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Transmittal - 10/15/2021 MARY BETH THOMPSON Chief Financial Officer ERIN MENDENHALL Mayor DEPARTMENT OF FINANCE 451 SOUTH STATE STREET, ROOM 245 SALT LAKE CITY, UTAH 84114 TEL 801-535-6403 CITY COUNCIL TRANSMITTAL ________________________ Date Received: ___________________ Lisa Shaffer, Chief Administrative Officer Date sent to Council: ______________ _____________________________________________________________________________ TO: Salt Lake City Council DATE: October 12, 2021 Amy Fowler, Chair FROM: Mary Beth Thompson, Chief Financial Officer___________________________________ SUBJECT: Amendment of Chapter 3.04 of the Salt Lake City Code Regarding Sales and Use Taxes STAFF CONTACT: Marina Scott, City Treasurer 801-535-6565 DOCUMENT TYPE: Amended and Restated Ordinance RECOMMENDATION: That the City Council adopt an amended and restated ordinance (Chapter 3.04) on October 19, 2021 updating the City’s sales tax ordinance to reflect updates to the Sales and Use Tax Act. BUDGET IMPACT: None at this time. BACKGROUND/DISCUSSION: Prior to 1986, the City Council adopted Salt Lake City Code Chapter 3.04 regarding sales and use tax. The Sales and Use Tax Act has been amended several times since its adoption resulting in Chapter 3.04 containing outdated or superseded wording and references. This housekeeping item will bring the ordinance up to date with current State code. PUBLIC PROCESS: N/A EXHIBITS: 1. Agenda and Motion Language 2. Sales Tax Ordinance Lisa Shaffer (Oct 11, 2021 10:40 MDT)10/11/2021 10/11/2021 @BCL@C40E718D.docx Salt Lake City Council AGENDA ITEM FOR OCTOBER 19, 2021 UNFINISHED BUSINESS: Suggested Agenda Language relating to the amending and restating of Salt Lake City Code Chapter 3.04 relating to local sales and use taxes: Ordinance: Amending and restating Salt Lake City Code Chapter 3.04 relating to local sales and use taxes. Consider adopting an ordinance amending and restating Salt Lake City Code Chapter 3.04 relating to local sales and use taxes. Staff Recommendation: Adopt the ordinance. Suggested Motion Language is as follows: I move that the City Council adopt the ordinance amending and restating Salt Lake City Code Chapter 3.04 relating to local sales and use taxes. 1 1 SALT LAKE CITY ORDINANCE 2 No. ______ of 2021 3 4 (Sales and use taxes) 5 6 An ordinance amending and restating Chapter 3.04 of the Salt Lake City Code, relating to 7 sales and use taxes. 8 WHEREAS, sales and use taxes in Utah are governed by the Sales and Use Tax Act, 9 Utah Code Title 59, Chapter 12, and local sales and use taxes are governed by the Local Sales 10 and Use Tax Act, Utah Code Title 59, Chapter 12, Part 2; 11 WHEREAS, prior to 1986 the City Council adopted Salt Lake City Code Chapter 3.04 12 regarding sales and use tax; 13 WHEREAS, the Sales and Use Tax Act has been amended several times since its 14 adoption, which amendments have resulted in Chapter 3.04 containing outdated or superseded 15 wording and section references, including some tax rate descriptions; 16 WHEREAS, the City Council intends to make clean-up changes to Chapter 3.04 to 17 clarify it and the rates it is already imposing and to conform it to state law, and does not intend 18 thereby to change any tax rates it is currently imposing; and 19 WHEREAS, the City Council of Salt Lake City, Utah, desires to amend and restate 20 Chapter 3.04 of the Salt Lake City Code, relating to local sales and use taxes, to make such 21 clean-up changes. 22 NOW, THEREFORE, be it ordained by the City Council of Salt Lake City, Utah that: 23 SECTION 1. Chapter 3.04 of the Salt Lake City Code, relating to local sales and use 24 taxes, is amended and restated to read as follows: 25 3.04.010: SHORT TITLE: 26 2 This chapter shall be known as the UNIFORM LOCAL SALES AND USE TAX ORDINANCE OF 27 THE CITY OF SALT LAKE. 28 29 3.04.020: PURPOSE: 30 A. The 45th session of the Utah legislature has authorized the counties and municipalities of 31 the state to adopt an ordinance that imposes a one percent localenact sales and use tax ordinances 32 imposing a seven-eighths of one percent tax thus enabling this municipality to increase its local 33 option sales and use tax from three-fourths of one percent to seven-eighths of one percent. 34 B. It is the purpose of this chapter to impose a local option sales and use to conform the city’s 35 uniform local sales and use taxes of the municipality to the requirements of the uniform local 36 sSales and uUse tTax Act,law of Utah, Utah Code title 59, chapter 912 of title 11, Utah Code 37 Annotated, 1953, as currently amended, and its successor, and to authorize and designate the 38 state tax commission as the city’s agent to collect those taxes by repealing the previously enacted 39 uniform local sales and use tax ordinance of this municipality and reenacting by this chapter a 40 new uniform local sales and use tax ordinance. 