SECTION 7. Tax 11.66(3)(a) is renumbered Tax 11.66(3)(a)1. and amended to read:
Tax 11.66(3)(a)1. Local and toll service and Wide-Area Telecommunications Service, or WATS, including intrastate private line service.
Note to Revisor: Replace the example at the end of sub. (3)(a)1. as renumbered with the following:
Example: Company JKL, headquartered in Milwaukee, has branch offices in Madison, Green Bay, Chicago and Minneapolis. Company JLK contracts with a telecommunications company for private line telecommunications service between its Milwaukee office and each branch office. The charges by the telecommunications company to Company JKL for private line service are subject to Wisconsin sales or use tax. A credit may be allowed, against the Wisconsin sales or use tax, for tax paid to Illinois or Minnesota. See sub. (6).
SECTION 8. Tax 11.66(3) (a) (intro.) is created to read:
Tax 11.66(3) (a) Telecommunications services, including:
SECTION 9. Tax 11.66(3) (b) and (c) are renumbered Tax 11.66(3) (a) 2. and 3.
SECTION 10. Tax 11.66(3)(d) is repealed.
SECTION 11. Tax 11.66(3)(e) to (m) are renumbered Tax 11.66(3)(a)4. to 12.
Note to Revisor: Add the following note at the end of Tax 11.66(3)(a)12. as renumbered:
Note: Refer to sub. (5) regarding the sale of rights to purchase telecommunications services.
SECTION 12. Tax 11.66(3)(b) is created to read:
Tax 11.66(3)(b) Telecommunications message services, including:
1. Nonmechanical telephone answering services.
Examples: 1) A real estate business, whose employes spend considerable periods of time away from its office, contracts with Company A to answer incoming telephone calls during periods when employes are not available to answer the telephone. Employes of Company A receive the calls to the real estate office by telephone, take messages from incoming callers and transmit the messages to the real estate company or particular employes in that company. The service provided by Company A is not an incidental element of another service that is sold to the real estate company and is nontaxable. Company A's charge for this service is subject to Wisconsin sales or use tax.
2) Company B employs an office management service that provides receptionist, typing, filing, scheduling, bookkeeping and similar services. Employes of the office management service also answer and route incoming telephone calls. When calls cannot be routed, the office management service takes and transmits messages to the appropriate person. This answering service is only a small part of the total services provided.
The telephone answering service provided as a part of the office management service is not subject to Wisconsin sales or use tax because it is incidental to the office management service provided and that office management service is not taxable.
2. Burglar alarm and similar security monitoring services.
3. Electronic mail services.
4. Mechanical or electronic voice messaging and telephone answering services.
Example: Company A provides its customers access to an office message system computer through which a customer can deposit or retrieve telephone messages using a touch-tone telephone. The service may be used as a message center, a call forwarding service or an answering service. Messages are stored in the computer, and the customer may send or retrieve messages, reply to a message directly, reroute messages to others, broadcast messages to a wider group, save selected messages and cancel messages no longer needed. The service is available 24 hours a day, and the customer accesses the computer either through a toll-free telephone number or a local telephone number. The service provided by Company A is not an incidental element of another service that is sold to the customer and is nontaxable. Company A's charges for this service are subject to Wisconsin sales or use tax.
SECTION 13. Tax 11.66(4)(intro.), (a) and (c) are amended to read:
Tax 11.66(4) Gross receipts from the sale of or charge for the following services are not taxable:
(a) Interstate or international telecommunications service if the service originates from another state or country or if the service originates in Wisconsin but is charged to a service address in another state or country.
(c) Access services, Measured Toll Service, or MTS, and Wide-Area Telecommunications Service, or WATS, services resellers purchase, repackage, and resell to customers.
SECTION 14. Tax 11.66(4) (d) is repealed and recreated to read:
Tax 11.66(4) (d) Services that are obtained by means of a toll-free number, that originate outside Wisconsin and terminate in Wisconsin.
Note to Revisor: Remove the example that followed sub. (4) (d) before its repeal.
SECTION 15. Tax 11.66 (4) (e) is repealed.
SECTION 16. Tax 11.66 (4) (f) and (5) are renumbered Tax 11.66 (4) (e) and (7).
SECTION 17. Tax 11.66 (5) and (6) are created to read:
Tax 11.66(5) PREPAID TELEPHONE CALLING CARDS AND AUTHORIZATION NUMBERS. (a) The sale of rights to purchase telecommunications services, including purchasing reauthorization numbers, by paying in advance and by using an access number and authorization code, is subject to Wisconsin sales or use tax.
