|
HOUSE OF REPRESENTATIVES |
H.C.R. NO. |
120 |
|
TWENTY-EIGHTH LEGISLATURE, 2016 |
|
|
|
STATE OF HAWAII |
|
|
|
|
|
|
|
|
||
|
|
||
HOUSE CONCURRENT
RESOLUTION
rEQUESTING THE DEPARTMENT OF TAXATION TO TAKE PROMPT AND DECISIVE ACTION ADDRESSING E-FAIRNESS.
WHEREAS, the Commerce Clause (Article I, Section 8) of the United States Constitution as currently interpreted by the Supreme Court of the United States, prohibits states from imposing sales or use tax collection obligations on out-of-state businesses unless the business has a substantial nexus with the taxing state, which in turn gives online-only retailers an unfair advantage over their competitors with a physical presence within the taxing state; and
WHEREAS, on November 14, 2014, the National Conference of State Legislatures (NCSL) stated that it advocates for passage of legislation to correct this advantage, also known as “e-fairness legislation,” because it levels the playing field for local businesses, which provide key employment and tax revenues that fund vital governmental services. As sales taxes account for over a third of revenues for most states, including over half of tax collections for six states, the inability to collect taxes that are legally owed constrains states’ options to reform their tax code elsewhere. This includes lowering tax rates or requiring states to raise certain tax rates to fund necessary government services; and
WHEREAS, the NCSL estimates that states lost an estimated $23.3 billion in 2012 from being prohibited from collecting sales tax from online and catalog purchases. The NCSL further estimates that Hawaii lost in excess of $122.5 million in that one year for this reason, which revenue could help fund disaster relief, eradication of mosquito-borne diseases, essential improvements to K-12 education, and other much-needed programs; and
WHEREAS, the Legislature and the Department of Taxation have made various efforts over the years to address the issue of e-fairness; and
WHEREAS, on or about February 29, 2016, the NCSL released model legislative language for expanding sales and use tax collection requirements through state lawmaking, which, in addition to suggesting possible legislative action, also suggests that the Department of Taxation may have power to address the issue administratively; now, therefore,
BE IT RESOLVED by the House of Representatives of the Twenty-eighth Legislature of the State of Hawaii, Regular Session of 2016, the Senate concurring, that the Department of Taxation is urged to take prompt and decisive action to address e-fairness; and
BE IT FURTHER RESOLVED that the Department of Taxation is requested to submit a report of its efforts, findings, and recommendations, including proposed legislation, if any, to the Legislature no later than twenty days prior to the convening of the Regular Session of 2017; and
BE IT FURTHER RESOLVED that certified copies of this Concurrent Resolution be transmitted to the Governor and the Director of Taxation.
|
|
OFFERED BY: |
_____________________________ |
|
|
|
|
Department of Taxation; E-fairness