Amends existing law to revise provisions certain definitions related to sales and use tax.

LEGISLATURE OF THE STATE OF IDAHO
Sixty-eighth Legislature Second Regular Session - 2026
IN THE HOUSE OF REPRESENTATIVES
HOUSE BILL NO. 839
BY REVENUE AND TAXATION COMMITTEE
AN ACT	1
RELATING TO TAXATION; AMENDING SECTION 63-3612, IDAHO CODE, TO REVISE A DEF-	2
INITION; AMENDING SECTION 63-3613, IDAHO CODE, TO REVISE A DEFINITION;	3
PROVIDING APPLICABILITY; AND DECLARING AN EMERGENCY AND PROVIDING	4
RETROACTIVE APPLICATION.	5
Be It Enacted by the Legislature of the State of Idaho:	6
SECTION 1. That Section 63-3612, Idaho Code, be, and the same is hereby	7
amended to read as follows:	8
63-3612. SALE. (1) The term "sale" means any transfer of title, ex-	9
change or barter, conditional or otherwise, of tangible personal property	10
for a consideration and shall include any similar transfer of possession	11
found by the state tax commission to be in lieu of, or equivalent to, a trans-	12
fer of title, exchange or barter.	13
(2) "Sale" shall also include the following transactions when a consid-	14
eration is transferred, exchanged or bartered:	15
(a) Producing, fabricating, processing, printing, or imprinting of	16
tangible personal property for consumers who furnish, either directly	17
or indirectly, the tangible personal property used in the producing,	18
fabricating, processing, printing, or imprinting.	19
(b) Furnishing, preparing, or serving food, meals, or drinks and nonde-	20
preciable goods and services directly consumed by customers included in	21
the charge thereof.	22
(c) A transfer of possession of property where the seller retains the	23
title as security for the payment of the sales price.	24
(d) A transfer of the title or possession of tangible personal property	25
which has been produced, fabricated, or printed to the special order of	26
the customer, or of any publication.	27
(e) Admission to a place or for an event in Idaho, provided that an or-	28
ganization conducting an exempt function as defined in section 527 or	29
exempted by section 501(c)(3) of the Internal Revenue Code, as incor-	30
porated in section 63-3004, Idaho Code, and collecting any charges for	31
attendance at the aforementioned event, shall not have those admission	32
charges be defined as a sale if the event:	33
(i) Is not predominately recreational or commercial; and	34
(ii) Any included entertainment value is minimal when compared to	35
the charge for attendance; and	36
(iii) Such entity has paid sales and use tax on taxable property or	37
services used during the event.	38
(f) The use of or the privilege of using tangible personal property or	39
facilities for recreation.	40

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(g) Providing hotel, motel, campground, or trailer court accommo-	1
dations, nondepreciable goods directly consumed by customers and	2
included services, except:	3
(i) where Where residence is maintained continuously under the	4
terms of a lease or similar agreement for a period in excess of	5
thirty (30) days.; or	6
(ii) Accommodations for redemptions of loyalty or rewards program	7
points where monetary consideration has not been paid for the ac-	8
commodations by the program member; however, sales tax shall apply	9
to monetary consideration paid by a loyalty program to an accom-	10
modations owner or operator when loyalty or reward points are re-	11
deemed for the providing of customer accommodations.	12
(h) The lease or rental of tangible personal property.	13
(i) The intrastate transportation for hire by air of freight or passen-	14
gers, except (1) as part of a regularly scheduled flight by a certified	15
air carrier, under authority of the United States, or (2) when providing	16
air ambulance services.	17
(3) As used in subsections (2)(b) and (2)(g) of this section, goods "di-	18
rectly consumed by customers" shall not be interpreted to mean any linens,	19
bedding, cloth napkins or similar nondisposable property.	20
SECTION 2. That Section 63-3613, Idaho Code, be, and the same is hereby	21
amended to read as follows:	22
63-3613. SALES PRICE. (a) The term "sales price" means the total	23
amount for which tangible personal property, including services agreed to be	24
rendered as a part of the sale, is sold, rented or leased, valued in money,	25
whether paid in money or otherwise, without any deduction on account of any	26
of the following:	27
1. The cost of the property sold. However, in accordance with such	28
rules as the state tax commission may prescribe, a deduction may be	29
taken if the retailer has purchased property for some purpose other than	30
resale or rental, has reimbursed his vendor for tax which the vendor is	31
required to pay to the state or has paid the use tax with respect to the	32
property, and has resold or rented the property prior to making any use	33
of the property other than retention, demonstration or display while	34
holding it for sale in the regular course of business. If such a deduc-	35
tion is taken by the retailer, no refund or credit will be allowed to his	36
vendor with respect to the sale of the property.	37
2. The cost of materials used, labor or service cost, losses, or any	38
other expense.	39
3. The cost of transportation of the property prior to its sale.	40
4. The face value of manufacturer's discount coupons. A manufacturer's	41
discount coupon is a price reduction coupon presented by a consumer to	42
a retailer upon purchase of a manufacturer's product, the face value of	43
which may only be reimbursed by the manufacturer to the retailer.	44
(b) The term "sales price" does not include any of the following:	45
1. Retailer discounts allowed and taken on sales, but only to the extent	46
that such retailer discounts represent price adjustments as opposed to	47
cash discounts offered only as an inducement for prompt payment.	48

