1     
JOINT RESOLUTION URGING CONGRESS TO SUPPORT

2     
EQUITY AND SALES TAX FAIRNESS

3     
2015 GENERAL SESSION

4     
STATE OF UTAH

5     
Chief Sponsor: Wayne A. Harper

6     
House Sponsor: Steve Eliason

7     

8     LONG TITLE
9     General Description:
10          This joint resolution of the Legislature urges the United States Congress to pass
11     legislation for fair and constitutional collection and remittance of state and local sales
12     and use taxes by both in-state and remote sellers.
13     Highlighted Provisions:
14          This resolution:
15          ▸     urges Congress to pass, without delay, federal legislation for the fair and
16     constitutional collection of state and local sales and use taxes;
17          ▸     urges that Congress consider the following principles and ideas when drafting the
18     legislation:
19               •     utilizing state-provided or state-certified tax collection and remittance software
20     that is simple to implement and maintain;
21               •     immunity from civil liability for retailers utilizing state-provided or state-
22     certified software in tax collection and remittance;
23               •     tax audit accountability to a single state tax audit authority;
24               •     elimination of interstate tax complexity by streamlining taxable good categories;
25               •     adoption of a meaningful small business exception so that small businesses that
26     sell remotely are not adversely affected by the legislation; and
27               •     fair compensation to the tax collecting retailer; and
28          ▸     affirms that, through passage of the legislation, Congress will:
29               •     foster consistent standards for in-state and remote sellers who are obligated to

30     collect state and local sales and use taxes, providing equal, consistent, and fair treatment
31     among traditional brick and mortar retailers, brick and click retailers, catalogue retailers, and
32     Internet only based retailers; and
33               •     require similarly situated purchasers to pay the same sales and use tax rates,
34     regardless of which type of retailer they make their purchases from and
35     regardless of where that retailer is located.
36     Special Clauses:
37          None
38     

39     Be it resolved by the Legislature of the state of Utah:
40          WHEREAS, United States Supreme Court decisions in National Bellas Hess v.
41     Department of Revenue, 386 U.S. 753 (1967) and Quill Corp. v. North Dakota, 504 U.S. 298
42     (1992), require a seller to have physical presence in a taxing state before the state may require
43     the seller to collect and remit sales and use taxes on transactions that occur within that state;
44          WHEREAS, the United States Supreme Court also declared in the Quill Corp. v. North
45     Dakota decision that Congress could exercise its authority under the commerce clause of the
46     United States Constitution to decide "whether, when, and to what extent" the states may require
47     sales and use tax collection and remittance on remote sales;
48          WHEREAS, states and localities that use sales and use taxes as a revenue source may
49     not collect revenue from some portion of remote sales commerce;
50          WHEREAS, since 1999, various state legislators, governors, local elected officials,
51     state tax administrators, and representatives of the private sector have worked together to
52     develop a streamlined sales and use tax system currently adopted in some form in 24 states
53     under the Streamlined Sales and Use Tax Agreement;
54          WHEREAS, between 2001 and 2002, forty states enacted legislation expressing their
55     intent to simplify the states' sales and use tax collection systems, and to participate in
56     discussions to allow for the collection of states' sales and use taxes;
57          WHEREAS, the actions of these states provide justification for Congress to enact

58     legislation to allow states to require remote sellers to collect the states' sales and use taxes;
59          WHEREAS, any federal legislation should be fair to both in-state and remote sellers
60     and purchasers, whether such legislation requires sales and use taxes to be collected on a point
61     of sale or point of delivery basis;
62          WHEREAS, Congress, in considering federal legislation, should consider the following
63     principles and ideas:
64          • utilizing state-provided or state-certified tax collection and remittance software that is
65     simple to implement and maintain;
66          • immunity from civil liability for retailers utilizing state-provided or state-certified
67     software in tax collection and remittance;
68          • tax audit accountability to a single state tax audit authority;
69          • elimination of interstate tax complexity by streamlining taxable good categories;
70          • adoption of a meaningful small business exception so that small businesses that sell
71     remotely are not adversely affected by the legislation; and
72          • fair compensation to the tax collecting retailer;
73          WHEREAS, the Utah State Legislature and other state legislatures have acknowledged
74     the complexities of the current sales and use tax system, formulated varied alternative
75     collection systems, and shown the political will to make changes in their respective sales and
76     use tax systems;
77          WHEREAS, the enactment of legislation by Congress that allows states to require
78     remote sellers to collect the states' sales and use taxes will facilitate the states' ability to enforce
79     their current laws for collecting sales and use taxes on remote sales;
80          WHEREAS, requiring remote sellers to collect sales and use taxes may broaden Utah's
81     sales and use tax base and potentially enable the Utah State Legislature to lower sales and use
82     tax rates;
83          WHEREAS, empowering states to collect sales and use taxes on in-state and remote
84     sales is consistent with the Tenth Amendment to the United States Constitution and is a states'
85     rights issue; and

86          WHEREAS, adoption of hybrid origin sourcing provisions in legislation enacted by
87     Congress will:
88          • create an unlevel playing field between in-state and remote sellers by giving an
89     advantage to those remote sellers located in the lowest rate state;
90          • result in a tax increase on all purchasers who make purchases from remote sellers
91     located in any taxing jurisdiction with a rate higher than the rate in the purchaser's jurisdiction;
92          • require purchasers to pay sales or use tax on certain purchases from remote sellers that
93     are currently exempt from sales and use tax;
94          • require sellers that make both remote and non-remote sales to have two tax calculation
95     systems operating simultaneously;
96          • put the sales and use tax revenues of a state that are generated by remote sales into the
97     hands of the other states; and
98          • likely cause the sales and use revenues to decline as sellers and purchasers develop
99     methods to legally circumvent paying sales and use taxes:
100          NOW, THEREFORE, BE IT RESOLVED that the Legislature of the state of Utah
101     urges the United States Congress to pass, without delay, and the President of the United States
102     to sign, federal legislation that provides for the fair and constitutional collection of state and
103     local sales and use taxes.
104          BE IT FURTHER RESOLVED that the Legislature of the state of Utah urges that, in
105     passing this federal legislation, Congress consider the following principles and ideas:
106          • utilizing state-provided or state-certified tax collection and remittance software that is
107     simple to implement and maintain;
108          • immunity from civil liability for retailers utilizing state-provided or state-certified
109     software in tax collection and remittance;
110          • tax audit accountability to a single state tax audit authority;
111          • elimination of interstate tax complexity by streamlining taxable good categories;
112          • adoption of a meaningful small business exception so that small businesses that sell
113     remotely are not adversely affected by the legislation; and

114          • fair compensation to the tax collecting retailer.
115          BE IT FURTHER RESOLVED that the Legislature of the state of Utah affirms that,
116     through passage of this legislation, the United States Congress will foster consistent standards
117     for in-state and remote sellers who are obligated to collect state and local sales and use taxes,
118     providing equal, consistent, and fair treatment among traditional brick and mortar retailers,
119     brick and click retailers, catalogue retailers, and Internet only based retailers and require
120     similarly situated purchasers to pay the same sales and use tax rates, regardless of which type
121     of retailer they make their purchases from and regardless of where that retailer is located.
122          BE IT FURTHER RESOLVED that a copy of this resolution be sent to the Majority
123     Leader of the United States Senate, the Speaker of the United States House of Representatives,
124     the chair and co-chair of the Senate Finance Committee, the chair and co-chair of the House
125     Judiciary Committee, and the members of Utah's congressional delegation.