Amends GS 105-164.3, the definitions section for use in the statutes concerning North Carolina's sales and use tax. Amends the definition for repair, maintenance, and installation services to mean specified activities by a taxpayer with more than three employees (previously, did not have an employee requirement). Further amends the definition to exclude any activities involving a motor vehicle. Also amends the definition for service contract, excluding a contract to maintain or repair a motor vehicle from being considered a service contract.

Amends GS 105-164.13 concerning the sales tax exemption for repair, maintenance, and installation services, making conforming changes reflecting the above changes excluding motor vehicles from the definition for repair, maintenance, and installation services.

Amends GS 105-164.4I(b), provisions outlining exemptions to the sales tax on retail service contracts, adding language that exempts service contracts for motor vehicles from the tax imposed by this section.

Effective July 1, 2016, applying to sales made on or after that date.