 162
2649  (d) sold in predetermined units or dollars that decline:
2650  (i) by a known amount; and
2651  (ii) with use.
2652     (99) "Prepaid wireless calling service" means a telecommunications service:
2653  (a) that provides the right to utilize:
2654  (i) mobile wireless service; and
2655  (ii) other service that is not a telecommunications service, including:
2656  (A) the download of a product transferred electronically;
2657  (B) a content service; or
2658  (C) an ancillary service;
2659  (b) that:
2660  (i) is paid for in advance; and
2661  (ii) enables the origination of a call using an:
2662  (A) access number; or
2663  (B) authorization code;
2664  (c) that is dialed:
2665  (i) manually; or
2666  (ii) electronically; and
2667  (d) sold in predetermined units or dollars that decline:
2668  (i) by a known amount; and
2669  (ii) with use.
2670     (100)(a) "Prepared food" means:
2671  (i) food:
2672  (A) sold in a heated state; or
2673  (B) heated by a seller;
2674  (ii) two or more food ingredients mixed or combined by the seller for sale as a single
2675  item; or
2676  (iii) except as provided in Subsection (100)(c), food sold with an eating utensil
2677  provided by the seller, including a:
2678  (A) plate;
2679  (B) knife;
2680  (C) fork;
2681  (D) spoon;
2682  (E) glass;
  - 79 -
       H.B. 162  01-07 09:49
2683  (F) cup;
2684  (G) napkin; or
2685  (H) straw.
2686       (b) "Prepared food" does not include:
2687  (i) food that a seller only:
2688  (A) cuts;
2689  (B) repackages; or
2690  (C) pasteurizes;
2691  (ii)(A) the following:
2692  (I) raw egg;
2693  (II) raw fish;
2694  (III) raw meat;
2695  (IV) raw poultry; or
2696  (V) a food containing an item described in Subsections (100)(b)(ii)(A)(I)
2697  through (IV); and
2698  (B) if the Food and Drug Administration recommends in Chapter 3, Part 401.11 of
2699  the Food and Drug Administration's Food Code that a consumer cook the items
2700  described in Subsection (100)(b)(ii)(A) to prevent food borne illness; or
2701  (iii) the following if sold without eating utensils provided by the seller:
2702  (A) food and food ingredients sold by a seller if the seller's proper primary
2703  classification under the 2002 North American Industry Classification System
2704  of the federal Executive Office of the President, Office of Management and
2705  Budget, is manufacturing in Sector 311, Food Manufacturing, except for
2706  Subsector 3118, Bakeries and Tortilla Manufacturing;
2707  (B) food and food ingredients sold in an unheated state:
2708  (I) by weight or volume; and
2709  (II) as a single item; or
2710  (C) a bakery item, including:
2711  (I) a bagel;
2712  (II) a bar;
2713  (III) a biscuit;
2714  (IV) bread;
2715  (V) a bun;
2716  (VI) a cake;
  - 80 -
       01-07 09:49  H.B. 162
2717  (VII) a cookie;
2718  (VIII) a croissant;
2719  (IX) a danish;
2720  (X) a donut;
2721  (XI) a muffin;
2722  (XII) a pastry;
2723  (XIII) a pie;
2724  (XIV) a roll;
2725  (XV) a tart;
2726  (XVI) a torte; or
2727  (XVII) a tortilla.
2728  (c) An eating utensil provided by the seller does not include the following used to
2729  transport the food:
2730  (i) a container; or
2731  (ii) packaging.
2732     (101) "Prescription" means an order, formula, or recipe that is issued:
2733  (a)(i) orally;
2734  (ii) in writing;
2735  (iii) electronically; or
2736  (iv) by any other manner of transmission; and
2737  (b) by a licensed practitioner authorized by the laws of a state.
2738     (102)(a) "Prewritten computer software" means computer software that is not designed
2739  and developed:
2740  (i) by the author or other creator of the computer software; and
2741  (ii) to the specifications of a specific purchaser.
2742  (b) "Prewritten computer software" includes:
2743  (i) a prewritten upgrade to computer software if the prewritten upgrade to the
2744  computer software is not designed and developed:
2745  (A) by the author or other creator of the computer software; and
2746  (B) to the specifications of a specific purchaser;
2747  (ii) computer software designed and developed by the author or other creator of the
2748  computer software to the specifications of a specific purchaser if the computer
2749  software is sold to a person other than the purchaser; or
2750  (iii) except as provided in Subsection (102)(c), prewritten computer software or a
  - 81 -
       H.B. 162  01-07 09:49
2751  prewritten portion of prewritten computer software:
2752  (A) that is modified or enhanced to any degree; and
2753  (B) if the modification or enhancement described in Subsection (102)(b)(iii)(A) is
2754  designed and developed to the specifications of a specific purchaser.
2755        (c) "Prewritten computer software" does not include a modification or enhancement
2756  described in Subsection (102)(b)(iii) if the charges for the modification or
2757  enhancement are:
2758  (i) reasonable; and
2759  (ii) subject to Subsections 59-12-103(2)(f)(ii) and (2)(g)(i), separately stated on the
2760  invoice or other statement of price provided to the purchaser at the time of sale or
2761  later, as demonstrated by:
2762  (A) the books and records the seller keeps at the time of the transaction in the
2763  regular course of business, including books and records the seller keeps at the
2764  time of the transaction in the regular course of business for nontax purposes;
2765  (B) a preponderance of the facts and circumstances at the time of the transaction;
2766  and
2767  (C) the understanding of all of the parties to the transaction.
2768    (103)(a) "Private communications service" means a telecommunications service:
2769  (i) that entitles a customer to exclusive or priority use of one or more
2770  communications channels between or among termination points; and
2771  (ii) regardless of the manner in which the one or more communications channels are
2772  connected.
2773        (b) "Private communications service" includes the following provided in connection
2774  with the use of one or more communications channels:
2775  (i) an extension line;
2776  (ii) a station;
2777  (iii) switching capacity; or
2778  (iv) another associated service that is provided in connection with the use of one or
2779  more communications channels as defined in Section 59-12-215.
2780    (104)(a) "Product transferred electronically" means a product transferred electronically
2781        that would be subject to a tax under this chapter if that product was transferred in a
2782        manner other than electronically.
2783        (b) "Product transferred electronically" does not include:
2784  (i) an ancillary service;
  - 82 -
       01-07 09:49  H.B. 162
2785  (ii) computer software; or
2786  (iii) a telecommunications service.
2787     (105)(a) "Prosthetic device" means a device that is worn on or in the body to:
2788  (i) artificially replace a missing portion of the body;
2789  (ii) prevent or correct a physical deformity or physical malfunction; or
2790  (iii) support a weak or deformed portion of the body.
