H-1586              _______________________________________________

                                                    HOUSE BILL NO. 598

                        _______________________________________________

State of Washington                              49th Legislature                              1985 Regular Session

By Representatives Grimm, Holland and Sanders

Read first time 2/8/85 and referred to Committee on Ways & Means.

AN ACT Relating to cigarette taxation; amending RCW 82.24.020; adding a new section to chapter 82.32 RCW; and providing an effective date.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

        Sec. 1.  Section 82.24.020, chapter 15, Laws of 1961 as last amended by section 15, chapter 3, Laws of 1983 2nd ex. sess. and RCW 82.24.020 are each amended to read as follows:

          (1) There is levied and there shall be collected as hereinafter provided, a tax upon the sale, use, consumption, handling, possession or distribution of all cigarettes, in an amount equal to the rate of eight and one-half mills per cigarette.  For purposes of this chapter and RCW 28A.47.440, "possession" shall mean both (a) physical possession by the purchaser and, (b) when cigarettes are being transported to or held for the purchaser or his designee by a person other than the purchaser, constructive possession by the purchaser or his designee, which constructive possession shall be deemed to occur at the location of the cigarettes being so transported or held.

          (2) An additional tax is imposed equal to the rate specified in RCW 82.02.030 multiplied by the tax payable under subsection (1) of this section, RCW 82.24.025, and 28A.47.440.

(3) There is levied and there shall be collected as hereinafter provided, an additional tax upon the sale, use, consumption, handling, possession or distribution of all cigarettes, in an amount equal to the rate of four mills per cigarette.  The revenue from this additional tax shall be deposited in the revenue reserve account created in section 2 of this 1985 act.

NEW SECTION. Sec. 2.  A new section is added to chapter 82.32 RCW to read as follows:

          (1) A used in this section:

          (a) "Biennial revenue forecast" means the official forecast of state general fund revenues expected to be received during a fiscal biennium, as issued by the economic and revenue forecast council on the March 20th immediately preceding the beginning of the biennium.

          (b) "General state revenues" has the meaning given in RCW 43.88.020(19).

          (2) The revenue reserve account is hereby established in the state general fund.  Moneys in this account may be used only for the purposes provided in this section.

          (3) If the balance in the revenue reserve account exceeds two percent of the biennial revenue forecast, moneys which would otherwise be deposited in the account shall be deposited in the state general fund.

          (4) If the balance in the budget stabilization account created under RCW 43.88.525 equals or exceeds eight percent of general state revenues for the biennium, moneys which would otherwise be deposited in the revenue reserve account shall be deposited in the state general fund.

          (5) If the economic and revenue forecast council issues an official forecast which indicates state general fund revenues for the then current fiscal biennium will be less than the biennial revenue forecast, the state treasurer shall transfer an amount equal to the projected shortfall from the revenue reserve account to the state general fund, to the extent of available moneys in the account.

NEW SECTION. Sec. 3.     This act shall take effect October 1, 1985.