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2. Any sums allowed on merchandise accepted in payment of other mer-	1
chandise, provided that this allowance shall not apply to the sale of a	2
"new manufactured home," a "new park model recreational vehicle" or a	3
"modular building" as defined herein.	4
3. The amount charged for property returned by customers when the	5
amount charged therefor is refunded either in cash or credit; but this	6
exclusion shall not apply in any instance when the customer, in order	7
to obtain the refund, is required to purchase other property at a price	8
greater than the amount charged for the property that is returned.	9
4. The amount charged for labor or services rendered in installing or	10
applying the property sold, provided that said amount is stated sepa-	11
rately and such separate statement is not used as a means of avoiding	12
imposition of this tax upon the actual sales price of the tangible per-	13
sonal property; except that charges by a manufactured homes dealer or	14
park model recreational vehicle dealer for set up of a manufactured	15
home or park model recreational vehicle shall be included in the "sales	16
price" of such manufactured home or park model recreational vehicle.	17
5. The amount of any tax (not including, however, any manufacturers' or	18
importers' excise tax) imposed by the United States upon or with respect	19
to retail sales whether imposed upon the retailer or the consumer.	20
6. The amount charged for finance charges, carrying charges, service	21
charges, time-price differential, or interest on deferred payment	22
sales, provided such charges are not used as a means of avoiding impo-	23
sition of this tax upon the actual sales price of the tangible personal	24
property.	25
7. Delivery and handling charges for transportation of tangible per-	26
sonal property to the consumer, provided that the transportation is	27
stated separately and the separate statement is not used as a means of	28
avoiding imposition of the tax upon the actual sales price of the tan-	29
gible personal property; except that charges by a manufactured homes	30
dealer or park model recreational vehicle dealer for transportation	31
of a manufactured home or park model recreational vehicle shall be in-	32
cluded in the "sales price" of such manufactured home or park model	33
recreational vehicle.	34
8. Manufacturers' rebates when used at the time of a retail sale as a	35
down payment on or reduction to the retail sales price of a motor vehi-	36
cle the following products to which the rebate applies: motor vehicles	37
as defined in section 63-3605L, Idaho Code; and all-terrain vehicles,	38
utility type vehicles, specialty off-highway vehicles, motorbikes, and	39
snowmobiles, as those terms are defined in section 67-7101, Idaho Code.	40
A manufacturer's rebate is a cash payment made by a manufacturer to a re-	41
tailer or to a consumer who has purchased or is purchasing the manufac-	42
turer's product from the retailer.	43
9. The amount of any fee imposed upon an outfitter as defined in section	44
36-2102, Idaho Code, by a governmental entity pursuant to statute for	45
the purpose of conducting outfitting activities on land or water sub-	46
ject to the jurisdiction of the governmental entity, provided that the	47
fee is stated separately and is presented as a use fee paid by the out-	48
fitted public to be passed through to the governmental entity.	49

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10. The amount of any discount or other price reduction on telecommuni-	1
cations equipment when offered as an inducement to the consumer to com-	2
mence or continue telecommunications service, or the amount of any com-	3
mission or other indirect compensation received by a retailer or seller	4
as a result of the consumer commencing or continuing telecommunications	5
service.	6
(c) The sales price of a "new manufactured home" or a "modular building"	7
as defined in this chapter shall be limited to and include only fifty-five	8
percent (55%) of the sales price as otherwise defined herein.	9
(d) Taxes previously paid on amounts represented by accounts found to	10
be worthless may be credited upon a subsequent payment of the tax provided in	11
this chapter or, if no such tax is due, refunded. If such accounts are there-	12
after collected, a tax shall be paid upon the amount so collected.	13
(e) Tangible personal property when sold at retail for more than eleven	14
cents (11¢) but less than one dollar and one cent ($1.01) through a vending	15
machine shall be deemed to have sold at a sales price equal to one hundred	16
seventeen percent (117%) of the price which is paid for such tangible per-	17
sonal property and/or its component parts including packaging by the owner	18
or operator of the vending machines.	19
(f) Sales price shall not include a gratuity or tip received when paid	20
to the service provider of a meal. The gratuity or tip can be either volun-	21
tary or mandatory, but must be given for the service provided and as a supple-	22
ment to the service provider's income.	23
(g) The sales price of a "new park model recreational vehicle" shall in-	24
clude one hundred percent (100%) of the sales price as otherwise defined in	25
this section.	26
SECTION 3. The provisions of this act shall apply to all appeals pend-	27
ing on and after January 1, 2026, involving interpretation or application of	28
sections 63-3612 and 63-3613, Idaho Code.	29
SECTION 4. An emergency existing therefor, which emergency is hereby	30
declared to exist, this act shall be in full force and effect on and after its	31
passage and approval, and retroactively to January 1, 2026.	32

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