2791  (b) "Prosthetic device" includes:
2792  (i) parts used in the repairs or renovation of a prosthetic device;
2793  (ii) replacement parts for a prosthetic device;
2794  (iii) a dental prosthesis; or
2795  (iv) a hearing aid.
2796  (c) "Prosthetic device" does not include:
2797  (i) corrective eyeglasses; or
2798  (ii) contact lenses.
2799     (106)(a) "Protective equipment" means an item:
2800  (i) for human wear; and
2801  (ii) that is:
2802  (A) designed as protection:
2803  (I) to the wearer against injury or disease; or
2804  (II) against damage or injury of other persons or property; and
2805  (B) not suitable for general use.
2806  (b) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
2807  commission shall make rules:
2808  (i) listing the items that constitute "protective equipment"; and
2809  (ii) that are consistent with the list of items that constitute "protective equipment"
2810  under the agreement.
2811     (107)(a) For purposes of Subsection 59-12-104(41), "publication" means any written or
2812  printed matter, other than a photocopy:
2813  (i) regardless of:
2814  (A) characteristics;
2815  (B) copyright;
2816  (C) form;
2817  (D) format;
2818  (E) method of reproduction; or
  - 83 -
       H.B. 162  01-07 09:49
2819  (F) source; and
2820  (ii) made available in printed or electronic format.
2821        (b) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
2822  commission may by rule define the term "photocopy."
2823    (108)(a) "Purchase price" and "sales price" mean the total amount of consideration:
2824  (i) valued in money; and
2825  (ii) for which tangible personal property, a product transferred electronically, or
2826  services are:
2827  (A) sold;
2828  (B) leased; or
2829  (C) rented.
2830        (b) "Purchase price" and "sales price" include:
2831  (i) the seller's cost of the tangible personal property, a product transferred
2832  electronically, or services sold;
2833  (ii) expenses of the seller, including:
2834  (A) the cost of materials used;
2835  (B) a labor cost;
2836  (C) a service cost;
2837  (D) interest;
2838  (E) a loss;
2839  (F) the cost of transportation to the seller; or
2840  (G) a tax imposed on the seller;
2841  (iii) a charge by the seller for any service necessary to complete the sale; or
2842  (iv) consideration a seller receives from a person other than the purchaser if:
2843  (A)(I) the seller actually receives consideration from a person other than the
2844  purchaser; and
2845  (II) the consideration described in Subsection (108)(b)(iv)(A)(I) is directly
2846  related to a price reduction or discount on the sale;
2847  (B) the seller has an obligation to pass the price reduction or discount through to
2848  the purchaser;
2849  (C) the amount of the consideration attributable to the sale is fixed and
2850  determinable by the seller at the time of the sale to the purchaser; and
2851  (D)(I)(Aa) the purchaser presents a certificate, coupon, or other
2852  documentation to the seller to claim a price reduction or discount; and
  - 84 -
       01-07 09:49  H.B. 162
2853  (Bb) a person other than the seller authorizes, distributes, or grants the
2854  certificate, coupon, or other documentation with the understanding that
2855  the person other than the seller will reimburse any seller to whom the
2856  certificate, coupon, or other documentation is presented;
2857  (II) the purchaser identifies that purchaser to the seller as a member of a group
2858  or organization allowed a price reduction or discount, except that a
2859  preferred customer card that is available to any patron of a seller does not
2860  constitute membership in a group or organization allowed a price reduction
2861  or discount; or
2862  (III) the price reduction or discount is identified as a third party price reduction
2863  or discount on the:
2864  (Aa) invoice the purchaser receives; or
2865  (Bb) certificate, coupon, or other documentation the purchaser presents.
2866        (c) "Purchase price" and "sales price" do not include:
2867  (i) a discount:
2868  (A) in a form including:
2869  (I) cash;
2870  (II) term; or
2871  (III) coupon;
2872  (B) that is allowed by a seller;
2873  (C) taken by a purchaser on a sale; and
2874  (D) that is not reimbursed by a third party; or
2875  (ii) subject to Subsections 59-12-103(2)(f)(ii) and (2)(g)(i), the following if
2876  separately stated on an invoice, bill of sale, or similar document provided to the
2877  purchaser at the time of sale or later, as demonstrated by the books and records the
2878  seller keeps at the time of the transaction in the regular course of business,
2879  including books and records the seller keeps at the time of the transaction in the
2880  regular course of business for nontax purposes, by a preponderance of the facts
2881  and circumstances at the time of the transaction, and by the understanding of all of
2882  the parties to the transaction:
2883  (A) the following from credit extended on the sale of tangible personal property or
2884  services:
2885  (I) a carrying charge;
2886  (II) a financing charge; or
  - 85 -
       H.B. 162  01-07 09:49
2887  (III) an interest charge;
2888  (B) a delivery charge;
2889  (C) an installation charge;
2890  (D) a manufacturer rebate on a motor vehicle; or
2891  (E) a tax or fee legally imposed directly on the consumer.
2892    (109) "Purchaser" means a person to whom:
2893        (a) a sale of tangible personal property is made;
2894        (b) a product is transferred electronically; or
2895        (c) a service is furnished.
2896    (110) "Qualifying data center" means a data center facility that:
2897        (a) houses a group of networked server computers in one physical location in order to
2898  disseminate, manage, and store data and information;
2899        (b) is located in the state;
2900        (c) is a new operation constructed on or after July 1, 2016;
2901        (d) consists of one or more buildings that total 150,000 or more square feet;
2902        (e) is owned or leased by:
2903  (i) the operator of the data center facility; or
2904  (ii) a person under common ownership, as defined in Section 59-7-101, of the
2905  operator of the data center facility; and
2906        (f) is located on one or more parcels of land that are owned or leased by:
2907  (i) the operator of the data center facility; or
2908  (ii) a person under common ownership, as defined in Section 59-7-101, of the
2909  operator of the data center facility.
2910    (111) "Qualifying energy storage manufacturing facility" means a facility that
2911        manufactures, in the state, equipment or devices that store and discharge energy for the
2912        purpose of providing electrical power.
2913    (112) "Regularly rented" means:
2914        (a) rented to a guest for value three or more times during a calendar year; or
2915        (b) advertised or held out to the public as a place that is regularly rented to guests for
2916  value.
2917    (113) "Rental" means the same as that term is defined in Subsection (64).
