(A) Exemptions; sales subject to other tax. There is hereby specifically exempted from the tax levied by this subchapter the gross receipts or gross proceeds exempted from the State Sales Tax Code inclusive, but not exclusive of, and derived from the:
(1) Sale of gasoline or motor fuel on which the motor fuel tax, gasoline excise tax, or special fuels tax levied by state law has been paid;
(2) Sale of motor vehicles or any optional equipment or accessories attached to motor vehicles on which the State Motor Vehicle Excise Tax levied by state law has been paid;
(3) Sale of crude petroleum or natural or casinghead gas and other products subject to gross production tax under state law. This exemption shall not apply when such products are sold to consumer or user for consumption or use, except when used for injection into the earth for the purpose of promoting or facilitating the production of oil or gas. This division (A)(3) shall not operate to increase or repeal the gross production tax levied by the laws of this state; and
(4) Sale of aircraft on which the tax levied pursuant to 68 O.S. §§ 6001 through 6004 has been paid. The provisions of this division (A)(4) shall not become operative until July 1, 1984.
(B) Exemptions; governmental and nonprofit entities. There are hereby specifically exempted from the tax levied by this subchapter:
(1) Sale of tangible personal property or services to the United States government or to the state, any political subdivision of this state, or any agency of a political subdivision of the state; provided, all sales to contractors in connection with the performance of any contract with the United States government, the state, or any of its political subdivisions shall not be exempted from the tax levied by this subchapter, except as hereinafter provided;
(2) Sales made directly by county, district, or state fair authorities of this state, upon the premises of the fair authority, for the sole benefit of the fair authority;
(3) Sale of food in cafeterias or lunch rooms of elementary schools, high schools, colleges, or universities which are operated primarily for teachers and pupils and are not operated primarily for the public or for profit;
(4) Dues paid to fraternal, religious, civic, charitable, or educational societies or organizations by regular members thereof; provided, such societies or organizations operate under what is commonly termed the lodge plan or system, and provided such societies or organizations do not operate for a profit which inures to the benefit of any individual member or members thereof to the exclusion of other members;
(5) Sale of tangible personal property or services to or by churches, except sales made in the course of business for profit or savings, competing with other persons engaged in the same or similar business;
(6) The amount of proceeds received from the sale of admission tickets which is separately stated on the ticket of admission for the repayment of money borrowed by any accredited state-supported college or university for the purpose of constructing or enlarging any facility to be used for the staging of an athletic event, a theatrical production or any other form of entertainment, edification or cultural cultivation to which entry is gained with a paid admission ticket. Such facilities include, but are not limited to, athletic fields, athletic stadiums, field houses, amphitheaters, and theaters. To be eligible for this sales tax exemption, the amount separately stated on the admission ticket shall be a surcharge which is imposed, collected, and used for the sole purpose of servicing or aiding in the servicing of debt incurred by the college or university to effect the capital improvements hereinbefore described;
(7) Sales of tangible personal property or services to the council organizations or similar state supervisory organizations of the Boy Scouts of America, Girl Scouts of U.S.A., and the Campfire Girls shall be exempt from sales tax; or
(8) (a) Sale of tangible personal property or services to any county, municipality, public school district, the institutions of the state system of higher education, and the Grand River Dam Authority, or to any person with whom any of the above named subdivisions or agencies of this state has duly entered into a public contract pursuant to law, necessary for carrying out such public contract.
(b) Any person making purchases on behalf of such subdivision or agency of this state shall certify, in writing, on the copy of the invoice or sales ticket to be retained by the vendor that the purchases are made for and on behalf of such subdivision or agency of this state and set out the name of such public subdivision or agency.
(C) Exemptions; general. There are hereby specifically exempted from the tax levied by this subchapter:
(1) Transportation of school pupils to and from elementary schools or high schools in motor or other vehicles;
(2) Transportation of persons where the fare of each person does not exceed an amount to be set by the City Council from time to time, or local transportation of persons within the corporate limits of a municipality except by taxicab;
(3) Carrier sales of newspapers and periodicals made directly to consumers. Other sales of newspapers and periodicals where any individual transaction does not exceed another amount to be set by the City Council from time to time. A CARRIER is a person who regularly delivers newspapers or periodicals to subscribers on an assigned route;
(4) Sales for resale to persons engaged in the business of reselling the articles purchased, whether within or without the state, provided that such sales to residents of this state are made to persons to whom sales tax permits have been issued as provided in this subchapter. This exemption shall not apply to the sales of articles made to persons holding permits when such persons purchase items for their use and which they are not regularly engaged in the business of reselling; neither shall this exemption apply to sales of tangible personal property to peddlers, solicitors, and other salespersons who do not have an established place of business and a sales tax permit;
(5) Sales of advertising space in newspapers and periodicals and billboard advertising service, and any advertising through the electronic media, including radio, television, and cable television;
(6) (a) Eggs, feed, supplies, machinery, and equipment purchased by persons regularly engaged in the business of raising worms, fish, any insect, or any other form of terrestrial or aquatic animal life and used for the purpose of raising same for marketing.
