A. 1996 Amendments: That certain document known as THE 1996 AMENDMENTS TO THE TOWN TAX CODE OF THE TOWN OF SNOWFLAKE, ARIZONA, three (3) copies of which are on file in the office of the town clerk, which document was made a public record by resolution 279, is hereby referred to, adopted and made a part hereof as if fully set out in this subsection. The provisions of this subsection and the public record adopted herein are effective from and after December 31, 1996. (Ord. 127, 11-26-1996, eff. 12-31-1996)
B. 1998 Amendments: That certain document known as THE 1998 AMENDMENTS TO THE TAX CODE OF THE TOWN OF SNOWFLAKE, ARIZONA, three (3) copies of which are on file in the office of the town clerk, which document was made a public record by resolution 319, is hereby referred to, adopted and made a part hereof as if fully set out in this subsection.
1. Except as provided in subsections B2 and B3 of this section, the provisions of this subsection B and the public record adopted herein are effective from and after July 1, 1998.
2. The following provisions of the public record adopted by this subsection B are retroactive to April 1, 1987:
a. The definition of "construction contractor" as amended and the definition of "remediation" as added to section 1. Section 8A-100. General Definitions.
b. Subsection (a), paragraph (16) on "cleanrooms" as added to section 2. Section 8A-110. Definitions: Income-producing capital equipment.
c. Section 9. Subsection (aa) of section 8A-465. Retail Sales: Exemptions.
d. Section 11. Regulation 8A-100.5 Remediation Contracting.
(Ord. 146, 6-9-1998)
3. The following provisions are effective from and after July 23, 1998:
a. Section 8A-445 of the tax code of the town of Snowflake is amended to read:
Sec. 8A-445. Rental, leasing, and licensing for use of real property.
(a) The tax rate shall be at an amount equal to two percent (2%) of the gross income from the business activity upon every person engaging or continuing in the business of leasing, or renting real property located within the Town for a consideration, to the tenant in actual possession, or the licensing for use of real property located within the Town for a consideration including any improvements, rights, or interest in such property; provided further that:
(1) Payments made by the lessee to, or on behalf of, the lessor for property taxes, repairs, or improvements are considered to be part of the taxable gross income.
(2) Charges for such items as telecommunications, utilities, pet fees, or maintenance are considered to be part of the taxable gross income.
(3) However, if the lessor engages in telecommunication activity, as evidenced by installing individual metering equipment and by billing each tenant based upon actual usage, such activity is taxable under Section 8A-470.
(b) If individual utility meters have been installed for each tenant and the lessor separately charges each single tenant for the exact billing from the utility company, such charges are exempt.
(c) Charges by primary health care facilities to patients of such facilities for use of rooms or other real property during the course of their treatment by such facilities are exempt.
(d) Charges for joint pole usage by a person engaged in the business of providing or furnishing utility or telecommunication services to another person engaged in the business of providing or furnishing utility or telecommunications services are exempt from the tax imposed by this Section.
(e) Exempt from the tax imposed by this Section is gross income derived from the rental, leasing, or licensing for use of real property to any non-profit primary health care facility, except when the property so rented, leased, or licensed is for use in activities resulting in gross income from unrelated business income as that term is defined in 26 U.S.C. Section 512.
(f) (Reserved)
(g) (Reserved)
(h) THE TAX PRESCRIBED BY THIS SECTION SHALL NOT INCLUDE GROSS INCOME FROM THE RENTAL, LEASING, OR LICENSING OF LODGING OR LODGING SPACE TO AN INDIVIDUAL WHO RESIDES THEREIN.
(i) (Reserved)
(j) Exempt from the tax imposed by this Section is gross income derived from the activities taxable under Section 8A-444 of this code.
(k) (Reserved)
(l) (Reserved)
(m) (Reserved)
(n) Notwithstanding the provisions of Section 8A-200(b), the fair market value of one (1) apartment, in an apartment complex provided rent free to an employee of the apartment complex is subject to the tax imposed by this Section. For an apartment complex with more than fifty (50) units, an additional apartment provided rent free to an employee for every additional fifty (50) units is not subject to the tax imposed by this Section.
b. Regulation 8A-200.1 of the tax code of the town of Snowflake is amended to read:
Reg. 8A-200.1. When deposits are includable in gross income.
