1998 Regular Session
To: Ways and Means
By: Representative Davis
House Bill 395
AN ACT TO AMEND SECTION 27-65-17, MISSISSIPPI CODE OF 1972, TO PROVIDE THAT THE ADDITIONAL 2% SALES TAX LEVIED UPON CERTAIN MOTOR VEHICLES SHALL NOT APPLY TO CERTAIN RENTAL MOTOR VEHICLES; TO AMEND SECTION 27-65-23, MISSISSIPPI CODE OF 1972, TO CLARIFY THAT THE IMPOSITION OF THE 7% SALES TAX ON THE BUSINESS OF RENTING OR LEASING PERSONAL PROPERTY DOES NOT APPLY TO THE RENTAL OF SUCH MOTOR VEHICLES; AND FOR RELATED PURPOSES.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI:
SECTION 1. Section 27-65-17, Mississippi Code of 1972, is amended as follows:
27-65-17. (1) Upon every person engaging or continuing within this state in the business of selling any tangible personal property whatsoever there is * * * levied, assessed and shall be collected a tax equal to seven percent (7%) of the gross proceeds of the retail sales of the business, except as otherwise provided herein.
Retail sales of farm tractors shall be taxed at the rate of one percent (1%) when made to farmers for agricultural purposes. Retail sales of other self-propelled farm implements, or farm implements used as attachments to or drawn by a tractor, or implements which are drawn by animals, when made to farmers for agricultural purposes shall be taxed at the rate of three percent (3%). The three percent (3%) rate shall also apply to retail sales of brooders, feeders and waterers to chicken farmers for use in chicken houses to produce poultry for the market, sales of mechanical and gravity feeders and waterers to livestock producers, sales of mechanical milking machines, milk tanks and coolers used in the production of milk for sale and sales of aerators to domestic fish farmers for use in the raising of domesticated fish as defined in Section 69-7-501. The three percent (3%) rate shall also apply to all equipment used in logging, pulpwood operations or tree farming which is either (a) self-propelled or which is (b) mounted so that it is (i) permanently attached to other equipment which is self-propelled or (ii) permanently attached to other equipment drawn by a vehicle which is self-propelled.
Retail sales of aircraft, automobiles, trucks, truck-tractors, semitrailers and mobile homes shall be taxed at the rate of three percent (3%).
Sales of manufacturing machinery or manufacturing machine parts when made to a manufacturer or custom processor for plant use only when such machinery and machine parts will be used exclusively and directly within this state in manufacturing a commodity for sale, rental or in processing for a fee shall be taxed at the rate of one and one-half percent (1-1/2%).
Sales of materials for use in track and track structures to a railroad whose rates are fixed by the Interstate Commerce Commission or the Mississippi Public Service Commission shall be taxed at the rate of three percent (3%).
Sales of tangible personal property to electric power associations for use in the ordinary and necessary operation of their generating or distribution systems shall be taxed at the rate of one percent (1%).
Wholesale sales of beer shall be taxed at the rate of seven percent (7%), and the retailer shall file a return and compute the retail tax on retail sales but may take credit for the amount of the tax paid to the wholesaler on such return covering the subsequent sales of the property, provided adequate invoices and records are maintained to substantiate the credit.
Wholesale sales of food and drink for human consumption to full service vending machine operators to be sold through vending machines located apart from and not connected with other taxable businesses shall be taxed at the rate of eight percent (8%).
A manufacturer selling at retail in this state shall be required to make returns of the gross proceeds of such sales and pay the tax imposed in this section.
Any person exercising any privilege taxable under Section 27-65-15 and selling his natural resource products at wholesale or to exempt persons shall pay the tax levied by said section in lieu of the tax levied by this section.
(2) From and after January 1, 1995, retail sales of private carriers of passengers and light carriers of property, as defined in Section 27-51-101, shall be taxed an additional two percent (2%); however, the additional tax provided for in this subsection (2) shall not apply to motor vehicles primarily used as rentals under agreements with a term of not more than thirty (30) continuous days each and under the control of persons who are engaged in the business of renting such motor vehicles and who are subject to the tax under Section 27-65-231.
