H-2663

AN ACT Relating to fiscal reform; amending RCW 41.40.380, 82.03.130, and 82.03.140; adding a new Title 82A to the Revised Code of Washington; creating a new section; prescribing penalties; providing for submission of this act to a vote of the people; and providing a contingent effective date.

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

PART I

INCOME TAX--DEFINITIONS

NEW SECTION. Sec. 101. INTRODUCTORY. Unless the context clearly requires otherwise, the definitions in sections 102 through 111 of this act apply throughout this title.

NEW SECTION. Sec. 102. ADJUSTED GROSS INCOME. "Adjusted gross income" means adjusted gross income as determined under the internal revenue code.

NEW SECTION. Sec. 103. DEPARTMENT. "Department" means the state department of revenue.

NEW SECTION. Sec. 104. FEDERAL BASE INCOME. "Federal base income" means:

(1) For individuals, adjusted gross income.

(2) For all other persons, taxable income as determined under the internal revenue code.

NEW SECTION. Sec. 105. INDIVIDUAL. "Individual" means a natural person.

NEW SECTION. Sec. 106. INTERNAL REVENUE CODE. "Internal revenue code" means the United States internal revenue code of 1986 and amendments thereto, as existing and in effect on January 1, 1991.

NEW SECTION. Sec. 107. PERSON. "Person" includes individuals, partnerships, firms, companies, fiduciaries, estates, trusts, and corporations.

NEW SECTION. Sec. 108. RESIDENT. "Resident" includes: (1) An individual who:

(a) Has resided in this state for the entire taxable year; or

(b) Is domiciled in this state unless the individual:

(i) Maintains no permanent place of abode in this state; and

(ii) Does maintain a permanent place of abode elsewhere; and

(iii) Spends in the aggregate not more than thirty days in the taxable year in this state; or

(c) Is not domiciled in this state, but maintains a permanent place of abode in this state and spends in the aggregate more than one hundred eighty-three days of the taxable year in this state unless the individual establishes to the satisfaction of the director of the department that the individual is in the state only for temporary or transitory purposes; or

(d) Claims the state of Washington as the individual's tax home for federal income tax purposes.

(2) A resident estate means an estate of which a personal representative was appointed by a Washington court, or, an estate the administration of which is carried on in this state.

(3) A resident trust means a trust whose situs as determined by RCW 11.96.040 is within the state of Washington.

NEW SECTION. Sec. 109. TAXABLE INCOME. "Taxable income" means federal base income after making the additions, subtractions, apportionments, and allocations provided under this title.

NEW SECTION. Sec. 110. TAXABLE YEAR. "Taxable year" means the taxpayer's taxable year as defined under the internal revenue code.

NEW SECTION. Sec. 111. TAXPAYER. "Taxpayer" means a person receiving income subject to tax under this title.

NEW SECTION. Sec. 112. DEFINITION OF TERMS GENERALLY. Except as provided in sections 101 through 111 of this act, any term used in this title has the same meaning as when used in a comparable context in the internal revenue code.

PART II

INCOME TAX--TAXABLE INCOME MODIFICATIONS

NEW SECTION. Sec. 201. INTRODUCTORY. In computing taxable income, modifications shall be made to the taxpayer's federal base income as required under this Part, unless the modification has the effect of duplicating an item of income or deduction.

NEW SECTION. Sec. 202. CARRY-OVERS. Add amounts that have been deducted in computing federal base income to the extent the amounts have been carried over from taxable years ending before the effective date of this act.

NEW SECTION. Sec. 203. CARRYBACKS. Add amounts that have been deducted in computing federal base income to the extent the amounts have been carried back from future taxable years.

NEW SECTION. Sec. 204. STATE AND LOCAL INCOME TAXES. Add taxes on or measured by net income that have been deducted under the internal revenue code in computing federal base income.

NEW SECTION. Sec. 205. STATE AND LOCAL OBLIGATIONS. (1) Add gross income that has been excluded under section 103 of the internal revenue code in computing federal base income, except gross income derived from obligations of the state of Washington or political subdivisions of the state of Washington.

(2) Subtract any expenses incurred in the production of amounts added under subsection (1) of this section, to the extent the expenses have not been deducted in computing federal base income.

NEW SECTION. Sec. 206. DEDUCTIONS REQUIRED BY FEDERAL LAW. (1) Subtract gross income that the state is prohibited from taxing under the Constitution or laws of the United States, to the extent the gross income was included in computing federal base income.

(2) Add any expenses incurred in the production of amounts subtracted under subsection (1) of this section, to the extent the expenses have been deducted in computing federal base income.

NEW SECTION. Sec. 207. TAX RETURNS FOR FRACTIONAL YEAR. (1) If the first taxable year of any taxpayer with respect to which a tax is imposed by this title ends before December 31st of the calendar year in which this title becomes effective, referred to in this section as a fractional taxable year, the taxable income for the fractional taxable year shall be the taxpayer's taxable income for the entire taxable year, adjusted by one of the following methods, at the taxpayer's election:

(a) The taxable income shall be multiplied by a fraction. The numerator of the fraction is the number of days in the fractional taxable year. The denominator of the fraction is the number of days in the entire taxable year.

(b) The taxable income shall be adjusted, in accordance with rules of the department, so as to include only such income and be reduced only by such deductions as can be clearly determined from the permanent records of the taxpayer to be attributable to the fractional taxable year.

(2) If an individual taxpayer's taxable income is adjusted under subsection (1) of this section, the deduction amounts allowed under section 402 of this act for the taxpayer shall be reduced by multiplying the amount of the exemption by a fraction. The numerator of the fraction is the number of days in the taxpayer's fractional taxable year. The denominator of the fraction is the number of days in the entire taxable year.

PART III

INCOME TAX--DIVISION OF INCOME, MODIFICATIONS, AND CREDITS

NEW SECTION. Sec. 301. APPORTIONMENT AND ALLOCATION OF INCOME‑-INDIVIDUALS, ESTATES, AND TRUSTS. (1) For resident individuals, estates, and trusts, all income shall be apportioned and allocated to this state.

(2) For nonresident individuals, estates, and trusts, income derived from sources within this state shall be apportioned and allocated to this state. For purposes of this title:

(a) The adjusted gross income of a nonresident derived from sources within this state is the net amount of items of income, gain, loss, and deduction of the nonresident's federal adjusted gross income that are derived from or connected with sources in this state including any distributive share of partnership income and deductions, and any share of estate or trust income and deductions, including any unrelated business income of an otherwise exempt trust or organization.

(b) Items of income, gain, loss, and deduction derived from or connected with sources within this state are those items attributable to the ownership or disposition of any interest in real or tangible personal property in this state, and a business, trade, profession, or occupation carried on within this state. The department shall issue rules to provide consistency of this section with the excise tax provisions.

(c) Deduction with respect to expenses, capital losses, and net operating losses shall be based solely on income, gains, losses, and deductions derived from or connected with sources in this state but shall otherwise be determined in the same manner as the corresponding federal deduction except as provided in this title.

(d) Income from intangible personal property, including annuities, dividends, interest, and gains from the disposition of intangible personal property, constitutes income derived from sources within the state of Washington only to the extent that such income is from property employed in a business, trade, profession, or occupation carried on within this state: PROVIDED, That distributed and undistributed income of an electing S corporation for federal tax purposes derived from or connected with sources within this state is income derived from sources within this state for a nonresident shareholder. A net operating loss of such corporation does constitute a loss or deduction connected with sources within this state for a nonresident shareholder.

(e) Compensation paid by the United States for service in the armed forces of the United States performed in this state by a nonresident does not constitute income derived from sources within this state.

(f) If a business, trade, profession, or occupation is carried on partly within and partly without this state, the determination of net income derived or connected with sources within this state as provided in this section, shall be made by apportionment and allocation under chapter 82.56 RCW.

NEW SECTION. Sec. 302. ESTATES, TRUSTS, AND BENEFICIARIES. (1) The taxable incomes of estates, trusts, and beneficiaries thereof shall be computed by including a share of the modifications under Part II and sections 301 and 302 of this act and the credits allowed under section 403 of this act.

Each taxpayer's share of a modification or credit is the amount of modification or credit multiplied by a fraction. The numerator of the fraction is the taxpayer's share of the distributable net income of the estate or trust. The denominator of the fraction is the total distributable net income of the estate or trust. The fraction shall never be greater than one.

(2) As used in this section, "distributable net income" means distributable net income as defined in the internal revenue code. If an estate or trust has no federal distributable net income, the term means the income of the estate or trust which is distributed or is required to be distributed during the taxable year under local law or the terms of the estate or trust instrument.

(3) Any portion of a modification that is not included in calculating the taxable incomes of the beneficiaries shall be included in calculating the taxable income of the trust or estate.

PART IV

INCOME TAX--RATES AND CREDITS

NEW SECTION. Sec. 401. PERSONAL INCOME TAX IMPOSED. (1) A regular tax and an additional tax are imposed on taxable income of individuals, estates, and trusts as provided in this section.

(2) The standard deductions and personal exemptions provided in section 402 of this act are allowed in computing taxable income for the regular tax. The regular tax is equal to taxable income multiplied by the rate of four and one-tenth percent.

(3) A deduction of one hundred thousand dollars is allowed in computing taxable income for the additional tax. The additional tax is equal to taxable income multiplied by the rate of two and four-tenths percent.

(4) The taxes imposed in this section shall never be less than zero.