(a) Refundable deposits shall be includable as gross income of the taxpayer for the month in which the deposits are forfeited by the lessee.
(b) (Reserved)
(Ord. 147, 6-23-1998, eff. 7-23-1998)
C. 1999 Amendments: That certain document known as THE 1999 AMENDMENTS TO THE TAX CODE OF THE TOWN OF SNOWFLAKE, ARIZONA, three (3) copies of which are on file in the office of the town clerk, which document was made a public record by resolution 339 of the town, is hereby referred to, adopted and made a part hereof as if fully set out in this subsection.
1. Except as provided in subsections C2 and C3 of this section, the provisions of this subsection C and the public record adopted herein are effective from and after December 31, 1999.
2. The following provisions of the public record adopted herein are retroactive to January 1, 1999:
a. Subsection (b)(3) of section 29-10-415;
b. Subsection (c)(1)(A) of section 29-10-416;
c. Subsection (b)(1)(A) of section 29-10-417.
3. The following provisions of the public record are retroactive to May 5, 1999:
a. Subsection (c)(10) of section 29-10-450;
b. Subsection (kk) of section 29-10-465. (Ord. 165, 11-9-1999)
D. 2000 Amendments:
1. Section 8A-447 of the town tax code is amended to read:
Sec. 8A-447 (Reserved). RENTAL, LEASING, AND LICENSING FOR USE OF REAL PROPERTY: ADDITIONAL TAX UPON TRANSIENT LODGING.
IN ADDITION TO THE TAXES LEVIED AS PROVIDED IN SECTION 8A-444, THERE IS HEREBY LEVIED AND SHALL BE COLLECTED AN ADDITIONAL TAX IN AN AMOUNT EQUAL TO TWO PERCENT (2%) OF THE GROSS INCOME FROM THE BUSINESS ACTIVITY OF ANY HOTEL ENGAGING OR CONTINUING WITHIN THE TOWN IN THE BUSINESS OF CHARGING FOR LODGING AND/OR LODGING SPACE FURNISHED TO ANY TRANSIENT. "TRANSIENT" MEANS ANY PERSON WHO, FOR ANY PERIOD OF NOT MORE THAN THIRTY (30) CONSECUTIVE DAYS, EITHER AT HIS OWN EXPENSE OR AT THE EXPENSE OF ANOTHER, OBTAINS LODGING OR THE USE OF ANY LODGING SPACE IN ANY HOTEL FOR WHICH LODGING OR USE OF LODGING SPACE A CHARGE IS MADE.
2. Regulation 8A-447.1 of the town tax code is amended to read:
Regulation 8A-447.1 (Reserved). GROSS INCOME FROM RENTAL, LEASING, AND LICENSING FOR USE OF REAL PROPERTY AS LODGING OR LODGING SPACE TO TRANSIENTS.
(a) IF THE CHARGE MADE BY A HOTEL TO A TRANSIENT INCLUDES ANY CHARGE FOR SERVICES OR ACCOMMODATIONS IN ADDITION TO THAT OF LODGING AND/OR THE USE OF LODGING SPACE, THEN SUCH PORTION OF THE TOTAL CHARGE AS REPRESENTS ONLY THE CHARGE FOR THE USE OF THE ROOM AND/OR LODGING SPACE SHALL BE DISTINCTLY SET OUT AND BILLED TO SUCH TRANSIENT BY SUCH HOTEL AS A SEPARATE ITEM, OR THE ENTIRE CHARGE SHALL BE DEEMED CHARGE FOR USE OF LODGING SPACE SUBJECT TO THE TAX IMPOSED BY SECTION 8A-447.
(b) A SEPARATELY ITEMIZED CHARGE FOR USE OF THE FURNISHINGS CONTAINED IN LODGING OR LODGING SPACE RENTED, LEASED, OR LICENSED TO A TRANSIENT SHALL BE DEEMED GROSS INCOME FROM THE BUSINESS OF RENTING, LEASING, AND LICENSING LODGING TO A TRANSIENT. FURTHERMORE, IN REGARD TO SUCH TANGIBLE PERSONAL PROPERTY, SUCH PERSON IS DEEMED NOT IN THE BUSINESS OF RENTAL, LEASING, AND LICENSING OF TANGIBLE PERSONAL PROPERTY FOR ALL PURPOSES OF THIS CHAPTER.
(c) COMPLIMENTARY FOOD AND DRINK. PERSONS ENGAGED IN THE BUSINESS OF RENTAL, LEASING, AND LICENSING OF LODGING TO TRANSIENTS SHALL INCLUDE CHARGES FOR COMPLIMENTARY FOOD AND DRINK AS GROSS INCOME FROM THE BUSINESS OF RENTAL, LEASING, AND LICENSING OF LODGING TO TRANSIENTS, AND SHALL NOT BE DEEMED IN THE RESTAURANT BUSINESS FOR ALL PURPOSES OF THIS CHAPTER, UNLESS SUCH CHARGES:
(1) ARE MADE ONLY AT THE REQUEST OF THE TRANSIENT, OR AS SEPARATE, OPTIONAL CHARGE FOR CONSUMING SPECIFIC FOOD OR DRINK (FOR EXAMPLE, "ROOM SERVICE" CHARGES); AND
(2) ARE COMMENSURATE WITH CHARGES FOR LIKE QUANTITY AND TYPE OF FOOD CONSUMED BY PATRONS OF PERSONS ENGAGED IN THE RESTAURANT BUSINESS.
(Ord. 169, 6-27-2000, eff. 10-1-2000)
E. 2001 Amendments:
1. That certain document known as SUPPLEMENTARY LOCAL AUDIT PROCEDURES FOR THE TOWN TAX CODE OF THE TOWN OF SNOWFLAKE, ARIZONA, three (3) copies of which are on file in the office of the town clerk, which document was made a public record by resolution 01-383 of the town of Snowflake, Arizona, is hereby referred to, adopted and made a part hereof as if fully set out in this subsection. (Ord. 01-183, 2-13-2001, eff. 4-16-2001)
2. That certain document known as the 2001 AMENDMENTS TO THE TAX CODE OF THE TOWN OF SNOWFLAKE, three (3) copies of which are on file in the office of the town clerk of the town of Snowflake, Arizona, which document was made a public record by resolution 02-417 of the town of Snowflake, Arizona, is hereby referred to, adopted and made a part hereof as if fully set out in this subsection. (Ord. 02-213, 6-11-2002, eff. 7-11-2002)
F. 2003 Amendments: Article V is repealed and replaced by that certain document known as ARTICLE V OF THE TOWN TAX CODE OF THE TOWN OF SNOWFLAKE, ARIZONA, three (3) copies of which are on file in the office of the town clerk, which document was made a public record by resolution 03-430 of the town of Snowflake, Arizona, and which is hereby referred to, adopted and made a part hereof as if fully set out in this subsection. (Ord. 03-216, 1-28-2003, eff. 2-27-2003)
1. Section 8A-447 of the town tax code is amended to read:
Sec. 8A-447. Rental, leasing, and licensing for use of real property: additional tax upon transient lodging.
In addition to the taxes levied as provided in Section 8A-444, there is hereby levied and shall be collected an additional tax in an amount equal to twoFOUR percent (24%) of the gross income from the business activity of any hotel engaging or continuing within the City in the business of charging for lodging and/or lodging space furnished to any transient. "Transient" means any person who, for any period of not more than thirty (30) consecutive days, either at his own expense or at the expense of another, obtains lodging or the use of any lodging space in any hotel for which lodging or use of lodging space a charge is made.
2. Section 8A-455 of the town tax code is amended to read:
Sec. 8A-455. Restaurants and Bars.
(a) The tax rate shall be at an amount equal to twoTHREE percent (23%) of the gross income from the business activity upon every person engaging or continuing in the business of preparing or serving food or beverage in a bar, cocktail lounge, restaurant, or similar establishment where articles of food or drink are prepared or served for consumption on or off the premises, including also the activity of catering. Cover charges and minimum charges must be included in the gross income of this business activity.
