GENERAL ASSEMBLY OF NORTH CAROLINA

SESSION 1989

H	1 

HOUSE BILL 1936

Short Title:  Salaries/Educ. Study; Facilities/Tax.	(Public)
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Sponsors: Representative Watkins.
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Referred to:  Public Employees.
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May 10, 1989

A BILL TO BE ENTITLED
AN ACT TO PROVIDE ADDITIONAL FUNDS FOR A PAY INCREASE FOR STATE EMPLOYEES AND TEACHERS, TO PROVIDE ADDITIONAL FUNDS FOR SCHOOL FACILITIES, AND TO RAISE THE SALES TAX FOR TWO YEARS TO PAY FOR THE SAME, AND TO CREATE THE STUDY COMMISSION ON THE FUTURE OF EDUCATION IN ORDER TO PROVIDE PERMANENT FINANCING FOR THE FUTURE OF EDUCATION.
Whereas, the recent education initiatives in North Carolina were recommended and begun as a result of a blue ribbon study commission appointed by Governor James B. Hunt and an education policy and goals commission appointed by the Speaker of the House of Representatives and the Lieutenant Governor; and
Whereas, these initiatives and goals include the Basic Education Plan, the Lead Teacher Program, Dropout Prevention Programs, efforts to improve instruction and raise test scores, and other initiatives and goals; and
Whereas, ideas and concepts have already been developed to accomplish many of these initiatives and goals and some of these have already been tried in pilot programs and others are still being tried; and
Whereas, at this point it is advisable to determine which of the education initiatives and goals developed in recent years have proven themselves to be worthwhile and to determine whether and how these initiatives and goals should be implemented to improve the quality of education in North Carolina and become a part of North Carolina's future education system; and
Whereas, major new initiatives in education and major  improvements in the quality of education in North Carolina cannot be successfully undertaken without the advice of and the  informed and active support of the entire State, including legislators, business people, educators, and the public at large; and
Whereas, it is advisable that the General Assembly create a Commission made up of legislators, business people, educators, and the public at large and that this Commission hold public hearings throughout the State on these new initiatives and goals; and
Whereas, it is further advisable that such a Commission determine which of the new initiatives and goals should become a permanent part of our education system, when and how they should become a permanent part of our education system, and what should be a permanent source of funding for them; Now, therefore,
The General Assembly of North Carolina enacts:
PART I––-CREATION OF COMMISSION
Section 1.1.  The Study Commission on the Future of Education is created.  The Commission shall be located administratively within the Department of Public Education.  The Commission shall consist of 48 members appointed as follows:
(1)	Three legislators, three educators, three representatives of business or industry, and three citizens who are none of the above, appointed by the Governor;
(2)	Three legislators, three educators, three representatives of business or industry, and three citizens who are none of the above, appointed by the State Superintendent of Public Instruction;
(3)	Three legislators, three educators, three representatives of business or industry, and three citizens who are none of the above, appointed by the President Pro Tempore of the Senate; and
(4)	Three legislators, three educators, three representatives of business or industry, and three citizens who are none of the above, appointed by the Speaker of the House of Representatives.
Sec. 1.2.  The State Superintendent of Public Instruction shall designate a chairman of the Commission.
Sec. 1.3.  The Commission shall:
(1)	Study all recent education initiatives and goals;
(2)	Hold public hearings throughout the State on whether and how these initiatives and goals should be implemented; and
(3)	Determine which of these initiatives and goals should be implemented; how they should be implemented to improve the quality of the State education system and to prepare young people to be well-educated, productive citizens; and how they should be funded.
Sec. 1.4.  The Commission shall submit a final report of its findings and recommendations to the Governor, the State Superintendent of Public Instruction, and the General Assembly on or before January 1, 1991.  Upon filing its final report, the Commission shall terminate.
Sec. 1.5.   Members of the Commission who are legislators shall receive subsistence and travel expenses at the rates set forth in G.S. 120-3.1.  Members who are officials or employees of the State shall be paid subsistence and travel allowances at the rates set forth in G.S. 120-3.1.  Other members of the Commission shall be paid per diem, subsistence, and travel allowances at the rates established in G.S. 138-5.
Sec.  1.6.  The Commission may contract for professional, clerical, or consultant services as it deems appropriate.
Sec.  1.7. When a vacancy occurs in the membership of the Commission the vacancy shall be filled by the same appointing officer who made the initial appointment.
