LRB-2028/8
JK:kmg&jd:rs
2003 - 2004 LEGISLATURE
October 1, 2003 - Introduced by Representatives M. Lehman, W. Wood, Musser, J.
Lehman, Ainsworth, Gielow, Jeskewitz, Van Roy, Kaufert, Olsen, Bies,
Miller, Richards, Pettis, Hahn, Krawczyk, Montgomery, Ziegelbauer,
McCormick, Schooff
and Hines, cosponsored by Senators Brown, Jauch,
Roessler, Erpenbach
and Chvala. Referred to Committee on Ways and
Means.
AB547,2,22 1An Act to repeal 20.435 (3) (bm), 46.513, 77.51 (4), 77.51 (14) (d), 77.51 (14) (i),
277.51 (14) (k), 77.51 (14) (L), 77.51 (14r), 77.51 (15), 77.52 (6), 77.52 (14) (a) 2.,
377.523 (title), 77.53 (4), 77.54 (14g), 77.54 (14s), 77.54 (20), 77.54 (20m), 77.54
4(22), 77.54 (40), 77.61 (3), 77.65 (2) (c), 77.72 (title) and 77.72 (2) and (3); to
5renumber
77.51 (1), 77.51 (14) (g), 77.524 (1) (a), 77.524 (1) (b) and 77.53 (9m);
6to renumber and amend 77.52 (1), 77.523, 77.61 (2), 77.72 (1) and 77.77 (1);
7to consolidate, renumber and amend 77.52 (14) (a) (intro.) and 1. and (b);
8to amend 66.0615 (1m) (f) 2., 70.111 (23), 73.03 (50) (d), 76.07 (4g) (b) 8., 77.51
9(5), 77.51 (13) (o), 77.51 (14) (intro.), 77.51 (14) (a), 77.51 (14) (j), 77.51 (17),
1077.51 (20), 77.51 (21), 77.52 (2) (intro.), 77.52 (2) (a) 10., 77.52 (7), 77.52 (13),
1177.52 (15), 77.524 (1) (intro.), 77.53 (1), 77.53 (9), 77.53 (10), 77.53 (11), 77.53
12(16), 77.53 (17), 77.53 (17m), 77.53 (17r) (a), 77.53 (18), 77.54 (1), 77.54 (2), 77.54
13(2m), 77.54 (3) (a), 77.54 (3m) (intro.), 77.54 (4), 77.54 (5) (intro.), 77.54 (6)
14(intro.), 77.54 (8), 77.54 (9), 77.54 (9a) (intro.), 77.54 (10), 77.54 (11), 77.54 (12),

177.54 (13), 77.54 (14) (intro.), 77.54 (14) (a), 77.54 (14) (b), 77.54 (14) (f), 77.54
2(15), 77.54 (16), 77.54 (17), 77.54 (18), 77.54 (21), 77.54 (23m), 77.54 (25), 77.54
3(26), 77.54 (26m), 77.54 (27), 77.54 (28), 77.54 (29), 77.54 (30) (a) (intro.), 77.54
4(30) (c), 77.54 (31), 77.54 (32), 77.54 (33), 77.54 (34), 77.54 (35), 77.54 (36), 77.54
5(37), 77.54 (38), 77.54 (39), 77.54 (41), 77.54 (42), 77.54 (43), 77.54 (44), 77.54
6(45), 77.54 (46), 77.54 (46m), 77.55 (1) (intro.), 77.55 (2), 77.55 (2m), 77.55 (3),
777.56 (1), 77.57, 77.58 (3) (b), 77.58 (6), 77.59 (9), 77.61 (1) (b), 77.61 (1) (c), 77.61
8(4) (c), 77.65 (2) (e), 77.70, 77.705, 77.706, 77.707 (1), 77.707 (2), 77.71 (1), 77.71
9(2), 77.71 (3), 77.71 (4), 77.73 (2), 77.785 (1), 77.785 (2), 77.98, 77.981, 77.982
10(2), 77.99, 77.991 (2), 77.994 (1) (intro.), 77.9941 (4), 77.995 (2), 77.9951 (2),
1186.195 (3) (b) 3. and 218.0171 (2) (cq); to repeal and recreate 77.51 (7), 77.51
12(17m) and 77.63; and to create 73.03 (50b), 73.03 (61), 77.51 (1b), 77.51 (1e),
1377.51 (1n), 77.51 (1p), 77.51 (2k), 77.51 (2m), 77.51 (3p), 77.51 (3pd), 77.51 (3pj),
1477.51 (3pm), 77.51 (3pp), 77.51 (3t), 77.51 (7m), 77.51 (10m), 77.51 (10n), 77.51
15(10r), 77.51 (11m), 77.51 (12m), 77.51 (12p), 77.51 (13s), 77.51 (15a), 77.51
16(15b), 77.51 (17w), 77.51 (21p), 77.51 (22) (bm), 77.52 (1) (b), 77.52 (1) (c), 77.52
17(7b), 77.522, 77.524 (1) (ag), 77.53 (9m) (b), 77.53 (9m) (c), 77.54 (14b), 77.54
