Register

The examiner may continue the hearing at such times and places as necessary to complete the hearing.

The building at 610 North Whitney Way is accessible to people in wheelchairs through the main floor entrance (Lobby) on the Whitney Way side of the building. Handicapped parking is available on the south side of the building and the building has some wheelchair accessible rest rooms. Interpreters for the deaf and hard of hearing will be provided.

Input Expressly Invited

The Commission invites all parties potentially affected by these proposed universal service fund rules to comment on them. The purpose of the proposed rules is to solicit comments so that the Commission can make a full and informed decision on additions to, deletions from, or modifications of the current universal service fund rules in ch. PSC 160.

The Commission is not modifying the data transmission speed rule in s. PSC 160.031. The Commission will be examining this issue and other Internet related matters in another forum, so comments on data speed matters should not be filed in this rulemaking proceeding.

Copies of Proposed Rules

A copy of the full Notice of Hearing, including the text of the proposed rules, was published in the February 28, 1999, Wisconsin Administrative Register. Copies of the Notice and proposed rules may also be obtained from the contact person listed at the end of this notice.

Written Comments

Any person may submit written comments on these proposed rules. The hearing record will remain open for written comments from the public until June 18, 1999, at noon (June 17, 1999, at noon, if filed by fax).

All written comments must include a reference on the filing to docket (1-AC-166). File by one mode only.

If filing by mail, courier, or hand delivery: Address as shown below:

Address comments to:

Lynda L. Dorr, Secretary to the Commission

Public Service Commission

P.O. Box 7854

Madison, WI 53707-7854

FAX [phone]

Industry parties should submit an original and 15 copies. Members of the general public need only file an original. File by June 18, 1999, at noon.

If filing by fax: Send fax comments to [phone]. Fax filing cover sheet MUST state “Official Filing," the docket number (1-AC-166), and the number of pages (limited to 20 pages for fax comments). File by June 17, 1999, at noon.

Contact Information

Questions regarding this matter should be directed to Gary Evenson, Assistant Administrator, Telecommunications Division, at [phone] or [e-mail]. Hearing- or speech-impaired individuals may also use the Commission's TTY number, [phone].

The Commission does not discriminate on the basis of disability in the provision of programs, services, or employment. Any person with a disability who needs accommodations to participate in this proceeding or who needs to get this document in a different format should contact Gary Evenson, as indicated in the previous paragraph, as soon as possible.

Notice of Proposed Rule

Revenue

[CR 99-11]

Notice is hereby given that pursuant to s. 227.11(2)(a), Stats., and interpreting ss. 73.03(50), 77.52(7), (9), (12), (13), (14) and (19), 77.53(10) and (11) and 77.61(2), Stats., and according to the procedure set forth in s. 227.16(2)(e), Stats., the Department of Revenue will adopt the following rules as proposed in this notice without public hearing unless, within 30 days after publication of this notice on May 1, 1999, tit is petitioned for a public hearing by 25 natural persons who will be affected by the rule, a municipality which will be affected by the rule, or an association which is representative of a farm, labor, business or professional group which will be affected by the rule.

Contact Person

Please contact Mark Wipperfurth at [phone], if you have any questions regarding this proposed rule order.

Analysis by the Department of Revenue

Statutory authority: s. 227.11(2)(a)

Statutes interpreted: ss. 73.03(50), 77.52(7), (9), (12), (13), (14) and (19), 77.53(10) and (11) and 77.61(2)

SECTIONS 1 TO 16. Tax 11.14(title), (1), (2)(a) and (c), (3)(a) and (b), (5)(b), (6)(title), (a)(title) and 2. and (b)(title), (intro.) and 3., the example following sub. (6) and subs. (7) to (12) and the second note at the end of Tax 11.14 are revised, to reflect a change in department policy to discontinue the issuance of various types of exemption certificates and replace them with Form S-211, a multipurpose exemption certificate. Form S-211 may be used for any sales and use tax exemption provided by law, except the exemption for construction contracts entered into before the effective date of county/stadium tax, and direct pay permits.

Tax 11.14(1) is further revised and the first note at the end of Tax 11.14 is revised, to reference all of the subsections of ss. 77.52 and 77.53, Stats., which relate to exemption certificates.

Tax 11.14(3)(b) is further revised, to place a nonsubstantive statement in a note rather than in the text of the rule.

Tax 11.14(5)(b) is further revised, to clarify that a seller is not liable for tax on transactions covered by a valid exemption certificate.

Tax 11.14(6)(b)4.c. is created, to reflect department policy that a person who makes exempt sales only may use a certificate of exemption (Form S-211) to claim exemption on tangible personal property or taxable services the person resells.