SECTION 2. Section 27-65-23, Mississippi Code of 1972, is amended as follows:
27-65-23. Upon every person engaging or continuing in any of the following businesses or activities there is * * * levied, assessed and shall be collected a tax equal to seven percent (7%) of the gross income of the business, except as otherwise provided:
Air conditioning installation or repairs;
Automobile, aircraft, motorcycle, boat or any other vehicle repairing or servicing;
Billiards, pool or domino parlors;
Bowling or tenpin alleys;
Burglar and fire alarm systems or services;
Car washing--automatic, self-service, or manual;
Computer software sales and services;
Cotton compresses or cotton warehouses;
Custom creosoting or treating, custom planing, custom sawing;
Custom meat processing;
Electricians, electrical work, wiring, all repairs or installation of electrical equipment;
Elevator or escalator installing, repairing or servicing;
Film developing or photo finishing;
Foundries, machine or general repairing;
Furniture repairing or upholstering;
Grading, excavating, ditching, dredging or landscaping;
Hotels, motels, tourist courts or camps, trailer parks;
Insulating services or repairs;
Jewelry or watch repairing;
Laundering, cleaning, pressing or dyeing;
Office and business machine repairing;
Parking garages and lots;
Plumbing or pipe fitting;
Public storage warehouses;
Refrigerating equipment repairs;
Radio or television installing, repairing, or servicing;
Renting or leasing personal property, other than the renting of motor vehicles which is subject to the tax under Section 27-65-231, used within this state;
Services performed in connection with geophysical surveying, exploring, developing, drilling, producing, distributing, or testing of oil, gas, water and other mineral resources;
Telephone answering or paging services;
Termite or pest control services;
Tin and sheet metal shops;
TV cable systems, subscription TV services, and other similar activities;
Vulcanizing, repairing or recapping of tires or tubes;
Woodworking or wood turning shops.
Income from services taxed herein performed for electric power associations in the ordinary and necessary operation of their generating or distribution systems shall be taxed at the rate of one percent (1%).
Income from services taxed herein performed on materials for use in track or track structures to a railroad whose rates are fixed by the Interstate Commerce Commission or the Mississippi Public Service Commission shall be taxed at the rate of three percent (3%).
Income from renting or leasing tangible personal property used within this state shall be taxed at the same rates as sales of the same property.
Persons doing business in this state who rent transportation equipment with a situs within or without the state to common, contract or private commercial carriers are taxed on that part of the income derived from use within this state. If specific accounting is impracticable, a formula may be used with approval of the commissioner.
A lessor may deduct from the tax computed on the rental income from tangible personal property a credit for sales or use tax paid to this state at the time of purchase of the specific personal property being leased or rented until such credit has been exhausted.
Charges for custom processing and repairing services may be excluded from gross taxable income when the property on which the service was performed is delivered to the customer in another state either by common carrier or in the seller's equipment.
When a taxpayer performs unitary services covered by this section, which are performed both in intrastate and interstate commerce, the commissioner is * * * vested with authority to formulate in each particular case and to fix for such taxpayer in each instance formulae of apportionment which will apportion to this state, for taxation, that portion of the services which are performed within the State of Mississippi.
SECTION 3. Nothing in this act shall affect or defeat any claim, assessment, appeal, suit, right or cause of action for taxes due or accrued under the sales tax laws before the date on which this act becomes effective, whether such claims, assessments, appeals, suits or actions have been begun before the date on which this act becomes effective or are begun thereafter; and the provisions of the sales tax laws are expressly continued in full force, effect and operation for the purpose of the assessment, collection and enrollment of liens for any taxes due or accrued and the execution of any warrant under such laws before the date on which this act becomes effective, and for the imposition of any penalties, forfeitures or claims for failure to comply with such laws.
SECTION 4. This act shall take effect and be in force from and after July 1, 1998.