18(20n), 77.54 (20r), 77.54 (22b), 77.58 (6m), 77.58 (9a), 77.585, 77.59 (2m), 77.59
19(9n), 77.59 (9p) (b), 77.59 (9r), 77.60 (13), 77.61 (2) (b), 77.61 (3m), 77.61 (5m),
2077.61 (16), 77.67, 77.73 (3) and 77.77 (1) (b) of the statutes; relating to: the
21Uniform Sales and Use Tax Administration Act, granting rule-making
22authority, making an appropriation, and providing a penalty.
Analysis by the Legislative Reference Bureau
This bill adopts the substantive provisions of the streamlined sales and use tax
agreement (agreement) for purposes of administering and collecting state, county,

and stadium district sales and use taxes. The agreement is intended to simplify and
modernize sales and use tax administration for the states that enter into the
agreement and to encourage out-of-state retailers to collect the state, county, and
stadium district sales and use taxes voluntarily. Under current federal law,
generally, an out-of-state retailer who sells goods or services to customers in this
state is not required to collect the sales tax or use tax imposed on such sales, if the
retailer has no physical presence in this state. See Quill v. North Dakota, 504 U.S.
298; 112 S.Ct. 1904 (1992).
States that wish to enter into the agreement must adopt uniform definitions
related to the administration of sales and use taxes and uniform policies related to
sourcing sales of goods and services, bad debt allowances, refunds, and, to some
extent, exemptions. Under the agreement, DOR may act jointly with other states
that are signatories to the agreement to establish standards for certifying service
providers and automated systems to aid out-of-state retailers with the collection of
state sales and use taxes.
Under current law, "gross receipts" refers to the measure of the sales tax, and
"sales price" refers to the measure of the use tax. Under the bill, "sales price" refers
to the measure of the sales tax, and "purchase price" refers to the measure of the use
tax.
The bill creates definitions for "alcohol beverages," "candy," "delivery charges,"
"dietary supplement," "food and food ingredients," "prepared food," and "soft drink."
The agreement provides that a state that is a signatory to the agreement may
choose to tax or not tax all articles that are covered by one definition, but a state may
not exempt from sales tax or use tax a particular item that is included in a definition.
The members of the project working on the agreement approved a definition for
"clothing." Therefore, in order to comply with the agreement, a state may either tax
all clothing or exempt all clothing, but a state may not exempt certain items of
clothing and tax others. This bill, therefore, eliminates the sales tax and use tax
exemptions for cloth diapers and antiembolism hose.
This bill creates definitions for "durable medical equipment,"
"mobility-enhancing equipment," and "prosthetic device." Under the bill, the sale
of such equipment and devices is exempt from the sales tax and the use tax.