Sec.  1.8. All State departments and agencies and local governments and their subdivisions shall furnish the Commission with any information in their possession or available to them.
Sec.  1.9. There is appropriated from the General Fund to the General Assembly the sum of $1,000,000 for the 1989-90  fiscal year for the Study Commission on the Future of Education.
PART II––-FUNDS FOR PUBLIC SCHOOL FACILITIES
Sec. 2.1.  There is appropriated from the General Fund to the Office of State Budget and Management the sum of $206,650,000 for the 1989-90 fiscal year and the sum of $240,700,000 for the 1990-91 fiscal year for the Public School Building Capital Fund.
PART III––-PAY RAISE FOR STATE EMPLOYEES AND TEACHERS
Sec. 3.1.  There is appropriated from the General Fund to the Reserve for Salary Increases the sum of $206,650,000 for the 1989-90 fiscal year and the sum of $240,700,000 for the 1990-91 fiscal year to be used with other funds appropriated for this purpose to provide salary increases for State employees and public school teachers in equal amounts.
PART IV––-SALES TAX INCREASE
Sec. 4.1.  G.S. 105-164.4 reads as rewritten:
"§ 105-164.4.  Imposition of tax; retailer.
There is hereby levied and imposed, in addition to all other taxes of every kind now imposed by law, a privilege or license tax upon every person who engages in the business of selling tangible personal property at retail, renting or furnishing tangible personal property or the renting and furnishing of rooms, lodgings and accommodations to transients, in this State, the same to be collected and the amount to be determined by the application of the following rates against gross sales and rentals, to wit:
(1)	At the rate of four percent (4%) of the sales price of each item or article of tangible property when sold at retail in this State, the tax to be computed on total net taxable sales as defined herein but for the purpose of computing the amount due the State each and every taxable retail sale, or retail sales upon which the tax has been collected, or the amount of tax actually collected, whichever be greater and whether or not erroneously collected, shall be included in the computation of tax due the State. Provided, however, that in the case of the sale of any aircraft, railway locomotive, railway car or the sale of any motor vehicle or boat, the tax shall be only at the rate of two percent (2%) of the sales price, but at no time shall the maximum tax with respect to any one such aircraft, railway locomotive, railway car or motor vehicle or boat, including all accessories attached thereto at the time of delivery thereof to the purchaser, be in excess of three hundred dollars ($300.00).
		The separate sale of a new motor vehicle chassis and a new motor vehicle body to be installed thereon, whether by the same retailer or by different retailers shall be subject only to the tax herein prescribed with respect to a single motor vehicle. No tax shall be imposed upon a body mounted on the chassis of a motor vehicle which temporarily enters the State for the purpose of having such body mounted thereon by the manufacturer thereof.
		Notwithstanding G.S. 105-164.3(16) and regardless whether the seller is a retailer of motor vehicles, the sales price of a motor vehicle is the gross sales price of the motor vehicle less any allowance given for a motor vehicle taken in trade as part of the consideration for the purchased motor vehicle.
		The tax levied under this section applies to all retail sales of motor vehicles regardless whether the seller is engaged in business as a retailer of motor vehicles or whether a tax on the sale of the vehicle has previously been  paid under this Article. A purchaser of a motor vehicle from a retailer shall pay the tax imposed under this Article to the retailer, who is liable for collecting and remitting the tax to the Secretary. A purchaser of a motor vehicle is liable for payment of the tax imposed by this Article if the seller is not a retailer. The purchaser shall pay the tax to the Commissioner of Motor Vehicles when applying for a certificate of title for the vehicle. When property is transferred by an individual to a partnership or corporation, and no gain or loss arises as provided by Section 351 or Section 721 of the Code, such transfer is not a sale for the purpose of this subdivision if the transfer is incident to the organization of the partnership or corporation.
		When applying for a certificate of title, a purchaser of a motor vehicle from a seller who is not a retailer shall certify in writing the sales price of the purchased motor vehicle. A purchaser who knowingly makes a false certification of the sales price is guilty of a misdemeanor.
		The Commissioner of Motor Vehicles may not issue a certificate of title for a motor vehicle sold by a seller who is not a retailer unless the tax imposed by this section is paid when the purchaser of the vehicle applies for a certificate of title. The Commissioner shall remit taxes collected by him under this subsection to the Secretary.
		Persons who lease or rent motor vehicles shall collect and remit the tax imposed by this Article on the separate retail sale of a motor vehicle in addition to the tax imposed on the proceeds from the lease or rental of the motor vehicle.
