H.B. 99 Eyewear Sales Tax Amendments: transcript

Thank you, Mr. Chair. I'm, uh, glad to be here. Appreciate everybody's, uh, attention to this bill. I'm here with, uh, Mark Taylor, who is the, what's your Executive Director? Executive director of the, uh, optometrists association, and he'll be part of my presentation. So, uh, HB 99 exempts prescription eyeglasses and contact lenses from sales and use tax by classifying them as prosthetic devices under existing Utah tax law and prosthetic. Uh, most prosthetics are not, uh, are charged, uh, sales tax. And so the bottom line is this bill is a tax reduction in our sales tax area. Uh, so basically it adds corrective eyeglasses and contact lenses to the, the definition of prosthetic device. And as a result, uh, those items will become exempt from sales and use tax. Prescription eyewear is not optional. It corrects physical impairment is required for daily life, work, school, and safe driving taxing. It treats a medical necessity like a discretionary purchase. HB 99, uh, fixes that Utah already exempts prosthetic devices that correct physical malfunction, corrective eyewear does exactly that. This bill simply lines the tax code with reality and existing policy. What the bill does not do is it does not affect prescriptions, licensing or scope of practice. It does not apply to non corrective or fashion eyewear and does not create, create a new program or bureaucracy. But the, but the tax reduction does have, uh, many benefits. It does not affect prescriptions. Licensing of scope? Oh, I already read that. Sorry. Uh, it, the benefits are families, uh, replacing for, it's a good benefit for families replacing children's prescriptions. It's a benefit to seniors who are on a fixed income and workers who rely on vision for safety and productivity. Anyone who cannot function without vision or correction. So that's basically my, uh, presentation. Uh, this is, uh, a bill. You should recognize this bill, uh, has come before us before, uh, and has passed, uh, handedly in the house and in the Senate, uh, but usually gets hung up with, uh, funding at the end when we're crunching the budget numbers. So I'd really like to see if we can get that through this year. Uh, the amount that we're talking about is nothing to sneeze at, but it's in the whole drop, the whole bucket of our, all the revenues that we collect here in the state of Utah. It's pretty pretty minute. So that's the, uh, that's my presentation, Mr. Chair.

I'm sorry, Mr. Chair. I didn't even give Mark a chance to talk. Would, would you like to have him? Would you presentation that? Please Go ahead, mark. Thank you. It's

Dr. Mark Taylor, the Executive Director for the Optometry Association. I have a practice also in, in Kaysville, and just a couple things on top of that is that 70% of the population, uh, wears some sort of prescribed corrective lenses. Uh, 25% of our school kids do. Uh, and that's projected to increase over the next 20 years, up to almost 40% of our kids will be wearing prescription eyewear. And so as, as these numbers increase, that puts a higher tax burden on families that have multiple kids in glasses and contact lenses. So, um, it, it's, it's a tax that is, is healthcare dollars. I mean, these people are coming in and buying their glasses with, with their HSA funds and they're using those HSA funds to pay sales tax, and that's money that could easily be utilized for additional copays, uh, medications, those types of things. So, uh, it, it's impacting people in their, in their, you know, healthcare. Um, you know, I was looking at the article from the one, uh, Utah Health Collaborative, and they're talking about a third of people put off their, you know, healthcare needs because of cost. And, and a fourth of them are, uh, going into debt to provide, um, you know, to, to get this healthcare. Uh, and, and there's no one thing that I, you know, this is not gonna solve that problem at all. But again, it's something that maybe we, we knock away a little bit of that burden by eliminating that added seven to 10% depending on what city you live in, uh, added cost to your eyewear. So I think it's, it's good policy. Thank you.

Thank you. Um, okay. Help me understand. This is prescription eyewear only. Yes. So my readers don't count. That's correct. And what if I have a prescription for a reader, but I bought these on Amazon. They would be, the way the statute is, if there's a written prescription, I I the exemption in the code is for, uh, prosthetic device for which a prescription is, is needed. So I would assume That that would, I'm not buying them through a glasses place.

