Statement of Scope
Department of
Revenue
Rule
No.
:
|
Chapter Tax 11
|
Relating
to
:
|
Sales and use tax
provisions
|
1.
Detailed d
escriptio
n of the objective of the
proposed
rule:
The object
ive of t
he
rule
is to
amend
s.
Tax 11.20
to
modify
the documentation requirements for persons in the business of raising animals for use in qualified research
,
as such requirements relate to whether the person sold the animals to a "biotechnology business"
as required
under s.
77.54
(57)
(b)
, Stats.
, as well as
to
whether
anima
ls sold to universities and/or government agencies are used in qualified
research.
The
sales and use tax exemption became effective January 1, 2012, pursuant to
2009 Wis. Act 28
.
2.
Description of existing policies relevant to the rule
,
new policies proposed to be included in the rule
,
and an a
nalysis of policy alternatives:
DOR's current policy
, as outlined in current sec. Tax 11.20
(4), Wis. Adm. Code,
is to require
persons in the business of raising animals to have their customers obtain a formal certification from DOR that they are
a
"biotechnology business
.
"
This policy has shown itself to be burdensome
for
business
es
to comply with.
The proposal creates an exception to this requirement
. The exception allows the
person in the business of raising
animals to treat a
customer,
other than a university or government
unit
,
as a biotechnology business if the
person
obtains an exemption certificate from the
customer
indicating the
customer
will use the animals exclusively and directly in qualified research, subject to DOR verifying
/certifying
that the
customer
actually meet
s
the requirements in current sec. Tax 11.20
(4), Wis. Adm. Code.
DOR
's
existing policy is to treat animals sold to universities and government agencies as sold for exclusive and direct use in qualified research. The rule is being updated to reflect this policy.
3.
Detailed explanation of s
t
atutory authority for the rule (including
the
statutory citation and language):
Section
77.54
(57)
(b)
3.
and
4.
, Stats., provide
s, in part,
exemptions for certain purchases made by persons who raise animals sold primarily to
a
"biotechnology business
,
"
for use in qualified research.
Section
77.51
(1d)
, Stats., defines "biotechnology business
,
"
in part,
to mean "…a business certified by the department in the manner prescribed by the department…".
DOR is using its authority under s.
77.51
(1d)
, Stats.,
to modify the manner in which
it
certifies
a
"
biotechnology business
" for purposes of s.
77.54
(57)
, Stats.
Section
77.65 (3)
, Stats., provides "[t]he department may promulgate rules to administer this section
…
"
Section
227.11
(2)
(a)
, Stats., provides “[
e]ach agency may promulgate rules interpreting the provisions of any statute enforced or administered by the agency, if the agency considers it necessary to effectuate the purpose of the statute...”
4.
Estimate of amount of time that state employees will spend develop
ing
the rule and of other resource
s necessary to develop the rule:
The department estimates it will take approximately 1
0
0
hours to develop the rule
.
5.
List with d
escription of all entities that may be
affec
ted by the
proposed
rule:
P
urchasers and sellers
of
the products described above.
6.
Summary and preliminary comparison
with
any existing or proposed federal regulation that is intended to address the activities to be regulated by the
proposed
rule
:
There is no existing or proposed federal regulation that is intended to address the activities to be regulated by the rule.
7. Anticipated economic impact of implementing the rule (note if the rule is likely to have a significant economic impact on small businesses):
No economic impact is anticipated.
Contact Person:
Janet Abrams (608) 264-7779