2918    (114)(a) "Repairs or renovations of tangible personal property" means:
2919  (i) a repair or renovation of tangible personal property that is not permanently
2920  attached to real property; or
  - 86 -
       01-07 09:49  H.B. 162
2921  (ii) attaching tangible personal property or a product transferred electronically to
2922  other tangible personal property or detaching tangible personal property or a
2923  product transferred electronically from other tangible personal property if:
2924  (A) the other tangible personal property to which the tangible personal property or
2925  product transferred electronically is attached or from which the tangible
2926  personal property or product transferred electronically is detached is not
2927  permanently attached to real property; and
2928  (B) the attachment of tangible personal property or a product transferred
2929  electronically to other tangible personal property or detachment of tangible
2930  personal property or a product transferred electronically from other tangible
2931  personal property is made in conjunction with a repair or replacement of
2932  tangible personal property or a product transferred electronically.
2933  (b) "Repairs or renovations of tangible personal property" does not include:
2934  (i) attaching prewritten computer software to other tangible personal property if the
2935  other tangible personal property to which the prewritten computer software is
2936  attached is not permanently attached to real property; or
2937  (ii) detaching prewritten computer software from other tangible personal property if
2938  the other tangible personal property from which the prewritten computer software
2939  is detached is not permanently attached to real property.
2940     (115) "Research and development" means the process of inquiry or experimentation aimed
2941  at the discovery of facts, devices, technologies, or applications and the process of
2942  preparing those devices, technologies, or applications for marketing.
2943     (116)(a) "Residential telecommunications services" means a telecommunications service
2944  or an ancillary service that is provided to an individual for personal use:
2945  (i) at a residential address; or
2946  (ii) at an institution, including a nursing home or a school, if the telecommunications
2947  service or ancillary service is provided to and paid for by the individual residing at
2948  the institution rather than the institution.
2949  (b) For purposes of Subsection (116)(a)(i), a residential address includes an:
2950  (i) apartment; or
2951  (ii) other individual dwelling unit.
2952     (117) "Residential use" means the use in or around a home, apartment building, sleeping
2953  quarters, and similar facilities or accommodations.
2954     (118) "Retail sale" or "sale at retail" means a sale, lease, or rental for a purpose other than:
  - 87 -
       H.B. 162  01-07 09:49
2955        (a) resale;
2956        (b) sublease; or
2957        (c) subrent.
2958    (119)(a) "Retailer" means any person, unless prohibited by the Constitution of the
2959        United States or federal law, that is engaged in a regularly organized business in
2960        tangible personal property or any other taxable transaction under Subsection
2961        59-12-103(1), and who is selling to the user or consumer and not for resale.
2962        (b) "Retailer" includes commission merchants, auctioneers, and any person regularly
2963  engaged in the business of selling to users or consumers within the state.
2964    (120)(a) "Sale" means any transfer of title, exchange, or barter, conditional or otherwise,
2965        in any manner, of tangible personal property or any other taxable transaction under
2966        Subsection 59-12-103(1), for consideration.
2967        (b) "Sale" includes:
2968  (i) installment and credit sales;
2969  (ii) any closed transaction constituting a sale;
2970  (iii) any sale of electrical energy, gas, services, or entertainment taxable under this
2971  chapter;
2972  (iv) any transaction if the possession of property is transferred but the seller retains
2973  the title as security for the payment of the price; and
2974  (v) any transaction under which right to possession, operation, or use of any article of
2975  tangible personal property is granted under a lease or contract and the transfer of
2976  possession would be taxable if an outright sale were made.
2977    (121) "Sale at retail" means the same as that term is defined in Subsection (118).
2978    (122) "Sale-leaseback transaction" means a transaction by which title to tangible personal
2979        property or a product transferred electronically that is subject to a tax under this chapter
2980        is transferred:
2981        (a) by a purchaser-lessee;
2982        (b) to a lessor;
2983        (c) for consideration; and
2984        (d) if:
2985  (i) the purchaser-lessee paid sales and use tax on the purchaser-lessee's initial
2986  purchase of the tangible personal property or product transferred electronically;
2987  (ii) the sale of the tangible personal property or product transferred electronically to
2988  the lessor is intended as a form of financing:
  - 88 -
       01-07 09:49  H.B. 162
2989  (A) for the tangible personal property or product transferred electronically; and
2990  (B) to the purchaser-lessee; and
2991  (iii) in accordance with generally accepted accounting principles, the
2992  purchaser-lessee is required to:
2993  (A) capitalize the tangible personal property or product transferred electronically
2994  for financial reporting purposes; and
2995  (B) account for the lease payments as payments made under a financing
2996  arrangement.
2997     (123) "Sales price" means the same as that term is defined in Subsection (108).
2998     (124)(a) "Sales relating to schools" means the following sales by, amounts paid to, or
2999  amounts charged by a school:
3000  (i) sales that are directly related to the school's educational functions or activities
3001  including:
3002  (A) the sale of:
3003  (I) textbooks;
3004  (II) textbook fees;
3005  (III) laboratory fees;
3006  (IV) laboratory supplies; or
3007  (V) safety equipment;
3008  (B) the sale of a uniform, protective equipment, or sports or recreational
3009  equipment that:
3010  (I) a student is specifically required to wear as a condition of participation in a
3011  school-related event or school-related activity; and
3012  (II) is not readily adaptable to general or continued usage to the extent that it
3013  takes the place of ordinary clothing;
3014  (C) sales of the following if the net or gross revenue generated by the sales is
3015  deposited into a school district fund or school fund dedicated to school meals:
3016  (I) food and food ingredients; or
3017  (II) prepared food; or
3018  (D) transportation charges for official school activities; or
3019  (ii) amounts paid to or amounts charged by a school for admission to a school-related
3020  event or school-related activity.
3021  (b) "Sales relating to schools" does not include:
3022  (i) bookstore sales of items that are not educational materials or supplies;
  - 89 -
       H.B. 162  01-07 09:49
3023  (ii) except as provided in Subsection (124)(a)(i)(B):
3024  (A) clothing;
3025  (B) clothing accessories or equipment;
3026  (C) protective equipment; or
3027  (D) sports or recreational equipment; or
3028  (iii) amounts paid to or amounts charged by a school for admission to a
3029  school-related event or school-related activity if the amounts paid or charged are
3030  passed through to a person:
3031  (A) other than a:
3032  (I) school;
3033  (II) nonprofit organization authorized by a school board or a governing body of
3034  a private school to organize and direct a competitive secondary school
3035  activity; or
3036  (III) nonprofit association authorized by a school board or a governing body of
3037  a private school to organize and direct a competitive secondary school
3038  activity; and
3039  (B) that is required to collect sales and use taxes under this chapter.
3040        (c) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
3041  commission may make rules defining the term "passed through."