41 3.04.030: EFFECTIVE DATE; CONTINUANCE OF FORMER ORDINANCESTATUTES: 42 This chapter shall become effective retroactively as of one minute after twelve o'clock (12:01) 43 A.M., July 1, 1983. The provisions of the previously enacted uniform local sales and use tax 44 ordinance of the municipality which is repealed by this chapter and which are in conflict with 45 this chapter shall continue effective until twelve o'clock (12:00) midnight, June 30, 1983. The 46 provisions of this chapter which that are not in conflict with the former ordinance shall be 47 deemed to be a continuation thereof and any rights, duties and obligations arising thereunder 48 shall not in any way be deemed abrogated or terminated. 49 3 3.04.040: ADMINISTRATION AND OPERATION; CONTRACT WITH STATE TAX 50 COMMISSION: 51 Heretofore, the citymunicipality has entered into an agreement with the state tax commission to 52 perform all functions incident to the administration or operation of the sales and use tax 53 ordinance of the citymunicipality. That contract is confirmed and the mayor is authorized to 54 enter into such supplementary agreements with the state tax commission as may be necessary to 55 the continued administration and operation of the local sales and use tax ordinance of the 56 citymunicipality as reenacted by contained in this chapter]. 57 3.04.050: SALES AND USE TAX IMPOSED: 58 A. 1. From and after July 1, 1986, tThere is levied and there shall be collected and paid a tax 59 on every transaction listed in Utah Code subsection 59-12-103(1), as amended, or its successor, 60 including upon every retail sale of tangible personal property, services, and meals made within 61 the city,municipality at the rate of one percent of the purchase price paid or charged, or any other 62 rate hereafter authorized in Utah Code section 59-12-204, as amended, or its successor, and if the 63 location of the transaction is within the city as determined under Utah Code sections 59-12-211 64 through 59-12-215, as amended, or their successorof fifty eight sixty-fourths of one percent. 65 There is levied and there shall be collected and paid an excise tax on the storage, use, or other 66 consumption within the city of tangible personal property or any items listed in Utah Code 67 subsection 59-12-103(1), as amended, or its successor, from any retailer at the rate of one percent 68 of the purchase price paid or charged or any other rate hereafter authorized in Utah Code section 69 59-12-204, as amended, or its successor. The local sales and use taxes shall be collected and 70 distributed pursuant to Utah Code title 59, chapter 12, as amended, or its successor. The mayor is 71 authorized to execute whatever documents are necessary to distribute local sales and use tax 72 4 revenues on the combination of point of sale and population factors set forth in Utah Code 73 section 59-12-205, as amended, or its successor. 74 2. All local sales and use taxes collected under this chapter shall be reported to the state tax 75 commission on forms that accurately identify the location where the sale or use transaction was 76 consummated. For the purpose of this chapter, all retail sales shall be presumed to have been 77 consummated at the place of business of the retailer unless the tangible personal property sold is 78 delivered by the retailer or his agent to an out of state destination or to a common carrier for 79 delivery to an out of state destination. In the event a retailer has no permanent place of business 80 in the state, or has more than one place of business, the place or places at which the retail sales 81 are consummated shall be as determined under the rules and regulations prescribed and adopted 82 by the state tax commission. Public utilities as defined by Utah Code title 54, Utah Code 83 Annotated, 1953as amended, or its successor, shall not be obligated to determine the place or 84 places within any county or municipality where public utilities services are rendered, but the 85 place of sale or the sales tax revenues arising from such service allocable to the city shall be as 86 determined by the state tax commission pursuant to an appropriate formula, and other rules and 87 regulations to be prescribed and adopted by it. 88 B. 1. Except as hereinafter provided, and except insofar as they are inconsistent with the 89 provisions of the uniform lLocal sSales and uUse tTax Actlaw of utah, all