		Provided further, the tax shall be only at the rate of one percent (1%) of the sales price on the following items:
	a.	Horses or mules by whomsoever sold.
	b.	Semen to be used in the artificial insemination of animals.
c.	Sales of fuel, other than electricity or piped natural gas, to farmers to be used by them for any farm purposes other than preparing food, heating dwellings and other household purposes. The quantity of fuel purchased or used at any one time shall not in any manner be a determinative factor as to whether any sale or use of fuel is or is not subject to the one percent (1%) rate of tax imposed herein.
	d.	Sales of fuel, other than electricity or piped natural gas, to manufacturing industries and manufacturing plants for use in connection with the operation of such industries and plants other than sales of fuels to be used for residential heating purposes. The quantity of fuel purchased or used at any one time shall not in any manner be a determinative factor as to whether any sale or use of fuel is or is not subject to the one percent (1%) rate of tax imposed herein.
	e.	Sales of fuel, other than electricity or piped natural gas, to commercial laundries or to pressing and dry-cleaning establishments for use in machinery used in the direct performance of the laundering or the pressing and  cleaning service.
	f.	Sales to freezer locker plants of wrapping paper, cartons and supplies consumed directly in the operation of such plant.
		Provided further, the tax shall be only at the rate of one percent (1%) of the sales price, subject to a maximum tax of eighty dollars ($80.00) per article, on the following items:
		g.	Sales of machines and machinery, whether animal or motor drawn or operated, and parts and accessories for such machines and machinery to farmers for use by them in the planting, cultivating, harvesting or curing of farm crops, and sales of machines and machinery and parts and accessories for such machines and machinery to dairy operators, poultry farmers, egg producers, and livestock farmers for use by them in the production of dairy products, poultry, eggs or livestock, except such machines, machinery, equipment, parts, and accessories that come within the provisions of G.S. 105-164.13(4c).
		The term ‘machines and machinery' as used in this subdivision is defined as follows:
		The term shall include all vehicular implements, designed and sold for any use defined in this subdivision, which are operated, drawn or propelled by motor or animal power, but shall not include vehicular implements which are operated wholly by hand, and shall not include any motor vehicles required to be registered under Chapter 20 of the General Statutes.
		The term shall include all nonvehicular implements and mechanical devices designed and sold for any use defined in this subdivision, which have moving parts, or which require the use of any motor or animal power, fuel, or electricity in their operation but shall not include nonvehicular implements which have no moving parts and are operated wholly by hand.
		The term shall also include metal flues sold for use in curing tobacco, whether such flues are attached to handfired furnaces or used in connection with mechanical burners.
		h.	Sales of mill machinery or mill machinery parts and accessories to manufacturing industries and plants, and sales to contractors and subcontractors purchasing mill machinery or mill machinery parts and accessories for use by them in the performance of contracts with manufacturing industries and plants, and sales to subcontractors purchasing mill machinery or mill machinery parts and accessories for use by them in the performance of contracts with general contractors who have contracts with manufacturing industries and plants. As used in this paragraph, the term "manufacturing industries and plants”does not include delicatessens, cafes, cafeterias, restaurants, and other similar retailers that are principally engaged in the retail sale of foods prepared by them for consumption on or off their premises.
	i.	Sales of central office equipment and switchboard and private branch exchange equipment to telephone companies regularly engaged in providing telephone service to subscribers on a commercial basis, and sales to these companies of prewritten computer programs used in providing telephone service to their subscribers.
	j.	Sales to commercial laundries or to pressing and dry cleaning establishments of machinery used in the direct performance of the laundering or the pressing and cleaning service and of parts and accessories thereto.
	k.	Sales to freezer locker plants of machinery used in the direct operation of said freezer locker plant and of parts and accessories thereto.
		l.	Sales of broadcasting equipment and parts and accessories thereto and towers to commercial radio and television companies which are under the regulation and supervision of the Federal Communications Commission.
		m.	Sales to farmers of bulk tobacco barns and racks and all parts and accessories thereto and similar apparatus used for the curing and drying of any farm produce.
		n.	Repealed by Session Laws 1987, c. 800, s. 2.
		o.	Sales to farmers of grain, feed or soybean storage facilities and accessories thereto, whether or not dryers are attached, and all similar apparatus and accessories thereto for the storage of grain, feed or soybeans.
		p.	Repealed by Session Laws 1983, c. 805, s. 2, effective July 1, 1983.
		q.	Sales of containers to farmers or producers for use in the planting, producing, harvesting, curing, marketing, packaging, sale, or transporting or delivery of their products when such containers do not go with and become part of the sale of their products at wholesale or retail.
