WeVote
Log In

Bill

Bill

HF 171

Amusement device gross receipts tax created, amusement devices removed from the definition of sale and purchase for the sales and use tax, and technical changes made.

2025-2026 Regular Session Introduced by Greg Davids

Minnesota would impose a new gross receipts tax on amusement devices, removing them from the sales/use tax and changing how operators report and remit taxes.

Introduction and first reading, referred to Taxes
#taxation #taxation-salesanduse
0
WeVote Research Nonpartisan
Bill Summary · HF 171

Summary of HF 171 (Session 2025-2026) — Minnesota

Purpose and Objective

HF 171 proposes an overhaul of Minnesota’s taxation on amusement devices and related sales and use tax rules. The core aims appear to be:
- Establishing a new gross receipts tax on amusement devices.
- Reclassifying amusement devices so they are not treated as sales for purposes of the existing sales and use tax.
- Implementing technical changes to align tax administration with the new structure.

The bill is sponsored by Rep. Greg Davids (Co-sponsor) and was introduced on February 10, 2025, and referred to the House Taxes Committee.

Key Provisions (What the bill would change)

  1. Amusement Device Gross Receipts Tax

    • Creates a new tax on gross receipts from amusement devices.
    • Details such as the tax rate, the tax base, exemptions, administrative procedures, and collection mechanisms would be specified in the bill, though the summary here does not include the exact rate or thresholds.

  2. Amusement Devices Removed from the Sales and Use Tax Definition

    • Amusement devices would be removed from the definition of “sale” or “purchase” for purposes of Minnesota’s sales and use tax.
    • This means the current sales and use tax framework would not apply to transactions involving amusement devices, shifting the tax burden to the new gross receipts tax rather than the sales tax.

  3. Technical and Administrative Changes

    • The bill includes technical provisions to implement and administer the new gross receipts tax.
    • Likely addresses: registration, reporting, remittance schedules, withholding or payment timelines, and penalties for noncompliance.
    • May include conformity updates with other tax statutes and cross-references to ensure cohesive administration.

Who Is Affected

  • Amusement Device Operators/Owners: Businesses that operate or supply amusement devices (e.g., coin-operated machines, arcade devices, or similar entertainments) would be directly subject to the new gross receipts tax.
  • Customers/Consumers: Indirectly affected through the pricing of amusements; price changes could reflect the new tax burden.
  • Tax Administrators/State Revenue Department: Would implement new collection, reporting, and enforcement mechanisms, and adjust IT systems, forms, and guidance.

Procedural and Timeline Considerations

  • Introduction and Referral: Filed January 2025, introduced February 10, 2025, and referred to the House Taxes Committee.
  • Next Steps in Schedule: The bill would move through committee hearings, potential amendments, and floor votes. If advanced, it would require passage by both chambers (House and Senate) and gubernatorial signature to become law.
  • Effective Date: Any enacted provisions would specify an effective date (often a future date or phased implementation), as well as possible transitional rules for existing amusements and contracts.

Practical Implications

  • The shift from sales/use tax treatment to a gross receipts tax on amusements could alter the effective tax rate experienced by operators and may influence pricing strategies, maintenance of devices, and investment in new amusements.
  • Businesses would need to adapt compliance processes, including new reporting forms, payment timing, and potential apportionment rules if multi-jurisdictional operations exist.
  • Government revenue would be affected by the new tax base and rate, with potential earmarking or general fund implications as specified in the bill.

If you’d like, I can tailor this summary to include any available fiscal notes, estimated revenue impacts, or a side-by-side comparison with current Minnesota tax treatment of amusements.

Compiled from official sources — confirm details with the bill’s official record.

Sign in to ask a question.