3042    (125) For purposes of this section and Section 59-12-104, "school" means:
3043        (a) an elementary school or a secondary school that:
3044  (i) is a:
3045  (A) public school; or
3046  (B) private school; and
3047  (ii) provides instruction for one or more grades kindergarten through 12; or
3048        (b) a public school district.
3049    (126)(a) "Seller" means a person that makes a sale, lease, or rental of:
3050  (i) tangible personal property;
3051  (ii) a product transferred electronically; or
3052  (iii) a service.
3053        (b) "Seller" includes a marketplace facilitator.
3054    (127)(a) "Semiconductor fabricating, processing, research, or development materials"
3055        means tangible personal property or a product transferred electronically if the
3056        tangible personal property or product transferred electronically is:
  - 90 -
       01-07 09:49  H.B. 162
3057  (i) used primarily in the process of:
3058  (A)(I) manufacturing a semiconductor;
3059  (II) fabricating a semiconductor; or
3060  (III) research or development of a:
3061  (Aa) semiconductor; or
3062  (Bb) semiconductor manufacturing process; or
3063  (B) maintaining an environment suitable for a semiconductor; or
3064  (ii) consumed primarily in the process of:
3065  (A)(I) manufacturing a semiconductor;
3066  (II) fabricating a semiconductor; or
3067  (III) research or development of a:
3068  (Aa) semiconductor; or
3069  (Bb) semiconductor manufacturing process; or
3070  (B) maintaining an environment suitable for a semiconductor.
3071  (b) "Semiconductor fabricating, processing, research, or development materials"
3072  includes:
3073  (i) parts used in the repairs or renovations of tangible personal property or a product
3074  transferred electronically described in Subsection (127)(a); or
3075  (ii) a chemical, catalyst, or other material used to:
3076  (A) produce or induce in a semiconductor a:
3077  (I) chemical change; or
3078  (II) physical change;
3079  (B) remove impurities from a semiconductor; or
3080  (C) improve the marketable condition of a semiconductor.
3081     (128) "Senior citizen center" means a facility having the primary purpose of providing
3082  services to the aged as defined in Section 26B-6-101.
3083     (129) "Shared vehicle" means the same as that term is defined in Section 13-48a-101.
3084     (130) "Shared vehicle driver" means the same as that term is defined in Section 13-48a-101.
3085     (131) "Shared vehicle owner" means the same as that term is defined in Section 13-48a-101.
3086     (132)(a) Subject to Subsections (132)(b) and (c), "short-term lodging consumable"
3087  means tangible personal property that:
3088  (i) a business that provides accommodations and services described in Subsection
3089  59-12-103(1)(i) purchases as part of a transaction to provide the accommodations
3090  and services to a purchaser;
  - 91 -
       H.B. 162  01-07 09:49
3091  (ii) is intended to be consumed by the purchaser; and
3092  (iii) is:
3093  (A) included in the purchase price of the accommodations and services; and
3094  (B) not separately stated on an invoice, bill of sale, or other similar document
3095  provided to the purchaser.
3096       (b) "Short-term lodging consumable" includes:
3097  (i) a beverage;
3098  (ii) a brush or comb;
3099  (iii) a cosmetic;
3100  (iv) a hair care product;
3101  (v) lotion;
3102  (vi) a magazine;
3103  (vii) makeup;
3104  (viii) a meal;
3105  (ix) mouthwash;
3106  (x) nail polish remover;
3107  (xi) a newspaper;
3108  (xii) a notepad;
3109  (xiii) a pen;
3110  (xiv) a pencil;
3111  (xv) a razor;
3112  (xvi) saline solution;
3113  (xvii) a sewing kit;
3114  (xviii) shaving cream;
3115  (xix) a shoe shine kit;
3116  (xx) a shower cap;
3117  (xxi) a snack item;
3118  (xxii) soap;
3119  (xxiii) toilet paper;
3120  (xxiv) a toothbrush;
3121  (xxv) toothpaste; or
3122  (xxvi) an item similar to Subsections (132)(b)(i) through (xxv) as the commission
3123  may provide by rule made in accordance with Title 63G, Chapter 3, Utah
3124  Administrative Rulemaking Act.
  - 92 -
       01-07 09:49  H.B. 162
3125  (c) "Short-term lodging consumable" does not include:
3126  (i) tangible personal property that is cleaned or washed to allow the tangible personal
3127  property to be reused; or
3128  (ii) a product transferred electronically.
3129     (133)(a) "Short-term rental" means a lease or rental for less than 30 consecutive days.
3130  (b) "Short-term rental" does not include car sharing.
3131     (134) "Simplified electronic return" means the electronic return:
3132  (a) described in Section 318(C) of the agreement; and
3133  (b) approved by the governing board of the agreement.
3134     (135) "Solar energy" means the sun used as the sole source of energy for producing
3135  electricity.
3136     (136)(a) "Sports or recreational equipment" means an item:
3137  (i) designed for human use; and
3138  (ii) that is:
3139  (A) worn in conjunction with:
3140  (I) an athletic activity; or
3141  (II) a recreational activity; and
3142  (B) not suitable for general use.
3143  (b) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
3144  commission shall make rules:
3145  (i) listing the items that constitute "sports or recreational equipment"; and
3146  (ii) that are consistent with the list of items that constitute "sports or recreational
3147  equipment" under the agreement.
3148     (137) "State" means the state of Utah, its departments, and agencies.
3149     (138) "Storage" means any keeping or retention of tangible personal property or any other
3150  taxable transaction under Subsection 59-12-103(1), in this state for any purpose except
3151  sale in the regular course of business.
3152     (139)(a) "Tangible personal property" means personal property that:
3153  (i) may be:
3154  (A) seen;
3155  (B) weighed;
3156  (C) measured;
3157  (D) felt; or
3158  (E) touched; or
  - 93 -
       H.B. 162  01-07 09:49
3159  (ii) is in any manner perceptible to the senses.
3160        (b) "Tangible personal property" includes:
3161  (i) electricity;
3162  (ii) water;
3163  (iii) gas;
3164  (iv) steam; or
3165  (v) prewritten computer software, regardless of the manner in which the prewritten
3166  computer software is transferred.
3167        (c) "Tangible personal property" includes the following regardless of whether the item is
3168  attached to real property:
3169  (i) a dishwasher;
3170  (ii) a dryer;
3171  (iii) a freezer;
3172  (iv) a microwave;
3173  (v) a refrigerator;
3174  (vi) a stove;
3175  (vii) a washer; or
3176  (viii) an item similar to Subsections (139)(c)(i) through (vii) as determined by the
3177  commission by rule made in accordance with Title 63G, Chapter 3, Utah
3178  Administrative Rulemaking Act.
3179        (d) "Tangible personal property" does not include a product that is transferred
3180  electronically.