(2)	At the rate of four percent (4%) of the gross proceeds derived from the lease or rental of tangible personal property as defined herein, where the lease or rental of such property is an established business, or the same is incidental or germane to said business; except that whenever a rate of less than four percent (4%) is applicable to a sale of property which is leased or rented, the lower rate of tax shall be due on such lease or rental proceeds.
(3)	Operators of hotels, motels, tourist homes, tourist camps, and similar type businesses and persons who rent private residences and cottages to transients are considered retailers under this Article.  There is levied upon every such retailer a tax of four percent (4%) of the gross receipts derived from the rental of any room or rooms, lodgings, or accommodations furnished to transients for a consideration.  This tax does not apply to any private residence or cottage that is rented for less than 15 days in a calendar year or to any room, lodging, or accommodation supplied to the same person for a period of 90 or more continuous days.
		As used in this subdivision, the term ‘persons who rent to transients' means (i) owners of private residences and cottages who rent to transients and (ii) rental agents, including ‘real estate brokers' as defined in G.S. 93A-2, who rent private residences and cottages to transients on behalf of the owners.  If a rental agent is liable for the tax imposed by this subdivision, the owner is not liable.
(4)	Every person, firm or corporation engaged in the business of operating a pressing club, cleaning plant, hat-blocking establishment, dry-cleaning plant, laundry (including wet or damp wash laundries and businesses known as launderettes and launderalls), or any similar-type business, or engaged in the business of renting clean linen or towels or wearing apparel, or any similar-type business, or engaged  in the business of soliciting cleaning, pressing, hat blocking, laundering or rental business for any of the aforenamed businesses, shall be considered "retailers”for the purposes of this Article. There is hereby levied upon every such person, firm or corporation a tax of four percent (4%) of the gross receipts derived from services rendered in  engaging in any of the occupations or businesses named in this subdivision, and every person, firm or corporation subject to the provisions of this subdivision shall register and secure a license in the manner hereinafter provided in this section, and, insofar as practicable, all other provisions of this Article shall be applicable with respect to the tax herein provided for. The tax imposed by this subdivision does not apply to receipts derived from coin or token-operated washing machines, extractors, and dryers.  The taxes levied in this subdivision are additional privilege or license taxes for the privilege of engaging in the occupations or businesses named herein. Any person, firm or corporation engaged in cleaning, pressing, hat blocking, laundering for, or supplying clean linen or towels or wearing apparel to, another person, firm or corporation engaged in soliciting shall not be required to pay the four percent (4%) tax on its gross receipts derived through such solicitor, if the soliciting person, firm or corporation has registered with the Department, secured the license hereinafter required and has paid the tax at the rate of four percent (4%) of the total gross receipts derived from business solicited.
(4a)	At the rate of three percent (3%) of the gross receipts derived by a utility from sales of electricity, piped natural gas, or local telecommunications service as defined by G.S. 105-120(a). A person who operates a utility is considered a retailer under this Article.
(4b)	A person who sells tangible personal property at a flea market, other than his own household personal property, is considered a retailer under this Article.  A tax is levied on that person at the rate of four percent (4%) of the sales price of each article sold by him at the flea market.  A person who leases or rents space at a flea market may not lease or rent this space unless the retailer requesting to rent or lease the space furnishes evidence that he has obtained the license required by this Article.  A person who leases or rents space at a flea market shall keep records of retailers to whom he has leased or rented space at the market.  As used in this subdivision, the term ‘flea market' means a place where space is rented to a person for the purpose of selling tangible personal property.
(4c)	At the rate of six and one-half percent (6 1/2%) of the gross receipts derived from providing toll telecommunications services or private telecommunications services as defined by G.S. 105-120(a) that both originate from and terminate in the State which are not subject to the privilege tax under G.S. 105-120.  Any business entity that provides the service outlined above is considered a retailer under this Article.  This subdivision shall not apply to telephone membership corporations as described in Chapter 117 of the General Statutes.
(5)	The said tax shall be collected from the retailer as defined herein and paid by him at the time and in the manner as hereinafter provided. Provided, however, that any person engaging or continuing in business as a retailer shall pay the tax required on the net taxable sales of such business at the rates specified when proper books are kept showing separately the gross proceeds of taxable and nontaxable sales of tangible personal property in such form as may be accurately and conveniently checked by the Secretary or his duly authorized agent. If such records are not kept separately the tax shall be paid as a retailer on the gross sales of business and the exemptions and exclusions provided by this Article shall not be allowed.
