House Bill 1660

AN ACT TO AUTHORIZE THE GOVERNING AUTHORITIES OF THE CITY OF QUITMAN, MISSISSIPPI, TO IMPOSE A SPECIAL SALES TAX OF NOT MORE THAN 1% ON THE GROSS PROCEEDS OF ALL SALES OR THE GROSS INCOME OF BUSINESSES IN THE MUNICIPALITY DERIVED FROM ACTIVITIES TAXED AT THE RATE OF 7% OR MORE UNDER THE MISSISSIPPI SALES TAX LAW; TO PROVIDE CERTAIN EXEMPTIONS FROM THE SPECIAL SALES TAX AUTHORIZED BY THIS ACT; TO PROVIDE THAT THE SPECIAL SALES TAX SHALL NOT BE LEVIED UNLESS AUTHORIZED BY AT LEAST 3/5 OF THE VOTES CAST AT AN ELECTION CALLED AND HELD FOR SUCH PURPOSE; TO PROVIDE THE PURPOSE FOR WHICH THE REVENUE COLLECTED FROM THE SPECIAL SALES TAX MAY BE USED AND EXPENDED; TO PROVIDE A CERTAIN DATE OF REPEAL FOR THE AUTHORITY OF THE IMPOSITION OF THE SPECIAL SALES TAX; AND FOR RELATED PURPOSES.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI:

SECTION 1. (1) As used in this section, the following terms shall have the meanings ascribed to them in this section unless otherwise clearly indicated by the context in which they are used:

(a) "Governing authorities" means the governing authorities of the City of Quitman, Mississippi.

(b) "Sports complex" means the Quitman Sports Complex and any additions and other improvements to the complex.

(2) (a) Subject to the provisions of this section, the governing authorities may impose upon all persons as a privilege for engaging or continuing in business or doing business within the City of Quitman, a special sales tax at the rate of not more than one percent (1%) of the gross proceeds of sales or gross income of the business, as the case may be, derived from any of the activities taxed at the rate of seven percent (7%) or more under the Mississippi Sales Tax Law, Section 27-65-1 et seq., Mississippi Code of 1972.

(b) The tax levied under this section shall apply to every person making sales, delivery or installations of tangible personal property or services within the municipality but shall not apply to:

(i) Sales exempted by Sections 27-65-19, 27-65-101, 27-65-103, 27-65-105, 27-65-107, 27-65-109 and 27-65-111 of the Mississippi Sales Tax Law;

(ii) Gross proceeds of sales or gross income of restaurants derived from the sale of food and beverages;

(iii) Gross proceeds of sales or gross income of hotels and motels derived from the sale of hotel rooms and motel rooms for lodging purposes;

(iv) Retail sales of food for human consumption not purchased with food stamps issued by the United States Department of Agriculture, or other federal agency, but which would be exempt under Section 27-65-111(o), Mississippi Code of 1972, from the taxes imposed by this chapter if the food items were purchased with food stamps;

(v) Gross income of businesses engaging or continuing in the business of TV cable systems, subscription TV services, and other similar activities, including, but not limited to, cable Internet services;

(vi) Gross income of businesses engaging or continuing in the business of providing telecommunications services and other similar services, including, but not limited to, Internet services, Internet protocol television (PIT) services, satellite television services and mobile TV broadcasting services; and

(vii) Gross proceeds of retail sales and the use or consumption in this state of drugs and medicines:

1. Prescribed for the treatment of a human being by a person authorized to prescribe the medicines, and dispensed or prescription filled by a registered pharmacist in accordance with law; or

2. Furnished by a licensed physician, surgeon, dentist or podiatrist to his own patient for treatment of the patient; or

3. Furnished by a hospital for treatment of any person pursuant to the order of a licensed physician, surgeon, dentist or podiatrist; or

4. Sold to a licensed physician, surgeon, podiatrist, dentist or hospital for the treatment of a human being; or

5. Sold to this state or any political subdivision or municipal corporation thereof, for use in the treatment of a human being or furnished for the treatment of a human being by a medical facility or clinic maintained by this state or any political subdivision or municipal corporation thereof.

"Medicines," as used in this subparagraph (vii), shall mean and include any substance or preparation intended for use by external or internal application to the human body in the diagnosis, cure, mitigation, treatment or prevention of disease and which is commonly recognized as a substance or preparation intended for such use; provided that "medicines" do not include any auditory, prosthetic, ophthalmic or ocular device or appliance, any dentures or parts thereof or any artificial limbs or their replacement parts, articles which are in the nature of splints, bandages, pads, compresses, supports, dressings, instruments, apparatus, contrivances, appliances, devices or other mechanical, electronic, optical or physical equipment or article or the component parts and accessories thereof, or any alcoholic beverage or any other drug or medicine not commonly referred to as a prescription drug.

Notwithstanding the preceding sentence of this subparagraph (vii), "medicines" as used in this subparagraph (vii), shall mean and include sutures, whether or not permanently implanted, bone screws, bone pins, pacemakers and other articles permanently implanted in the human body to assist the functioning of any natural organ, artery, vein or limb and which remain or dissolve in the body.

