HB 231 — Restaurant Tax Repeal Amendments

HB0231S02HB0231S01 compared with HB0231S01HB0231 {Omitted text} shows text that was in HB0231S01HB0231 but was omitted in HB0231S02HB0231S01 inserted text shows text that was not in HB0231S01HB0231 but was inserted into HB0231S02HB0231S01 DISCLAIMER:

▸ repeals the authority for a county to impose the tax, referred to as the restaurant tax, on food items and alcoholic beverage items sold at restaurants and customized prepared foods sold at convenience stores, gas stations, and grocery storesstores{;} {onceonce a county has received an amount of revenue to secure existing debt obligations;

and}and ;▸ {provides authority for a county to impose a tax on taxable transactions, other than food and food ingredients, at a rate that will generate an equivalent amount of revenue to the restaurant tax;

▸and} replaces the restaurant tax with a tax on taxable transactions, other than food and food H ingredients,▸ atmakes atechnical ratechanges. that will generate an equivalent amount of revenue to the restaurant tax;

and ▸ makes technical changes.

32 None 13 SHB0231 compared with HB0231S01 Other Special Clauses:

1 HB0231S01 compared with HB0231S02 None Utah Code Sections Affected:

59-12-602{59-12-602 , as last amended by Laws of Utah 2025, Chapter 306306} 59-12-603 , as last amended by Laws of Utah 2025, First Special Session, Chapter 17 Be it enacted by the Legislature of the state of Utah:

Section{Section 1.

} 59-12-602.

(9) - 2 - HB0231S01HB0231 compared with HB0231S02HB0231S01 (9) (a) "Customized" means prepared or heated by a seller for on-premise or immediate consumption at the request or specification of the purchaser.

- 3 - HB0231 compared with HB0231S01 (ii) a camping trailer;

and - 3 - HB0231S01 compared with HB0231S02 (iii) a fifth wheel trailer.

Section 2.1.

and (B) a county legislative body [of any county ]imposing a tax under Subsection (1)(a)(i)(A) may, in addition to imposing the tax under Subsection (1)(a)(i)(A), impose a tax of not to exceed 4% on - 4 - HB0231 compared with HB0231S01 [all ]short-term rentals of motor vehicles, except for short-term rentals of motor vehicles made for - 4 - HB0231S01 compared with HB0231S02 the purpose of temporarily replacing a person's motor vehicle that is being repaired [pursuant to] in accordance with a repair or an insurance agreement;

(iii) {subject{before toOctober Subsection1, (10)}2026} beforesubject Octoberto 1,Subsection 2026,(10), a county legislative body of any county may impose a tax of not to exceed 1% [of all] on sales of:

(iv) on{on or after October 1, 2026, thea taxcounty describedlegislative inbody Subsectionmay (1)(a)(iii)impose isa replacedtax, withat a tax,rate atnot to exceed the rate calculated in accordance with Subsection (11), on an eligible transaction;

and [(v)]{[(v){]} (vi){(vi)} } if a county legislative body [of any county ]imposes a tax under Subsection (1)(a)(i),(1)(a) (i), a tax at the same rate applies to car sharing of less than 30 days, except for car sharing for the purpose of temporarily replacing a person's motor vehicle that is being repaired [pursuant to] in accordance with a repair or an insurance agreement.

or - 5 - HB0231 compared with HB0231S01 (E) a tourist facility.

- 5 - HB0231S01 compared with HB0231S02 (b) (i) In addition to the uses described in Subsection (2)(a) and subject to Subsection (2)(b)(ii), a county of the fourth, fifth, or sixth class, as classified in Section 17-60-104, or a county with a population density of fewer than 15 people per square mile may expend the revenue from the imposition of a tax under Subsections (1)(a)(i) and (ii) on the following activities to mitigate the impacts of tourism:

(c) A county of the first class, as classified in Section 17-60-104, shall expend at least $450,000 each year of the revenue from the imposition of a tax authorized by Subsection [(1)(a)(iv)]{[(1)(a)(iv){]} (1)(a)(v)(1)(a)(v)} within the county to fund a marketing and ticketing system designed to:

(3) A tax imposed under this part may be pledged as security for bonds, notes, or other {[evidences{]}[evidences] evidence}evidence of indebtedness incurred by a county, city, or town under Title 11, Chapter 14, Local Government Bonding Act, or a community reinvestment agency under Title 17C, Chapter 1, Part 5, Agency Bonds, to finance:

(4) - 6 - HB0231S01HB0231 compared with HB0231S02HB0231S01 (a) To impose a tax under Subsection (1), the county legislative body shall adopt an ordinance imposing the tax.

- 7 - HB0231S01HB0231 compared with HB0231S02HB0231S01 (v) [how meetings are to be called] the procedures for calling meetings and the frequency of meetings;

- 8 - HB0231S01HB0231 compared with HB0231S02HB0231S01 (i) the commission shall distribute 70% of the revenue based on the percentages generated by dividing the revenue collected by each county under Subsection (1)(a)(i)(B) by the total revenue collected by all counties under Subsection (1)(a)(i)(B);

[(b)] (c) Population for purposes of [this ]Subsection [(8)] {(8)(c)} (8)(b) shall be based on, to the extent not otherwise required by federal law:

(c) (i) If the billing period for a transaction begins before the effective date of the enactment of the tax or the tax rate increase imposed under Subsection (1), the enactment of the tax or the tax rate increase - 9 - HB0231S01HB0231 compared with HB0231S02HB0231S01 shall take effect on the first day of the first billing period that begins after the effective date of the enactment of the tax or the tax rate increase.