(b) This exemption shall only be granted and extended to the purchaser when the items are to be used and in fact are used in the raising of animal life as set out above. Each purchaser shall certify, in writing, on the invoice or sales ticket retained by the vendor that he or she is regularly engaged in the business of raising such animal life and that the items purchased will be used only in such business. The vendor shall certify to the State Tax Commission that the price of the items has been reduced to grant the full benefit of the exemption;
(7) Sales of medicine or drugs prescribed for the treatment of human beings by a person licensed to prescribe the medicine or drugs; and
(8) Nothing herein shall be construed as limiting or prohibiting the city from levying and collecting taxes on the sale of natural or artificial gas and electricity, whether sold for residential or any other use after December 31, 1980. The sales tax levied by the city on natural or artificial gas and electricity shall be in effect regardless of any ordinance or contractual provisions referring to previously imposed state sales tax on such items.
(D) Exemptions; agriculture. There are hereby specifically exempted from the tax levied by this subchapter:
(1) Sales of agricultural products produced in this state by the producer thereof directly to the consumer or user when such articles are sold at or from a farm and not from some other place of business, as follows:
(a) Farm, orchard, or garden products;
(b) Dairy products sold by a dairyman or farmer who owns all the cows from which the dairy products offered for sale are produced;
(c) Livestock sold by the producer at a special livestock sale; and
(d) The provisions of this division (D)(1) shall not be construed as exempting sales by florists, nurserymen, or chicken hatcheries, or sales of dairy products by any other business, except as set out herein.
(2) Sale of baby chicks, turkey poults, and starter pullets used in the commercial production of chickens, turkeys and eggs, provided that the purchaser certifies, in writing, on the copy of the invoice or sales ticket to be retained by the vendor that the pullets will be used primarily for egg production;
(3) Sale of salt, grains, tankage, oyster shells, mineral supplements, limestone, and other generally recognized animal feeds for the following purposes, and subject to the following limitations:
(a) Feed which is fed to poultry and livestock, including breeding stock and wool-bearing stock, for the purpose of producing eggs, poultry, milk, or meat for human consumption;
(b) Feed purchased in the state for the purpose of being fed to and which is fed by the purchaser to horses, mules, or other domestic or draft animals used directly in the producing and marketing of agricultural products;
(c) Any stock tonics, water purifying products, stock sprays, disinfectants, or other such agricultural supplies;
(d) Poultry shall not be construed to include any fowl other than domestic fowl kept and raised for the market or production of eggs;
(e) Livestock shall not be construed to include any pet animals such as dogs, cats, birds or such other fur-bearing animals; and
(f) This exemption shall only be granted and extended where the purchaser of feed that is to be used and in fact is used for a purpose that would bring about an exemption hereunder executes an invoice or sales ticket in duplicate on a form to be prescribed by the Tax Commission. The purchaser may demand and receive a copy of the invoice or sales ticket and the vendor shall retain a copy.
(4) Sales of items to be and in fact used in the production of agricultural products. Sale of the following items shall be subject to the following limitations:
(a) Sales of agricultural fertilizer to any person regularly engaged, for profit, in the business of farming and/or ranching. Each such purchaser shall certify, in writing, on the copy of the invoice or sales ticket to be retained by the vendor, that he or she is so engaged in farming and/or ranching and that the material purchased will be used only in such business;
(b) Sales of agricultural fertilizer to any person engaged in the business of applying such materials on a contract or custom basis to land owned or leased and operated by persons regularly engaged, for profit, in the business of farming and/or ranching. Each such purchaser shall certify, in writing, on the copy of the invoice or sales ticket to be retained by the vendor that he or she is engaged in the business of applying such materials to lands owned or leased and operated by persons regularly engaged, for profit, in the business of farming and/or ranching, and shall show in said certificate the name or names of such owner or lessee and operator, the location of the lands on which said materials are to be applied to each such land, and he or she shall further certify that his or her contract price has been reduced so as to give the farmer or rancher the full benefit of this exemption;
(c) Sales of agricultural fertilizer to persons engaged in the business of applying such materials on a contract or custom basis shall not be considered to be sales to contractors under this subchapter, and said sales shall not be considered to be taxable sales within the meaning of the State Sales Tax Code. As used in this section, AGRICULTURAL FERTILIZER means any substance sold and used for soil enrichment or soil corrective purposes or for promoting the growth and productivity of plants;
(d) Sales of agricultural seed or plants to any person regularly engaged, for profit, in the business of farming and/or ranching. This section shall not be construed as exempting from sales tax, seed which is packaged and sold for use in noncommercial flower and vegetable gardens;
(e) Sales of agricultural chemical pesticides to any person regularly engaged, for profit, in the business of farming and/or ranching. For the purposes of this act, agricultural chemical pesticides shall include any substance or mixture of substances intended for preventing, destroying, repelling, or mitigating any insect, snail, slug, rodent, bird, nematode, fungus, weed, or any other form of terrestrial or aquatic plant or animal life or virus, bacteria or other microorganism, except viruses, bacterial, or other microorganisms on or in living humans, or any substance or mixture of substances intended for use as a plant regulator, defoliant, or desiccant; and
(f) This exemption shall only be granted and extended to the purchaser where the items are to be used and in fact are used in the production of agricultural products. Each purchaser shall certify, in writing, on the copy of the invoice or sales ticket to be retained by the vendor, that the material purchased will only be used in his or her farming occupation. The vendor shall certify to the State Tax Commission that the contract price of the items has been reduced to grant the full benefit of the exemption. Violation hereof by the purchaser or vendor shall be a misdemeanor, and, upon violation and conviction for a second offense the State Tax Commission shall revoke the vendor’s sales tax permit.
