Fiscal Note Package 36342

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Fiscal Note Package 36342 Multiple Agency Fiscal Note Summary Bill Number: 2539 HB Title: Tax/recreation services, etc Estimated Cash Receipts Agency Name 2013-15 2015-17 2017-19 GF- State Total GF- State Total GF- State Total Department of Revenue (522,000) (523,000) (5,004,000) (5,014,000) (6,758,000) (6,771,000) Total $ (522,000) (523,000) (5,004,000) (5,014,000) (6,758,000) (6,771,000) Local Gov. Courts * Loc School dist-SPI Local Gov. Other ** (232,650) (2,227,500) (3,007,620) Local Gov. Total (232,650) (2,227,500) (3,007,620) Estimated Expenditures Agency Name 2013-15 2015-17 2017-19 FTEs GF-State Total FTEs GF-State Total FTEs GF-State Total Department of Revenue .2 38,600 38,600 .0 0 0 .0 0 0 Total 0.2 $38,600 $38,600 0.0 $0 $0 0.0 $0 $0 Estimated Capital Budget Impact NONE Prepared by: Kathy Cody, OFM Phone: Date Published: (360) 902-9822 Final 1/23/2014 * See Office of the Administrator for the Courts judicial fiscal note ** See local government fiscal note FNPID: 36342 FNS029 Multi Agency rollup Department of Revenue Fiscal Note Bill Number: 2539 HB Title: Tax/recreation services, etc Agency: 140-Department of Revenue Part I: Estimates No Fiscal Impact Estimated Cash Receipts to: Account FY 2014 FY 2015 2013-15 2015-17 2017-19 GF-STATE-State (620,000) (620,000) (5,946,000) (8,032,000) 01 - Taxes 01 - Retail Sales Tax GF-STATE-State 98,000 98,000 942,000 1,274,000 01 - Taxes 05 - Bus and Occup Tax Performance Audits of Government (1,000) (1,000) (10,000) (13,000) Account-State 01 - Taxes 01 - Retail Sales Tax Total $ (523,000) (523,000) (5,014,000) (6,771,000) Estimated Expenditures from: FY 2014 FY 2015 2013-15 2015-17 2017-19 FTE Staff Years 0.3 0.2 Account GF-STATE-State 001-1 38,600 38,600 Total $ 38,600 38,600 Estimated Capital Budget Impact: NONE The cash receipts and expenditure estimates on this page represent the most likely fiscal impact. Factors impacting the precision of these estimates, and alternate ranges (if appropriate), are explained in Part II. Check applicable boxes and follow corresponding instructions: If fiscal impact is greater than $50,000 per fiscal year in the current biennium or in subsequent biennia, complete entire fiscal note X form Parts I-V. If fiscal impact is less than $50,000 per fiscal year in the current biennium or in subsequent biennia, complete this page only (Part I). Capital budget impact, complete Part IV. Requires new rule making, complete Part V. Legislative Contact: Dominique Meyers Phone: 360-786-7150 Date: 01/20/2014 Agency Preparation: Erin Valz Phone: 360-534-1522 Date: 01/23/2014 Agency Approval: Don Gutmann Phone: 360-534-1510 Date: 01/23/2014 OFM Review: Kathy Cody Phone: (360) 902-9822 Date: 01/23/2014 Request # 2539-1-1 Form FN (Rev 1/00) 1 Bill # 2539 HB FNS062 Department of Revenue Fiscal Note Part II: Narrative Explanation II. A - Brief Description Of What The Measure Does That Has Fiscal Impact Briefly describe, by section number, the significant provisions of the bill, and any related workload or policy assumptions, that have revenue or expenditure impact on the responding agency. THIS LEGISLATION - Removes the undefined term “amusement and recreation services” from the definition of “retail sale” (RCW 82.04.050) for business and occupation (B&O) and retail sales tax purposes. The bill replaces “amusement and recreation services” with a specific list of retailing activities of an amusement and recreational nature. - Provides that charges to consumers for the specified retail amusement and recreational activities listed below, including, in most cases, instruction, would be subject to retail sales tax and retailing B&O tax. Unlike amusement and recreation services under current law, use tax would not apply to the specified retail amusement and recreational activities listed below. - Removes the term “physical fitness services” from the definition of “retail sale” and instead provides that the operation of an “athletic or fitness facility” is a retail sale. - Would take effect January 1, 2015. SPECIFIED RETAIL AMUSEMENT AND RECREATIONAL ACTIVITIES Charges to consumers for the following specified activities would be subject to retail sales tax: - Ballooning, hang gliding, indoor or outdoor sky diving, paragliding, parasailing, and similar activities. - Golf, including any variant in which either golf balls or golf clubs are used, such as miniature golf, hitting golf balls at a driving range, and golf simulators. This does not include competitive events (tournaments) except that amounts paid either by the participants or the event organizer to the owner or operator of the golfing facility are a retail sale if such amounts vary based on the number of event participants. - Air hockey, billiards, pool, foosball, darts, shuffleboard, ping pong, and similar games. - Access to amusement park, theme park, and water park facilities, including but not limited to charges for admission and locker or cabana rentals. An amusement park or theme park is a location that provides permanently affixed amusement park or theme park