HB 0433

CS

CHAMBER ACTION

1	The Finance & Tax Committee recommends the following:
2
3	Council/Committee Substitute
4	Remove the entire bill and insert:
5	A bill to be entitled
6	An act relating to the tax on gross receipts for utility
7	services; amending s. 203.01, F.S.; providing for a tax on
8	utility services delivered to a retail consumer in this
9	state; providing for a tax on the gross receipts of a
10	distribution company providing delivery of electricity to
11	a retail consumer, based on an index price; providing for
12	an annual calculation of the index price; providing for a
13	tax reduction by refund for like taxes paid to another
14	jurisdiction; providing for a tax on the gross receipts of
15	a distribution company providing for the sale or
16	transportation of natural gas or manufactured gas to a
17	retail consumer, based on an index price; providing for an
18	annual calculation of the index price; providing for a tax
19	reduction by refund for like taxes paid to another
20	jurisdiction; providing for a tax on the cost price of
21	electricity, natural gas, or manufactured gas to be paid
22	by any person who causes these products to be severed or
23	imported into the state for that person's own use;
24	revising obsolete provisions; providing that the tax does
25	not apply to certain sales, transportation, delivery, or
26	uses; providing that a written certificate of entitlement
27	to an exclusion from tax relieves certain persons from
28	responsibility of remitting tax on nontaxable amounts;
29	requiring persons transporting natural or manufactured gas
30	to annually provide a customer list to the Department of
31	Revenue; providing an exception; providing alternatives;
32	providing confidentiality requirements; amending s.
33	203.012, F.S.; redefining the term "utility service";
34	defining the term "distribution company"; authorizing the
35	executive director of the Department of Revenue to adopt
36	emergency rules to implement the act; providing an amnesty
37	for unpaid gross receipts tax, penalties, and interest on
38	unpaid gross receipts tax otherwise due for selling
39	natural gas in this state; providing conditions for the
40	amnesty; providing limitations for the amnesty;
41	authorizing the executive director of the Department of
42	Revenue to adopt emergency rules to implement the amnesty;
43	providing effective dates.
44
45	Be It Enacted by the Legislature of the State of Florida:
46
47	Section 1.  Subsections (1) and (3) of section 203.01,
48	Florida Statutes, are amended, and subsection (9) is added to
49	said section, to read:
50	203.01  Tax on gross receipts for utility and
51	communications services.--
52	(1)(a)1.  A tax is imposed on gross receipts from utility
53	services that are delivered to a retail consumer in this state.
54	Such tax shall be levied as provided in paragraphs (b)-(j) Every
55	person that receives payment for any utility service shall
56	report by the last day of each month to the Department of
57	Revenue, under oath of the secretary or some other officer of
58	such person, the total amount of gross receipts derived from
59	business done within this state, or between points within this
60	state, for the preceding month and, at the same time, shall pay
61	into the State Treasury an amount equal to a percentage of such
62	gross receipts at the rate set forth in paragraph (b). Such
63	collections shall be certified by the Chief Financial Officer
64	upon the request of the State Board of Education.
65	2.  A tax is levied on communications services as defined
66	in s. 202.11(3). Such tax shall be applied to the same services
67	and transactions as are subject to taxation under chapter 202,
68	and to communications services that are subject to the exemption
69	provided in s. 202.125(1). Such tax shall be applied to the
70	sales price of communications services when sold at retail and
71	to the actual cost of operating substitute communications
72	systems, as such terms are defined in s. 202.11, shall be due
73	and payable at the same time as the taxes imposed pursuant to
74	chapter 202, and shall be administered and collected pursuant to
75	the provisions of chapter 202.
76	(b)  The rate applied to utility services shall be 2.5
77	percent. The rate applied to communications services shall be
78	2.37 percent.
79	(c)  The tax shall be levied against the total amount of
80	gross receipts received by a distribution company for its sale
81	of utility services if the utility service is delivered to the
82	retail consumer by a distribution company and the retail
83	consumer pays the distribution company a charge for utility
84	service which includes a charge for both the electricity and the
85	transportation of electricity to the retail consumer. The
86	distribution company shall report and remit to the Department of
87	Revenue by the last day of each month the taxes levied pursuant
88	to this paragraph during the preceding month.
89	(d)1.  Each distribution company that receives payment for
90	the delivery of electricity to a retail consumer in this state
91	is subject to tax on the exercise of this privilege as provided
92	by this paragraph unless the payment is subject to tax under
93	paragraph (c). For the exercise of this privilege, the tax
94	levied on such distribution company's receipts for the delivery
95	of electricity shall be determined by multiplying the number of
96	kilowatt hours delivered by the index price and applying the
97	rate in paragraph (b) to the result.