3181        (e) "Tangible personal property" does not include the following if attached to real
3182  property, regardless of whether the attachment to real property is only through a line
3183  that supplies water, electricity, gas, telephone, cable, or supplies a similar item as
3184  determined by the commission by rule made in accordance with Title 63G, Chapter 3,
3185  Utah Administrative Rulemaking Act:
3186  (i) a hot water heater;
3187  (ii) a water filtration system; or
3188  (iii) a water softener system.
3189    (140)(a) "Telecommunications enabling or facilitating equipment, machinery, or
3190        software" means an item listed in Subsection (140)(b) if that item is purchased or
3191        leased primarily to enable or facilitate one or more of the following to function:
3192  (i) telecommunications switching or routing equipment, machinery, or software; or
  - 94 -
       01-07 09:49  H.B. 162
3193  (ii) telecommunications transmission equipment, machinery, or software.
3194        (b) The following apply to Subsection (140)(a):
3195  (i) a pole;
3196  (ii) software;
3197  (iii) a supplementary power supply;
3198  (iv) temperature or environmental equipment or machinery;
3199  (v) test equipment;
3200  (vi) a tower; or
3201  (vii) equipment, machinery, or software that functions similarly to an item listed in
3202  Subsections (140)(b)(i) through (vi) as determined by the commission by rule
3203  made in accordance with Subsection (140)(c).
3204        (c) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
3205  commission may by rule define what constitutes equipment, machinery, or software
3206  that functions similarly to an item listed in Subsections (140)(b)(i) through (vi).
3207     (141) "Telecommunications equipment, machinery, or software required for 911 service"
3208        means equipment, machinery, or software that is required to comply with 47 C.F.R. Sec.
3209        20.18.
3210     (142) "Telecommunications maintenance or repair equipment, machinery, or software"
3211        means equipment, machinery, or software purchased or leased primarily to maintain or
3212        repair one or more of the following, regardless of whether the equipment, machinery, or
3213        software is purchased or leased as a spare part or as an upgrade or modification to one or
3214        more of the following:
3215        (a) telecommunications enabling or facilitating equipment, machinery, or software;
3216        (b) telecommunications switching or routing equipment, machinery, or software; or
3217        (c) telecommunications transmission equipment, machinery, or software.
3218     (143)(a) "Telecommunications service" means the electronic conveyance, routing, or
3219        transmission of audio, data, video, voice, or any other information or signal to a
3220        point, or among or between points.
3221        (b) "Telecommunications service" includes:
3222  (i) an electronic conveyance, routing, or transmission with respect to which a
3223  computer processing application is used to act:
3224  (A) on the code, form, or protocol of the content;
3225  (B) for the purpose of electronic conveyance, routing, or transmission; and
3226  (C) regardless of whether the service:
  - 95 -
       H.B. 162  01-07 09:49
3227  (I) is referred to as voice over Internet protocol service; or
3228  (II) is classified by the Federal Communications Commission as enhanced or
3229  value added;
3230  (ii) an 800 service;
3231  (iii) a 900 service;
3232  (iv) a fixed wireless service;
3233  (v) a mobile wireless service;
3234  (vi) a postpaid calling service;
3235  (vii) a prepaid calling service;
3236  (viii) a prepaid wireless calling service; or
3237  (ix) a private communications service.
3238       (c) "Telecommunications service" does not include:
3239  (i) advertising, including directory advertising;
3240  (ii) an ancillary service;
3241  (iii) a billing and collection service provided to a third party;
3242  (iv) a data processing and information service if:
3243  (A) the data processing and information service allows data to be:
3244  (I)(Aa) acquired;
3245  (Bb) generated;
3246  (Cc) processed;
3247  (Dd) retrieved; or
3248  (Ee) stored; and
3249  (II) delivered by an electronic transmission to a purchaser; and
3250  (B) the purchaser's primary purpose for the underlying transaction is the processed
3251  data or information;
3252  (v) installation or maintenance of the following on a customer's premises:
3253  (A) equipment; or
3254  (B) wiring;
3255  (vi) Internet access service;
3256  (vii) a paging service;
3257  (viii) a product transferred electronically, including:
3258  (A) music;
3259  (B) reading material;
3260  (C) a ring tone;
  - 96 -
       01-07 09:49  H.B. 162
3261  (D) software; or
3262  (E) video;
3263  (ix) a radio and television audio and video programming service:
3264  (A) regardless of the medium; and
3265  (B) including:
3266  (I) furnishing conveyance, routing, or transmission of a television audio and
3267  video programming service by a programming service provider;
3268  (II) cable service as defined in 47 U.S.C. Sec. 522(6); or
3269  (III) audio and video programming services delivered by a commercial mobile
3270  radio service provider as defined in 47 C.F.R. Sec. 20.3;
3271  (x) a value-added nonvoice data service; or
3272  (xi) tangible personal property.
3273     (144)(a) "Telecommunications service provider" means a person that:
3274  (i) owns, controls, operates, or manages a telecommunications service; and
3275  (ii) engages in an activity described in Subsection (144)(a)(i) for the shared use with
3276  or resale to any person of the telecommunications service.
3277        (b) A person described in Subsection (144)(a) is a telecommunications service provider
3278  whether or not the Public Service Commission of Utah regulates:
3279  (i) that person; or
3280  (ii) the telecommunications service that the person owns, controls, operates, or
3281  manages.
3282     (145)(a) "Telecommunications switching or routing equipment, machinery, or software"
3283        means an item listed in Subsection (145)(b) if that item is purchased or leased
3284        primarily for switching or routing:
3285  (i) an ancillary service;
3286  (ii) data communications;
3287  (iii) voice communications; or
3288  (iv) telecommunications service.
3289        (b) The following apply to Subsection (145)(a):
3290  (i) a bridge;
3291  (ii) a computer;
3292  (iii) a cross connect;
3293  (iv) a modem;
3294  (v) a multiplexer;
  - 97 -
       H.B. 162  01-07 09:49
3295  (vi) plug in circuitry;
3296  (vii) a router;
3297  (viii) software;
3298  (ix) a switch; or
3299  (x) equipment, machinery, or software that functions similarly to an item listed in
3300  Subsections (145)(b)(i) through (ix) as determined by the commission by rule
3301  made in accordance with Subsection (145)(c).
3302       (c) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
3303  commission may by rule define what constitutes equipment, machinery, or software
3304  that functions similarly to an item listed in Subsections (145)(b)(i) through (ix).