Tax 11.14(15) is renumbered Tax 11.14(13) and revised, to place the subsection in a more logical order and to add references to the stadium tax. Consequently, subs. (13) and (14) are renumbered (14) and (15).

Tax 11.14(16) is created and the second note at the end of Tax 11.14 is further revised, to reflect a change in exemption certificate requirements for sales of certain commodities, as a result of amendments to ss. 77.52(13) and 77.53(10), Stats., by 1997 Wis. Acts 27 and 237.

SECTIONS 17 AND 19 TO 22. Tax 11.53(1)(a),(b) and (e) are repealed, subs. (2) to (5) are revised, and a note is added at the end of sub. (3), to reflect a change in department policy, to no longer issue temporary seller's permits and concessionaire permits.

SECTION 18. Tax 11.53(1)(c) and (d) are renumbered Tax 11.53(1)(a) and (b), because of the repeal of Tax 11.53(1)(a) and (b). Tax 11.53(1)(a) as renumbered is revised, to reflect a change in department policy, to now permit use of a mobile seller's permit simultaneously at multiple locations.

SECTION 23. Tax 11.53(6) is revised, to clarify the conditions under which the permit violation provisions apply.

Text of Rule

SECTION 1. Tax 11.14(title), (1) and (2)(a)(intro.) are amended to read:

Tax 11.14(title) Exemption certificates, including resale certificates.

(1) STATUTES. The sales tax status of exemption certificates is contained in s. 77.52(13) to (16) (17), Stats., and the use tax status of exemption certificates is contained in s. 77.53(10) and (11) to (13), Stats.

(2)(a)(intro.) Exemption certificates are signed by purchasers or lessees and are given to sellers or lessors to verify that a transaction is exempt. Sellers and lessors shall exclude from taxable gross receipts transactions for which they have accepted a valid exemption certificate in good faith from a purchaser. The department has provided retailers with 7 types of the following 2 sales and use tax exemption certificates, each of which is designed for use in specific types of transactions. These certificates, discussed individually in this section, are the following:

SECTION 2. Tax 11.14(2)(a)1. and 2. are repealed and recreated to read:

Tax 11.14(2)(a)1. Wisconsin sales and use tax exemption certificate, form S-211. This is a multipurpose form which may be used for any sales and use tax exemption provided by law, except as provided in subs. (13) and (14).

2.   Construction contract entered into before the effective date of county/stadium tax, form S-207CT-1. This is a certificate which may be used by a contractor to purchase building materials without a county or stadium tax under the circumstances described in sub. (13).

SECTION 3. Tax 11.14(2)(a)3. to 7. are repealed.

SECTION 4. Tax 11.14(2)(c), (3)(a) and (b), (5)(b) and (6)(title), (a)(title) and 2. and (b)(title), (intro.) and 3. are amended to read:

Tax 11.14(2)(c) Under s. 77.57, Stats., if If a purchaser certifies in writing by using an exemption certificate, other than a resale certificate, that the property purchased will be used for activities or under circumstances which make the purchase of the property exempt from the sales tax or for resale, and the property is subsequently used in a manner that makes the property ineligible for exemption from tax, the purchaser shall pay the sales tax.

(3)(a) A seller is relieved of liability for the tax if the seller takes from the purchaser a valid, written resale or exemption certificate which certifies that the purchaser will use the property or service in a manner or for a purpose entitling the seller to accept the certificate in good faith.

(b) To be valid, a resale or other an exemption certificate shall upon its face disclose a proper basis for exemption. The use of phrases such as “nontaxable," “exempt" or similar terminology do not provide a proper basis for an exemption. A certificate shall be properly executed and dated and shall contain all the necessary information. Thus, all retailers should be familiar with the instructions contained in the certificate. A certificate claiming an exemption not provided by law is not valid.

Note to Revisor: Insert the following note at the end of sub. (3)(b):

Note: All retailers should be familiar with the instructions contained in an exemption certificate.

(5)(b) Continuous exemption certificates, including continuous resale certificates, approved by the department do not allow a purchaser to issue “this time only" purchase orders cancelling the continuous tax exemption certificate for the one transaction only. The notation “taxable" on a purchase order is not sufficient to relieve a purchaser of the responsibility for a previously issued continuous certificate, unless it. The seller is not liable for the tax on transactions covered by a valid exemption certificate, unless the purchase order is accompanied by a separate letter explaining the inapplicability of the previously issued certificate to a particular order.

(6)(title) RESALE CERTIFICATE, FORM S-205.

(a)(title) Effect of obtaining resale exemption certificate claiming resale.

  2. If a purchaser gives a resale an exemption certificate claiming resale for property acquired and then makes any storage or use of the property other than retention, demonstration or display while holding it for sale in the regular course of business, the storage or use is taxable as of the time the property is first stored or used. The use tax shall be reported and paid by the purchaser with the tax return for the period in which the property is first so stored or used.

