SENATE BILL REPORT

SB 6015

BYSenators Moore and von Reichbauer

Regarding taxation of stock brokers, broker-dealers and security houses.

Senate Committee on Financial Institutions & Insurance

Senate Hearing Date(s):February 28, 1989

Majority Report:  Do pass.

      Signed by Senators von Reichbauer, Chairman; Johnson, Vice Chairman; Fleming, McCaslin, McMullen, Moore, Rasmussen, Sellar, Smitherman, West.

Senate Staff:Bev Tweddle (786-7403)

                  February 28, 1989

AS REPORTED BY COMMITTEE ON FINANCIAL INSTITUTIONS & INSURANCE, FEBRUARY 28, 1989

BACKGROUND:

Stock brokers, broker-dealers and security houses pay business and occupation taxes on their gross earned commissions even if they do not personally retain the full commission.  Often these individuals have contracts with other members of their firm or with other firms to share a portion of their commissions.  This can create a situation where B&O tax is being paid twice on a portion of the same commission.

SUMMARY:

The B&O tax only applies to that part of the commission retained by each stock broker, broker-dealer or security house.

Appropriation:    none

Revenue:    none

Fiscal Note:      requested February 21, 1989

Senate Committee - Testified: Mike Stevenson, Department of Licensing, Securities Division