REPORT TITLE:
General Excise Tax


DESCRIPTION:
Expands the definition of wholesaler to include intermediary
services.

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
                                                        
THE SENATE                              S.B. NO.           728
TWENTIETH LEGISLATURE, 1999                                
STATE OF HAWAII                                            
                                                             
________________________________________________________________
________________________________________________________________


                   A  BILL  FOR  AN  ACT

RELATING TO GENERAL EXCISE TAX.
 


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

 1      SECTION 1.  Section 237-4, Hawaii Revised Statutes, is
 
 2 amended to read as follows:
 
 3      "§237-4 "Wholesaler", "jobber", defined."Wholesaler" or
 
 4 "jobber" applies only to a person making sales at wholesale.
 
 5 Only the following are sales at wholesale:
 
 6      (1)  Sales to a licensed retail merchant, jobber, or other
 
 7           licensed seller for purposes of resale;
 
 8      (2)  Sales to a licensed manufacturer of material or
 
 9           commodities which are to be incorporated by the
 
10           manufacturer into a finished or saleable product
 
11           (including the container or package in which the
 
12           product is contained) during the course of its
 
13           preservation, manufacture, or processing, including
 
14           preparation for market, and which will remain in such
 
15           finished or saleable product in such form as to be
 
16           perceptible to the senses, which finished or saleable
 
17           product is to be sold and not otherwise used by the
 
18           manufacturer;
 

 
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 1      (3)  Sales to a licensed producer or cooperative association
 
 2           of materials or commodities which are to be
 
 3           incorporated by the producer or by the cooperative
 
 4           association into a finished or saleable product which
 
 5           is to be sold and not otherwise used by the producer or
 
 6           cooperative association, including specifically
 
 7           materials or commodities expended as essential to the
 
 8           planting, growth, nurturing, and production of
 
 9           commodities which are sold by the producer or by the
 
10           cooperative association;
 
11      (4)  Sales to a licensed contractor, of material or
 
12           commodities which are to be incorporated by the
 
13           contractor into the finished work or project required
 
14           by the contract and which will remain in such finished
 
15           work or project in such form as to be perceptible to
 
16           the senses;
 
17      (5)  Sales to a licensed producer, or to a cooperative
 
18           association described in section 237-23(a)(7) for sale
 
19           to such producer, or to a licensed person operating a
 
20           feed lot, of poultry or animal feed, hatching eggs,
 
21           semen, replacement stock, breeding services for the
 
22           purpose of raising or producing animal or poultry
 

 
 
 
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 1           products for disposition as described in section 237-5
 
 2           or to be incorporated in a manufactured product as
 
 3           described in paragraph (2) or for the purpose of
 
 4           breeding, hatching, milking, or egg laying other than
 
 5           for the customer's own consumption of the meat,
 
 6           poultry, eggs, or milk so produced; provided that in
 
 7           the case of a feed lot operator, only the segregated
 
 8           cost of the feed furnished by the feed lot operator as
 
 9           part of the feed lot operator's service to a licensed
 
10           producer of poultry or animals to be butchered or to a
 
11           cooperative association described in section
 
12           237-23(a)(7) of such licensed producers shall be deemed
 
13           to be a sale at wholesale; and provided further that
 
14           any amount derived from the furnishing of feed lot
 
15           services, other than the segregated cost of feed, shall
 
16           be deemed taxable at the service business rate.  This
 
17           paragraph shall not apply to the sale of feed for
 
18           poultry or animals to be used for hauling,
 
19           transportation, or sports purposes;
 
20      (6)  Sales to a licensed producer, or to a cooperative
 
21           association described in section 237-23(a)(7) for sale
 
22           to the producer, of seed for producing agricultural
 

 
 
 
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 1           products, or bait for catching fish (including the
 
 2           catching of bait for catching fish), which agricultural
 
 3           products or fish are to be disposed of as described in
 
 4           section 237-5 or to be incorporated in a manufactured
 
 5           product as described in paragraph (2);
 
 6      (7)  Sales to a licensed producer, or to a cooperative
 
 7           association described in section 237-23(a)(7) for sale
 
 8           to such producer; of polypropylene shade cloth; of
 
 9           polyfilm; of polyethylene film; of cartons and such
 
10           other containers, wrappers, and sacks, and binders to
 
11           be used for packaging eggs, vegetables, fruits, and
 
12           other agricultural products; of seedlings and cuttings
 
13           for producing nursery plants; or of chick containers;
 