of the provisions of 90 Utah Code chapter 15, title 59, chapter 12 Utah Code Annotated, 1953, as amended, or its 91 successor, and in force and effect on the effective date of this chapter, insofar as they relate to 92 sales and use taxes, excepting sections 59-152-101, as amended, or its successor and 59-15-21 93 thereof, and excepting for the amount of the sales and use tax levied therein, are adopted and 94 made a part of this chapter as though fully set forth in this chapter. Any amendments made by 95 5 the Utah legislature to Utah Code title 59, chapter 12, as amended, or its successor, that would be 96 applicable to the city are hereby incorporated herein by reference and shall be effective upon the 97 date they are effective as a Utah statute. The provisions of Utah Code title 59, chapter 12, part I, 98 Tax Collection, insofar as they relate to sales and use taxes, are hereby incorporated by reference 99 into this chapter, except that the name of the city as the taxing agency shall be substituted for that 100 of the state where necessary for the purposes of this chapter. 101 2. Wherever, and to the extent that in Utah Code title 59, chapter 12, 5 of title 59, as 102 amendedUtah Code Annotated, 1953, or its successor, the state is named or referred to as the 103 taxing agency, the name of this municipality the city shall be substituted therefor. Nothing in this 104 subsection shall be deemed to requires substitution of the name of the citymunicipality for the 105 word "state" when that word is used as part of the title of the state tax commission, or of the 106 constitution of the state, nor shall the name of the citymunicipality be substituted for that of the 107 state in any section when the result of that substitution would require action to be taken by or 108 against the state tax commission in performing the functions incident to the administration or 109 operation of this chapter. 110 3. If an annual license has been issued to a retailer under Utah Code section 59-12-1065-3 111 of the said Utah Code Annotated, 1953, as amended, or its successor, an additional license shall 112 not be required by reason of this section. 113 4. There shall be excluded from the purchase price paid or charged by which the tax is 114 measured: 115 a. The amount of any sales or use tax imposed by the state upon a retailer or consumer; 116 b. Receipts from the sale or the cost of storage, use, or other consumption of tangible 117 personal property upon which a sales or use tax has become due by reason of the same 118 6 transaction to any other municipality and any county in the state, under a sales or use tax 119 ordinance enacted by that county or municipality in accordance with the uniform lLocal sSales 120 and uUse tTax Actlaw of Utah; 121 c. the amount of any tax paid under Utah Code title 59, chapter 12, part 1, Tax Collection, 122 as amended, or its successor. 123 5. There shall be exempt from the tax due under this section: 124 a. The amount of any sales or use tax imposed by the state upon a retailer or consumer; 125 b. The sale, storage, use, or other consumption of tangible personal property, the gross 126 receipts from the sale of or the purchase price or the cost of which has been subject to sales or 127 use tax under a sales or use tax ordinance enacted in accordance with the Local Sales and Use 128 Tax Act by any county, city, or town in any other county in Utah or by any county other than 129 Salt Lake County, or city or town in Utah. 130 C. As provided in Utah Code section 59-12-204(6), as amended, and its successor, any person 131 subject to the provisions of the city’s local sales and use taxes is exempt from the Salt Lake 132 County local sales and use tax due to the provisions of this chapter described in section 59-12-133 204(6). 134 D. The city shall not impose a tax on the sales and uses described in Utah Code section 59-12-135 104, as amended, and its successor, to the extent the sales and uses are exempt from taxation 136 under section 59-12-104. 137 3.04.060: [RESERVED]USE TAX IMPOSED: 138 A. 1. Effective July 1, 1986, an excise tax is imposed on the storage, use or other 139 consumption in the municipality of tangible personal property from any retailer for storage, use 140 or other consumption in the municipality at the rate of fifty eight sixty- fourths of one percent of 141 7 the sales price of the property. 142 2. The use tax provided herein shall be collected and distributed pursuant to section 11-9-143 5(c) of the Utah Code Annotated (1953) as amended, or its successor. 