Bills › 90th General Assembly
Expanding the sales and use tax exemption allowed for nonprofit blood centers
Sponsored by the House Ways and Means Committee
Topics:Health careTaxes
Where it is now
- Done: IntroducedApril 12, 2023
- Done: SubcommitteeApril 12, 2023
- Done: House committeeApril 19, 2023
- Skipped: Passes the HouseContinued as HF 2628
- Next: Senate committee
- Next: Passes the Senate
- Next: To the Governor
- Next: Signed into law
Became HF 2628 → Its progress continues under the new number. Go to HF 2628 What’s a funnel?
What’s in it
AI summary Nonprofit blood centers and other places that collect or process blood, like plasma donor centers and labs, would no longer have to pay sales tax on certain items. This change covers things like physical goods, digital products, and specific services used to handle blood. It expands the current tax break to include more types of blood collection and testing businesses.1
Read the official explanation
This bill expands the current sales and use tax exemption allowed for nonprofit blood centers. Under current law, tangible personal property sold or test laboratory services furnished are exempt from sales and use tax if sold or furnished to a nonprofit blood center that is registered by the federal food and drug administration, and the property or services are directly and primarily used in the processing of human blood. The bill provides that tangible personal property or specified digital products sold or any services furnished are exempt from sales and use tax if sold or furnished to a blood collection and processing establishment. 3(c), which means a place of business under one management at one general physical location. The term includes, among others, human blood and plasma donor centers, blood banks, transfusion services, and other blood product manufacturers and independent laboratories that engage in quality control and testing for registered blood product establishments.
House subcommittee
Named January 24, 2024. On January 30, 2024 it recommended passage. Vote Total: 3-0.
Three legislators hear a bill first and recommend what the committee should do; it’s the best time to weigh in. How to take part
Fiscal note
AI summary This bill expands sales and use tax exemptions for nonprofit blood centers to include more types of property, digital products, and services. It is estimated to reduce revenues for the state's General Fund, the SAVE Fund, and local option sales tax distributions. The estimated reductions are -$0.18 million, -$0.04 million, and -$0.03 million for fiscal year 2025, with slightly larger decreases projected through fiscal year 2029.3
Read the fiscal note
Description
House File 2628 expands the current sales and use tax exemption allowed for nonprofit blood centers to exempt any tangible personal property or specified digital products sold and any services furnished to a blood collection and processing establishment. A blood collection and processing establishment is defined as a place of business under one management at one general physical location and includes human blood and plasma donor centers, blood banks, transfusion services, and other blood product manufacturers and independent laboratories that engage in quality control and testing for registered blood product establishments.
Background
2019 Iowa Acts, chapter 141, provided a narrower exemption for nonprofit blood centers. Under current law, tangible personal property sold or test laboratory services furnished that are directly and primarily involved in the processing of human blood are exempt from sales tax for nonprofit blood centers in Iowa that are Food and Drug Administration (FDA)-registered. According to the Fiscal Note on 2019 Iowa Acts, chapter 141, there are two nonprofit blood centers affected by the current sales tax exemption.
Assumptions
- The same nonprofit blood centers currently exempt will be exempt from sales tax on all tangible personal property sold, specified digital products sold, and services furnished under the Bill.
- According to the Department of Revenue and utilizing Internal Revenue Service (IRS) 990 reports for calendar year 2019, an estimated $2.9 million in additional purchases would have been exempt under the Bill in FY 2020.
- Growth trends are based on the Consumer Price Index (CPI-U) less food and energy average estimated increases of 2.0% from FY 2025 to FY 2029.
- Secure an Advanced Vision for Education (SAVE) refunds are 1.0% of taxable sales. Local option sales tax (LOST) distributions are estimated to be 0.97% of taxable sales.
Fiscal Impact
House File 2628 is estimated to reduce revenues to the General Fund, SAVE Fund, and LOST by the estimated amounts in Figure 1.
Figure 1 — Fiscal Impact of HF 2628 (in Millions)
Sources
- Iowa Department of Revenue
- Internal Revenue Service 990 filings
- Sales Tax Exemption for Non-Profit Blood Centers · February 29, 2024
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90th General Assembly