NEW SECTION. Sec. 402. STANDARD DEDUCTION--PERSONAL EXEMPTION. The following standard deductions and personal exemption deductions are allowed in determining the regular tax under section 401(2) of this act:

(1) The standard deduction for an individual is:

(a) Fifteen thousand dollars for a joint return or a surviving spouse;

(b) Thirteen thousand two hundred dollars for a head of household;

(d) Seven thousand five hundred dollars for a married individual filing a separate return.

(2) A personal exemption deduction in the amount of three thousand seven hundred fifty dollars is allowed for each individual for whom a personal exemption deduction is allowed for federal income tax purposes.

(3) The deductions from adjusted gross income allowed under this section for individual taxpayers who are not residents of this state for the entire taxable year shall be reduced by multiplying the amount of the deductions by a fraction. The numerator of the fraction is the taxpayer's adjusted gross income attributable to sources within the state of Washington. The denominator of the fraction is the taxpayer's adjusted gross income from all sources. The fraction shall never be greater than one.

NEW SECTION. Sec. 403. CREDIT FOR INCOME TAXES DUE ANOTHER JURISDICTION. (1) The intent of this section is to prevent double taxation of income potentially subject to tax in both Washington and another jurisdiction.

(2) As used in this section, "another jurisdiction" means another state or foreign country, or a political subdivision of another state or foreign country.

(3) A resident individual, estate, or trust is allowed a credit against the tax imposed under this title, equal to the lesser of:

(a) The amount of tax paid to another jurisdiction on net income derived from sources within the other jurisdiction; or

(b) The amount of tax due under this title, before application of credits allowable by this title, multiplied by a fraction. The numerator of the fraction is the amount of the taxpayer's adjusted gross income subject to tax in the other jurisdiction. The denominator of the fraction is the taxpayer's total adjusted gross income as modified under Part II of this act. The fraction shall never be greater than one.

(4) If the laws of another jurisdiction contain a provision exempting a resident of Washington from net income taxes on income derived from sources in that jurisdiction, the director is authorized to enter into a reciprocal agreement with that jurisdiction providing a similar tax exemption for residents of that jurisdiction for income derived from sources within Washington.

(5) The amount of tax credits received by any taxpayer under this section shall not exceed the total amount of tax due, and there shall be no carryback or carryforward of any unused credits.

NEW SECTION. Sec. 404. DUAL RESIDENCE. If an individual is regarded as a resident both of this state and another jurisdiction for state personal income tax purposes, the department shall reduce the tax on that portion of the individual's income that is subjected to tax in both jurisdictions solely by virtue of dual residence, if the other taxing jurisdiction allows a similar reduction. The reduction shall equal the lower of the two taxes applicable to the income taxed twice, multiplied by a fraction. The numerator of the fraction is the tax imposed by this state on the income taxed twice. The denominator of the fraction is the tax imposed by both jurisdictions on the income taxed twice. The fraction shall never be greater than one.

PART V

INCOME TAX--WITHHOLDING AND ESTIMATED TAX

NEW SECTION. Sec. 501. EMPLOYER WITHHOLDING--REQUIREMENTS. (1) Every employer making a payment of wages or salaries earned in this state, regardless of the place where the payment is made, and who is required by the internal revenue code to withhold taxes, shall deduct and withhold tax as prescribed by the department by rule. The rules prescribed shall reasonably reflect the annual tax liability under this title of the employee under this title. Every employer making such a deduction and withholding shall furnish to the employee a record of the amount of tax deducted and withheld from the employee on forms provided by the department.

(2) If the employee is a resident of this state and earns income from personal services entirely performed in another state that imposes an income tax on the income, and the employer withholds income taxes under the laws of the state in which the income is earned, the employer is not required to withhold any tax imposed by this title on the income if the laws of the state in which the income is earned allow a similar exemption for its residents who earn income in this state.

NEW SECTION. Sec. 502. LIABILITY OF EMPLOYER FOR TAX WITHHELD. Any person required to deduct and withhold the tax imposed by this title is liable to the department for the payment of the amount deducted and withheld, and is not liable to any other person for the amount of tax deducted and withheld under this title or for the act of withholding. The amount of tax so deducted and withheld shall be held to be a special fund in trust for this state.

NEW SECTION. Sec. 503. CREDIT FOR TAX WITHHELD--HOW CLAIMED. The amount deducted and withheld as tax under section 501 of this act during any taxable year shall be allowed as a credit against the tax imposed for the taxable year by this title. If the liability of any individual for taxes, interest, penalties, or other amounts due the state of Washington is less than the total amount of the credit that the individual is entitled to claim under this section, the individual is entitled to a refund from the department in the amount of the excess of the credit over the amounts otherwise due. If any individual entitled to claim a credit under this section is not otherwise required by this title to file a return, a refund may be obtained in the amount of the credit by filing a return, with applicable sections completed, to claim the refund. No credit or refund is allowed under this section unless the credit or refund is claimed on a return filed for the taxable year for which the amount was deducted and withheld.