rides, games, and other entertainment. It does not include parks or zoos for which the primary purpose is the exhibition of wildlife. - Batting cage activities. - Bowling, but not including competitive events (tournaments), except amounts paid by the participants or the event organizer to the owner or operator of the bowling alley are retail sales if such amounts vary based on the number of event participants. - Climbing on artificial climbing structures, whether indoors or outdoors. - Day trips for sightseeing purposes. - Bungee jumping; zip lining; and riding inside a ball, whether inflatable or otherwise. - Horseback riding offered to the public, where the seller furnishes the horse to the buyer and providing instruction is not the primary focus of the activity, including guided rides. This does not include therapeutic horseback riding provided by an instructor certified by a nonprofit organization that offers national or international certification for therapeutic riding instructors. - Fishing, including providing access to private fishing areas and charter or guided fishing, but not including fishing license fees imposed by a government entity. - Guided hunting and hunting at game farms and shooting preserves, but not including hunting license fees imposed by a government entity. - Swimming, but only in respect to recreational or fitness swimming open to the public and pool parties for private events. Fees for swimming lessons, to participate in competitive events, or to join a swim team, club, or stand-alone aquatic facility are not retail sales. - Go-karting, bumper cars, and other motorized activities where the seller provides the vehicle and the premises where the buyer will operate the vehicle. - Indoor or outdoor playground activities, such as inflatable bounce structures and other inflatables; mazes; trampolines; Request # 2539-1-1 Form FN (Rev 1/00) 2 Bill # 2539 HB FNS062 Department of Revenue Fiscal Note slides; ball pits; games of tag, including laser tag and soft-dart tag; and human gyroscope rides, regardless of whether such activities occur at the seller’s place of business. This does not include playground activities provided for children by a licensed child day care center or licensed family day care provider (as defined in RCW 43.215.010). - Shooting sports and activities, such as target shooting, skeet, trap, sporting clays, “5” stand, and archery, but only with respect to discrete charges to members of the public to engage in these activities. Fees to join a competitive event, join or renew a membership at a club, range, or other facility, or instruction that is entirely or predominately classroom based, are not retail sales. - Paintball and air soft activities. - Skating, including ice skating, roller skating, and inline skating, but only in respect to discrete charges to the public to engage in skating activities. The term “retail sale” does not include fees for skating lessons, to enter a competitive event, to engage in team activities, or to join or renew a membership at a skating facility, club, or other organization. - Non-motorized snow sports and activities, such as downhill and cross country skiing, snowboarding, ski jumping, sledding, snow tubing, snowshoeing, and similar snow sports and activities, whether engaged in outdoors or in an indoor facility with or without snow, but only in respect to discrete charges to the public for the use of land or facilities to engage in non-motorized snow sports and activities. - Scuba diving; snorkeling; river-rafting; surfing; kite boarding; fly boarding; water slides; inflatables, such as water pillows, water trampolines, and water rollers; and similar water sports and activities. Specific exclusions are provided for: - Admission to fairs, carnivals, and festivals, including charges for rides and attractions. - Otherwise taxable activities provided by an educational institution to its students and staff. This exclusion does not apply to charges made to its alumni or other members of the public. - Diver training provided by a licensed vocational school. - Day camps provided by nonprofit organizations or state or local governmental entities for persons who are under 19 years of age or that are focused on persons who have a disability or mental illness. ATHLETIC AND FITNESS FACILITIES With certain exceptions, this bill makes all charges for the use of an athletic or fitness facility a retail sale, including any associated services or amenities. An "athletic or fitness facility" is defined as an indoor or outdoor facility, or portion of a facility, that is predominantly used for exercise classes; strength and conditioning programs; personal training services; tennis, racquetball, handball, squash, or pickleball; yoga; boxing, kickboxing, wrestling, martial arts, or mixed martial arts training; or other activities requiring the use of exercise or strength training equipment, such as treadmills, elliptical machines, stair climbers, stationary cycles, rowing machines, Pilates equipment, balls, climbing ropes, jump ropes, and weightlifting equipment.
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