(a) The gross receipts or gross proceeds derived from the sale of the following are subject to the gross receipts tax levied by this chapter:
(1) Any intrastate, interstate, and international telecommunications service that is sourced in this state in accordance with subsection (d) of this section;
(2) Any ancillary service; and
(3) Any installation, maintenance, or repair service of telecommunication equipment.
(b) The following services shall not be taxable under this section:
(1) Any interstate or international private communications service;
(2) Any interstate or international 800 service or 900 service; or
(3) (A) Any prepaid calling service or prepaid wireless calling service.
(B) However, prepaid calling service and prepaid wireless calling service are taxed under § 26-52-314.
(c) (1) (A) The Mobile Telecommunications Sourcing Act, Pub. L. No. 106-252, is adopted in its entirety.
(B) All charges for mobile telecommunications services are deemed to be provided by the customer's home service provider and sourced to the customer's place of primary use and are subject to gross receipts tax based upon the customer's place of primary use as determined by the Mobile Telecommunications Sourcing Act, Pub. L. No. 106-252.
(2) (A) (i) Any customer who alleges that an amount of tax, charge, or fee or that the assignment of the place of primary use or taxing jurisdiction included on a billing is erroneous shall notify the home service provider in writing.
(ii) The customer must include the street address for the customer's place of primary use, the account name and number for which the correction of tax assignment is sought, a description of the alleged error, and any other information requested by the home service provider necessary to process the request.
(B) (i) The home service provider shall conduct a review of its records and the electronic database or enhanced zip code used to determine the place of primary use within sixty (60) days of receiving the notice from its customer.
(ii) If it is determined that the amount of the tax, charge, or fee or that the assignment of the place of primary use or taxing jurisdiction is in error, the home service provider shall correct the error and refund or credit the amount of tax, charge, or fee erroneously collected from the customer for a period of up to three (3) years.
(iii) If it is determined that the amount of the tax, charge, or fee or assignment of the place of primary use or taxing jurisdiction is correct, the home service provider shall provide a written explanation to the customer.
(C) A customer seeking correction of assignment of place of primary use or taxing jurisdiction or a refund or credit of taxes, charges, or fees erroneously collected by the home service provider must seek to have the error corrected under subdivision (c)(2)(A) of this section before any cause of action arises as a result of the error.
(3) (A) Charges for nontaxable services that are aggregated with other charges for communications services that are taxable and are not separately stated on the bill or invoice shall not be subject to the gross receipts tax if the seller can reasonably identify the nontaxable charges on the seller's books and records kept in the regular course of business.
(B) If the nontaxable charges cannot reasonably be identified, the gross receipts from the sales of both taxable and nontaxable communications services billed on a combined basis shall be attributed to the taxable communications services.
(C) The burden of proving nontaxable receipts or charges is on the seller of the communications services.
(d) (1) Except for the telecommunications services in subdivision (d)(3) of this section, the sale of telecommunications services sold on a call-by-call basis shall be sourced to:
(A) Each state, county, or city jurisdiction where the call originates and terminates in that jurisdiction; or
(B) Each state, county, or city where the call either originates or terminates and in which the service address is also located.
(2) Except for the telecommunications services in subdivision (d)(3) of this section, a sale of telecommunications services sold on a basis other than a call-by-call basis is sourced to the customer's place of primary use.
(3) The sale of the following telecommunication services shall be sourced to each state, county, or city as follows:
(A) A sale of mobile telecommunications services other than air-to-ground radiotelephone service and prepaid calling service is sourced to the customer's place of primary use as required by the Mobile Telecommunications Sourcing Act, Pub. L. No. 106-252;
(B) A sale of postpaid calling service is sourced to the origination point of the telecommunications signal as first identified by either:
(i) The seller's telecommunications system; or
(ii) Information received by the seller from its service provider if the system used to transport the signals is not that of the seller;
(C) (i) A sale of prepaid calling service or a sale of a prepaid wireless calling service is sourced in accordance with § 26-52-521(b).
(ii) Except for a sale of prepaid wireless calling service that is a prepaid telecommunications service, the rule provided in § 26-52-521(b)(5) shall include as an option the location associated with the mobile telephone number; or
(D) A sale of a private communication service is sourced as follows:
(i) Service for a separate charge related to a customer channel termination point is sourced to each state, county, or city in which the customer channel termination point is located;
(ii) Service where all customer termination points are located entirely within one (1) jurisdiction or levels of jurisdiction is sourced in the state, county, and city in which the customer channel termination points are located;
(iii) Service for segments of a channel between two (2) customer channel termination points located in different jurisdictions and which segments of a channel are separately charged is sourced fifty percent (50%) in each state, county, and city in which the customer channel termination points are located; or
(iv) Service for segments of a channel located in more than one (1) jurisdiction or levels of jurisdiction and which segments are not separately billed is sourced in each jurisdiction based on the percentage determined by dividing the number of customer channel termination points in the jurisdiction by the total number of customer channel termination points.
(4) The sale of an ancillary service is sourced to the customer's place of primary use.
(e) As used in this section:
(1) "Air-to-ground radiotelephone service" means a radio service, as that term is defined in 47 C.F.R. § 22.99, as in effect on January 1, 2007, in which common carriers are authorized to offer and provide radio telecommunications service for hire to subscribers in aircraft;
(2) "Ancillary service" means a service that is associated with or incidental to the provision of a telecommunications service, including without limitation detailed telecommunications billing, directory assistance, vertical service, and voice mail services;
(3) "Call-by-call basis" means any method of charging for a telecommunications service when the price is measured by individual calls;
(4) "Communications channel" means a physical or virtual path of communications over which signals are transmitted between or among customer channel termination points;
(5) (A) "Customer" means the person or entity that contracts with the seller of a telecommunications service.