(6)	The tax so levied is and shall be in addition to all other taxes whether levied in the form of excise, license or privilege or other taxes.
(7)	Any person who shall engage or continue in any business for which a privilege tax is imposed by this Article shall immediately after July 1, 1979, apply for and obtain from the Secretary upon payment of the sum of five dollars ($5.00) a license to engage in and conduct such business upon the condition that such person shall pay the tax accruing to the  State of North Carolina under the provisions of this Article  and he shall thereby be duly licensed and registered to engage in and conduct such business. Except as hereinafter provided, a license issued under this subsection shall be a continuing license until revoked for failure to comply with the provisions of this Article. However, any person who has heretofore applied for and obtained such license, and such license was in force and effect as of July 1, 1979, shall not be required to apply for and obtain a new license.
   Any person who shall cease to be engaged in any business for which a privilege tax is imposed by this Article, and who shall remain continuously out of business for a period of five years shall apply for and obtain a new license from the  Secretary upon the payment of a tax of five dollars ($5.00),  and any license previously issued under this section shall be null, void and of no effect. The burden of proof after such period shall be upon the taxpayer to show that he did engage in such activity within the period, and that no new license is required.
		A retailer who sells tangible personal property at a flea market shall conspicuously display his sales tax license when making sales at the flea market."
Sec. 4.2.  105-164.6(1), (2), and (3) read as rewritten:
"(1)	At the rate of four percent (4%) of the cost price of each item or article of tangible personal property when the same is not sold but used, consumed, distributed or stored for use or consumption in this State; except that, whenever a rate of less than four percent (4%) is applicable under the sales tax schedule set out in G.S. 105-164.4 to the sale at retail of an item or article of tangible personal property, the same rate, and maximum tax if any, shall be used in computing any use tax due under this subdivision.  The separate sale of a new motor vehicle chassis and a new motor vehicle body to be installed thereon, whether by the same retailer or by different retailers, shall be subject only to the tax herein prescribed with respect to a single motor vehicle.
(2)	At the rate of four percent (4%) of the monthly lease or rental price paid by the lessee or rentee, or contracted or agreed to be paid by the lessee or rentee, to the owner of the tangible personal property; except that, whenever a rate of less than four percent (4%) is applicable under the sales tax schedule set out in G.S. 105-164.4 to the sale at retail of an item or article of tangible personal property, then the same rate, and maximum tax if any, shall be used in computing any use tax due under this subdivision.
(3)	There is hereby levied and there shall be collected from every person, firm, or corporation, an excise tax of four percent (4%) of the purchase price of all tangible personal property purchased or used which shall enter into or become a part of any building or other kind of structure in this State, including all materials, supplies, fixtures and equipment of every kind and description which shall be annexed thereto or in any manner become a part thereof.  Said tax shall be levied against the purchaser of such property.  Provided, that where the purchaser is a contractor, the contractor and owner shall be jointly and severally liable for said tax, but the liability of the owner shall be deemed satisfied if before final settlement between them the contractor furnishes to the owner an affidavit certifying that said tax has been paid.  Provided further, that where the purchaser is a subcontractor, the contractor and subcontractor shall be jointly and severally liable for said tax, but the liability of the contractor shall be deemed satisfied if before final settlement between them the subcontractor furnishes to the contractor an affidavit certifying that said tax has been paid."
Sec. 4.3.  G.S. 105-164.10 reads as rewritten:
"§ 105-164.10.  Retail bracket system.
For the convenience of the retailer in collecting the tax due at the rate of four percent (4%) and to facilitate the administration of this Article, every retailer engaged in or continuing within this State in a business for which a license, privilege or excise tax is required by this Article shall add to the sale price and collect from the purchaser on all taxable retail sales an amount equal to the following:
						(1)	No amount on sales of less than 10¢;
(2)	1¢ on sales of 10¢ through 29¢;
(3)	2¢ on sales of 30¢ through 59¢;
(4)	3¢ on sales of 60¢ through 84¢;
(5)	4¢ on sales of 85¢ through $1.12; and
(6)	Sales of over $1.12–straight four percent (4%) with major fractions governing.