98	2.  The index price is the Florida price per kilowatt hour
99	for retail consumers in the previous calendar year, as published
100	in the United States Energy Information Administration Electric
101	Power Monthly and announced by the Department of Revenue on June
102	1 of each year to be effective for the 12-month period beginning
103	July 1 of that year. For each customer class residential,
104	commercial, and industrial, the applicable index posted for
105	residential, commercial, and industrial will be applied in
106	calculating the gross receipts to which the tax applies. If
107	publication of the indices is delayed or discontinued, the last
108	posted index shall be used until a current index is posted or
109	the department adopts a comparable index by rule.
110	3.  Tax due under this paragraph shall be administered,
111	paid, and reported in the same manner as the tax due under
112	paragraph (c).
113	4.  The amount of tax due under this paragraph shall be
114	reduced by the amount of any like tax lawfully imposed on and
115	paid by the person from whom the retail consumer purchased the
116	electricity, whether imposed by and paid to this state, another
117	state, a territory of the United States, or the District of
118	Columbia. This reduction in tax shall be available to the retail
119	consumer as a refund made pursuant to s. 215.26 and does not
120	inure to the benefit of the person who receives payment for the
121	delivery of the electricity. The methods of demonstrating proof
122	of payment and the amount of such refund shall be made according
123	to rules of the Department of Revenue.
124	(e)1.  Every distribution company that receives payment for
125	the sale or transportation of natural or manufactured gas to a
126	retail consumer in this state is subject to tax on the exercise
127	of this privilege as provided by this paragraph. For the
128	exercise of this privilege, the tax levied on such distribution
129	company's receipts for the sale or transportation of natural or
130	manufactured gas shall be determined by dividing the number of
131	cubic feet delivered by 1,000, multiplying the resulting number
132	by the index price, and applying the rate in paragraph (b) to
133	the result.
134	2.  The index price is the Florida price per 1,000 cubic
135	feet for retail consumers in the previous calendar year as
136	published in the United States Energy Information Administration
137	Natural Gas Monthly and announced by the Department of Revenue
138	on June 1 of each year to be effective for the 12-month period
139	beginning July 1 of that year. For each customer class
140	residential, commercial, and industrial, the applicable index
141	posted for residential, commercial, and industrial will be
142	applied in calculating the gross receipts to which the tax
143	applies. If publication of the indices is delayed or
144	discontinued, the last posted index shall be used until a
145	current index is posted or the department adopts a comparable
146	index by rule.
147	3.  Tax due under this paragraph shall be administered,
148	paid, and reported in the same manner as the tax due under
149	paragraph (c).
150	4.  The amount of tax due under this paragraph shall be
151	reduced by the amount of any like tax lawfully imposed on and
152	paid by the person from whom the retail consumer purchased the
153	natural gas or manufactured gas, whether imposed by and paid to
154	this state, another state, a territory of the United States, or
155	the District of Columbia. This reduction in tax shall be
156	available to the retail consumer as a refund pursuant to s.
157	215.26 and does not inure to the benefit of the person providing
158	the transportation service. The methods of demonstrating proof
159	of payment and the amount of such refund shall be made according
160	to rules of the Department of Revenue.
161	(f)  Any person who imports into this state electricity,
162	natural gas, or manufactured gas, or severs natural gas, for
163	that person's own use or consumption as a substitute for
164	purchasing utility, transportation, or delivery services taxable
165	under this chapter and who cannot demonstrate payment of the tax
166	imposed by this chapter must register with the Department of
167	Revenue and pay into the State Treasury each month an amount
168	equal to the cost price of such electricity, natural gas, or
169	manufactured gas times the rate set forth in paragraph (b),
170	reduced by the amount of any like tax lawfully imposed on and
171	paid by the person from whom the electricity, natural gas, or
172	manufactured gas was purchased or any person who provided
173	delivery service or transportation service in connection with
174	the electricity, natural gas, or manufactured gas. For purposes
175	of this paragraph, the term "cost price" has the meaning
176	ascribed in s. 212.02(4). The methods of demonstrating proof of
177	payment and the amount of such reductions in tax shall be made
178	according to rules of the Department of Revenue.
179	(g)(c)  Electricity produced by cogeneration or by small
180	power producers which is transmitted and distributed by a public
181	utility between two locations of a customer of the utility
182	pursuant to s. 366.051 is subject to the tax imposed by this
183	section. The tax shall be applied to the cost price of such
184	electricity as provided in s. 212.02(4) and shall be paid each
185	month by the producer of such electricity.