Under the bill, generally, for purposes of determining which jurisdiction may
impose a sales tax or use tax on a sale, if a purchaser receives a product at the seller's
business location, the sale of that product occurs at the seller's business location. If
a purchaser does not receive the product at a seller's business location, the sale
occurs at the location where the purchaser receives the product. If the location of the
sale cannot be so determined, the sale occurs at the purchaser's address, as indicated
by the seller's business records. If the address cannot be determined from the
business records, the sale occurs at the purchaser's address, as obtained during the
consummation of the sale, including the address indicated on the purchaser's check.
Finally, if the location of a sale cannot be determined in any other way, the sale of
tangible personal property occurs at the location from which the tangible personal
property is shipped. Under the bill, if the item sold is a digital good or computer
software, and the digital good or computer software is delivered electronically, the

sale occurs at the location from which the digital good or computer software was first
available for transmission by the seller.
Under the bill, generally, the sale of a telecommunications service occurs at a
location that is determined to be consistent with the provisions of the federal Mobile
Telecommunications Sourcing Act.
This bill will be referred to the Joint Survey Committee on Tax Exemptions for
a detailed analysis, which will be printed as an appendix to this bill.
For further information see the state and local fiscal estimate, which will be
printed as an appendix to this bill.
The people of the state of Wisconsin, represented in senate and assembly, do
enact as follows:
AB547, s. 1 1Section 1. 20.435 (3) (bm) of the statutes is repealed.
AB547, s. 2 2Section 2. 46.513 of the statutes is repealed.
AB547, s. 3 3Section 3. 66.0615 (1m) (f) 2. of the statutes is amended to read:
AB547,4,84 66.0615 (1m) (f) 2. Sections 77.51 (12m), (14) (c), (f) and (j) and, (14g), (15a),
5and (15b),
77.52 (3), (3m), (4), (6) and (13), (14), (18), and (19), 77.522, 77.58 (1) to (5),
6(6m),
and (7), 77.585, 77.59, 77.60, 77.61 (2), (3m), (5), (8), (9) and, (12) to (14), and
7(15),
and 77.62, as they apply to the taxes under subch. III of ch. 77, apply to the tax
8described under subd. 1.
AB547, s. 4 9Section 4. 70.111 (23) of the statutes is amended to read:
AB547,4,1510 70.111 (23) Vending machines. All machines that automatically dispense soda
11water beverages, as defined in s. 97.29 (1) (i), and items included as a food or beverage
12under s. 77.54 (20) (a) and (b)
food and food ingredient, as defined in s. 77.51 (3t),
13upon the deposit in the machines of specified coins or currency, or insertion of a credit
14card, in payment for the soda water beverages, food or beverages food and food
15ingredient, as defined in s. 77.51 (3t)
.
AB547, s. 5 16Section 5. 73.03 (50) (d) of the statutes is amended to read:
AB547,5,8
173.03 (50) (d) In the case of a sole proprietor, signs the form or, in the case of
2other persons, has an individual who is authorized to act on behalf of the person sign
3the form, or, in the case of a single-owner entity that is disregarded as a separate
4entity under section 7701 of the Internal Revenue Code, the person is the owner. Any
5person who may register under this subsection may designate an agent, as defined
6in s. 77.524 (1) (ag), to register with the department under this subsection in the
7manner prescribed by the department. In this paragraph, "sign" has the meaning
8given in s. 77.51 (17r).
AB547, s. 6 9Section 6. 73.03 (50b) of the statutes is created to read:
AB547,5,1310 73.03 (50b) To waive the fee established under sub. (50) for applying for and
11renewing the business tax registration certificate, if the person who is applying for
12or renewing the certificate is not required for purposes of ch. 77 to hold such a
13certificate.
AB547, s. 7 14Section 7. 73.03 (61) of the statutes is created to read:
AB547,5,1615 73.03 (61) To do all of the following related to the Uniform Sales and Use Tax
16Administration Act:
AB547,5,1717 (a) Certify compliance with the agreement, as defined in s. 77.65 (2) (a).
AB547,5,2018 (b) Pursuant to the agreement, as defined in s. 77.65 (2) (a), certify certified
19service providers, as defined in s. 77.51 (1g), and certified automated systems, as
20defined in s. 77.524 (1) (am).