Okay. And, and, uh, representative, I'll just say this from my own experience, and correct me if I'm wrong on this, but, uh, I've gone to my optometrist and said I need some readers, and I think I'm like one 20. And, uh, and so he does the whole measurement thing and then I get a prescription that's not plus one 20 or whatever. It's whatever the language they use for prescriptions. And uh, so when you, if you do like readers in a prescription, you're gonna get a prescription for those that are basically your readers. Yeah. But you're gonna pay a hundred, 200, $300, whatever, where I've got my prescription, but I can go on Amazon and get a 1.5.

Hello, I'm Dr. Kele Franson. Um, I just wanted to make a quick comment about patient experiences. I fortunately just practice a couple blocks away in downtown Salt Lake and, and I see a variety of patients from all income levels. I also have a large Medicare and Medicaid population, and especially children of Medicaid. And I have seen firsthand how families are trying to get glasses for their children. But instead of being able to get glasses covered by Medicaid, um, in full, they're paying taxes on the retail amount. So for some families, this can be 20 to $80 depending on how many kids are needing glasses in their family. And this is something that sometimes they struggle to come up with and then they're trying to decide, do I want to get glasses for my children or not? How am I gonna pay for this? Right. And I think one thing that was missed today, um, is that we are paying on the retail amount. So even if your insurance discounts your glasses or your contact lenses for you, you're still paying on that full amount, which can be a big deal for a lot of families. That's it.

And the time is yours. Dr. Chat Chatwin. That's me. I'm, I'm, uh, Dr. Ross Chatwin. I, um, own a practice in Sugar House. Um, and I would ask for your favorable vote, uh, on this bill. And I appreciate you taking the time to listen. Um, similar to Dr. Franon, I have a large population of patients that, um, that struggle, um, and have and feel that this, uh, this sales tax on the only, uh, medical device that is taxed or has a sales tax in the state, um, becomes a barrier to some of my patients. Um, it becomes difficult for them to pay that extra amount. And two of my patients in particular, I have a patient that is a 15-year-old boy, um, that has a condition called keratoconus. And without specialty contact lenses, he is unable to do well enough in school, regardless of glasses. Glasses don't work. Um, but he can't see well enough in school to do well. Um, he also cannot drive without these specialty lenses, and these specialty lenses cost over a thousand dollars. Um, so, um, sales tax on that is, um, expensive. And, um, because of that, he has really struggled in order to get these contact lenses, um, and had to save his own money. Um, and so if we can avoid that barrier, if we can remove that barrier for him to do well in school and drive, I think that that would be a, a huge benefit to the youth that, that struggle with this kind of condition. The other have an older patients that are in their seventies that, um, require glasses in order to read, in order to drive, in order to keep their driver's license. And, and sales tax on those glasses is a barrier for them to continue to do those things. And we know that when patients, um, we, I believe 92% of patients over the age of 65, um, need some form of correction when they don't have that and they can't derive it really is, uh, has a disparate effect on their, on their lives. So I would ask for your support of this bill, um, and support it again as you have in previous years. Thank you.

I move that we favorably recommend HB 99 eyewear tax Sales Tax amendment.

Is this where I sum? Mm-hmm. Yes. Okay. Uh, I'll just read Reiter reiterate that this is a very narrow, reasonable tax policy change that removes sales tax from medical necessity and ask for your support. And thank you for your time.

I'll waive. Okay.

Thank you. Yep. Okay. That is our last agenda item.

Thank you Mr. Chair and members of the committee. It's good to be here. Good to go?

