Update: Tax Bill HF 884
March 8, 2018
Earlier, this week, we alerted you to a hearing at the Capitol, introducing Tax Bill HF 884; that is intended to exempt certain massage therapy from sales taxation and impose the health care provider tax on certain massage therapy services. By registering with the Department of Revenue certain massage therapist’s services could be subject to the lower 2% health care provider tax. In order for the Department of Revenue to determine who is a massage therapist the bill contains definitions of “massage therapist” and “massage therapy services.” These definitions are new since the scope of practice for massage therapy is not defined anywhere else in Minnesota Statute.
Our Government Relations Team and Lobbyist, Maureen O’Connell, worked with the author (Representative Tina Liebling) and we requested changes to the language, that defined massage therapy and the removal of a section, that defined the variety of products that are used in the profession. This amendment was presented and passed.
The House Tax Committee moved the bill into a holding status until Tax Committee Chair, Greg Davids, decides which tax bills will be included in the omnibus tax bill, near the end of this years session.
We feel it is important to include our membership in on our decisions, especially ones that effect all Massage Therapists, within the state of Minnesota. We have highlighted a few Pro’s and Con’s for this Bill and openly encourage you to share with us your thoughts.
Pro’s of this Bill:
- Lower tax being applied to massage therapy services and potential simplification of the collection of taxes for massage therapy.
- Massage Therapy gets recognized as a healthcare profession.
Con’s of this Bill:
- The tax commissioner has no guidelines to determine the qualifications of an individual registering as a massage therapist. An individual can simply assert on an application that they are a massage therapist. For example, he/she will not have to demonstrate that he/she has completed any education requirements or proven competency, in the form an exam or other.
- There seems to be contradictory language in that massage is listed under “patient services” and “sales and purchase” tax codes yet there is no clearly defined path to one or the other.
Attached is the Department of Revenue fact sheet: http://www.revenue.state.mn.us/businesses/sut/factsheets/FS162.pdf
We will post Audio of March 7, 2018 Tax Committee hearing when it is available.
We would encourage you all to carefully read Tax Bill HF 884,
Please, feel free to share your opinions and comments on HF 884 with us, by emailing Susan Tietjen, AMTA – MN Government Relations Chair at email@example.com.