14           which cartons and such other containers, wrappers, and
 
15           sacks, binders, seedlings, cuttings, and containers are
 
16           to be used as described in section 237-5, or to be
 
17           incorporated in a manufactured product as described in
 
18           paragraph (2);
 
19      (8)  Sales of tangible personal property to a licensed
 
20           person engaged in the service business; provided that
 
21           (A) the property is not consumed or incidental to the
 
22           performance of the services; (B) there is a resale of
 

 
 
 
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 1           the article at the retail rate of four per cent; and
 
 2           (C) the resale of the article is separately charged or
 
 3           billed by the person rendering the services;
 
 4      (9)  Sales to a licensed leasing company of capital goods
 
 5           which are thereafter leased as a service to others.
 
 6           Capital goods means goods which have a depreciable life
 
 7           and which are purchased by the leasing company for
 
 8           lease to its customers[.]; and
 
 9     (10)  Sales of services by an intermediary to a licensed
 
10           taxpayer under this chapter; provided the licensed
 
11           taxpayer receives compensation subject to a retail rate
 
12           from a third party for the services performed by the
 
13           intermediary.
 
14      If the use tax law is finally held by a court of competent
 
15 jurisdiction to be unconstitutional or invalid insofar as it
 
16 purports to tax the use or consumption of tangible personal
 
17 property imported into the State in interstate or foreign
 
18 commerce or both, wholesalers and jobbers shall be taxed
 
19 thereafter under this chapter in accordance with the following
 
20 definition (which shall supersede the preceding paragraph
 
21 otherwise defining "wholesaler" or "jobber"):  "Wholesaler" or
 
22 "jobber" means a person, or a definitely organized division
 

 
 
 
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 1 thereof, definitely organized to render and rendering a general
 
 2 distribution service which buys and maintains at the person's
 
 3 place of business a stock or lines of merchandise which the
 
 4 person distributes; and which, through salespersons, advertising,
 
 5 or sales promotion devices, sells to licensed retailers, to
 
 6 institutional or licensed commercial or industrial users, in
 
 7 wholesale quantities and at wholesale rates.  A corporation
 
 8 deemed not to be carrying on a trade or business in this State
 
 9 under section 235-6 shall nevertheless be deemed to be a
 
10 wholesaler and shall be subject to the tax imposed by this
 
11 chapter."
 
12      SECTION 2.  Section 237-13, Hawaii Revised Statutes, is
 
13 amended to read as follows:
 
14      "§237-13  Imposition of tax.  There is hereby levied and
 
15 shall be assessed and collected annually privilege taxes against
 
16 persons on account of their business and other activities in the
 
17 State measured by the application of rates against values of
 
18 products, gross proceeds of sales, or gross income, whichever is
 
19 specified, as follows:
 
20      (1)  Tax on manufacturers.
 
21           (A)  Upon every person engaging or continuing within
 
22                the State in the business of manufacturing,
 

 
 
 
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 1                including compounding, canning, preserving,
 
 2                packing, printing, publishing, milling,
 
 3                processing, refining, or preparing for sale,
 
 4                profit, or commercial use, either directly or
 
 5                through the activity of others, in whole or in
 
 6                part, any article or articles, substance or
 
 7                substances, commodity or commodities, the amount
 
 8                of the tax to be equal to the value of the
 
 9                articles, substances, or commodities,
 
10                manufactured, compounded, canned, preserved,
 
11                packed, printed, milled, processed, refined, or
 
12                prepared, for sale, as shown by the gross proceeds
 
13                derived from the sale thereof by the manufacturer
 
14                or person compounding, preparing, or printing
 
15                them, multiplied by one-half of one per cent.
 
16           (B)  The measure of the tax on manufacturers is the
 
17                value of the entire product for sale, regardless
 
18                of the place of sale or the fact that deliveries
 
19                may be made to points outside the State.
 