This is an attempt to, uh, provide some tax relief to a, uh, very important group of people, our senior citizens and our families who have children. And, uh, and also correct something that I think has been wrong in the code for a while now. What HB 99 does is it exempts prescription eyeglasses and contact lenses from sales and use techs by classifying them as prosthetic devices, uh, under existing Utah law. So there's a list of prosthetic devices, um, that, uh, are tax free, basically when people have to purchase 'em, uh, for, to correct whatever it is on their bodies that, uh, they don't have to pay sales tax. The exception is, uh, contact lenses and corrective eyeglasses. So, uh, what we're wanting to do is include those in with the prosthetic devices, medical devices, and make them exempt from sales and use tags. And I'll tell you, this is, uh, important because, uh, most people who have corrective lenses, uh, of some sort don't have a choice. They have to have it to see properly. And so it's not something that, uh, they can really choose to do or not. And, uh, so that's why we think this is important. And then the, uh, policy rationale, uh, behind this is that we already, uh, exempt prosthetic devices. And, uh, so we want to just include the lenses and context in that as well. What the bill does not do is it does not affect prescriptions, licensing, or scope of practice, and it does not apply to non corrective or fashion eyewear. Um, the benefits are going to be, uh, families replacing children's prescriptions. You, you can imagine how much, uh, it can cost if you have several children in your family, and you have to put 'em all in, in some form of corrective lenses. Uh, also seniors on fixed income, same thing. They're, uh, uh, a group of people that are, uh, by a lot of lenses, uh, workers who rely on vision for safety and productivity, and anyone who cannot function without vision correction. So the, uh, so what this does is, uh, it reduces the, uh, sales tax for that the state collects for, uh, prescription eyeglasses and contact lenses, which does create a fiscal note. So, uh, if this passes, uh, it will, uh, be tabled on the third reading calendar in the Senate, of course, until it gets funded, but we're optimistic that we can get it funded. Um, uh, so that's, that's the presentation. I'm gonna turn it over to, uh, Mark Taylor, who's the executive director of the Opto Optometrist Optometry Optometrist Association, and he can give you a lot more details and information from the optometrist point of view, Please. Thank you, Mr.

Chair. Uh, Dr. Mark Taylor. I'm an optometrist. I'm the executive director for the Utah Optometric Association, but I also practice in Kaysville. Um, glasses and contacts are interesting. Over the years, I've seen them become kind of put up as a commodity, you know, their fashion, you see 'em advertised online. And, and the bottom line is, yeah, they, people like to look good in their glasses, but they're not wearing them because of fashion. They're wearing them because they need to, you know, our, our kids are wearing them because that's the best way for them to learn and to get an education, is to see the board. Uh, we're wearing them to drive at night. We're obligated by law to have glasses if our vision is worse than 2040. So they're truly a prosthetic device, and by definition, they're a prosthetic device. They assist in a weak or deformed part of the body. So, uh, they should be treated just like other, every other prosthetic device we have, hearing aids, dental appliances, those types of things. So somehow they, they got taken out of that, and I think, you know, now is a good time to put them back on as a prosthetic device. Uh, 70% of households, uh, roughly 70% have some sort of prescription eyewear. Uh, and that's non-discriminatory. That's every, that's low income, that's wealthy, that's, you know, all, all races of people. That's people in every, every district in this state, possibly up to 70% of them wear prescription eyeglasses. So constituents will benefit, uh, a lot from this. These are healthcare dollars they're spending, they're spending 7%, seven and a quarter in Davis County and Park City. They may be spending 10% of their healthcare dollars on eyewear, uh, that could be saved and used for other things, copays, things like that. Uh, our kids right now have 25%, uh, are wearing glasses, and that's projected to be upwards of 40% in the next, you know, 20 years. Uh, that becomes an increasing burden on those homes with larger families, a larger tax burden, because now they're going to have more, uh, more tax responsibility. Uh, probably one final thing to add to this is when, when we're collecting sales tax, um, you know, even if a vision plan provides, uh, coverage for a pair of glasses, the the individual is still responsible to pay the sales tax. Even our Medicaid recipients that have a fully covered pair of glasses, frame and lenses, uh, they're obligated to pay sales tax according to the tax commission. So, uh, they're, they're paying, uh, a tax on things that are covered by the insurance. So, uh, we would appreciate support on this. We think it's a, a good policy. Um, I think it's the right thing to do for the, you know, residents of Utah. Thank you. Okay.

that we recommend favorably.