(b) Caterers and other taxpayers subject to the tax who deliver food and/or serve such food off premises shall also be allowed to exclude separately charged delivery, set-up, and clean-up charges, provided that the charges are also maintained separately in the books and records. When a taxpayer delivers food and/or serves such food off premises, his regular business location shall still be deemed the location of the transaction for the purposes of the tax imposed by this Section.
(c) The tax imposed by this Section shall not apply to sales to a qualifying hospital, qualifying community health center or a qualifying health care organization, except when sold for use in activities resulting in gross income from unrelated business income as that term is defined in 26 U.S.C. Section 512.
(d) The tax imposed by this section shall not apply to sales of food, beverages, condiments and accessories used for serving food and beverages to a commercial airline, as defined in A.R.S. § 42-5061(A)(49), that serves the food and beverages to its passengers, without additional charge, for consumption in flight.
(e) The tax imposed by this section shall not apply to sales of prepared food, beverages, condiments or accessories to a public educational entity, pursuant to any of the provisions of title 15, Arizona Revised Statutes, to the extent such items are to be prepared or served to individuals for consumption on the premises of a public educational entity during school hours.
(f) For the purposes of this section, "accessories" means paper plates, plastic eating utensils, napkins, paper cups, drinking straws, paper sacks or other disposable containers, or other items which facilitate the consumption of the food.
(Ord. 03-219, 3-25-2003, eff. 6-1-2003)
G. 2005 Amendments:
1. Sec. -480. Utility services. Of the model city tax code is amended to read:
(a) The tax rate shall be at an amount equal to two percent (2%) of the gross income from the business activity upon every person engaging or continuing in the business of producing, providing, or furnishing utility services, including electricity, electric lights, current, power, gas (natural or artificial), or water to:
(1) Consumers or ratepayers who reside within the city.
(2) (Reserved)
++(Local Option #GG:
(2) Consumers or ratepayers of this city, whether within the city or without, to the extent that this city provides such persons utility services, excluding consumers or ratepayers who are residents of another city or town which levies an equivalent excise tax upon this city for providing such utility services to such persons.)++
(b) Exclusion of certain sales of natural gas to a public utility. Notwithstanding the provisions of subsection (a) above, the gross income derived from the sale of natural gas to a public utility for the purpose of generation of power to be transferred by the utility to its ratepayers shall be considered a retail sale of tangible personal property subject to sections -460 and -465, and not considered gross income taxable under this section.
(c) Resale utility services. Sales of utility services to another provider of the same utility services for the purpose of providing such utility services either to another properly licensed utility provider or directly to such purchaser's customers or ratepayers shall be exempt and deductible from the gross income subject to the tax imposed by this section, provided that the purchaser is properly licensed by all applicable taxing jurisdictions to engage or continue in the business of providing utility services, and further provided that the seller maintains proper documentation, in a manner similar to that for sales for resale, of such transactions.
**((d) (Reserved)
2. Regulation 3.08.350.2 of the model city tax code is amended to read:
Reg. 3.08.350.2. Recordkeeping: Expenditures.
The minimum records required for persons having expenditures, costs, purchases and rental or lease or license expenses subject to, or exempt or excluded from, tax by this chapter are:
(a) The total price of all goods acquired for use or storage in the town.
(b) The date of acquisition and the name and business address of the seller or lessor of all goods acquired for use or storage in the town.
(c) Documentation of taxes, freight, and direct customer service labor separately charged and paid for each purchase, rental, lease, or license.
(d) The gross price of each acquisition claimed as exempt from tax, and with respect to each transaction so claimed, sufficient evidence to satisfy the tax collector that the exemption claimed is applicable.
(e) As applicable to each taxpayer, documentation sufficient to the tax collector, so that he may ascertain:
(1) All construction expenditures and all privilege and use taxes claimed paid, relating to owner-builders and speculative builders.
(2) Disbursement of collected gratuities and related payroll information required of restaurants.
(3) Franchise and license fee payments and computations thereto which relate to:
(A) (Reserved)
(B) Telecommunication service.
(4) The validity of any claims of proof of exemption, as provided by regulation.
(5) A claimed alternative prior value for reconstruction.
(6) (Reserved)
(7) (Reserved)
(8) Payments of tax to the Arizona department of transportation and computations therefore, when a motor-vehicle transporter claims such the exemption.
