HF4331

Purpose

• Remove certain lawn care services from the sales tax base, making them non-taxable.

Main Provisions

• Amends Minnesota Statutes to change what counts as a sale or purchase for tax purposes, specifically narrowing the list of taxable services.
• The bill would remove lawn care services (fertilizing, mowing, spraying, sprigging, garden maintenance, tree/shrub pruning and related care, and indoor plant care) from the set of services that are subject to sales tax.
• The bill repeals Minnesota Statutes 2024 sections 297A.67 subdivision 25 and 297A.68 subdivision 40 as part of implementing the change.
• The bill retains many other taxable items and services (e.g., admission to places of amusement, lodging, nonresidential parking, laundry/dry cleaning, pet grooming, detective/security services, etc.), but explicitly excludes lawn care from the taxable list.
• The bill continues to define sale and purchase to include a wide range of other property and services, including digital products, telecommunications services, and installation or delivery in other contexts.

Changes to Existing Law

• Alters the scope of what is considered a taxable service by removing lawn care-related services from the taxable category.
• Repeals two existing statutory provisions (297A.67 subd. 25 and 297A.68 subd. 40) that intersect with the current tax base and service definitions.
• Keeps the broader framework for sales tax on other tangible property and services, including many digital, telecommunications, and other service categories, intact.

Economic/Tax Impact (Note)

• By removing lawn care services from taxation, state and local tax revenue related to those services would be reduced.
• Consumers and lawn care providers would see changes in pricing and compliance requirements related to sales tax collection.

Summary of Key Concepts (for quick reference)

• sale and purchase; tangible personal property; retail sale
• taxable services; lawn care fertilizing mowing spraying sprigging; garden maintenance; tree/shrub pruning
• prewritten computer software; digital products; installation; telecommunications
• places of amusement; lodging; parking; laundry/dry cleaning; pet grooming; detective/security

Relevant Terms - lawn care services - tax base - taxable services - sale and purchase - tangible personal property - digital products - prewritten computer software - installation - admission to places of amusement - lodging - nonresidential parking - laundry and dry cleaning - pet grooming - lawn care fertilizing mowing spraying sprigging - garden maintenance - tree and shrub pruning - repeal (297A.67 subd. 25; 297A.68 subd. 40)