Purpose of the Bill

The bill aims to modify the tax treatment of certain gambling activities in Minnesota, specifically focusing on "pulltabs" and "electronic pulltabs," which are forms of charitable gambling.

Main Provisions

• Separate Taxation for Pulltabs: The bill proposes the removal of pulltabs and electronic pulltabs from the existing combined net receipts tax base. This means they will no longer be taxed as part of a collective group of games.

• New Tax Structure: It introduces a separate taxation system specifically for pulltabs and electronic pulltabs. This aims to provide clarity and potentially a more equitable taxation framework for these popular gambling formats.

• Definition Modification: The bill includes changes to the current definitions under Minnesota Statutes to reflect these adjustments. Particularly, it modifies the definition of "gross receipts," which pertains to the total amount derived from all gambling activities before deductions.

Significant Changes to Existing Law

• Gross Receipts Definition: This change seeks to adjust what constitutes gross receipts by specifying what is included and excluded in this category concerning charitable gambling. Notably, it affirms that rental proceeds from premises owned by gambling organizations are not counted as part of gross receipts.

• Tax Base Adjustments: By separating pulltabs and electronic pulltabs from the combined net receipts tax base, the bill fundamentally alters how these activities are financially reported and taxed, affecting both charities and other organizations involved in such activities.

Relevant Terms

• Charitable gambling
• Pulltabs
• Electronic pulltabs
• Gross receipts
• Tax base
• Lawful gambling
• Gambling proceeds