(9) (Reserved)
(f) Any additional documentation as the tax collector, by regulation, shall deem necessary for any specific class of taxpayer by reason of the specialized business activity of specific exemptions afforded to that class of taxpayer.
(g) In all cases, the books and records of the taxpayer shall indicate both individual transaction amounts and totals for each reporting period for each category of taxable, exempt, and excluded expenditures as defined by this chapter.
(Ord. 05-256, 11-22-2005)
H. 2007 Amendments:
1. Amendments: That certain document known as "the 2007 amendments to the tax code of the town of Snowflake", three (3) copies of which are on file in the office of the city clerk of the town of Snowflake, Arizona, which document was made a public record by resolution 06-488 of the town of Snowflake, Arizona, is hereby referred to, adopted and made a part hereof as if fully set out in this subsection.
2. Any person found guilty of violating any provision of these amendments to the tax code shall be guilty of a class one misdemeanor. Each day that a violation continues shall be a separate offense punishable as hereinabove described.
3. If any sentence, clause, phrase or portion of this subsection or any part of these amendments to the tax code adopted herein by reference is for any reason held to be invalid or unconstitutional by the decision of any court of competent jurisdiction, such decision shall not affect the validity of the remaining portions thereof.
4. The provisions of subsection H1 of this section as it relates to the definition of "transient", subsection H3 of this section as it relates to subsections 8A-410(b)(3) through (5) and (c) of the tax code of the town of Snowflake shall be effective from and after January 1, 2007.
5. The provisions of subsection H3 of this section as it relates to subsection 8A-410(b)(2) of the tax code of the town of Snowflake shall be effective from and after July 1, 1999.
6. The provisions of subsections H4 and H5 of this section and this subsection H6 shall be effective from and after September 1, 2006. (Ord. 06-284, 12-12-2006)
I. 2007 Amendments:
Sec. 8A-416. Construction contracting: speculative builders.
(a) The tax shall be equal to two percent (2%) of the gross income from the business activity upon every person engaging or continuing in business as a speculative builder within the town.
(1) The gross income of a speculative builder considered taxable shall include the total selling price from the sale of improved real property at the time of closing of escrow or transfer of title:
(2) "Improved real property" means any real property:
(A) Upon which a structure has been constructed; or
(B) Where improvements have been made to land containing no structure (such as paving or landscaping); or
(C) Which has been reconstructed as provided by regulation; or
(D) Where water, power, and streets have been constructed to the property line.
(3) "Sale of improved real property" includes any form of transaction, whether characterized as a lease or otherwise, which in substance is a transfer of title of, or equitable ownership in, improved real property and includes any lease of the property for a term of thirty (30) years or more (with all options for renewal being included as a part of the term). In the case of multiple unit projects, "sale" refers to the sale of the entire project or to the sale of any individual parcel or unit.
(4) "Partially improved residential real property", as used in this section, means any improved real property, as defined in subsection (a)(2) above, being developed for sale to individual homeowners, where the construction of the residence upon such property is not substantially complete at the time of the sale.
(b) Exclusions.
(1) In cases involving reconstruction contracting, the speculative builder may exclude from gross income the prior value allowed for reconstruction contracting in determining his taxable gross income, as provided by regulation.
(2) Fair market value of land. Gross income from the sale of improved real property shall not include the "fair market value" of the land which is included in the real property sold, when a charge for such land is included in the total selling price of the real property sold.
(A) Except as provided in subsection (b)(2)(B) below, the taxpayer must document such "fair market value" to the satisfaction of the tax collector, and maintain and provide such documentation upon demand in addition to and in like manner to the books and records required in article III.
(B) In lieu of the documented fair market value of land allowed in subsection (b)(2)(A) above, an amount equal to twenty percent (20%) of the total selling price may be used to estimate the "fair market value" of land.