(b) The situs of the sale of the rights to purchase telecommunications services is as follows:
1. If the sale takes place at a retailer's place of business, the situs of the sale is that place of business.
2. If the sale does not take place at a retailer's place of business and an item that will implement the right to purchase telecommunications services, such as a calling card, is shipped, the situs of the sale is the customer's shipping address.
3. If the sale does not take place at a retailer's place of business and no item that will implement the right to purchase telecommunications services is shipped, the situs of the sale is the customer's billing address.
(6) CREDIT FOR TAX PAID TO ANOTHER STATE. Any person who is subject to the tax under s. 77.52(2)(a)5., Stats., on telecommunications services that terminate in Wisconsin and who has paid a similar tax on the same services to another state may reduce the amount of the tax remitted to Wisconsin by an amount equal to the similar tax properly paid to another state on those services or by the amount due Wisconsin on those services, whichever is less. That person shall refund proportionally to the persons to whom the tax under s. 77.52(2)(a)5., Stats., was passed on an amount equal to the amounts not remitted.
Note to Revisor: 1) Replace the first note at the end of Tax 11.66 with the following:
Note: Section Tax 11.66 interprets ss. 77.51(17m) and (21m), 77.52(2)(a)5. and 5m., (2m) and (3m) and 77.525, Stats.
2) In the 3rd note at the end of Tax 11.66: remove part (b); renumber parts (c) to (h) to be parts (b) to (g); remove the word “and" before part (g) as renumbered; and add the following to the end of the note:
;(h) Certain telecommunications message services became taxable December 1, 1997, pursuant to 1997 Wis. Act 27; (i) Telecommunications services originating outside Wisconsin, terminating in Wisconsin and charged to a service address in Wisconsin, except certain services obtained by means of a toll-free number, became taxable December 1, 1997, pursuant to 1997 Wis. Act 27; (j) Credit for sales tax properly paid to another state on interstate telecommunications services became effective October 14, 1997, pursuant to 1997 Wis. Act 27; and (k) Sales of rights to purchase telecommunications services became taxable August 1, 1998, pursuant to 1997 Wis. Act 237.
Initial Regulatory Flexibility Analysis
This proposed rule order does not have a significant economic impact on a substantial number of small businesses.
Fiscal Estimate
The proposed order updates the Department of Revenue's administrative code relating to telecommunications services and telecommunications message services. The changes incorporate recent law changes, clarify existing language to reflect the Department's current position, and alter style and format to conform to Legislative Council Clearinghouse standards. These rule changes do not have a fiscal effect.
Notice of Submission of Proposed Rules to the Presiding Officer of each House of the Legislature, Under S. 227.19, Stats.
Please check the Bulletin of Proceedings for further information on a particular rule.
Agriculture, Trade and Consumer Protection
(CR 99-5):
Chs. ATCP 29 and 40 - Relating to agricultural chemical cleanup surcharge fees.
Agriculture, Trade and Consumer Protection
(CR 99-85):
Ch. ATCP 15 - Relating to humane officer training and certification.
Ch. Phar 16 - Relating to the approval of continuing education courses for pharmacists.
Podiatrists Affiliated Credentialing Board
(CR 99-38):
Chs. Pod 1 to 6 - Relating to the regulation and licensure of podiatrists.
Administrative Rules Filed With The
Revisor Of Statutes Bureau
The following administrative rules have been filed with the Revisor of Statutes Bureau and are in the process of being published. The date assigned to each rule is the projected effective date. It is possible that the publication of these rules could be delayed. Contact the Revisor of Statutes Bureau at (608) 266-7275 for updated information on the effective dates for the listed rules.
Agriculture, Trade and Consumer Protection
(CR 98-142):
An order affecting chs. HSS 165 and ATCP 77, relating to certification of laboratories engaged in public health testing of milk, water and food.
Effective 10-01-99.
Agriculture, Trade and Consumer Protection
(CR 99-18):
An order affecting chs. ATCP 10 and 11, relating to paratuberculosis (Johne's disease).
Effective 07-01-00.
An order affecting ch. HFS 90, relating to early intervention services for children with developmental needs in the age group from birth up to 3.
Effective 10-01-99.
An order creating s. NR 25.06 (2) (c) 1., relating to commercial fishing for smelt on Lake Michigan and Green Bay.
Effective 10-01-99.
An order affecting the chs. NR 400-- series, relating to updating and cleanup changes to the chs. NR 400-- series.
Part effective 11-01-99.
Part effective 12-01-99.
The following administrative rule orders have been adopted and published in the August 31, 1999 Wisconsin Administrative Register. Copies of these rules are sent to subscribers of the complete Wisconsin Administrative Code, and also to the subscribers of the specific affected Code.
For subscription information, contact Document Sales at (608) 266-3358.
Agriculture, Trade and Consumer Protection
(CR 98-81):
