SF4439

Purpose

Proposes a new plastic bottle excise tax in Minnesota to raise revenue for water infrastructure. The tax would create a new tax category under Minnesota Statutes chapter 297H and apply to certain plastic beverage bottles sold in the state. The tax would sunset after December 31, 2030.

Main Provisions

• Section 1 – Definitions

  • Beverage: a drinkable liquid intended for human consumption, excluding drugs regulated under federal law and infant formula.
  • Bottle distributor: a person who sells a taxable plastic bottle to a retailer in Minnesota, or a beverage producer who sells at retail.
  • Commissioner: Minnesota the Department of Revenue.
  • Taxable plastic bottle: a formed or molded container primarily of plastic resin, sealed, containing a beverage, and holding less than three liters when full.

• Section 2 – Tax imposed

  • An excise tax is imposed on bottle distributors.
  • The tax is charged to the first distributor selling a taxable bottle to a retailer in Minnesota; with an exception: if a beverage producer sells directly at retail, the tax is imposed on the beverage producer instead.
  • Tax is payable quarterly, in a form and manner prescribed by the commissioner.

• Section 3 – Rate of tax

  • The tax rate is ten cents per taxable plastic bottle sold.

• Section 4 – Use of proceeds

  • Revenue from the tax must be deposited into the water infrastructure account established in a separate section.

• Section 5 – Expiration

  • The tax provision expires after December 31, 2030 (sunset).

Significant changes to existing law

• Creates a new plastic bottle excise tax under Minnesota law (chapter 297H) with defined terms, collection rules, and a sunset date.
• Shifts tax liability to the first distributor or, in cases where a beverage producer sells retail, to the beverage producer.
• Directs proceeds to a water infrastructure account, tying the tax revenue to water-related infrastructure funding.
• Establishes quarterly payment requirements and a specific rate of 10 cents per bottle.

Relevant terms - plastic bottle excise tax - bottle distributor - beverage producer - taxable plastic bottle - rate of ten cents - payable quarterly - Minnesota Statutes chapter 297H - water infrastructure account - expiration 2030 - less than three liters - sealed container - beverage (excluding FDA-regulated drugs and infant formula)