(3) (Reserved)
(4) A speculative builder may exclude gross income from the sale of partially improved residential real property as defined in (a)(4) above to another speculative builder only if all of the following conditions are satisfied:
(A) The speculative builder purchasing the partially improved residential real property has a valid town privilege license for construction contracting as a speculative builder; and
(B) At the time of the transaction, the purchaser provides the seller with a properly completed written declaration that the purchaser assumes liability for and will pay all privilege taxes which would otherwise be due the town at the time of sale of the partially improved residential real property; and
(C) The seller also:
(i) Maintains proper records of such transactions in a manner similar to the requirements provided in this chapter relating to sales for resale; and
(ii) Retains a copy of the written declaration provided by the buyer for the transaction; and
(iii) Is properly licensed with the town as a speculative builder and provides the town with the written declaration attached to the town privilege tax return where he claims the exclusion.
(c) Tax liability for speculative builders occurs at close of escrow or transfer of title, whichever occurs earlier, and is subject to the following provisions, relating to exemptions, deductions and tax credits:
(1) Exemptions.
(A) The gross proceeds of sales or gross income attributable to the purchase of machinery, equipment or other tangible personal property that is exempt from or deductible from privilege or use tax under:
(i) Section 8A-465, subsections (g) and (p)
(ii) (Reserved)
shall be exempt or deductible, respectively, from the tax imposed by this section.
(B) The gross proceeds of sales or gross income received from a contract for the construction of an environmentally controlled facility for the raising of poultry for the production of eggs and the sorting, or cooling and packaging of eggs shall be exempt from the tax imposed under this section.
(C) The gross proceeds of sales or gross income that is derived from the installation, assembly, repair or maintenance of clean rooms that are deducted from the tax base of the retail classification pursuant to section 8A-465, subsection (g) shall be exempt from the tax imposed under this section.
(D) The gross proceeds of sales or gross income that is derived from a contract entered into with a person who is engaged in the commercial production of livestock, livestock products or agricultural, horticultural, viticultural or floricultural crops or products in this state for the construction, alteration, repair, improvement, movement, wrecking or demolition or addition to or subtraction from any building, highway, road, excavation, manufactured building or other structure, project, development or improvement used directly and primarily to prevent, monitor, control or reduce air, water or land pollution shall be exempt from the tax imposed under this section.
(E) Development or impact fees included in a construction or development contract for payment to the state or local government to offset governmental costs of providing public infrastructure, public safety and other public services to a development.
(2) Deductions.
(A) All amounts subject to the tax shall be allowed a deduction in the amount of thirty-five percent (35%).
(B) The gross proceeds of sales or gross income that is derived from a contract entered into for the installation, assembly, repair or maintenance of income-producing capital equipment, as defined in section 8A-110, that is deducted from the retail classification pursuant to section 8A-465(g), that does not become a permanent attachment to a building, highway, road, railroad, excavation or manufactured building or other structure, project, development or improvement shall be exempt from the tax imposed by this section. If the ownership of the realty is separate from the ownership of the income-producing capital equipment, the determination as to permanent attachment shall be made as if the ownership was the same. The deduction provided in this paragraph does not include gross proceeds of sales or gross income from that portion of any contracting activity which consists of the development of, or modification to, real property in order to facilitate the installation, assembly, repair, maintenance or removal of the income-producing capital equipment. For purposes of this paragraph, "permanent attachment" means at least one of the following:
(i) To be incorporated into real property.
(ii) To become so affixed to real property that it becomes part of the real property.
(iii) To be so attached to real property that removal would cause substantial damage to the real property from which it is removed.
(3) Tax credits. The following tax credits are available to owner-builders or speculative builders, not to exceed the tax liability against which such credits apply, provided such credits are documented to the satisfaction of the tax collector:
(A) A tax credit equal to the amount of town privilege or use tax, or the equivalent excise tax, paid directly to a taxing jurisdiction or as a separately itemized charge paid directly to the vendor with respect to the tangible personal property incorporated into the said structure or improvement to real property undertaken by the owner-builder or speculative builder.
(B) A tax credit equal to the amount of privilege taxes paid to this town, or charged separately to the speculative builder, by a construction contractor, on the gross income derived by said person from the construction of any improvement to the real property.
(C) No credits provided herein may be claimed until such time that the gross income against which said credits apply is reported.
Any person found guilty of violating any provision of these amendments to the tax code shall be guilty of a class one misdemeanor. Each day that a violation continues shall be a separate offense punishable as hereinabove described. (Ord. 07-301, 9-11-2007, eff. 10-1-2007)