(5) Sale of farm machinery, repair parts thereto, or fuel, oil, lubricants, and other substances used for operation and maintenance of the farm machinery to be used directly on a farm or ranch in the production, cultivation, planting, sowing, harvesting, processing, spraying, preservation, or irrigation of any livestock, poultry, agricultural, or dairy products produced from such lands. Each purchaser of farm machinery, repair parts thereto, or fuel must certify, in writing, on the copy of the invoice or sales ticket to be retained by the vendor, that he or she is engaged in farming or ranching and that the farm machinery, repair parts thereto, or fuel will be used only in farming, and/or ranching. The exemption provided for herein shall not apply to motor vehicles. Each purchaser shall certify, in writing, on the copy of the invoice or sales ticket to be retained by the vendor, that the material purchased will only be used in his or her farming occupation. The vendor shall certify to the State Tax Commission that the price of the items has been reduced to grant the full benefit of the exemption.
(E) Exemptions; manufacturers. There are hereby specifically exempted from the tax levied by this subchapter:
(1) Goods, wares, merchandise, and property purchased for the purpose of being used or consumed in the process of manufacturing, compounding, processing, assembling, or preparing for sale a finished article and such goods, wares, merchandise, or property become integral parts of the manufactured, compounded, processed, assembled, or prepared products or are consumed in the process of manufacturing, compounding, processing, assembling, or preparing products for resale. The term MANUFACTURING PLANTS shall mean those establishments primarily engaged in manufacturing or processing operations and generally recognized as such;
(2) Ethyl alcohol when sold and used for the purpose of blending same with motor fuel on which motor fuel tax is levied by state law;
(3) Sale of machinery and equipment purchased and used by persons establishing new manufacturing plants in the state, and machinery and equipment purchased and used by persons in the operation of manufacturing plants already established in the state. This exemption shall not apply unless such machinery and equipment is incorporated into, and is directly used in, the process of manufacturing property subject to taxation under this subchapter. The term MANUFACTURING PLANTS shall mean those establishments primarily engaged in manufacturing or processing operations, and generally recognized as such;
(4) Sales of containers when sold to a person regularly engaged in the business of reselling empty or filled containers or when purchased for the purpose of packaging raw products of farm, garden, or orchard for resale to the consumer or processor. This exemption shall not apply to the sale of any containers used more than once and which are ordinarily known as returnable containers, except returnable soft drink bottles. Each and every transfer of title or possession of such returnable containers in this state to any person who is not regularly engaged in the business of selling, reselling, or otherwise transferring empty or filled containers shall be taxable under this code. And, this exemption shall not apply to the sale of labels or other materials delivered along with items sold but which are not necessary or absolutely essential to the sale of the sold merchandise; or
(5) Sale of tangible personal property manufactured in the state when sold by the manufacturer to a person who transports it to another state for immediate and exclusive use in some other state.
(F) Exemptions; corporations and partnerships. There are hereby specifically exempted from the tax levied in this subchapter:
(1) The transfer of tangible personal property, as follows:
(a) From one corporation to another corporation pursuant to a reorganization. As used in this division (F), the term REORGANIZATION means a statutory merger or consolidation or the acquisition by a corporation of substantially all of the properties of another corporation when the consideration is solely all or a part of the voting stock of the acquiring corporation, or of its parent or subsidiary corporation;
(b) In connection with the winding up, dissolution, or liquidation of a corporation only when there is a distribution in kind to the shareholders of the property of such corporation;
(c) To a corporation for the purpose of organization of such corporation where the former owners of the property transferred are immediately after the transfer in control of the corporation, and the stock or securities received by each is substantially in proportion to his or her interest in the property prior to the transfer;
(d) To a partnership in the organization of such partnership if the former owners of the property transferred are immediately after the transfer, members of such partnership and the interest in the partnership, received by each, is substantially in proportion to his interest in the property prior to the transfer; or
(e) From a partnership to the members thereof when made in kind in the dissolution of such partnership.
(2) Sale of an interest in tangible personal property to a partner or other person who after such sale owns a joint interest in such tangible personal property where the state sales or use tax has previously been paid on such tangible personal property.
(Prior Code, § 33.009) (Ord. 376, passed 10-23-1973)