AB547,6,621 (c) Consistent with the agreement, as defined in s. 77.65 (2) (a), establish
22performance standards and eligibility criteria for a seller that sells tangible personal
23property or taxable services in at least 5 states that are signatories to the agreement,
24as defined in s. 77.65 (2) (a); that has total annual sales revenue of at least
25$500,000,000; that has a proprietary system that calculates the amount of tax owed

1to each taxing jurisdiction in which the seller sells tangible personal property or
2taxable services; and that has entered into a performance agreement with the states
3that are signatories to the agreement, as defined in s. 77.65 (2) (a). For purposes of
4this paragraph, "seller" includes an affiliated group of sellers using the same
5proprietary system to calculate the amount of tax owed in each taxing jurisdiction
6in which the sellers sell tangible personal property or taxable services.
AB547,6,107 (d) Issue a tax identification number to a person who claims an exemption
8under subch. III or V of ch. 77 and who is not required to register with the department
9for the purposes of subch. III or V of ch. 77 and establish procedures for the
10registration of such a person.
AB547,6,1411 (e) Maintain a database that is accessible to sellers and certified service
12providers, as defined in s. 77.51 (1g), that indicates whether items defined in
13accordance with the Uniform Sales and Use Tax Administration Act are taxable or
14nontaxable.
AB547,6,1815 (f) Maintain a database that is accessible to sellers and certified service
16providers, as defined in s. 77.51 (1g), that indicates tax rates, taxing jurisdiction
17boundaries, and zip code or address assignments related to the administration of
18taxes imposed under subchs. III and V of ch. 77.
AB547,6,2119 (g) Set forth the information that the seller shall provide to the department for
20tax exemptions claimed by purchasers and establish the manner in which a seller
21shall provide such information to the department.
AB547,6,2522 (h) Provide monetary allowances, in addition to the retailer's discount provided
23under s. 77.61 (4) (c), to certified service providers, as defined in s. 77.51 (1g), and
24sellers that use certified automated systems, as defined in s. 77.524 (1) (am), or
25proprietary systems, pursuant to the agreement as defined in s. 77.65 (2) (a).
AB547, s. 8
1Section 8. 76.07 (4g) (b) 8. of the statutes is amended to read:
AB547,7,82 76.07 (4g) (b) 8. Determine transport-related revenue by adding public service
3revenue allocated to this state on the basis of routes for which the company is
4authorized to receive subsidy payments, mutual aid allocated to this state on the
5basis of the ratio of transport revenues allocated to this state to transport revenues
6everywhere in the previous year, in-flight sales allocated to this state as they are
7allocated under s. 77.51 (14r) 77.522 and all other transport-related revenues from
8sales made in this state.
AB547, s. 9 9Section 9. 77.51 (1) of the statutes is renumbered 77.51 (1d).
AB547, s. 10 10Section 10. 77.51 (1b) of the statutes is created to read:
AB547,7,1211 77.51 (1b) "Alcohol beverage" means a beverage that is suitable for human
12consumption and that contains 0.5 percent or more of alcohol by volume.
AB547, s. 11 13Section 11. 77.51 (1e) of the statutes is created to read:
AB547,7,1714 77.51 (1e) "Candy" means a preparation of sugar, honey, or other natural or
15artificial sweetener combined with chocolate, fruit, nuts, or other ingredients or
16flavorings in the form of bars, drops, or pieces. "Candy" does not include a
17preparation that contains flour or that requires refrigeration.
AB547, s. 12 18Section 12. 77.51 (1n) of the statutes is created to read:
AB547,7,2119 77.51 (1n) "Computer" means an electronic device that accepts information in
20digital or similar form and that manipulates such information to achieve a result
21based on a sequence of instructions.
AB547, s. 13 22Section 13. 77.51 (1p) of the statutes is created to read:
AB547,7,2423 77.51 (1p) "Computer software" means a set of coded instructions designed to
24cause a computer or automatic data processing equipment to perform a task.
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