3305    (146)(a) "Telecommunications transmission equipment, machinery, or software" means
3306       an item listed in Subsection (146)(b) if that item is purchased or leased primarily for
3307       sending, receiving, or transporting:
3308  (i) an ancillary service;
3309  (ii) data communications;
3310  (iii) voice communications; or
3311  (iv) telecommunications service.
3312       (b) The following apply to Subsection (146)(a):
3313  (i) an amplifier;
3314  (ii) a cable;
3315  (iii) a closure;
3316  (iv) a conduit;
3317  (v) a controller;
3318  (vi) a duplexer;
3319  (vii) a filter;
3320  (viii) an input device;
3321  (ix) an input/output device;
3322  (x) an insulator;
3323  (xi) microwave machinery or equipment;
3324  (xii) an oscillator;
3325  (xiii) an output device;
3326  (xiv) a pedestal;
3327  (xv) a power converter;
3328  (xvi) a power supply;
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3329  (xvii) a radio channel;
3330  (xviii) a radio receiver;
3331  (xix) a radio transmitter;
3332  (xx) a repeater;
3333  (xxi) software;
3334  (xxii) a terminal;
3335  (xxiii) a timing unit;
3336  (xxiv) a transformer;
3337  (xxv) a wire; or
3338  (xxvi) equipment, machinery, or software that functions similarly to an item listed in
3339  Subsections (146)(b)(i) through (xxv) as the commission determines by rule made
3340  in accordance with Subsection (146)(c).
3341  (c) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
3342  commission may by rule define what constitutes equipment, machinery, or software
3343  that functions similarly to an item listed in Subsections (146)(b)(i) through (xxv).
3344     (147)(a) "Textbook for a higher education course" means a textbook or other printed
3345  material that is required for a course:
3346  (i) offered by an institution of higher education; and
3347  (ii) that the purchaser of the textbook or other printed material attends or will attend.
3348  (b) "Textbook for a higher education course" includes a textbook in electronic format.
3349     (148) "Tobacco" means:
3350  (a) a cigarette;
3351  (b) a cigar;
3352  (c) chewing tobacco;
3353  (d) pipe tobacco; or
3354  (e) any other item that contains tobacco.
3355     (149) "Unassisted amusement device" means an amusement device, skill device, or ride
3356  device that is started and stopped by the purchaser or renter of the right to use or operate
3357  the amusement device, skill device, or ride device.
3358     (150)(a) "Use" means the exercise of any right or power over tangible personal property,
3359  a product transferred electronically, or a service under Subsection 59-12-103(1),
3360  incident to the ownership or the leasing of that tangible personal property, product
3361  transferred electronically, or service.
3362  (b) "Use" does not include the sale, display, demonstration, or trial of tangible personal
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       H.B. 162  01-07 09:49
3363  property, a product transferred electronically, or a service in the regular course of
3364  business and held for resale.
3365    (151) "Value-added nonvoice data service" means a service:
3366        (a) that otherwise meets the definition of a telecommunications service except that a
3367  computer processing application is used to act primarily for a purpose other than
3368  conveyance, routing, or transmission; and
3369        (b) with respect to which a computer processing application is used to act on data or
3370  information:
3371  (i) code;
3372  (ii) content;
3373  (iii) form; or
3374  (iv) protocol.
3375    (152)(a) Subject to Subsection (152)(b), "vehicle" means the following that are required
3376        to be titled, registered, or titled and registered:
3377  (i) an aircraft as defined in Section 72-10-102;
3378  (ii) a vehicle as defined in Section 41-1a-102;
3379  (iii) an off-highway vehicle as defined in Section 41-22-2; or
3380  (iv) a vessel as defined in Section 41-1a-102.
3381        (b) For purposes of Subsection 59-12-104(33) only, "vehicle" includes:
3382  (i) a vehicle described in Subsection (152)(a); or
3383  (ii)(A) a locomotive;
3384  (B) a freight car;
3385  (C) railroad work equipment; or
3386  (D) other railroad rolling stock.
3387    (153) "Vehicle dealer" means a person engaged in the business of buying, selling, or
3388        exchanging a vehicle as defined in Subsection (152).
3389    (154)(a) "Vertical service" means an ancillary service that:
3390  (i) is offered in connection with one or more telecommunications services; and
3391  (ii) offers an advanced calling feature that allows a customer to:
3392  (A) identify a caller; and
3393  (B) manage multiple calls and call connections.
3394        (b) "Vertical service" includes an ancillary service that allows a customer to manage a
3395  conference bridging service.
3396    (155)(a) "Voice mail service" means an ancillary service that enables a customer to
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       01-07 09:49  H.B. 162
3397  receive, send, or store a recorded message.
3398  (b) "Voice mail service" does not include a vertical service that a customer is required to
3399  have in order to utilize a voice mail service.
3400     (156)(a) "Waste energy facility" means a facility that generates electricity:
3401  (i) using as the primary source of energy waste materials that would be placed in a
3402  landfill or refuse pit if it were not used to generate electricity, including:
3403  (A) tires;
3404  (B) waste coal;
3405  (C) oil shale; or
3406  (D) municipal solid waste; and
3407  (ii) in amounts greater than actually required for the operation of the facility.
3408  (b) "Waste energy facility" does not include a facility that incinerates:
3409  (i) hospital waste as defined in 40 C.F.R. 60.51c; or
3410  (ii) medical/infectious waste as defined in 40 C.F.R. 60.51c.
3411     (157) "Watercraft" means a vessel as defined in Section 73-18-2.
3412     (158) "Wind energy" means wind used as the sole source of energy to produce electricity.
3413     (159) "ZIP Code" means a Zoning Improvement Plan Code assigned to a geographic
3414  location by the United States Postal Service.
3415  Section 3. Section 59-12-2501 is enacted to read:
3416  Part 25. Law Enforcement Infrastructure Tax
3417  59-12-2501 (Effective 05/06/26). Definitions.
3418        As used in this part:
3419     (1)(a) "Infrastructure improvement" means the replacement, repair, or upgrade of a
3420  facility, equipment, or technology that a local law enforcement agency owns or
3421  operates for law enforcement purposes.
3422  (b) "Infrastructure improvement" does not include payment for salaries of law
3423  enforcement personnel or other operational costs.
3424     (2) "Law enforcement infrastructure tax" means the sales and use tax authorized under
3425  Section 59-12-2502.
3426     (3) "Local law enforcement agency" means the law enforcement agency of a qualifying
3427  municipality.
3428     (4) "Qualifying municipality" means a city or town that:
3429  (a) is located within a county of the fourth, fifth, or sixth class, as classified in Section
3430  17-60-104; and
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3431        (b) does not impose a sales and use tax under Section 59-12-401 or 59-12-402.