(b)(title) Contents of resale exemption certificates claiming resale.

(intro.) A resale certificate, form S-205, An exemption certificate claiming resale shall contain the following information for the seller to be relieved from the burden of proving the sale of property or services was not a taxable sale:

  3. A general description of the property or service purchased for resale if a “continuous" resale exemption certificate is used, or an itemization of the property or service purchased if a “single purchase" certificate is used.

SECTION 5. Tax 11.14(6)(b)4.c. is created to read:

Tax 11.14(6)(b)4.c. A person who makes exempt sales only in the regular course of business may insert the words “exempt sales only" in the space for a seller's permit number.

Note to Revisor: Replace the example following sub. (6) with the following:

  Example: A “continuous" exemption certificate claiming resale describing a business as a “tavern" normally should not be accepted for the sale of a radio, camera, auto part or other item not regularly sold by taverns.

SECTION 6. Tax 11.14(7)(title) is repealed.

SECTION 7. Tax 11.14(7)(a)(intro.) and 1. to 6. are renumbered Tax 11.14(12)(intro.) and (a) to (f), and as renumbered Tax 11.14(12)(intro.) and (d) are amended to read:

Tax 11.14(12)(intro.) The certificate of exemption, form S-207, is a multiple purpose form which Wisconsin sales and use tax exemption certificate, form S-211, may also be used for purchasing any of any other sales and use tax exemption provided by law, including the following 6 exempt types of property or services:

  (d) Property or services purchased directly by and used by a religious, charitable, educational, scientific or other organization or governmental unit holding a certificate of exempt status, CES. Sales to organizations holding a CES also can be shown to be exempt by a retailer's recording the certificate number on its bill of sale. A corporation, community chest fund, foundation or association organized and operated exclusively for religious, charitable, scientific or educational purposes, or for the prevention of cruelty to children or animals, which is located out-of-state, may use the certificate of exemption, form S-207 Wisconsin sales and use tax exemption certificate, form S-211, to purchase without tax even though it has not been issued a Wisconsin certificate of exempt status.

SECTION 8. Tax 11.14(7)(b) is repealed.

SECTION 9. Tax 11.14(8), (9) and (10)(title) and (a) are renumbered Tax 11.14(7), (8) and (9), and as renumbered Tax 11.14(7)(title) and (a), (8) and (9) are amended to read:

Tax 11.14(7)(title) MANUFACTURER'S MANUFACTURING EXEMPTION CERTIFICATE, FORM S-207M.

(a) A supplier which accepts a properly completed manufacturer's exemption certificate, form S-207m, claiming a manufacturing exemption in good faith marked for “continuous" use may make sales to the manufacturer without collecting the tax if the nature of the property or services sold qualifies for one of the exempt uses claimed by the manufacturer on the form. If a form S-207m an exemption certificate is a “continuous" form, each purchase order of the manufacturer shall refer to it. If an individual order contains both exempt and non-exempt purchases, the purchaser shall designate which items are taxable.

(8)(title) FARMER'S EXEMPTION CERTIFICATE, FORM S-206. A retailer shall have a signed farmer's exemption certificate, form S-206, for every exempt sale made to a farmer.

  Note: Section Tax 11.12 describes the types of property which may be sold to farmers without tax, and the use of the exemption certificate to claim farming exemptions.

(9)(title) CERTIFICATE OF EXEMPTION FOR FUEL OIL, PROPANE, COAL, STEAM AND WOOD FOR FUEL FOR RESIDENTIAL OR FARM USE, FORM S-016. A retailer shall have a signed exemption certificate, form S-016, if the sale of fuel oil, propane, coal, steam or wood for residential or farm use is partially exempt from sales or use tax. If the sale is 100% exempt, an exemption certificate is not required.

SECTION 10. Tax 11.14(10)(b) is repealed.

SECTION 11. Tax 11.14(11)(title) and (a)(intro.) and 1. to 3. are renumbered Tax 11.14(10)(title) and (intro.) and (a) to (c), and as renumbered Tax 11.14(10)(title) and (intro.) are amended to read:

Tax 11.14(10)(title) CERTIFICATE OF EXEMPTION FOR ELECTRICITY AND NATURAL GAS SOLD FOR RESIDENTIAL OR FARM USE, FORM S-017.

(intro.) A retailer of electricity or natural gas shall have a signed exemption certificate, form S-017, for all sales of electricity or natural gas for residential or farm use which are exempt from sales or use tax unless any, or all, of the following apply:

SECTION 12. Tax 11.14(11)(b) is repealed.

SECTION 13. Tax 11.14(12)(title), (a) and (b)(intro.) are renumbered Tax 11.14(11)(title), (a) and (b)(intro.) and amended to read: