2022 Utah Legislative Update – Week 2 | What Local, Independent Business Owners Need to Know
By Carol Elliott (UIBC Advocacy Chair) and Jon Parry (UIBC Advocacy Co-Chair) | January 30, 2022
UIBC Reports on the 2022 Legislative Session
We report here regarding the second week of the 2022 Session of the Utah Legislature. UIBC is providing a series of weekly reports during the 2022 legislative session for our UIBC members and friends pertaining to legislation affecting our state’s local, independent businesses. To see an updated running list of bills we are watching, click here.
Be Informed and Get Involved!
UIBC encourages everyone to both keep informed about the legislature’s work and, even more importantly, communicate with your individual senators and representatives to voice your opinion on the legislative bills being considered.
Visit the Utah Legislature’s website at https://le.utah.gov/ to get access to all the bills, committee hearings, and contact information for all the legislators. You can watch and listen to legislative committee and floor proceedings in real time or view proceedings from finished meetings using the website’s streaming portal here. Identify and get contact information for all the legislators here.
It is more critical than ever to be informed of and be involved in the Utah state legislative process. In the past few years, the Utah legislature has assumed more pure power and authority than it has ever before in the history of this state. Its power now overshadows the previous balance that had existed among the state legislature, the governor’s office, and local county and city governments. We at UIBC are frankly very concerned about this shift in power to the state legislature and its impact on both our local, independent businesses and the communities they serve. Read more about this increase in the legislature’s power here. If we as citizens of this state aren’t actively communicating with and advocating to our legislators, they will proceed to govern anyway, and we will have to live with the results.
Summary of New Developments and Proposed Legislation Affecting Utah Local, Independent Businesses
This past week, one significant bill not directly related to independent, local businesses that caught much news attention, but was ultimately withdrawn after strong public opposition was HB234.That bill, sponsored by South Jordan Representative Rep. Jordan Teuscher would have required public school teachers to publicly post their classroom curriculum a minimum of 30 days before use in the classroom. The Utah Education Association and other members of the public strongly opposed the bill. This serves as a good example of how Utah citizens can, with a little effort, influence the outcomes of legislation.
It appears that some version of a very small state income tax reduction will be approved, as the Utah Senate on Friday passed SB59. That bill, which one of a few that are focused on an income tax cut, now goes to the House of Representatives for consideration, would lower the state income tax rate for individuals and businesses to 4.85% from 4.95%. What we believe to be of more practical importance in that same tax bill is an additional provision making some business supplies exempt from the personal property tax. SB59 provides that “supplies” that would be exempt from business personal property taxes would include tangible personal property that isn’t held for sale, is either carried on hand and for which no record of consumption is taken in ordinary business or which is typically used up within the calendar year; and is used in the provision of the taxpayer’s business activity. “Supplies” would include office, shipping, and maintenance supplies, replacement parts, and other items consumed in the course of operating a business. We believe most UIBC members and friends would welcome the exclusion of supplies from the personal property tax, and UIBC supports this part of the bill.
HB 199, sponsored by Rep. Robert Spendlove, would remove the current requirement that a taxpayer file a signed statement after the first calendar year in which a taxpayer qualifies for a property tax exemption for tangible personal property if the taxpayer continues to qualify for the exemption for consecutive subsequent years. In light of the administrative burden compliance with the personal property tax imposes on our small businesses, UIBC supports this bill.
HB 202, sponsored by Rep. Mark Wheatley, would prohibit employers from asking for information regarding an applicant’s current or previous compensation from the applicant or the applicant’s current or previous employer. This bill raises a number of important questions, and UIBC will continue to monitor it.
HB 203, sponsored by Rep. Judy Weeks Rohner, is a new proposed bill that would remove the tax on food in Utah. HB 165 also has the same general purpose. The general assumption is that the bills eliminating sales tax on food have public support, and the notion of removing the sales tax on food has even been supported by Governor Cox. However, there appears to be less than strong support from the majority of legislators currently to pass the bills. We will monitor their progress.
On the Senate side of the Legislature this week, SB 125, sponsored by Sen. Wayne Harper, would establish a claim a refundable state income tax credit equal to $1,250 for the 2022 tax year for food service employees working in restaurants and bars if they work a minimum of 1,560 hours in such food service positions during the year. This would be a one-time tax credit and would require the certification of hospitality industry employers for the employees to claim the individual tax credit. UIBC supports this bill.
Other House Bills We Are Watching
HB 35 Economic Development Modifications [click here to see the bill]
HB 44 Business And Labor Reporting Requirements [click here to see the bill]
This bill includes adjustments to Workers Compensation statute.
H.B. 57 Government Records Access Amendments [click here to see the bill]
This bill would essentially protect a government official from having a personal device searched for a public record even though the proposed statute confirms that a public record can be determined to be saved on a personal device.
H.B. 60 Vaccine Passport Amendments [click here to see the bill]
This bill appears to prohibit an employer from requiring an employee to obtain a vaccine.
H.B. 146 Food Truck Licensing Amendments [click here to see the bill]
H.B. 156 Sales and Use Tax Refund Amendments [click here to see the bill]
This bill would enact a refund of the sales and use tax paid pertaining to purchase or lease of machinery, equipment, normal operating repair or replacement parts, or materials, by an oil and gas extraction establishment or a pipeline transportation establishment. UIBC strongly opposes this bill, as it is designed to specially favor the oil and gas industry. UIBC member businesses would continue to owe their sales and use taxes.
H.B. 165 Food Sales Tax Amendments [click here to see the bill]
This bill would remove the sales tax on food.
NEW! H.B. 199 Tangible Personal Property Tax Amendments [click here to see the bill]
This bill removes the current requirement that a taxpayer file a signed statement after the first calendar year in which a taxpayer qualifies for a property tax exemption for tangible personal property if the taxpayer continues to qualify for the exemption for consecutive subsequent years.
H.B. 202 Employment Selection Procedures Act [click here to see the bill]
This bill would prohibit an employer from asking for a prospective employee’s compensation history.
H.B. 203 Food Sales Tax Modifications [click here to see the bill]
This bill would also eliminate the state sales tax on food.
Senate Bills We Are Watching
S.B. 16 Licensing Amendments [click here to see the bill]
This bill establishes a professional license review process to occur every 10 years.
S.B. 26 Division of Consumer Protection Amendments [click here to see the bill]
This bill alters provisions pertaining to franchise business opportunities.
S.B. 39 Mobile Workforce Income Tax Amendments [click here to see the bill]
This bills appears to eliminate income tax on out of state persons who work 20 or fewer days in UT.
S.B. 93 Business Tax Amendments [click here to see the bill]
This will would exempt supplies used in the course of business from personal property tax; exempt certain tangible personal property consumed in the performance of a taxable service from sales and use tax; and exempt certain tangible personal property used or consumed in the production or development of taxable computer software from sales and use tax. UIBC would favor this bill.
S.B. 95 Limitations on Employer Liability [click here to see the bill]
This bill addresses liability of an employer for negligently hiring, or failing to adequately
supervise, an employee that has been previously convicted of an offense.
New! S.B. 125 Hospitality Employee Tax Credit [click here to see the bill]
This bill would allow restaurant and bar employees to claim a one-time $1,250 state income tax credit if they work a minimum of 1,560 hours during 2022.
UIBC will be posting regular updates on which bills are up for consideration, which bills pass, etc. If you receive email updates from UIBC, keep and eye on your email for updates. If you don’t already receive our emails, click here to subscribe for free.