Use of the above bracket does not relieve the retailer from the duty and liability to remit to the Secretary an amount equal to four percent (4%) of the gross receipts derived from all taxable retail sales subject to the four percent (4%) rate during the taxable period.
Whenever a sales or use tax is due at a rate of less than four percent (4%), the tax shall be computed by multiplying the sales or purchase price by the applicable rate and by rounding the result off to the nearest whole cent. The use of this method in computing the sales or use tax shall not relieve a taxpayer from the duty and liability of remitting to the Secretary an amount equal to the applicable rates times gross receipts subject to taxation at the lesser rates."
Sec. 4.4.  G.S. 105-164.13(18) reads as rewritten:
"(18)	Funeral expenses, including coffins and caskets, not to exceed one thousand five hundred dollars ($1,500).  All other funeral expenses, including gross receipts for services rendered, shall be taxable at the rate of four percent (4%).  However, ‘services rendered' shall not include those services which have been taxed pursuant to G.S. 105-164.4(4), or those services performed by any beautician, cosmetologist, hairdresser or barber employed by or at the specific direction of the family or personal representative of a deceased; and ‘funeral expenses' and ‘services rendered' shall not include death certificates procured by or at the specific direction of the family or personal representative of a deceased.  Where coffins, caskets or vaults are purchased direct and a separate charge is paid for services, the provisions of this subdivision shall apply to the total for both."
Sec. 4.5.  G.S. 105-465 reads as rewritten:
"§ 105-465. County election as to adoption of local sales and use tax.
The board of elections of any county, upon the written request of the board of county commissioners thereof, or upon receipt of a petition signed by qualified voters of the county equal in number to at least fifteen percent (15%) of the total number of votes cast in the county, at the last preceding election for the office of Governor, shall call a special election for the purpose of submitting to the voters of the county the question of whether a one percent (1%) sales and use tax as hereinafter provided will be levied.
The special election shall be held under the same rules and regulations applicable to the election of members of the General Assembly.  No new registration of voters shall be required. All qualified voters in the county who are properly registered not later than 21 days (excluding Saturdays and Sundays) prior to the election shall be entitled to vote at said election.  The county board of elections shall give at least 20 days' public notice prior to the closing of the registration books for the special election.
The county board of election shall prepare ballots for the special election which shall contain the words, ‘FOR the one percent (1%) local sales and use tax only on those items presently covered by the four percent (4%) sales and use tax,' and the words, ‘AGAINST the one percent (1%) local sales and use tax only on those items presently covered by the four percent (4%) sales and use tax,' with appropriate squares so that each voter may designate his vote by his cross (X) mark.
The county board of elections shall fix the date of the special election; provided, however, that the special election shall not be held on the date of any biennial election for county officers, nor within 60 days thereof, nor within one year from the date of the last  preceding special election under this section."
Sec. 4.6.  G.S. 105-467 reads as rewritten:
"§ 105-467.  Sales tax imposed; limited to items on which the State now imposes a four percent sales tax.
The sales tax which may be imposed under this Article is limited to a tax at the rate of one percent (1%) of:
(1)	The sales price of those articles of tangible personal property now subject to the four percent (4%) sales tax imposed by the State under G.S. 105-164.4(1);
(2)	The gross receipts derived from the lease or rental of tangible personal property where the lease or rental of such  property is an established business now subject to the four percent (4%) sales tax imposed by the State under G.S. 105-164.4(2);
(3)	The gross receipts derived from the rental of any room or lodging furnished by any hotel, motel, inn, tourist camp or other similar accommodations now subject to the four percent (4%) sales tax imposed by the State under G.S. 105-164.4(3); and
(4)	The gross receipts derived from services rendered by laundries, dry cleaners, cleaning plants and similar type businesses now subject to the four percent (4%) sales tax imposed by the State under G.S. 105-164.4(4).
The sales tax authorized by this Article does not apply to sales by a utility of electricity, piped natural gas, local, toll, or private telecommunications services as defined by G.S. 105-120(a).
The exemptions and exclusions contained in G.S. 105-164.13 and the refund provisions contained in G.S. 105-164.14 shall apply with equal force and in like manner to the local sales and use tax authorized to be levied and imposed under this Article.  A taxing county shall have no authority, with respect to the local sales and use tax imposed under this Article to change, alter, add to or delete any refund provisions contained in G.S. 105-164.14, or any exemptions  or exclusions contained in G.S. 105-164.13 or which are elsewhere provided for.