(10) - 10 - HB0231S01HB0231 compared with HB0231S02HB0231S01 (a) A county may not{not } impose the tax described in Subsection (1)(a)(iii) on or after October 1, 2026{,2026{.} , until the date described in Subsection (10)(d) only if the county:}county: .

(b)(i) Notwithstandinghas pledged the revenue from the tax described in Subsection (9)(b),(1)(a)(iii) aas countysecurity doesfor notbonds, neednotes, toor provideother noticeevidence of theindebtedness repealas ofauthorized theby taxthis describedsection inbefore SubsectionJanuary (1)(a)(iii).1, 2026;

(11)and (a)(b){(ii)} (i){Notwithstanding {hasSubsection pledged(9)(b), }a Thecounty ratedoes ofnot theneed tax described in Subsection (1)(a)(iv) is equal to theprovide {revenuenotice of } rateprovides the commission{repeal estimates to generate the same amount of revenue} distributedcommission towith the county{tax from} theinformation tax described in Subsection (1)(a)(iii){(1)(a)(iii)} {as(10)(b) security for bonds, notes, or other evidence of indebtedness as authorized by this section before }October between January 1, {2026;2026.

and}{(11) } {(a) {Subject to Subsection (11)(b), a county may impose the tax described in Subsection (1)(a)(iv) at a rate equal to or less than the rate the commission estimates to generate the same amount of revenue distributed to the county from the tax described in Subsection (1)(a)(iii) between January 1, 2025, and December 31, 2025.2025.} } (b) A county shall submit to the commission evidence of:

(ii)(b){(i) The{(i)} commission{For shalla roundcounty } the estimatedtotal rate,amount expressedof asthe a{first percentage,or upsecond class} bond, {as classified in Section 17-60-104, the commission shall round the estimated rate to the nearest second decimal place.place.} note, or other indebtedness;

(12)and (a)(ii) (ii){(i)}{For {providesa county of the commissionthird withthrough thesixth informationclass, }as Notwithstandingclassified Subsectionin (4),Section a17-60-104, county} doesthe notcounty's needpledge toof adoptthe an{commission ordinanceshall imposinground } revenue from the {estimated rate up to } tax described in Subsection {(10)(b)(1)(a)(iii) beforeto Octobersecure 1,the 2026}{second (1)(a)(iv).decimal place} debt described in Subsection (10)(b)(i).

{(b)(c) {AThe countycommission shall submitcalculate toan the commission evidence of:} } {(i) {the total amount ofby: the bond, note, or other indebtedness;

and(i) }dividing }the (ii)amount Aof revenue a county shallcollected amendfrom the county'stax {pledgedescribed ofin theSubsection revenue(1)(a) from(iii) }during ordinancecalendar toyear reflect2025 theby replacement of the taxtotal describedamount inof Subsectionrevenue (1)(a)(iii) {to secure the debtcounty }collected withfrom theall taxtaxes described in Subsectionthis {(10)(b)(i)}section (1)(a)(iv).during calendar year 2025;

(b)and Notwithstanding(ii) Subsectionmultiplying (9)(b),the aamount countycalculated doesin notaccordance needwith toSubsection provide(10)(c) noticeby of the enactmenttotal amount of debt the taxcounty describedsubmitted in accordance with Subsection (1)(a)(iv).(10)(b)(i).

(13)(d) A county may repealnot orimpose reduce the amount of tax imposeddescribed byin Subsection (1)(a)(iv)(1)(a)(iii): in accordance with this section.

{(c)}(i) {{once The commission shall calculate an amount by:} } {(i)} {{dividing the amount of revenue a county collectedcollects from the tax described in Subsection (1)(a)(1)(a)(iii) (iii)on duringor calendarafter yearOctober 20251, by2026, equals the total amount ofcalculated revenue the county collected from all taxes described in thisaccordance sectionwith duringSubsection calendar(10)(c); year 2025;

and}and } - 11 - HB0231S01HB0231 compared with HB0231S02HB0231S01 {(ii)}(ii) {{multiplyingbeginning theon amount calculated in accordance with Subsection (10)(c) by the totalfirst amountday of debt the countycalendar submittedquarter inthat accordanceis withat Subsectionleast (10)(b)(i).}90 }days {(d)}after {{A county may not impose the taxday described in Subsection (1)(a)(iii):}(10)(d)(i). } {(i)} {{once the amount of revenue a county collects from the tax described in Subsection (1)(a)(iii) on or after October 1, 2026, equals the amount calculated in accordance with Subsection (10)(c);

and}(e) }(i) {(ii)}Notwithstanding {{beginning on the first day of the calendar quarter that is at least 90 days after the day described in Subsection (10)(d)(i).} } {(e)} {(i)} {{Notwithstanding Subsection (9)(b), a county does not need to provide notice of the repeal of the tax described in Subsection (1)(a)(iii).}(1)(a)(iii). } {(ii)} {The commission shall stop collection of the tax described in Subsection (1)(a)(iii) after the requirements of Subsection (10)(d) are met as if the commission had received notice from the county to repeal the tax.} } Section 3.