"Hospital," as used in this subparagraph (vii), shall have the meaning ascribed to it in Section 41-9-3, Mississippi Code of 1972.

Insulin furnished by a registered pharmacist to a person for treatment of diabetes as directed by a physician shall be deemed to be dispensed on prescription within the meaning of this subparagraph (vii).

(3) Before any tax authorized under this section may be imposed, the governing authorities shall adopt a resolution declaring its intention to levy the tax, setting forth the amount of the tax to be imposed, the purposes for which the revenue collected pursuant to the tax levy may be used and expended, the date upon which the tax shall become effective and calling for an election to be held on the question. The date of the election shall be set in the resolution. Notice of the election shall be published once each week for at least three (3) consecutive weeks in a newspaper published or having a general circulation in the City of Quitman, with the first publication of the notice to be made not less than twenty-one (21) days before the date fixed in the resolution for the election and the last publication to be made not more than seven (7) days before the election. At the election, all qualified electors of the City of Quitman may vote. The ballots used at the election shall have printed thereon a brief description of the sales tax, the amount of the sales tax levy, a description of the purposes for which the tax revenue may be used and expended and the words "FOR THE LOCAL SALES TAX" and "AGAINST THE LOCAL SALES TAX" and the voter shall vote by placing a cross (X) or check mark (√) opposite his choice on the proposition. When the results of the election have been canvassed by the election commissioners of the City of Quitman and certified by them to the governing authorities, it shall be the duty of such governing authorities to determine and adjudicate whether at least three-fifths (3/5) of the qualified electors who voted in the election voted in favor of the tax. If at least three-fifths (3/5) of the qualified electors who voted in the election voted in favor of the tax, the governing authorities shall adopt a resolution declaring the levy and collection of the tax provided in this section and shall set the first day of the second month following the date of such adoption as the effective date of the tax levy. A certified copy of this resolution, together with the results of the election, shall be furnished to the Department of Revenue not less than thirty (30) days before the effective date of the levy.

(4) The revenue collected pursuant to the tax levy imposed under this section may be expended for the purposes of building an addition and other improvements at the Quitman Sports Complex.

(5) (a) The special sales tax authorized by this section shall be collected by the Department of Revenue, shall be accounted for separately from the amount of sales tax collected for the state in the municipality and shall be paid to the municipality. The Department of Revenue may retain three percent (3%) of the proceeds of such tax for the purpose of defraying the costs incurred by the commission in the collection of the tax. Payments to the City of Quitman shall be made by the Department of Revenue on or before the fifteenth day of the month following the month in which the tax was collected.

(b) The proceeds of the special sales tax shall be placed into a special municipal fund apart from the municipal general fund and any other funds of the City of Quitman, and shall be expended by the City of Quitman solely for the purposes authorized in subsection (4) of this section. The records reflecting the receipts and expenditures of the revenue from the special sales tax shall be audited annually by an independent certified public accountant. The accountant shall make a report of his findings to the governing authorities of the City of Quitman and file a copy of his report with the Secretary of the Senate and the Clerk of the House of Representatives. The audit shall be made and completed as soon as practical after the close of the fiscal year of the municipality, and expenses of the audit shall be paid from the funds derived by the municipality pursuant to this section.

(c) All provisions of the Mississippi Sales Tax Law applicable to filing of returns, discounts to the taxpayer, remittances to the Department of Revenue, enforced collection, rights of taxpayers, recovery of improper taxes, refunds of overpaid taxes or other provisions of law providing for imposition and collection of the state sales tax shall apply to the special sales tax authorized by this section, except where there is a conflict, in which case the provisions of this section shall control. Any damages, penalties or interest collected for the nonpayment of taxes imposed under this section, or for noncompliance with the provisions of this section, shall be paid to the City of Quitman on the same basis and in the same manner as the tax proceeds. Any overpayment of tax for any reason that has been disbursed to the city or any payment of the tax to the city in error may be adjusted by the Department of Revenue on any subsequent payment to the municipality pursuant to the provisions of the Mississippi Sales Tax Law. The Department of Revenue may, from time to time, make such rules and regulations not inconsistent with this section as may be deemed necessary to carry out the provisions of this section, and such rules and regulations shall have the full force and effect of law.

(6) If the City of Quitman expands its corporate boundaries, the governing authorities of the city may not impose the special sales tax in the annexed area unless the tax is approved at an election conducted, as far as is practicable, in the manner provided in subsection (3) of this section, except that only qualified electors in the annexed area may vote in the election.

(7) The governing authorities may issue bonds or otherwise incur indebtedness of the city in an aggregate principal amount that is not in excess of an amount for which debt service is capable of being funded by the proceeds of the special sales tax levied under this act. The indebtedness authorized by this subsection shall not be considered when computing any limitation of indebtedness of the city established by law.

(8) This section shall stand repealed from and after July 1, 2020.

SECTION 2. This act shall take effect and be in force from and after its passage.