144 B. 1. Except as hereinafter provided, and except insofar as they are inconsistent with the 145 provisions of the uniform local sales and use tax law of the state, all of the provisions of chapter 146 16, title 59, Utah Code Annotated, 1953, as amended, or its successor, and in force and effect on 147 the effective date of this chapter, applicable to use taxes, excepting the provisions of sections 59-148 16-1 and 59-16-25 thereof, and excepting for the amount of the tax levied therein, are adopted 149 and made a part of this section as though fully set forth in this chapter. 150 2. Whenever and to the extent that in the chapter 16 of title 59, Utah Code Annotated, 1953, 151 or its successor, the state is named or referred to as the taxing agency, the name of this 152 municipality shall be substituted therefor. Nothing in this subsection shall be deemed to require 153 the substitution of the name of the municipality for the word "state" when that word is used as 154 part of the title of the state tax commission, or of the constitution of the state, nor shall the name 155 of the municipality be substituted for that of the state in any section when the results of that 156 substitution would require action to be taken by or against the municipality or any agency 157 thereof, rather than by or against the state tax commission in performing the functions incident to 158 the administration or operation of this chapter. 159 3. There shall be exempt from the tax due under this section: 160 a. The amount of any sales or use tax imposed by the state upon a retailer or consumer; 161 b. The storage, use or other consumption of tangible personal property, the gross receipts 162 from the sales of or the cost of which has been subject to sales or use tax under a sales or use tax 163 ordinance enacted in accordance with the uniform local sales and use tax law of the state by any 164 8 other municipality and any county of the state. 165 3.04.070: VIOLATION; PENALTY: 166 Any person violating any of the provisions of this chapter shall be deemed guilty of a 167 misdemeanor, and upon conviction thereof, shall be punishable as set out in section 1.12.050 of 168 this code. 169 SECTION 2. This ordinance shall take effect immediately after it has been published in 170 accordance with Utah Code section 10-3-711 and recorded in accordance with Utah Code section 171 10-3-713. 172 Passed by the City Council of Salt Lake City, Utah, this ______ day of ____________, 173 2021. 174 ____________________________ 175 CHAIRPERSON 176 ATTEST AND COUNTERSIGN: 177 178 ___________________________ 179 CITY RECORDER 180 181 Transmitted to Mayor on ______________________. 182 183 Mayor’s Action: __________ Approved. ___________ Vetoed. 184 185 186 ____________________________ 187 MAYOR 188 189 190 191 ___________________________ 192 CITY RECORDER 193 194 195 (SEAL) 196 197 198 Bill No. ______ of 2021. 199 Published: _____________________. 200 Salt Lake City Attorney’s Office Approved As To Form By: _______________________ Boyd Ferguson Date: __________________ 10-8-21 9 201 202 203 204 1 1 SALT LAKE CITY ORDINANCE 2 No. ______ of 2021 3 4 (Sales and use taxes) 5 6 An ordinance amending and restating Chapter 3.04 of the Salt Lake City Code, relating to 7 sales and use taxes. 8 WHEREAS, sales and use taxes in Utah are governed by the Sales and Use Tax Act, 9 Utah Code Title 59, Chapter 12, and local sales and use taxes are governed by the Local Sales 10 and Use Tax Act, Utah Code Title 59, Chapter 12, Part 2; 11 WHEREAS, prior to 1986 the City Council adopted Salt Lake City Code Chapter 3.04 12 regarding sales and use tax; 13 WHEREAS, the Sales and Use Tax Act has been amended several times since its 14 adoption, which amendments have resulted in Chapter 3.04 containing outdated or superseded 15 wording and section references, including some tax rate descriptions; 16 WHEREAS, the City Council intends to make clean-up changes to Chapter 3.04 to 17 clarify it and the rates it is already imposing and to conform it to state law, and does not intend 18 thereby to change any tax rates it is currently imposing; and 19 WHEREAS, the City Council of Salt Lake City, Utah, desires to amend and restate 20 Chapter 3.04 of the Salt Lake City Code, relating to local sales and use taxes, to make such 21 clean-up changes. 22 NOW, THEREFORE, be it ordained by the City Council of Salt Lake City, Utah that: 23 SECTION 1. Chapter 3.04 of the Salt Lake City Code, relating to local sales and use 24 taxes, is amended and restated to read as follows: 25 3.04.010: SHORT TITLE: 26 2 This chapter shall be known as the LOCAL SALES AND USE TAX ORDINANCE OF THE CITY 27 OF SALT LAKE. 28 3.04.020: PURPOSE: 29 The Utah legislature has authorized municipalities to adopt an ordinance that imposes a one 30 percent local sales and use tax. It is the purpose of this chapter to impose a local option sales and 31 use to conform the city’s sales and use taxes to the requirements of the Sales and Use Tax Act, 32 Utah Code title 59, chapter 12, as currently amended, and its successor, and to authorize and 33 designate the state tax commission as the city’s agent to collect those taxes. 