20           (C)  If any person liable for the tax on manufacturers
 
21                ships or transports the person's product, or any
 
22                part thereof, out of the State, whether in a
 

 
 
 
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 1                finished or unfinished condition, or sells the
 
 2                same for delivery outside of the State (for
 
 3                example, consigned to a mainland purchaser via
 
 4                common carrier f.o.b. Honolulu), the value of the
 
 5                products in the condition or form in which they
 
 6                exist immediately before entering interstate or
 
 7                foreign commerce, determined as hereinafter
 
 8                provided, shall be the basis for the assessment of
 
 9                the tax imposed by this paragraph.  This tax shall
 
10                be due and payable as of the date of entry of the
 
11                products into interstate or foreign commerce,
 
12                whether the products are then sold or not.  The
 
13                department of taxation shall determine the basis
 
14                for assessment, as provided by this paragraph, as
 
15                follows:
 
16                (i)  If the products at the time of their entry
 
17                     into interstate or foreign commerce already
 
18                     have been sold, the gross proceeds of sale,
 
19                     less the transportation expenses, if any,
 
20                     incurred in realizing the gross proceeds for
 
21                     transportation from the time of entry of the
 
22                     products into interstate or foreign commerce,
 

 
 
 
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 1                     including insurance and storage in transit,
 
 2                     shall be the measure of the value of the
 
 3                     products.
 
 4               (ii)  If the products have not been sold at the
 
 5                     time of their entry into interstate or
 
 6                     foreign commerce, and in cases governed by
 
 7                     clause (i) in which the products are sold
 
 8                     under circumstances such that the gross
 
 9                     proceeds of sale are not indicative of the
 
10                     true value of the products, the value of the
 
11                     products constituting the basis for
 
12                     assessment shall correspond as nearly as
 
13                     possible to the gross proceeds of sales for
 
14                     delivery outside the State, adjusted as
 
15                     provided in clause (i), or if sufficient data
 
16                     are not available, sales in the State, of
 
17                     similar products of like quality and
 
18                     character and in similar quantities, made by
 
19                     the taxpayer (unless not indicative of the
 
20                     true value) or by others.  Sales outside the
 
21                     State, adjusted as provided in clause (i),
 
22                     may be considered when they constitute the
 

 
 
 
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 1                     best available data.  The department shall
 
 2                     prescribe uniform and equitable rules for
 
 3                     ascertaining the values.
 
 4              (iii)  At the election of the taxpayer and with the
 
 5                     approval of the department, the taxpayer may
 
 6                     make the taxpayer's returns under clause (i)
 
 7                     even though the products have not been sold
 
 8                     at the time of their entry into interstate or
 
 9                     foreign commerce.
 
10               (iv)  In all cases in which products leave the
 
11                     State in an unfinished condition, the basis
 
12                     for assessment shall be adjusted so as to
 
13                     deduct the portion of the value as is
 
14                     attributable to the finishing of the goods
 
15                     outside the State.
 
16      (2)  Tax on business of selling tangible personal property;
 
17           producing.
 
18           (A)  Upon every person engaging or continuing in the
 
19                business of selling any tangible personal property
 
20                whatsoever (not including, however, bonds or other
 
21                evidence of indebtedness, or stocks), there is
 
22                likewise hereby levied, and shall be assessed and
 

 
 
 
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 1                collected, a tax equivalent to four per cent of
 
 2                the gross proceeds of sales of the business;
 
 3                provided that insofar as certain retailing is
 
 4                taxed by section 237-16, the tax shall be that
 
 5                levied by section 237-16, and in the case of a
 
 6                wholesaler, the tax shall be equal to one-half of
 
 7                one per cent of the gross proceeds of sales of the
 
 8                business.  Upon every person engaging or
 
 9                continuing within this State in the business of a
 
10                producer, the tax shall be equal to one-half of
 
11                one per cent of the gross proceeds of sales of the
 
12                business, or the value of the products, for sale,
 
13                if sold for delivery outside the State or shipped
 
14                or transported out of the State, and the value of
 
15                the products shall be determined in the same
 
16                manner as the value of manufactured products
 
17                covered in the cases under paragraph (1)(C).
 
18           (B)  Gross proceeds of sales of tangible property in
 
19                interstate and foreign commerce shall constitute a
 
20                part of the measure of the tax imposed on persons
 
21                in the business of selling tangible personal
 
22                property, to the extent, under the conditions, and
 

 
 
 
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 1                in accordance with the provisions of the
 
 2                Constitution of the United States and the Acts of
 
 3                the Congress of the United States which may be now
 
 4                in force or may be hereafter adopted, and whenever
 
 5                there occurs in the State an activity to which,
 
 6                under the Constitution and Acts of Congress, there
 
 7                may be attributed gross proceeds of sales, the
 
 8                gross proceeds shall be so attributed.
 