The local sales tax authorized to be imposed and levied under the provisions of this Article shall be applicable to such retail sales, leases, rentals, rendering of services, furnishing of rooms, lodgings or accommodations and other taxable transactions which are made, furnished or rendered by retailers whose place of business is located  within the taxing county.  The tax imposed shall apply to the furnishing of rooms, lodging or other accommodations within the county which are rented to transients.  For the purpose of this Article, the situs of a transaction is the location of the retailer's place of business."
Sec. 4.7.  G.S. 105-468 reads as rewritten:
"§ 105-468. Use tax imposed; limited to items upon which the State now imposes a four percent use tax.
The use tax which may be imposed under this Article shall be at the rate of one percent (1%) of the cost price of each item or article of tangible personal property when the same is not sold but used, consumed or stored for use or consumption in the taxing county, except that no tax shall be imposed upon such tangible personal property when, if the property were subject to the use tax imposed by G.S. 105-164.6, such property would be taxed by the State of North Carolina at a rate less than four percent (4%).
Every retailer engaged in business in this State and in the taxing county and required to collect the use tax levied by G.S. 105-164.6 shall also collect the one percent (1%) use tax when such property is to be used, consumed or stored in the taxing county, said one percent (1%) use tax to be collected concurrently with the State's use tax; but no retailer not required to collect the use tax levied by G.S. 105-164.6 shall be required to collect the one percent (1%) use tax.  The use tax contemplated by this section shall be levied against the purchaser, and his liability for such use tax shall be extinguished only upon his payment of the use tax to the retailer, where the retailer is required to collect the tax, or to the Secretary of Revenue, or to the taxing county, as appropriate, where the retailer is not required to collect the tax.
Where a local sales or use tax has been paid with respect to said tangible personal property by the purchaser thereof, either in another taxing county within the State, or in a taxing jurisdiction outside the State where the purpose of the tax is similar in purpose and intent to the tax which may be imposed pursuant to this Article, said tax may be credited against the tax imposed under this section by a taxing county upon the same property.  If the amount of sales or use tax so paid is less than the amount of the use tax due the taxing county under this section, the purchaser shall pay to the Secretary of Revenue or to the taxing county, as appropriate, an amount equal to the difference between the amount so paid in the other taxing county or jurisdiction and the amount due in the taxing county hereunder.  The Secretary of Revenue or the taxing county, as appropriate, may require such proof of payment in another taxing county or jurisdiction as is deemed to be necessary and proper.  The use tax levied hereunder shall not be subject to credit for payment of any State sales or use tax not imposed for the benefit and use of counties and municipalities.  No credit shall be given under this section for sales or use taxes paid in a taxing jurisdiction outside this State if that taxing jurisdiction does not grant similar credit for sales taxes paid under this Article."
Sec. 4.8.  G.S. 105-470 reads as rewritten:
"§ 105-470. Retail bracket system; application to local sales and use tax.
For the convenience of the retailer in collecting the State sales or use tax due at the rate of four percent (4%) and the local sales or use tax due at the rate of one percent (1%), and to facilitate the administration of this Article, every retailer engaged in or continuing in business in any county wherein the tax imposed and levied herein shall be applicable, is required by this Article to add to the sales price and collect from the purchaser on all taxable sales an amount equal to the following:
(1)	No amount on sales of less than 9¢;
(2)	1¢ on sales of 9¢ through 23¢;
(3)	2¢ on sales of 24¢ through 48¢;
(4)	3¢ on sales of 49¢ through 67¢;
(5)	4¢ on sales of 68¢ through 85¢;
(6)	5¢ on sales of 86¢ through $1.09; and
(7)	Sales of over $1.09–straight five percent (5%) with major fractions governing.
The use of the bracket system, set out above, shall not relieve the retailer from the duty and liability of collecting and remitting to the Secretary of Revenue, or to a taxing county, as appropriate, an amount equal to the tax imposed by the taxing county under this Article."
Sec. 4.9.  G.S. 105-485 reads as rewritten:
"§ 105-485. Retail collection bracket.
The following bracket applies to collections by retailers in a county that levies additional sales and use taxes under this Article:
							(1)	No amount on sales of less than 9¢;
(2)	1¢ on sales of 9¢ through 21¢;
(3)	2¢ on sales of 22¢ through 43¢;
(4)	3¢ on sales of 44¢ through 61¢;
(5)	4¢ on sales of 62¢ through 78¢;
(6)	5¢ on sales of 79¢ through 96¢;
(7)	6¢ on sales of 97¢ through $1.18; and
(8)	Sales of over $1.18–straight five and one-half percent (5-1/2%) with major fractions governing."