34 3.04.030: EFFECTIVE DATE; CONTINUANCE OF FORMER ORDINANCE: 35 This chapter shall become effective retroactively as of one minute after twelve o'clock (12:01) 36 A.M., July 1, 1983. The provisions of this chapter that are not in conflict with the former 37 ordinance shall be deemed to be a continuation thereof and any rights, duties and obligations 38 arising thereunder shall not in any way be deemed abrogated or terminated. 39 3.04.040: ADMINISTRATION AND OPERATION; CONTRACT WITH STATE TAX 40 COMMISSION: 41 Heretofore, the city has entered into an agreement with the state tax commission to perform all 42 functions incident to the administration or operation of the sales and use tax ordinance of the 43 city. That contract is confirmed and the mayor is authorized to enter into such supplementary 44 agreements with the state tax commission as may be necessary to the continued administration 45 and operation of the local sales and use tax ordinance of the city as contained in this chapter]. 46 3.04.050: SALES AND USE TAX IMPOSED: 47 A. 1. There is levied and there shall be collected and paid a tax on every transaction listed in 48 Utah Code subsection 59-12-103(1), as amended, or its successor, including upon every retail 49 3 sale of tangible personal property, services, and meals made within the city, at the rate of one 50 percent of the purchase price paid or charged, or any other rate hereafter authorized in Utah Code 51 section 59-12-204, as amended, or its successor, and if the location of the transaction is within 52 the city as determined under Utah Code sections 59-12-211 through 59-12-215, as amended, or 53 their successor. There is levied and there shall be collected and paid an excise tax on the storage, 54 use, or other consumption within the city of tangible personal property or any items listed in 55 Utah Code subsection 59-12-103(1), as amended, or its successor, from any retailer at the rate of 56 one percent of the purchase price paid or charged or any other rate hereafter authorized in Utah 57 Code section 59-12-204, as amended, or its successor. The local sales and use taxes shall be 58 collected and distributed pursuant to Utah Code title 59, chapter 12, as amended, or its successor. 59 The mayor is authorized to execute whatever documents are necessary to distribute local sales 60 and use tax revenues on the combination of point of sale and population factors set forth in Utah 61 Code section 59-12-205, as amended, or its successor. 62 2. All local sales and use taxes collected under this chapter shall be reported to the state tax 63 commission on forms that accurately identify the location where the sale or use transaction was 64 consummated. For the purpose of this chapter, all retail sales shall be presumed to have been 65 consummated at the place of business of the retailer unless the tangible personal property sold is 66 delivered by the retailer or his agent to an out of state destination or to a common carrier for 67 delivery to an out of state destination. In the event a retailer has no permanent place of business 68 in the state, or has more than one place of business, the place or places at which the retail sales 69 are consummated shall be as determined under the rules and regulations prescribed and adopted 70 by the state tax commission. Public utilities as defined by Utah Code title 54, as amended, or its 71 successor, shall not be obligated to determine the place or places within any county or 72 4 municipality where public utilities services are rendered, but the place of sale or the sales tax 73 revenues arising from such service allocable to the city shall be as determined by the state tax 74 commission pursuant to an appropriate formula, and other rules and regulations to be prescribed 75 and adopted by it. 76 B. 1. Except as hereinafter provided, and except insofar as they are inconsistent with the 77 provisions of the Local Sales and Use Tax Act, all of the provisions of Utah Code title 59, 78 chapter 12, as amended, or its successor, and in force and effect on the effective date of this 79 chapter, insofar as they relate to sales and use taxes, excepting section 59-12-101, as amended, or 80 its successor, and except for the amount of the sales and use tax levied