Text: HR00163 Text: HR00165 Text: HR00100 - HR00199 Text: HR Index Bills and Amendments: General Index Bill History: General Index
PAG LIN
1 1 HOUSE RESOLUTION NO.
1 2 BY J. K. VAN FOSSEN
1 3 A Resolution requesting the United States Congress to
1 4 expand the physical presence standard for the
1 5 imposition of state and local business activity
1 6 taxes.
1 7 WHEREAS, the United States Supreme Court, in Quill
1 8 Corp. v. North Dakota, 504 U. S. 298 (1992), held that
1 9 remote sellers lacking a physical presence may not be
1 10 required to act as tax collection agents of the state;
1 11 and
1 12 WHEREAS, direct state and local taxes on
1 13 businesses, also known as "business activity taxes",
1 14 such as income, franchise, net worth, business
1 15 license, business and occupation, single business,
1 16 capital stock, and like taxes, impose an even greater
1 17 burden on businesses engaged in interstate commerce
1 18 than an obligation to collect a tax from consumers;
1 19 and
1 20 WHEREAS, the physical presence standard promotes
1 21 fairness by ensuring that businesses that receive
1 22 benefits and protections provided by state and local
1 23 governments pay their fair share for these services;
1 24 and
1 25 WHEREAS, the ability of state and local
1 26 jurisdictions to tax out-of-state businesses should be
1 27 limited to those situations in which the business has
1 28 employees or property in the taxing jurisdiction and
1 29 accordingly receives meaningful governmental benefits
1 30 or protections from the jurisdiction; and
2 1 WHEREAS, the physical presence standard results in
2 2 the proper attribution of business profits to taxing
2 3 jurisdictions where a business is located and thus
2 4 does not result in tax avoidance; and
2 5 WHEREAS, a business activity tax filing requirement
2 6 based on a standard other than physical presence
2 7 results in increased filing requirements and thus
2 8 increased compliance costs; and
2 9 WHEREAS, businesses currently rely on a physical
2 10 presence standard for complying with state and local
2 11 business activity tax obligations, and this standard
2 12 is applied currently by most state courts; and
2 13 WHEREAS, any congressional authorization for states
2 14 to impose a sales and use tax collection obligation
2 15 would further put businesses at risk of the unfair
2 16 application of business activity taxes by
2 17 jurisdictions in which the businesses lack a physical
2 18 presence; and
2 19 WHEREAS, the imposition of a standard other than
2 20 physical presence for business activity taxes would
2 21 expose United States companies lacking a physical
2 22 presence overseas to similarly expansive and unfair
2 23 taxation by foreign countries and their provinces; and
2 24 WHEREAS, businesses operating in interstate
2 25 commerce should not be compelled to pay taxes in state
2 26 and local jurisdictions solely as a result of the
2 27 business having customers located in the taxing
2 28 jurisdiction; and
2 29 WHEREAS, the United States economy has become more
2 30 global since Congress first enacted Pub. L. No. 86-272
3 1 and has shifted toward the provision of more
3 2 interstate services and intangibles, and providers of
3 3 services and intangibles are competitively
3 4 disadvantaged relative to businesses that only sell
3 5 tangible personal property; and
3 6 WHEREAS, the enactment of new business activity
3 7 taxes other than income taxes threatens to circumvent
3 8 the intent of Congress in enacting Pub. L. No. 86-272;
3 9 NOW THEREFORE,
3 10 BE IT RESOLVED BY THE HOUSE OF REPRESENTATIVES,
3 11 That the State of Iowa urges Congress to enact
3 12 legislation recognizing a physical presence standard
3 13 for the imposition of state and local business
3 14 activity taxes, defining de minimis standards for
3 15 measuring physical presence and setting reasonable
3 16 limits on the attribution of nexus, and updating Pub.
3 17 L. No. 86-272 to extend the current protections
3 18 available for the solicitation for sales of goods to
3 19 the solicitation for sales of services and intangibles
3 20 and to apply these protections to all business
3 21 activity taxes; and
3 22 BE IT FURTHER RESOLVED, That the State of Iowa
3 23 recognizes that any congressional approval of "sales
3 24 tax streamlining" without the simultaneous enactment
3 25 of these business activity tax measures would have a
3 26 harmful effect on American businesses and the economy;
3 27 and
3 28 BE IT FURTHER RESOLVED, That the Chief Clerk of the
3 29 House of Representatives shall forward a copy of this
3 30 Resolution to the Congress of the United States.
4 1 LSB 7081HH 80
4 2 mg/cf/24
Text: HR00163 Text: HR00165 Text: HR00100 - HR00199 Text: HR Index Bills and Amendments: General Index Bill History: General Index
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