Amends existing law to exempt sales to or purchases by the Salvation Army.

LEGISLATURE OF THE STATE OF IDAHO Sixty-eighth Legislature Second Regular Session - 2026 IN THE HOUSE OF REPRESENTATIVES HOUSE BILL NO. 732 BY REVENUE AND TAXATION COMMITTEE AN ACT1 RELATING TO SALES AND USE TAX; AMENDING SECTION 63-3622O, TO PROVIDE A SALES2 AND USE TAX EXEMPTION FOR DONATIONS TO, SALES TO, OR PURCHASES BY THE3 SALVATION ARMY AND TO MAKE TECHNICAL CORRECTIONS; AND DECLARING AN4 EMERGENCY AND PROVIDING AN EFFECTIVE DATE.5

Be It Enacted by the Legislature of the State of Idaho:6

SECTION 1. That Section 63-3622O, Idaho Code, be, and the same is hereby7 amended to read as follows:8 63-3622O. EXEMPT PRIVATE AND PUBLIC ORGANIZATIONS. (1) There are ex-9 empted from the taxes imposed by this chapter:10 (a) Sales to or purchases by hospitals, health-related entities, edu-11 cational institutions, forest protective associations and canal compa-12 nies that are nonprofit organizations; and13 (b) Donations to, sales to, and purchases by the Idaho Foodbank Ware-14 house, Inc.; and15 (c) Donations to, sales to, and purchases by food banks or soup kitchens16 of food or other tangible personal property used by food banks or soup17 kitchens in the growing, storage, preparation or service of food, but18 not including motor vehicles or trailers; and19 (d) Sales of clothes to, donations of clothes to, and purchases of20 clothes by nonsale clothiers; and21 (e) Sales to or purchases by centers for independent living; and22 (f) Sales to or purchases by the state of Idaho and its agencies and its23 political subdivisions; and24 (g) Sales to or purchases by volunteer fire departments or licensed25 emergency medical service agencies; and26 (h) Sales to or purchases by a qualifying senior citizen center; and27 (i) Sales to or purchases by the Blind Services Foundation, Inc.; and28 (j) Donations to, sales to or purchases by the Advocates for Survivors29 of Domestic Violence and Sexual Assault, Inc., a nonprofit corporation;30 and31 (k) Sales to or purchases by nonprofit organizations offering free den-32 tal clinic services to children; and33 (l) Admissions to and purchases by museums, as defined in subsection34 (2) of this section; and35 (m) Donations to, sales to, or purchases by the Salvation Army.36 (2) As used in this section, these words shall have the following mean-37 ings:38 (a) "Educational institution" shall mean nonprofit colleges, univer-39 sities, public charter schools organized pursuant to chapter 52, title40 33, Idaho Code, the Idaho digital learning academy established pursuant41 to chapter 55, title 33, Idaho Code, and other primary and secondary42

2 schools, the income of which is devoted solely to education and in which1 systematic instruction in the usual branches of learning is given. This2 definition does not include schools primarily teaching business, danc-3 ing, dramatics, music, cosmetology, writing, gymnastics, exercise and4 other special accomplishments nor parent-teacher associations, parent5 groups, alumni or other auxiliary organizations with purposes related6 to the educational function of an institution or collective group of in-7 stitutions.8 (b) "Hospital" shall include nonprofit institutions licensed by the9 state for the care of ill persons. It shall not extend to nursing homes10 or similar institutions.11 (c) "Health-related entities" shall mean the Idaho Cystic Fibrosis12 Foundation, Idaho Epilepsy League, Idaho Lung Association, March of13 Dimes, American Cancer Society, Camp Rainbow Gold, Mental Health As-14 sociation, The Arc, The Children's Home Society of Idaho, American15 Heart Association, Idaho Ronald McDonald House, United Cerebral Palsy,16 Arthritis Foundation, Muscular Dystrophy Foundation, National Mul-17 tiple Sclerosis Society, Rocky Mountain Kidney Association, American18 Diabetes Association, Easter Seals, Idaho Community Action Agencies,19 Idaho Primary Care Association and community health centers that are20 members of the Idaho Primary Care Association, the Idaho Association of21 Free and Charitable Clinics and its member clinics, the Idaho Diabetes22 Youth Programs, Special Olympics Idaho, the Idaho Women's and Chil-23 dren's Alliance, and the Family Services Alliance of Southeast Idaho,24 together with said entities' local or regional chapters or divisions.25 (d) "Canal companies" shall include nonprofit corporations that are26 incorporated solely for the purpose of operating and maintaining and27 are engaged solely in operation and maintenance of dams, reservoirs,28 canals, lateral and drainage ditches, pumps or pumping plants.29 (e) "Forest protective associations" shall mean associations whose30 purpose is the furnishing, operating and maintaining of a protective31 system for the detection, prevention and suppression of forest or range32 fires. Forest protective associations shall include only those associ-33 ations with which the state of Idaho has contracted or become a member of34 pursuant to chapter 1, title 38, Idaho Code.35 (f) "Food banks or soup kitchens" shall mean any nonprofit corporation36 or association, other than the Idaho Foodbank Warehouse, Inc., one of37 whose regular activities is the furnishing or providing of food or food38 products to others without charge.39 (g) "Nonsale clothier" shall mean any nonprofit corporation or associ-40 ation, one of whose primary purposes is the furnishing or providing of41 clothes to others without charge.42 (h) "Clothes" shall mean garments in general, designed or intended to43 be worn by humans, and shall include footwear in addition to wearing ap-44 parel.45 (i) "Center for independent living" shall mean a private, nonprofit,46 nonresidential organization in which at least fifty-one percent (51%)47 of the principal governing board, management and staff are individuals48 with disabilities and that:49

