The services to be taxed under legislature’s overhaul

SALT LAKE CITY — In a special session called Thursday night by Utah Gov. Gary Herbert, the Utah Legislature passed sweeping tax reform, which includes an income tax cut and adding sales taxes to groceries and gas.

But the passage of this tax reform bill represents an effort that started during the last legislative session — almost a year ago — as an effort to get more revenue by adding sales taxes to services.

At that time almost every service in Utah was on the list. But after months of discussion, input and feedback, the list was trimmed to what bill sponsors deemed necessary and unnecessary.

Now the list of services to be taxed includes: pet boarding and pet grooming, Uber and Lyft rides, streaming media, dating referral services, towing, ambulance services, sightseeing transportation, parking lots and garages, and identify theft protection.

And that’s not all.

The sales tax exemptions will be removed from: textbooks purchased off campus, certain car washes, vending machines, newspapers and electricity to ski resorts for the lifts.

State Senator Lyle Hillyard said this week he thought more services should be taxed, and that this list did not go far enough. Others said the task force would look at further changes.

Supporters said sales tax revenues lagged behind income tax, and consumer spending has shifted away from goods and towards more services.

There are also interesting changes coming as to how gas tax is configured, as legislators see that resources as a changing source of revenue. It appears for example that after 2025, drivers who use the HOV or carpool lanes will be required to have at least 3 people in their car to qualify. That, or pay for a toll or decal.

You can see the bullet points as outlined by legislative staff in this document: 4th SUB Tax Restructuring Revisions Summary 12-12-2019-final

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