(B) If the end user of a telecommunications service is not the contracting party, the end user of the telecommunications service is the customer of the telecommunications service, but this subdivision (e)(5)(B) only applies for the purpose of sourcing sales of a telecommunications service under subsection (d) of this section.
(C) "Customer" does not include a reseller of telecommunications service or for mobile telecommunications service of a serving carrier under an agreement to serve the customer outside the home service provider's licensed service area;
(6) "Customer channel termination point" means the location where the customer either inputs or receives the communications;
(7) (A) "End user" means the person who utilizes the telecommunications service.
(B) In the case of an entity, "end user" means the individual who utilizes the telecommunications service on behalf of the entity;
(8) "Home service provider" means the same as that term is defined in the Mobile Telecommunications Sourcing Act, Pub. L. No. 106-252;
(9) (A) "International" means a telecommunications service that originates or terminates in the United States and terminates or originates outside the United States, respectively.
(B) United States includes the District of Columbia or a United States territory or possession;
(10) "Interstate" means a telecommunications service that originates in one (1) United States state or a United States territory or possession and terminates in a different United States state or a United States territory or possession;
(11) "Intrastate" means a telecommunications service that originates in one (1) United States state or a United States territory or possession and terminates in the same United States state or a United States territory or possession;
(12) "Mobile telecommunications service" means the same as that term is defined in the Mobile Telecommunications Sourcing Act, Pub. L. No. 106-252;
(13) (A) "Place of primary use" means the street address representative of where the customer's use of the telecommunications service primarily occurs, which must be the residential street address or the primary business street address of the customer.
(B) In the case of a mobile telecommunications service, "place of primary use" must be within the licensed service area of the home service provider;
(14) (A) "Postpaid calling service" means the telecommunications service obtained by making a payment on a call-by-call basis either through the use of a credit card or payment mechanism such as a bank card, travel card, credit card, or debit card or by charge made to which a telephone number which is not associated with the origination or termination of the telecommunications service.
(B) "Postpaid calling service" includes a telecommunications service, except a prepaid wireless calling service, that would be a prepaid calling service except it is not exclusively a telecommunications service;
(15) "Prepaid calling service" means the right to access exclusively telecommunications services, which must be paid for in advance and which enables the origination of calls using an access number or authorization code, whether manually or electronically dialed, and that is sold in predetermined units or dollars of which the number declines with use in a known amount;
(16) "Prepaid wireless calling service" means a telecommunications service that provides the right to utilize mobile wireless service as well as other nontelecommunications services, including the downloading of digital products delivered electronically, content, and ancillary services that must be paid for in advance and that is sold in predetermined units or dollars of which the number declines with use in a known amount;
(17) "Private communication service" means a telecommunications service that entitles the customer to exclusive or priority use of a communications channel or group of channels between or among termination points regardless of the manner in which the channel or channels are connected and includes switching capacity, extension lines, stations, and any other associated services that are provided in connection with the use of the channel or channels;
(18) (A) "Service address" means the location of the telecommunications equipment to which a customer's call is charged and from which the call originates or terminates regardless of where the call is billed or paid.
(B) If the location in subdivision (e)(18)(A) of this section is not known, "service address" means the origination point of the signal of the telecommunications service first identified by either the seller's telecommunications system or in information received by the seller from its service provider if the system used to transport the signals is not that of the seller.
(C) If the location in subdivisions (e)(18)(A) and (B) of this section is not known, "service address" means the location of the customer's place of primary use;
(19) (A) "Telecommunications service" means the electronic transmission, conveyance, or routing of voice, data, audio, video, or any other information or signals to a point or between or among points.
(B) "Telecommunications service" includes the transmission, conveyance, or routing in which computer processing applications are used to act on the form, code, or protocol of the content for purposes of transmission, conveyance, or routing without regard to whether the service is referred to as voice over Internet protocol services or is classified by the Federal Communications Commission as enhanced or value added.
(C) "Telecommunications service" does not include:
(i) Data processing and information services that allow data to be generated, acquired, stored, processed, or retrieved and delivered by an electronic transmission to a purchaser when the purchaser's primary purpose for the underlying transaction is the processed data or information;
(ii) Installation or maintenance of wiring or equipment on a customer's premises;
(iii) Tangible personal property;
(iv) Advertising, including but not limited to directory advertising;
(v) Billing and collection services provided to third parties;
(vi) Internet access service;
(vii) (a) Radio and television audio and video programming services, regardless of the medium, including the furnishing of transmission, conveyance, and routing of the services by the programming service provider.
(b) Radio and television audio and video programming services shall include but not be limited to cable service as defined in 47 U.S.C. § 522(6), as in effect on January 1, 2007, and audio and video programming services delivered by commercial mobile radio service providers, as defined in 47 C.F.R. § 20.3, as in effect on January 1, 2007;
(viii) Ancillary services; or
(ix) A digital product delivered electronically, including but not limited to software, music, video, reading material, or a ring tone;
(20) "800 service" means a telecommunications service that allows a caller to dial a toll-free number without incurring a charge for the call; and
(21) (A) "900 service" means an inbound toll telecommunications service purchased by a subscriber that allows the subscriber's customers to call in to the subscriber's prerecorded announcement or live service.
(B) "900 service" does not include:
(i) The charge for collection services provided by the seller of the telecommunications service to the subscriber; or
(ii) Service or product sold by the subscriber to the subscriber's customer.
(f) The Department of Finance and Administration shall promulgate rules to implement this section.
Section: Previous 26-52-304 26-52-305 26-52-306 26-52-307 26-52-308 26-52-309 26-52-314 26-52-315 26-52-316 26-52-317 26-52-318 26-52-319 26-52-320 26-52-321 26-52-322 NextLast modified: November 15, 2016