3 (i) Is designed and operated within a local community by individ-1 uals with disabilities;2 (ii) Provides an array of independent living services and pro-3 grams; and4 (iii) Is cross-disability.5 (j) "Political subdivision" means:6 (i) A governmental organization that:7 1. Embraces a certain territory,8 2. Is organized for public advantage and not in the interest9 of private individuals or classes,10 3. Has been delegated functions of government, and11 4. Has the statutory power to levy taxes; or12 (ii) A public health district created by section 39-408, Idaho13 Code; or14 (iii) A soil conservation district as defined in section 22-2717,15 Idaho Code; or16 (iv) A drainage district created pursuant to chapter 29, title17 42, Idaho Code; or18 (v) An irrigation district created pursuant to title 43, Idaho19 Code; or20 (vi) A state grazing board created by section 57-1204, Idaho21 Code; or22 (vii) A water measurement district created pursuant to section23 42-705 or 42-706, Idaho Code; or24 (viii) A ground water management district created pursuant to25 chapter 51, title 42, Idaho Code.26 (k) "Agency of the state of Idaho" shall mean an office or organization27 created by the constitution or statutes of this state and constituting a28 component part of the executive, judicial or legislative branch of the29 government of this state.30 (l) "Volunteer fire department" means an entity exempt from federal31 income taxation pursuant to section 501(c)(3) of the Internal Revenue32 Code and which primarily provides fire protection or fire prevention on33 a not-for-profit basis to surrounding residents.34 (m) "Licensed emergency medical service agency" means an emergency35 medical service (EMS) licensed by the Idaho military division and which36 is exempt from federal income taxation pursuant to section 501(c)(3) of37 the Internal Revenue Code and which provides emergency medical services38 on a not-for-profit basis to surrounding residents.39 (n) "Qualifying senior citizen center" means an entity exempt from in-40 come tax pursuant to section 501(c)(3) of the Internal Revenue Code and41 which is a community facility for the organization and provision of a42 broad spectrum of services, which shall include provision of health,43 including mental health, social, nutritional, and educational services44 and the provision of facilities for recreational activities for older45 individuals.46 (o) "Museum" means a public institution or an entity exempt from income47 tax pursuant to section 501(c)(3) of the Internal Revenue Code, which48 stores, preserves and exhibits objects of art, history, science or49 other objects of historical, educational or cultural value on a perma-50

4 nent basis in a building, portion of a building or outdoor location and1 which provides museum services to the public on a regular basis.2 (3) The exemption granted by subsection (1)(f) of this section does not3 include any association or other organization whose members are political4 subdivisions or state agencies unless the organization is expressly created5 under the joint powers provision of sections 67-2328 through 67-2333, Idaho6 Code.7 (4) The exemptions granted by subsection (1) of this section do not in-8 clude the use of tangible personal property by a contractor used to improve9 real property of an exempt entity when such use is within the definition pro-10 vided by section 63-3615(b), Idaho Code, whether the use tax liability is in-11 cluded in a contract total or stated separately in a contract.12 (5) There is exempted from the taxes imposed in this chapter the renting13 of a place to sleep to an individual by the Idaho Ronald McDonald House.14

SECTION 2. An emergency existing therefor, which emergency is hereby15 declared to exist, this act shall be in full force and effect on and after16 July 1, 2026.17