3432  Section 4. Section 59-12-2502 is enacted to read:
3433  59-12-2502 (Effective 05/06/26). Imposition of law enforcement infrastructure
3434    tax -- Rate -- Requirements for imposing tax -- Expenditure of tax revenue --
3435    Administration, collection, and enforcement of tax -- Reauthorization of tax --
3436    Administrative charge.
3437    (1)(a) The legislative body of a qualifying municipality may impose a sales and use tax
3438        of up to 0.5% on the transactions described in Subsection 59-12-103(1) located
3439        within the qualifying municipality.
3440        (b) Notwithstanding Subsection (1)(a), a qualifying municipality may not impose a tax
3441  under this section on:
3442  (i) the sales and uses described in Section 59-12-104 to the extent the sales and uses
3443  are exempt from taxation under Section 59-12-104; and
3444  (ii) except as provided in Subsection (1)(d), amounts paid or charged for food and
3445  food ingredients.
3446        (c) For purposes of this Subsection (1), the location of a transaction is determined in
3447  accordance with Sections 59-12-211 through 59-12-215.
3448        (d) A qualifying municipality that imposes a tax under this section shall impose the tax
3449  on the purchase price or sales price for amounts paid or charged for food and food
3450  ingredients if the food and food ingredients are sold as part of a bundled transaction
3451  attributable to food and food ingredients and tangible personal property other than
3452  food and food ingredients.
3453    (2) Before imposing a tax under this section, the legislative body of a qualifying
3454        municipality shall:
3455        (a) hold a public hearing at which the tax is discussed, after providing notice under
3456  Subsection (3); and
3457        (b) after the public hearing required by Subsection (2)(a) is held, obtain approval to
3458  impose the tax from a majority of the members of the qualifying municipality's
3459  legislative body.
3460    (3)(a) The legislative body of a qualifying municipality proposing a tax under this
3461        section shall, as a class A notice under Section 63G-30-102, publish notice of the
3462        public hearing required by Subsection (2)(a) for at least 14 days before the day of the
3463        public hearing.
3464        (b) The notice described in Subsection (3)(a) shall state:
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       01-07 09:49  H.B. 162
3465  (i) that the legislative body proposes to adopt a tax under this section;
3466  (ii) the proposed tax rate;
3467  (iii) the date, time, and location of the public hearing; and
3468  (iv) that the purpose of the public hearing is to obtain public comments regarding the
3469  proposed tax.
3470     (4)(a) Subject to Subsection (4)(b), a qualifying municipality may use money collected
3471  from a tax imposed under this section to fund infrastructure improvements for the
3472  qualifying municipality's local law enforcement agency.
3473  (b) A qualifying municipality that imposes a tax under this section:
3474  (i) shall deposit the revenue the qualifying municipality receives from the tax into a
3475  special revenue fund that is created to hold the revenue and is separate from the
3476  qualifying municipality's general fund; and
3477  (ii) may only expend the revenue as provided in Subsection (4)(a).
3478     (5)(a) Except as provided in Subsection (5)(b), a tax under this section shall be
3479  administered, collected, and enforced in accordance with the same procedures used to
3480  administer, collect, and enforce the tax under:
3481  (i)(A) Part 1, Tax Collection; or
3482  (B) Part 2, Local Sales and Use Tax Act; and
3483  (ii) Chapter 1, General Taxation Policies.
3484  (b) A tax under this section is not subject to Subsections 59-12-205(2) through (5).
3485     (6)(a) The legislative body of a qualifying municipality shall levy a tax under this
3486  section for a period of 10 years.
3487  (b) The legislative body of a qualifying municipality may reauthorize a tax under this
3488  section at the end of the 10-year levy period by following the procedures and
3489  requirements of Subsections (2) and (3).
3490     (7) The commission shall retain and deposit an administrative charge in accordance with
3491  Section 59-1-306 from the revenue the commission collects from a tax under this section.
3492  Section 5. Section 59-12-2503 is enacted to read:
3493  59-12-2503 (Effective 05/06/26). Enactment, repeal, or change in the rate of
3494     rural public safety tax -- Annexation -- Notice.
3495     (1)(a) Except as provided in Subsection (3), if a qualifying municipality enacts or
3496  repeals a law enforcement infrastructure tax or changes the rate of a law enforcement
3497  infrastructure tax, the enactment, repeal, or change shall take effect:
3498  (i) on the first day of a calendar quarter; and
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       H.B. 162  01-07 09:49
3499  (ii) after a 90-day period beginning on the date the commission receives notice that
3500  meets the requirements of Subsection (1)(b) from the qualifying municipality.
3501        (b) The notice described in Subsection (1)(a)(ii) shall state:
3502  (i) that the qualifying municipality will enact, repeal, or change the rate of a law
3503  enforcement infrastructure tax;
3504  (ii) the statutory authority for the law enforcement infrastructure tax;
3505  (iii) the effective date of the enactment, repeal, or change in the rate of the law
3506  enforcement infrastructure tax; and
3507  (iv) if the qualifying municipality enacts or changes the rate of the law enforcement
3508  infrastructure tax, the rate of the law enforcement infrastructure tax.
3509    (2)(a) Except as provided in Subsection (3), if an annexation will result in the enactment,
3510        repeal, or change in the rate of a law enforcement infrastructure tax for an annexing
3511        area, the enactment, repeal, or change shall take effect:
3512  (i) on the first day of a calendar quarter; and
3513  (ii) after a 90-day period beginning on the date the commission receives notice
3514  meeting the requirements of Subsection (2)(b) from the municipality that annexes
3515  the annexing area.
3516        (b) The notice described in Subsection (2)(a)(ii) shall state:
3517  (i) that the annexation described in Subsection (2)(a) will result in the enactment,
3518  repeal, or change in the rate of a law enforcement infrastructure tax for the
3519  annexing area;
3520  (ii) the statutory authority for the law enforcement infrastructure tax;
3521  (iii) the effective date of the enactment, repeal, or change in the rate of the law
3522  enforcement infrastructure tax; and
3523  (iv) if the annexation results in the enactment or change in the rate of a law
3524  enforcement infrastructure tax for the annexing area, the rate of the law
3525  enforcement infrastructure tax.
3526    (3)(a) If the billing period for a transaction begins before the effective date of the
3527        enactment of a law enforcement infrastructure tax or the increase in the rate of a law
3528        enforcement infrastructure tax, the enactment of the tax or the tax rate increase shall
3529        take effect on the first day of the first billing period that begins after the effective
3530        date of the enactment of the tax or the tax rate increase.