You. I'll just say it's a good bill and it'll, uh, bring a lot of tax relief to some, a lot of people that could really use it. So thank you.

The what? Getting the policy passed is not your hurdle. No, it's Not. Getting funded is always hurdle, So I appreciate that. So, but When it comes up, you guys, you're gonna support me, right?

Mr. Chair.

Madam Reading Clerk House Bill 99 Eyewear Sales Tax Amendments by Representative Malloy. This bill was heard in revenue and taxation with the vote of 9 0 2 Representative Maloy.

Thank you Mr. Speaker. I'd like to move to circle.

I'd like to make a motion to encircle HB 99. That motion is in order. Would you like to speak to it? Um, I just wanted to go ahead and present the bill.

Thank you, Mr. Speaker. Mr. Speaker. HB 99 is, is the eyewear sales tax amendments bill. Uh, that, uh, basically places prescription eyeglasses and contact lenses in the category of prosthetic devices, which, uh, as a has been for long standing time, uh, not, uh, uh, charge sales tax, uh, when people purchase those products. And so that's what the bill does. It exempts, uh, some, uh, prescription eyeglasses and contact lenses from sales tax and use tax. What it does not do is it does not affect prescriptions. It does not affect licensing or scope of practice and does not apply to, uh, non corrective or fashion eyewear. Um, but this will be a great benefit for families that are replacing children's, uh, uh, prescriptions, seniors that are on fixed incomes, and workers who rely on vision for safety and productivity. Um, so that's the bill and, uh, love to, uh, have everybody's support on it. Thank you, Mr. Speaker.

Thank you, Mr. Speaker with a sponsor yield to questions Representative Maloy, we yield to a series of questions.

Bet yes. Representative Cutler,

Uh, could, could you explain the, the fiscal note and how eyewear relates to the transportation investment fund?

That I would have to call the fiscal analysts on, but, uh, but the, uh, fiscal note as a whole is the reduction in, uh, the sales tax is currently collected. So it's probably money that was allocated from the sales tax to the transportation fund.

I see. So this would have an impact on less funding for roads and I guess all the things that a sales tax would fund is, is probably the explanation. Thank you.

Thank you, Mr. Speaker. Will the, uh, sponsor yield to a question? Representative Maloy, will you yield to a question? Yes, yes. Representative Shelley, Are, is eyewear somewhat considered similar to other prosthetics? Where and are the other prosthetics, are they taxed with sales tax?

They, they, that's what we're trying to do is get them included with prosthetics and they are not. So there's a whole group of prosthetic devices that are available to people and, uh, they, uh, do not charge sales tax on those, but they do on lenses and contacts.

Thank you. So it seems to me that, uh, eliminating the sales tax on eyewear, uh, would most affect the seniors who are on a fixed income and, and probably the most, uh, popular prosthetics in the state. So I would, I would support this to, uh, to save that. And I, I realize there will be impact in other places. It would be a small impact, but for those on a fixed income, it's probably a large impact. Thank you.

yield to a series of questions? Representative Moss, we yield to a series of questions. Yes, yes. Representative Thurston. So can you clarify whether the sales tax exemption applies to just the lenses or does it also include the frames? I it would include the frames only with prescription lenses, not non cause, non, uh, prescription ware. So is there any price limit to how expensive those frames can be before they're no longer exempt from the sales tax?

Uh, there's no limitation at this point that the, the criteria is corrective lenses and contacts.

Okay. Mr. Speaker, here's, so here's the problem I have when we talk about frames, we're crossing over between a device and into fashion clothing. As you may be aware, you can buy fashion frames from designer brands that are thousands of dollars, and I don't feel sympathetic that those items should be exempted from the sales tax that I, you know, if there was a, if there was a price limit that said maybe the frames the first a hundred dollars or the first, something like that. But to just tell people that your choice of wearing Gucci or Prada or whatever you want to do somehow now gets you exempt from sales tax. Just because you can put a prescription lens in there, I think is, uh, very problematic for me. Thank you, Mr. Speaker.