 9           (C)  No manufacturer or producer, engaged in such
 
10                business in the State and selling the
 
11                manufacturer's or producer's products for delivery
 
12                outside of the State (for example, consigned to a
 
13                mainland purchaser via common carrier f.o.b.
 
14                Honolulu), shall be required to pay the tax
 
15                imposed in this chapter for the privilege of so
 
16                selling the products, and the value or gross
 
17                proceeds of sales of the products shall be
 
18                included only in determining the measure of the
 
19                tax imposed upon the manufacturer or producer.
 
20           (D)  When a manufacturer or producer, engaged in such
 
21                business in the State, also is engaged in selling
 
22                the manufacturer's or producer's products in the
 

 
 
 
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 1                State at wholesale, retail, or in any other
 
 2                manner, the tax for the privilege of engaging in
 
 3                the business of selling the products in the State
 
 4                shall apply to the manufacturer or producer as
 
 5                well as the tax for the privilege of manufacturing
 
 6                or producing in the State, and the manufacturer or
 
 7                producer shall make the returns of the gross
 
 8                proceeds of the wholesale, retail, or other sales
 
 9                required for the privilege of selling in the
 
10                State, as well as making the returns of the value
 
11                or gross proceeds of sales of the products
 
12                required for the privilege of manufacturing or
 
13                producing in the State.  The manufacturer or
 
14                producer shall pay the tax imposed in this chapter
 
15                for the privilege of selling its products in the
 
16                State, and the value or gross proceeds of sales of
 
17                the products, thus subjected to tax, may be
 
18                deducted insofar as duplicated as to the same
 
19                products by the measure of the tax upon the
 
20                manufacturer or producer for the privilege of
 
21                manufacturing or producing in the State; except
 
22                that no producer of agricultural products who
 

 
 
 
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 1                sells the products to a purchaser who will process
 
 2                the products outside the State shall be required
 
 3                to pay the tax imposed in this chapter for the
 
 4                privilege of producing or selling those products.
 
 5           (E)  A taxpayer selling to a federal cost-plus
 
 6                contractor may make the election provided for by
 
 7                paragraph (3)(C), and in that case the tax shall
 
 8                be computed pursuant to the election,
 
 9                notwithstanding this paragraph or paragraph (1) to
 
10                the contrary.
 
11           (F)  The department, by rule, may provide that a seller
 
12                may take from the purchaser of tangible personal
 
13                property a certificate, in a form as the
 
14                department shall prescribe, certifying that the
 
15                sale is a sale at wholesale.  If the certificate
 
16                is so provided for by rule of the department:
 
17                (i)  Any purchaser who furnishes a certificate
 
18                     shall be obligated to pay to the seller, upon
 
19                     demand, if the sale in fact is not at
 
20                     wholesale, the amount of the additional tax
 
21                     which by reason thereof is imposed upon the
 
22                     seller; and
 

 
 
 
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 1               (ii)  The absence of a certificate, unless the
 
 2                     sales of the business are exclusively at
 
 3                     wholesale, in itself shall give rise to the
 
 4                     presumption that the sale is not at
 
 5                     wholesale.
 
 6      (3)  Tax upon contractors.
 
 7           (A)  Upon every person engaging or continuing within
 
 8                the State in the business of contracting, the tax
 
 9                shall be equal to four per cent of the gross
 
10                income of the business; provided that insofar as
 
11                the business of contracting is taxed by section
 
12                237-16, which relates to certain retailing, the
 
13                tax shall be that levied by section 237-16.
 
14           (B)  In computing the tax levied under this paragraph
 
15                or section 237-16, there shall be deducted from
 
16                the gross income of the taxpayer so much thereof
 
17                as has been included in the measure of the tax
 
18                levied under subparagraph (A) or section 237-16,
 
19                on:
 
20                (i)  Another taxpayer who is a contractor, as
 
21                     defined in section 237-6;
 
22               (ii)  A specialty contractor, duly licensed by the
 

 
 
 
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 1                     department of commerce and consumer affairs
 
 2                     pursuant to section 444-9, in respect of the
 
 3                     specialty contractor's business; or
 
 4              (iii)  A specialty contractor who is not licensed by
 
 5                     the department of commerce and consumer
 
 6                     affairs pursuant to section 444-9, but who
 
 7                     performs contracting activities on federal
 
 8                     military installations and nowhere else in
 
 9                     this State;
 
10                but any person claiming a deduction under this
 
11                paragraph shall be required to show in the
 
12                person's return the name and general excise number
 
13                of the person paying the tax on the amount
 
14                deducted by the person.
 