3531        (b) If the billing period for a transaction begins before the effective date of the repeal of
3532  a law enforcement infrastructure tax or the decrease in the rate of a law enforcement
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       01-07 09:49  H.B. 162
3533  infrastructure tax, the repeal of the tax or the tax rate decrease shall take effect on the
3534  first day of the billing period that began before the effective date of the repeal of the
3535  tax or the tax rate decrease.
3536  (c) If a law enforcement infrastructure tax due on a catalogue sale is computed on the
3537  basis of sales and use tax rates published in the catalogue, an enactment, repeal, or
3538  change in the rate of the tax shall take effect:
3539  (i) on the first day of a calendar quarter; and
3540  (ii) beginning 60 days after the effective date of the enactment, repeal, or change in
3541  the rate of the tax.
3542     (4) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, and for
3543  purposes of Subsection (3)(c), the commission may by rule define the term "catalogue
3544  sale."
3545  Section 6. Section 59-12-2504 is enacted to read:
3546  59-12-2504 (Effective 05/06/26). Seller or certified service provider reliance on
3547     commission information.
3548  A seller or certified service provider is not liable for failing to collect a law enforcement
3549     infrastructure tax if the seller's or certified service provider's failure to collect the law
3550     enforcement infrastructure tax is as a result of the seller's or certified service provider's
3551     reliance on incorrect data provided by the commission in a database created by the
3552     commission:
3553     (1) containing tax rates, boundaries, or local taxing jurisdiction assignments; or
3554     (2) indicating the taxability of tangible personal property, a product transferred
3555  electronically, or a service.
3556  Section 7. Section 59-12-2505 is enacted to read:
3557  59-12-2505 (Effective 05/06/26). Certified service provider or model 2 seller
3558     reliance on commission certified software.
3559     (1) Except as provided in Subsection (2) and subject to Subsection (4), a certified service
3560  provider or model 2 seller is not liable for failing to collect a law enforcement
3561  infrastructure tax if:
3562  (a) the certified service provider or model 2 seller relies on software the commission
3563  certifies; and
3564  (b) the certified service provider's or model 2 seller's failure to collect a law enforcement
3565  infrastructure tax is a result of the certified service provider's or model 2 seller's
3566  reliance on incorrect data:
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       H.B. 162  01-07 09:49
3567  (i) provided by the commission; or
3568  (ii) in the software the commission certifies.
3569    (2) The relief from liability described in Subsection (1) does not apply if a certified service
3570        provider or model 2 seller incorrectly classifies an item or transaction into a product
3571        category the commission certifies.
3572    (3) If the taxability of a product category is incorrectly classified in software the
3573        commission certifies, the commission shall:
3574        (a) notify a certified service provider or model 2 seller of the incorrect classification of
3575  the taxability of a product category in software the commission certifies; and
3576        (b) state in the notice required by Subsection (3)(a) that the certified service provider or
3577  model 2 seller is liable for failing to collect the correct amount of a law enforcement
3578  infrastructure tax on the incorrectly classified product category if the certified service
3579  provider or model 2 seller fails to correct the taxability of the item or transaction
3580  within 10 days after the day on which the certified service provider or model 2 seller
3581  receives the notice.
3582    (4) If a certified service provider or model 2 seller fails to correct the taxability of an item
3583        or transaction within 10 days after the day on which the certified service provider or
3584        model 2 seller receives the notice described in Subsection (3), the certified service
3585        provider or model 2 seller is liable for failing to collect the correct amount of a law
3586        enforcement infrastructure tax on the item or transaction.
3587  Section 8. Section 59-12-2506 is enacted to read:
3588  59-12-2506 (Effective 05/06/26). Purchaser relief from liability.
3589    (1)(a) Except as provided in Subsection (1)(b), a purchaser is relieved from a penalty
3590        under Section 59-1-401 for failure to pay a tax due under this part or an
3591        underpayment of the tax if:
3592  (i) the purchaser's seller or certified service provider relies on incorrect data provided
3593  by the commission:
3594  (A) on a tax rate;
3595  (B) on a boundary;
3596  (C) on a taxing jurisdiction; or
3597  (D) in the taxability matrix the commission provides in accordance with the
3598  agreement; or
3599  (ii) the purchaser, regardless of whether the purchaser holds a direct payment permit
3600  in accordance with Section 59-12-107.1, relies on incorrect data provided by the
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       01-07 09:49  H.B. 162
3601  commission:
3602  (A) on a tax rate;
3603  (B) on a boundary;
3604  (C) on a taxing jurisdiction; or
3605  (D) in the taxability matrix the commission provides in accordance with the
3606  agreement.
3607  (b) For purposes of Subsection (1)(a), a purchaser is not relieved from a penalty under
3608  Section 59-1-401 for failure to pay a tax due under this part or an underpayment of
3609  the tax if the purchaser's, the purchaser's seller's, or the purchaser's certified service
3610  provider's reliance on incorrect data provided by the commission is a result of
3611  conduct that is:
3612  (i) fraudulent;
3613  (ii) intentional; or
3614  (iii) willful.
3615     (2) In addition to the relief from a penalty described in Subsection (1), a purchaser is not
3616  liable for a tax or interest under Section 59-1-402 for failure to pay a tax due under this
3617  part or an underpayment of the tax if:
3618  (a) the purchaser's seller or certified service provider relies on:
3619  (i) incorrect data provided by the commission:
3620  (A) on a tax rate;
3621  (B) on a boundary; or
3622  (C) on a taxing jurisdiction; or
3623  (ii) an erroneous classification by the commission:
3624  (A) in the taxability matrix the commission provides in accordance with the
3625  agreement; and
3626  (B) with respect to a term that is in the library of definitions and that is listed as
3627  taxable or exempt, included in or excluded from "sales price," or included in or
3628  excluded from a definition; or
3629  (b) the purchaser, regardless of whether the purchaser holds a direct payment permit in
3630  accordance with Section 59-12-107.1, relies on:
3631  (i) incorrect data provided by the commission:
3632  (A) on a tax rate;
3633  (B) on a boundary; or
3634  (C) on a taxing jurisdiction; or
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       H.B. 162  01-07 09:49
3635  (ii) an erroneous classification by the commission:
3636  (A) in the taxability matrix the commission provides in accordance with the
3637  agreement; and
3638  (B) with respect to a term that is in the library of definitions and that is listed as
3639  taxable or exempt, included in or excluded from "sales price," or included in or
3640  excluded from a definition.
3641  Section 9. Effective Date.
3642    (1) Except as provided in Subsection (2), this bill takes effect May 6, 2026.
3643    (2) The actions affecting Section 59-12-102 (Effective 07/01/26) take effect on July 1, 2026.
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