Thank you, Mr. Speaker. I'm right in support of this. Uh, when people wear glasses, it's not something that they choose to do. They're wearing glasses because they can't see very well. It's, uh, right. They, they, they need them. It's like any other prosthetic. If you have a prosthetic leg, it's so that you can walk a little bit better, right? There are things that, that they need to do. And I think that it, it goes in well just like the, uh, it, it fits in well with other prosthetics. So, uh, I encourage your support. Um, you know, some people have have, uh, better taste in glasses or not, but I don't think it really that matter that matters. Uh, it is something that they need and I encourage your support. Thank you.

Thank You, Mr. Speaker. I move that we circle,

Yes, I would. As a member of the glasses wearing community, uh, I think that, uh, the conversation around frames specifically is a good conversation. I'd like to allow us for some time to consider, um, an amendment that would, uh, allow for the prescription glass, the prescription lens portion to proceed. Um, but, uh, work out an accommodation on the designer glasses that we've discussed in our meeting today. Thank you, Representative Walter.

I would, uh, resist that motion. I don't think it's necessary. We've, uh, looked at this bill before. It's very, very clear that it does not include fashion wear, like sunglasses, uh, and other products that you might get in an optometrist. It's just the lenses and the contacts and, uh, I don't think a family of four kids is gonna be putting their kids in Gucci frames or anything like that. So it's, uh, it's a good bill in the regards that helps people who have those fixed costs that, or they have a, uh, a lot of kids or whatever it's going to, it just helps them and it lowers the, uh, tax sales tax rate for those people.

Thank you. Thank you, Mr. Speaker. I, um, would agree with the bill sponsor, um, that this should not be circled. It has been on the board and circled for several days, and there's been ample opportunity for people to address concerns with the sponsor.

Thank you, Mr. Speaker. Um, I, I have to agree with, uh, motion to circle. I know, uh, I've got a, I had a sister-in-law that had to have a pair of glasses for every dress she wore, and I feel like that's a little bit extreme and, and so, uh, I feel like that this is a good, uh, that we ought to maybe investigate this a little bit more. Thank you.

Yes, thank you, Mr. Speaker. As, uh, we're considering this motion, um, I'm supportive of the, uh, underlying bill. I'm supportive of the principal, uh, that we're going to, uh, uh, exempt, uh, prescription lenses. Um, but prescription but frames, uh, can be very, very expensive. And that's a choice. And I think that, uh, particularly with the sensitivity in our state with regard to sales tax in general, um, uh, finding some reasonable accommodation that allows for families that need glasses and a frame, um, uh, that is affordable is, is a good accommodation. While simultaneously recognizing that there are frames that, uh, might, uh, uh, be considered designer. And I think that making that, making that adjustment in the bill would be a good, good, good thing. So that's why I'm, uh, making the motion to circle. Thank you.

See none. Back to Representative Maloy for summation. Thank you, Mr. Speaker. This is a great bill. This is gonna help a lot of people. Uh, and so, uh, I really appreciate it. Everybody's affirmative vote. It's, it's good. Bill.

Thank you Mr. President Pro Tem House Bill 99 51 page bill, but it does a Juab a simple little thing. Um, it, uh, the tax reduction actually and it, um, exempts in, uh, corrective eyeglasses and contact lenses in the definition of a prosthetic device, which has the effect of exempting these items from sales tax and use tax. With that, I'd be open to question. That concludes your presentation.

Move that, um, house Bill 99, be read a third time.

Senator Vickers. Baldy Aye. Lewin Aye. Rammer bus? Aye. Cullum Cullimore. I I'm confident. Fillmore Grover. Harper. Aye. Hankins Aye. Ipson. Aye. Johnson a Juab McKay. Mikel Milner Musselman Owens Aye. Pitcher Aye. Plum. Aye. Rebe Sandal Stevenson Stratton. Yes. Bickers. Aye. Weiler. Aye. Wilson, I Winterton.

You Mr. President Prote. A motion that we table on third house Bill 99 for physical impact.