15           (C)  In computing the tax levied under this paragraph
 
16                against any federal cost-plus contractor, there
 
17                shall be excluded from the gross income of the
 
18                contractor so much thereof as fulfills the
 
19                following requirements:
 
20                (i)  The gross income exempted shall constitute
 
21                     reimbursement of costs incurred for
 
22                     materials, plant, or equipment purchased from
 

 
 
 
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 1                     a taxpayer licensed under this chapter, not
 
 2                     exceeding the gross proceeds of sale of the
 
 3                     taxpayer on account of the transaction; and
 
 4               (ii)  The taxpayer making the sale shall have
 
 5                     certified to the department that the taxpayer
 
 6                     is taxable with respect to the gross proceeds
 
 7                     of the sale, and that the taxpayer elects to
 
 8                     have the tax on gross income computed the
 
 9                     same as upon a sale to the state government.
 
10           (D)  A person who, as a business or as a part of a
 
11                business in which the person is engaged, erects,
 
12                constructs, or improves any building or structure,
 
13                of any kind or description, or makes, constructs,
 
14                or improves any road, street, sidewalk, sewer, or
 
15                water system, or other improvements on land held
 
16                by the person (whether held as a leasehold, fee
 
17                simple, or otherwise), upon the sale or other
 
18                disposition of the land or improvements, even if
 
19                the work was not done pursuant to a contract,
 
20                shall be liable to the same tax as if engaged in
 
21                the business of contracting, unless the person
 
22                shows that at the time the person was engaged in
 

 
 
 
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 1                making the improvements it was, and for the period
 
 2                of at least one year after completion of the
 
 3                building, structure, or other improvements, it
 
 4                continued to be the person's purpose to hold and
 
 5                not sell or otherwise dispose of the land or
 
 6                improvements.  The tax in respect of the
 
 7                improvements shall be measured by the amount of
 
 8                the proceeds of the sale or other disposition that
 
 9                is attributable to the erection, construction, or
 
10                improvement of such building or structure, or the
 
11                making, constructing, or improving of the road,
 
12                street, sidewalk, sewer, or water system, or other
 
13                improvements.  The measure of tax in respect of
 
14                the improvements shall not exceed the amount which
 
15                would have been taxable had the work been
 
16                performed by another, subject as in other cases to
 
17                the deductions allowed by subparagraph (B).  Upon
 
18                the election of the taxpayer, this paragraph may
 
19                be applied notwithstanding the improvements were
 
20                not made by the taxpayer, or were not made as a
 
21                business or as a part of a business, or were made
 
22                with the intention of holding the same.  However,
 

 
 
 
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 1                this paragraph shall not apply in respect of any
 
 2                proceeds that constitute or are in the nature of
 
 3                rent; all such gross income shall be taxable under
 
 4                paragraph (10); provided that insofar as the
 
 5                business of renting or leasing real property under
 
 6                a lease is taxed under section 237-16.5, the tax
 
 7                shall be levied by section 237-16.5.
 
 8      (4)  Tax upon theaters, amusements, radio broadcasting
 
 9           stations, etc.  Upon every person engaging or
 
10           continuing within the State in the business of
 
11           operating a theater, opera house, moving picture show,
 
12           vaudeville, amusement park, dance hall, skating rink,
 
13           radio broadcasting station, or any other place at which
 
14           amusements are offered to the public, the tax shall be
 
15           equal to four per cent of the gross income of the
 
16           business.
 
17      (5)  Tax upon sales representatives, etc.  Upon every person
 
18           classified as a representative or purchasing agent
 
19           under section 237-1, engaging or continuing within the
 
20           State in the business of performing services for
 
21           another, other than as an employee, there is likewise
 
22           hereby levied and shall be assessed and collected a tax
 

 
 
 
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 1           equal to four per cent of the commissions and other
 
 2           compensation attributable to the services so rendered
 
 3           by the person.
 