186	(h)(d)  Electricity produced by cogeneration or by small
187	power producers during the 12-month period ending June 30 of
188	each year which is in excess of nontaxable electricity produced
189	during the 12-month period ending June 30, 1990, is subject to
190	the tax imposed by this section. The tax shall be applied to the
191	cost price of such electricity as provided in s. 212.02(4) and
192	shall be paid each month, beginning with the month in which
193	total production exceeds the production of nontaxable
194	electricity for the 12-month period ending June 30, 1990. For
195	purposes of this paragraph, "nontaxable electricity" means
196	electricity produced by cogeneration or by small power producers
197	which is not subject to tax under paragraph (g)(c). Taxes paid
198	pursuant to paragraph (g)(c) may be credited against taxes due
199	under this paragraph. Electricity generated as part of an
200	industrial manufacturing process which manufactures products
201	from phosphate rock, raw wood fiber, paper, citrus, or any
202	agricultural product shall not be subject to the tax imposed by
203	this paragraph. "Industrial manufacturing process" means the
204	entire process conducted at the location where the process takes
205	place.
206	(i)(e)  Any person other than a cogenerator or small power
207	producer described in paragraph (h)(d) who produces for his or
208	her own use electrical energy which is a substitute for
209	electrical energy produced by an electric utility as defined in
210	s. 366.02 is subject to the tax imposed by this section. The tax
211	shall be applied to the cost price of such electrical energy as
212	provided in s. 212.02(4) and shall be paid each month. The
213	provisions of this paragraph do not apply to any electrical
214	energy produced and used by an electric utility.
215	(j)(f)  Notwithstanding any other provision of this
216	chapter, with the exception of a communications services dealer
217	reporting taxes administered under chapter 202 telephone or
218	telecommunication system described in paragraph (c), the
219	department may require:
220	1.  A quarterly return and payment when the tax remitted
221	for the preceding four calendar quarters did not exceed $1,000;
222	2.  A semiannual return and payment when the tax remitted
223	for the preceding four calendar quarters did not exceed $500; or
224	3.  An annual return and payment when the tax remitted for
225	the preceding four calendar quarters did not exceed $100.
226	(3)  The tax imposed by subsection (1) does not apply to
227	term "gross receipts" as used herein does not include gross
228	receipts of any person derived from:
229	(a)1.  The sale or transportation of natural gas or
230	manufactured gas to a public or private utility, including a
231	municipal corporation or rural electric cooperative association,
232	either for resale or for use as fuel in the generation of
233	electricity; or
234	2.(b)  The sale or delivery of electricity to a public or
235	private utility, including a municipal corporation or rural
236	electric cooperative association, for resale within the state,
237	or as part of an electrical interchange agreement or contract
238	between such utilities for the purpose of transferring more
239	economically generated power;
240
241	provided the person deriving gross receipts from such sale
242	demonstrates that a sale, transportation, or delivery for resale
243	in fact occurred and complies with the following requirements: A
244	sale, transportation, or delivery for resale in this state must
245	be in strict compliance with the rules and regulations of the
246	Department of Revenue; and any sale subject to the tax imposed
247	by this section person making a sale for resale in this state
248	which is not in strict compliance with the rules and regulations
249	of the Department of Revenue shall be subject to liable for and
250	pay the tax at the appropriate rate imposed on utilities by
251	paragraph (b) on the person making the sale. Any person making a
252	sale for resale in this state may, through an informal protest
253	provided for in s. 213.21 and the rules of the Department of
254	Revenue, provide the department with evidence of the exempt
255	status of a sale. The department shall adopt rules which provide
256	that valid proof and documentation of the resale in this state
257	by a person making the sale for resale in this state will be
258	accepted by the department when submitted during the protest
259	period but will not be accepted when submitted in any proceeding
260	under chapter 120 or any circuit court action instituted under
261	chapter 72;.
262	(b)  Wholesale sales of electric transmission service;
263	(c)  The use of natural gas in the production of oil or
264	gas, or the use of natural or manufactured gas by a person
265	transporting natural or manufactured gas, when used and consumed
266	in providing such services; or
267	(d)  The sale or transportation to, or use of, natural gas
268	or manufactured gas by a person eligible for an exemption under
269	s. 212.08(7)(ff)2. for use as an energy source or a raw
270	material. Possession by a seller of natural or manufactured gas,
271	or by any person providing transportation or delivery of natural
272	or manufactured gas, of a written certification by the purchaser
273	certifying the purchaser's entitlement to the exclusion
274	permitted by this paragraph relieves the seller or person
275	providing transportation or delivery from the responsibility of
276	remitting tax on the nontaxable amounts and the department shall
277	look solely to the purchaser for recovery of such tax if the
278	department determines that the purchaser was not entitled to the
279	exclusion. The certification shall include an acknowledgment by
280	the purchaser that the purchaser will be liable for tax pursuant
281	to paragraph (1)(f) if the requirements for exclusion are not
282	met.