Sec. 4.10.  G.S. 105-492 reads as rewritten:
"§ 105-492. Retail collection bracket.
The following bracket applies to collections by retailers in a county that levies sales and use taxes under this Article:
						(1)	No amount on sales of less than 10¢;
(2)	1¢ on sales of 10¢ through 25¢;
(3)	2¢ on sales of 26¢ through 53¢;
(4)	3¢ on sales of 54¢ through 75¢;
(5)	4¢ on sales of 76¢ through 95¢;
(6)	5¢ on sales of 96¢ through $1.22; and
(7)	Sales of over $1.22–straight four and one-half percent (4-1/2%) with major fractions governing."
Sec. 4.11.  G.S. 105-500 reads as rewritten:
"§ 105-500. Retail collection bracket.
The following bracket applies to collections by retailers in a county that levies additional sales and use taxes under this Article:
							(1)	No amount on sales of less than 9¢;
(2)	1¢ on sales of 9¢ through 19¢;
(3)	2¢ on sales of 20¢ through 39¢;
(4)	3¢ on sales of 40¢ through 56¢;
(5)	4¢ on sales of 57¢ through 71¢;
(6)	5¢ on sales of 72¢ through 88¢;
(7)	6¢ on sales of 89¢ through $1.08; and
(8)	Sales of over $1.08–straight six percent (6%) with major fractions governing."
Sec. 4.12.  Chapter 1096 of the 1967 Session Laws, as amended, is further amended as follows:
(1)	By deleting the phrases "THREE PER CENT", "three per cent (3%)", "Three Per Cent (3%)", "Three Percent (3%)", and "three percent (3%)”wherever they appear and substituting the phrase "FOUR PERCENT (4%)", "four percent (4%)", or "Four Percent (4%)", as appropriate; and
(2)	By deleting the tax table at the end of the first paragraph of Section 7 and substituting the following new table to read:
"(1)	No amount on sales of less than 9¢;
(2)	1¢ on sales of 9¢ through 23¢;
(3)	2¢ on sales of 24¢ through 48¢;
(4)	3¢ on sales of 49¢ through 67¢;
(5)	4¢ on sales of 68¢ through 85¢;
(6)	5¢ on sales of 86¢ through $1.09; and
(7)	Sales of over $1.09–straight five percent (5%) with major fractions governing."
Sec. 4.13.  (a)	Approval under the Local Government Sales and Use Tax Act, Article 39 of Chapter 105 of the General Statutes, or under the Mecklenburg County Sales and Use Tax Act, Chapter 1096 of the 1967 Session Laws, as amended, of one percent (1%) local sales and use taxes in addition to the three percent (3%) State sales and use taxes constitutes approval of one percent (1%) local sales and use taxes in addition to the four percent (4%) State sales and use taxes.
(b)	Approval under the Supplemental Local Government Sales and Use Tax Act, Article 40 of Chapter 105 of the General Statutes, of one-half percent (1/2%) local sales and use taxes in addition to the one percent (1%) local sales and use taxes and three percent (3%) State sales and use taxes constitutes approval of one-half percent (1/2%) local sales and use taxes in addition to the one percent (1%) local sales and use taxes and the four percent (4%) State sales and use taxes.
(c)	Approval under the Alternative Local Government Sales and Use Tax Act, Article 41 of Chapter 105 of the General Statutes, of one-half percent (1/2%) local sales and use taxes in addition to the three percent (3%) State sales and use taxes constitutes approval of one-half percent (1/2%) local sales and use taxes in addition to the four percent (4%) State sales and use taxes.
(d)	Approval under the Additional Supplemental Local Government Sales and Use Tax Act, Article 42 of Chapter 105 of the General Statutes, of one-half percent (1/2%) local sales and use taxes in addition to the one and one-half percent (1-1/2%) local sales and use taxes and three percent (3%) State sales and use taxes constitutes approval of one-half percent (1/2%) local sales and use taxes in addition to the one and one-half percent (1-1/2%) local sales and use taxes and the four percent (4%) State sales and use taxes.
PART V––-EFFECTIVE DATE
Sec. 5.1. Sections 4.1 through 4.13 of this act shall become effective July 1, 1989, shall apply to sales made on or after that date, and shall expire June 1, 1991. The remainder of this act shall become effective July 1, 1989.