therein, are adopted and 81 made a part of this chapter as though fully set forth in this chapter. Any amendments made by 82 the Utah legislature to Utah Code title 59, chapter 12, as amended, or its successor, that would be 83 applicable to the city are hereby incorporated herein by reference and shall be effective upon the 84 date they are effective as a Utah statute. The provisions of Utah Code title 59, chapter 12, part I, 85 Tax Collection, insofar as they relate to sales and use taxes, are hereby incorporated by reference 86 into this chapter, except that the name of the city as the taxing agency shall be substituted for that 87 of the state where necessary for the purposes of this chapter. 88 2. Wherever, and to the extent that in Utah Code title 59, chapter 12, as amended, or its 89 successor, the state is named or referred to as the taxing agency, the name of the city shall be 90 substituted therefor. Nothing in this subsection requires substitution of the name of the city for 91 the word "state" when that word is used as part of the title of the state tax commission, or of the 92 constitution of the state, nor shall the name of the city be substituted for that of the state in any 93 section when the result of that substitution would require action to be taken by or against the 94 state tax commission in performing the functions incident to the administration or operation of 95 5 this chapter. 96 3. If an annual license has been issued to a retailer under Utah Code section 59-12-106 , as 97 amended, or its successor, an additional license shall not be required by reason of this section. 98 4. There shall be excluded from the purchase price paid or charged by which the tax is 99 measured: 100 a. The amount of any sales or use tax imposed by the state upon a retailer or consumer; 101 b. Receipts from the sale or the cost of storage, use, or other consumption of tangible 102 personal property upon which a sales or use tax has become due by reason of the same 103 transaction to any other municipality and any county in the state, under a sales or use tax 104 ordinance enacted by that county or municipality in accordance with the Local Sales and Use 105 Tax Act; 106 c. the amount of any tax paid under Utah Code title 59, chapter 12, part 1, Tax Collection, 107 as amended, or its successor. 108 5. There shall be exempt from the tax due under this section: 109 a. The amount of any sales or use tax imposed by the state upon a retailer or consumer; 110 b. The sale, storage, use, or other consumption of tangible personal property, the gross 111 receipts from the sale of or the purchase price or the cost of which has been subject to sales or 112 use tax under a sales or use tax ordinance enacted in accordance with the Local Sales and Use 113 Tax Act by any county, city, or town in any other county in Utah or by any county other than 114 Salt Lake County, or city or town in Utah. 115 C. As provided in Utah Code section 59-12-204(6), as amended, and its successor, any person 116 subject to the provisions of the city’s local sales and use taxes is exempt from the Salt Lake 117 County local sales and use tax due to the provisions of this chapter described in section 59-12-118 6 204(6). 119 D. The city shall not impose a tax on the sales and uses described in Utah Code section 59-12-120 104, as amended, and its successor, to the extent the sales and uses are exempt from taxation 121 under section 59-12-104. 122 3.04.060: [RESERVED] 123 3.04.070: VIOLATION; PENALTY: 124 Any person violating any of the provisions of this chapter shall be deemed guilty of a 125 misdemeanor, and upon conviction thereof, shall be punishable as set out in section 1.12.050 of 126 this code. 127 SECTION 2. This ordinance shall take effect immediately after it has been published in 128 accordance with Utah Code section 10-3-711 and recorded in accordance with Utah Code section 129 10-3-713. 130 Passed by the City Council of Salt Lake City, Utah, this ______ day of ____________, 131 2021. 132 ____________________________ 133 CHAIRPERSON 134 ATTEST AND COUNTERSIGN: 135 136 ___________________________ 137 CITY RECORDER 138 139 Transmitted to Mayor on ______________________. 140 141 Mayor’s Action: __________ Approved. ___________ Vetoed. 142 143 144 ____________________________ 145 MAYOR 146 147 148 149 _ 150 Salt Lake City Attorney’s Office Approved As To Form By: _______________________ Boyd Ferguson Date: __________________ 10-8-21 7 __________________________ 151 CITY RECORDER 152 153 154 (SEAL) 155 156 157 Bill No. ______ of 2021. 158 Published: _____________________. 159 160 161 162 163 Signature: Email:Garrett.Danielson@slcgov.com