A BILL TO BE ENTITLED
AN ACT to provide for a sales tax discount for merchants.
The General Assembly of North Carolina enacts:
SECTION 1.  G.S. 105‑164.21 is reenacted and rewritten to read:
"§ 105‑164.21.  Merchant's discount.
(a)	Amount. – Except as provided in subsection (b) of this section, a retailer who pays the retail sales or use tax imposed by this Article may deduct from the amount of the tax paid a discount of one percent (1%).
(b)	Restrictions. – The Secretary may deny a retailer the benefit of this section for failure to pay the full tax when due as well as in cases of fraud, evasion, or failure to keep accurate and clear records as required by this Article. In order to receive the discount provided in this section, a retailer must deduct the discount when it remits the tax to the Department. A retailer who sells electricity, telecommunications services, or ancillary services may not deduct the discount provided in this section on sales of electricity, telecommunications services, or ancillary services."
SECTION 2.  G.S. 105‑164.21(a) reads as rewritten:
"(a)	Amount. – Except as provided in subsection (b) of this section, a retailer who pays the retail sales or use tax imposed by this Article may deduct from the amount of the tax paid a discount of two percent (2%)."
SECTION 3.  G.S. 105‑164.21(a) reads as rewritten:
"(a)	Amount. – Except as provided in subsection (b) of this section, a retailer who pays the retail sales or use tax imposed by this Article may deduct from the amount of the tax paid a discount of three percent (3%)."
SECTION 4.  G.S. 105‑474 reads as rewritten:
"§ 105‑474.  Administration and construction of Article.
This Article shall be administered consistently with Article 5 of this Chapter to the extent practicable. The merchant's discount provided in G.S. 105‑164.21 does not apply to this Article. The remaining provisions of Articles 5 and 9 of this Chapter apply to this Article to the extent they are consistent with this Article.
"
SECTION 5.  The first sentence of Section 10 of Chapter 1096 of the 1967 Session Laws is amended by adding after the word 'Act' the phrase ', other than G.S. 105‑164.21,'.
SECTION 6.  G.S. 105‑187.5(d) reads as rewritten:
"(d)	Administration. – The Division shall notify the Secretary of Revenue of a retailer who makes the election under this section. A retailer who makes this election shall report and remit to the Secretary the tax on the gross receipts of the lease or rental of the motor vehicle. The Secretary shall administer the tax imposed by this section on gross receipts in the same manner as the tax levied under G.S. 105‑164.4(a)(2). The administrative provisions and powers of the Secretary that apply to the tax levied under G.S. 105‑164.4(a)(2) apply to the tax imposed by this section. The merchant's discount provided in G.S. 105‑164.21 does not apply to this section.
The Division may request the Secretary to audit a retailer who elects to pay tax on gross receipts under this section. When the Secretary conducts an audit at the request of the Division, the Division shall reimburse the Secretary for the cost of the audit, as determined by the Secretary. In conducting an audit of a retailer under this section, the Secretary may audit any sales of motor vehicles made by the retailer."
SECTION 7.  G.S. 105‑187.17 reads as rewritten:
"§ 105‑187.17.  Administration.
(a)	Retail Sale or Use. – The privilege tax this Article imposes on a tire retailer who sells new tires at retail is an additional State sales tax and the excise tax this Article imposes on the storage, use, or consumption of a new tire in this State is an additional State use tax. Except as otherwise provided in this Article, these taxes shall be collected and administered in the same manner as the State sales and use taxes imposed by Article 5 of this Chapter. As under Article 5 of this Chapter, the additional State sales tax paid when a new tire is sold is a credit against the additional State use tax imposed on the storage, use, or consumption of the same tire.
(b)	Wholesale Sale or Use. – The privilege tax this Article imposes on a tire retailer and on a tire wholesale merchant who sell new tires for placement in this State on a vehicle offered for sale, lease, or rental is a tax on the wholesale sale of the tires. This tax and the excise tax this Article imposes on a new tire purchased for placement in this State on a vehicle offered for sale, lease, or rental shall, to the extent practical, be collected and administered as if they were additional State sales and use taxes. The privilege tax paid when a new tire is sold for placement on a vehicle offered for sale, lease, or rental is a credit against the use tax imposed on the purchase of the same tire for placement in this State on a vehicle offered for sale, lease, or rental.
(c)	Discount. – The merchant's discount provided in G.S. 105‑164.21 does not apply to this Article."
SECTION 8.  G.S. 105‑187.22 reads as rewritten:
"§ 105‑187.22.  Administration.
The privilege tax this Article imposes on a white goods retailer is an additional State sales tax and the excise tax this Article imposes on the storage, use, or consumption of a new white good in this State is an additional State use tax. Except as otherwise provided in this Article, these taxes shall be collected and administered in the same manner as the State sales and use taxes imposed by Article 5 of this Chapter. As under Article 5 of this Chapter, the additional State sales tax paid when a new white good is sold at retail is a credit against the additional State use tax imposed on the storage, use, or consumption of the same white good. The merchant's discount provided in G.S. 105‑164.21 does not apply to this Article."
SECTION 9.  G.S. 105‑187.32 reads as rewritten:
"§ 105‑187.32.  Administration.
The privilege tax this Article imposes on a dry‑cleaning solvent retailer is an additional State sales tax, and the excise tax this Article imposes on the storage, use, or consumption of dry‑cleaning solvent by a dry‑cleaning facility in this State is an additional State use tax. Except as otherwise provided in this Article these taxes shall be collected and administered in the same manner as the State sales and use taxes imposed by Article 5 of this Chapter. The merchant's discount provided in G.S. 105‑164.21 does not apply to this Article. As under Article 5 of this Chapter, the additional State sales tax paid when dry‑cleaning solvent is sold at retail is a credit against the additional State use tax imposed on the storage, use, or consumption of the same dry‑cleaning solvent."
SECTION 10.  Section 1 of this act becomes effective July 1, 2009.  Sections 4 through 9 apply to returns filed on or after that date.  Section 2 of this act becomes effective January 1, 2010. Section 3 of this act becomes effective January 1, 2011.  The remainder of this act is effective when it becomes law.