 4      (6)  Tax on service business.  Upon every person engaging or
 
 5           continuing within the State in any service business or
 
 6           calling not otherwise specifically taxed under this
 
 7           chapter, there is likewise hereby levied and shall be
 
 8           assessed and collected a tax equal to four per cent of
 
 9           the gross income of the business; provided that where
 
10           any person engaging or continuing within the State in
 
11           any service business or calling [renders those] is a
 
12           wholesaler of services as defined in section 237-4(10),
 
13           or renders services upon the order of or at the request
 
14           of another taxpayer who is engaged in the service
 
15           business and who, in fact, acts as or acts in the
 
16           nature of an intermediary between the person rendering
 
17           those services and the ultimate recipient of the
 
18           benefits of those services, so much of the gross income
 
19           as is received by the person rendering the services
 
20           shall be subjected to the tax at the rate of one-half
 
21           of one per cent and all of the gross income received by
 
22           the intermediary from the principal shall be subjected
 

 
 
 
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 1           to a tax at the rate of four per cent; and provided
 
 2           that where any person is engaged in the business of
 
 3           selling interstate or foreign common carrier
 
 4           telecommunication services within and without the
 
 5           State, the tax shall be imposed on that portion of
 
 6           gross income received by a person from service which is
 
 7           originated or terminated in this State and is charged
 
 8           to a telephone number, customer, or account in this
 
 9           State notwithstanding any other state law (except for
 
10           the exemption under section 237-23(a)(1)) to the
 
11           contrary.  If, under the Constitution and laws of the
 
12           United States, the entire gross income as determined
 
13           under this paragraph of a business selling interstate
 
14           or foreign common carrier telecommunication services
 
15           cannot be included in the measure of the tax, the gross
 
16           income shall be apportioned as provided in section
 
17           237-21; provided that the apportionment factor and
 
18           formula shall be the same for all persons providing
 
19           those services in the State.
 
20      (7)  Tax on insurance solicitors and agents.  Upon every
 
21           person engaged as a licensed solicitor, general agent,
 
22           or subagent pursuant to chapter 431, there is hereby
 

 
 
 
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 1           levied and shall be assessed and collected a tax equal
 
 2           to .15 per cent of the commissions due to that
 
 3           activity.
 
 4      (8)  Professions.  Upon every person engaging or continuing
 
 5           within the State in the practice of a profession,
 
 6           including those expounding the religious doctrines of
 
 7           any church, there is likewise hereby levied and shall
 
 8           be assessed and collected a tax equal to four per cent
 
 9           of the gross income on the practice or exposition.
 
10      (9)  Tax on receipts of sugar benefit payments.  Upon the
 
11           amounts received from the United States government by
 
12           any producer of sugar (or the producer's legal
 
13           representative or heirs), as defined under and by
 
14           virtue of the Sugar Act of 1948, as amended, or other
 
15           Acts of the Congress of the United States relating
 
16           thereto, there is hereby levied a tax of one-half of
 
17           one per cent of the gross amount received, provided
 
18           that the tax levied hereunder on any amount so received
 
19           and actually disbursed to another by a producer in the
 
20           form of a benefit payment shall be paid by the person
 
21           or persons to whom the amount is actually disbursed,
 
22           and the producer actually making a benefit payment to
 

 
 
 
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 1           another shall be entitled to claim on the producer's
 
 2           return a deduction from the gross amount taxable
 
 3           hereunder in the sum of the amount so disbursed.  The
 
 4           amounts taxed under this paragraph shall not be taxable
 
 5           under any other paragraph, subsection, or section of
 
 6           this chapter.
 
 7     (10)  Tax on other business.  Upon every person engaging or
 
 8           continuing within the State in any business, trade,
 
 9           activity, occupation, or calling not included in the
 
10           preceding paragraphs or any other provisions of this
 
11           chapter, there is likewise hereby levied and shall be
 
12           assessed and collected, a tax equal to four per cent of
 
13           the gross income thereof.  In addition, the rate
 
14           prescribed by this paragraph shall apply to a business
 
15           taxable under one or more of the preceding paragraphs
 
16           or other provisions of this chapter, as to any gross
 
17           income thereof not taxed thereunder as gross income or
 
18           gross proceeds of sales or by taxing an equivalent
 
19           value of products, unless specifically exempted."
 
20      SECTION 3.  Statutory material to be repealed is bracketed.
 
21 New statutory material is underscored.
 

 
 
 
 
 
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 1      SECTION 4.  This Act shall take effect on July 1, 1999.
 
 2 
 
 3                              INTRODUCED BY:______________________