NC H985

Excludes motor vehicles from the definition of "repair, maintenance, and installation services" subject to sales tax, making labor on motor vehicles taxable under different rules.

Modifies the sales tax exemption for repair and maintenance services to apply only to items for which service contracts are exempt from tax, or services purchased for resale.

Adds motor vehicles to the list of items exempt from sales tax on service contracts, meaning warranties and maintenance agreements on motor vehicles are not subject to service contract tax.

Effective July 1, 2016 for all sales made on or after that date.