283	(9)  Any person that engages in the transportation of
284	natural or manufactured gas shall furnish annually to the
285	Department of Revenue a list of customers to whom transportation
286	services were provided in the prior year. This reporting
287	requirement does not apply to distribution companies. Any person
288	required to furnish such a list may elect to identify only those
289	customers who take direct delivery without purchasing
290	interconnection services from a distribution company. Such lists
291	shall be subject to the confidentiality provisions of s.
292	213.053. Any person required to furnish a customer list may
293	instead comply by maintaining a publicly accessible customer
294	list on its internet website. Such list shall be updated no less
295	than annually.
296	Section 2.  Section 203.012, Florida Statutes, is amended
297	to read:
298	203.012  Definitions.--As used in this chapter:
299	(1)  "Distribution company" means any person owning or
300	operating local electric or natural or manufactured gas utility
301	distribution facilities within this state for the transmission,
302	delivery, and sale of electricity or natural or manufactured
303	gas. The term does not include natural gas transmission
304	companies that are subject to the jurisdiction of the Federal
305	Energy Regulatory Commission.
306	(2)  "Person" means any person as defined in s. 212.02.
307	(3)(1)  "Utility service" means electricity for light,
308	heat, or power; and natural or manufactured gas for light, heat,
309	or power, including transportation, delivery, transmission, and
310	distribution of the electricity or natural or manufactured gas.
311	This subsection does not broaden the definition of utility
312	service to include separately stated charges for tangible
313	personal property or services which are not charges for the
314	electricity or natural or manufactured gas or the
315	transportation, delivery, transmission, or distribution of
316	electricity or natural or manufactured gas.
317	Section 3.  Emergency rules.--
318	(1)  The executive director of the Department of Revenue is
319	authorized, and all conditions are deemed met, to adopt
320	emergency rules, under ss. 120.536(1) and 120.54(4), Florida
321	Statutes, to implement the provisions of s. 203.01, Florida
322	Statutes, which provide for remittance of tax by distribution
323	companies and self-accrual of tax by retail consumers and the
324	provisions of s. 203.012, Florida Statutes, which define the
325	term "distribution company" and provide that utility services
326	include transportation, transmission, and distribution of
327	electricity and natural or manufactured gas. Such rules shall
328	include forms the Department of Revenue determines are necessary
329	or appropriate for registration, applying for self-accrual
330	authority, reporting, and remitting taxes, or applying for
331	credits. Notwithstanding any other law, such emergency rules
332	shall remain effective for 6 months after the date of adoption
333	and may be renewed during the pendency of procedures to adopt
334	rules addressing the subject of the emergency rules.
335	(2)  This section shall take effect upon this act becoming
336	a law.
337	Section 4.  Amnesty for registration and remittance of
338	tax.--
339	(1)  The state shall provide an amnesty for unpaid gross
340	receipts tax, penalties, and interest on unpaid gross receipts
341	tax that may otherwise be due for the sale or transportation of
342	natural gas for consumption in this state if all of the
343	following requirements are satisfied:
344	(a)  The sales subject to amnesty were made prior to
345	January 1, 2006.
346	(b)  The gross receipts at issue were derived from one of
347	the following:
348	1.  Sales by persons who are not regulated pursuant to
349	chapter 366, Florida Statutes;
350	2.  Sales for which the written sales agreement provides
351	for transfer of title to the gas outside the state; or
352	3.  Sales of transportation services associated with the
353	sales of gas.
354	(c)  The seller registered with the Department of Revenue
355	to pay gross receipts tax on or before January 1, 2006, if the
356	seller is required to be registered as of January 1, 2006.
357	(d)  The seller applies for amnesty on or before January 1,
358	2006, in accordance with the rules of the Department of Revenue.
359	(2)  The amnesty is not available for taxes, penalties, or
360	interest that have been assessed if the assessment is final and
361	has not been timely challenged, or for any tax, penalty, or
362	interest that has been previously paid to the department unless
363	the payment is the subject of an assessment that is not final or
364	that has been timely challenged.
365	(3)  The amnesty is not available for tax billed to or
366	collected by the seller as an itemized charge to customers.
367	(4)  The executive director of the Department of Revenue
368	may adopt emergency rules under ss. 120.536(1) and 120.54(4),
369	Florida Statutes, to implement the amnesty. Such rules may
370	provide forms and procedures for applying for amnesty; for
371	reporting the sales for which amnesty is sought; and for
372	ensuring the applicant's ongoing commitment to registration,
373	collection, and remittance of the state's gross receipts tax.
374	Notwithstanding any other law, the emergency rules shall remain
375	effective until the later of the date that is 6 months after the
376	date of adoption of the rule or the date of final resolution of
377	all amnesty applications filed pursuant to this section.
378	(5)  This section shall take effect upon this act becoming
379	a law.
380	Section 5.  Except as otherwise provided herein, this act
381	shall take effect January 1, 2006.

CODING: Words stricken are deletions; words underlined are additions.