NEW SECTION. Sec. 504. WITHHOLDING--FAILURE TO PAY OR COLLECT‑-PENALTIES. (1) The tax required by this title to be collected by the employer shall be deemed to be held in trust by the employer until paid to the department.

(2) In case any employer, or a responsible person within the meaning of section 6672 of the internal revenue code, fails to collect the tax imposed by this title or having collected the tax fails to pay it to the department, the employer or responsible person shall, nevertheless, be personally liable to the state for the amount of the tax. The interest and penalty provisions of chapter 82.32 RCW apply to this section.

NEW SECTION. Sec. 505. ESTIMATED TAX IMPOSED--DUE DATE OF ESTIMATED TAXES--AMOUNT OF ESTIMATED TAX--UNDERPAYMENT PENALTY. (1) Each taxpayer who is required by the internal revenue code to make payment of estimated taxes shall pay to the department on forms prescribed by the department the estimated taxes due under this title.

(2) The provisions of the internal revenue code relating to the determination of reporting periods and due dates of payments of estimated tax apply to the estimated tax payments due under this section.

(3) The amount of the estimated tax shall be the annualized tax divided by the number of months in the reporting period. No estimated tax shall be due if the annualized tax is less than five hundred dollars. The provisions of RCW 82.32.050 and 82.32.090 shall apply to underpayments of estimated tax but shall not apply to underpayments if the tax remitted to the department under this Part is either ninety percent of the tax shown on the return or one hundred percent of the tax shown on the previous year's tax return.

(4) For purposes of this section, the annualized tax is the taxpayer's projected tax liability for the taxable year as computed under section 6654 of the internal revenue code and the regulations thereunder.

PART VI

INCOME TAX--ADMINISTRATION AND ENFORCEMENT

NEW SECTION. Sec. 601. METHOD OF ACCOUNTING. (1) A taxpayer's method of accounting for purposes of the tax imposed under this title shall be the same as the taxpayer's method of accounting for federal income tax purposes. If no method of accounting has been regularly used by a taxpayer for federal income tax purposes or if the method used does not clearly reflect income, tax due under this title shall be computed by a method of accounting that in the opinion of the department fairly reflects income.

(2) If a person's method of accounting is changed for federal income tax purposes, it shall be similarly changed for purposes of this title.

NEW SECTION. Sec. 602. PERSONS REQUIRED TO FILE RETURNS. (1) All taxpayers shall file with the department, on forms prescribed by the department, an income tax return for each taxable year. An individual owing no tax for a taxable year is not required to file a return for that year. Each person required to file a return under this title shall, without assessment, notice, or demand, pay any tax due thereon to the department on or before the date fixed for the filing of the return.

(2) The department may by rule require that certain taxpayers file, on forms prescribed by the department, informational returns for any period.

(3) In the event an adjustment to a taxpayer's federal return is made by the taxpayer or the internal revenue service, the taxpayer shall, within ninety days of the final determination of the adjustment by the internal revenue service or within thirty days of the filing of a federal return adjusted by the taxpayer, file with the department on forms prescribed by the department, a corrected return reflecting the adjustments as finally determined. The taxpayer shall pay any additional tax due resulting from the finally determined internal revenue service adjustment or a taxpayer adjustment without notice and assessment. Notwithstanding any provision of this title or any other title to the contrary, the period of limitation for the collection of the additional tax, interest and penalty due as a result of an adjustment by the taxpayer or a finally determined internal revenue service adjustment shall begin at the later of thirty days following the final determination of the adjustment or the date of the filing of the corrected return.

NEW SECTION. Sec. 603. DUE DATE FOR FILING A RETURN--EXTENSIONS‑-INTEREST AND PENALTIES. The due date of a return required to be filed with the department shall be the due date of the federal income tax return or informational return for federal income tax purposes. The department shall have the authority to grant extensions of times by which returns required to be filed by this title may be submitted. The department shall also have the authority to grant extensions of time to pay tax with regard to taxes imposed by this title. Interest at the rate as specified in RCW 82.32.050 shall accrue during any extension period and the interest and penalty provisions of chapter 82.32 RCW shall apply to late payments and deficiencies. Notwithstanding the limitation of RCW 82.32.090, in the case of the late filing of an informational return, there shall be imposed a penalty the amount of which shall be established by the department by rule. The penalty shall not exceed fifty dollars per month for a maximum of ten months. RCW 82.32.105 shall apply to this section.

NEW SECTION. Sec. 604. JOINT RETURN. (1) If the federal income tax liabilities of both spouses are determined on a joint federal return for the taxable year, they shall file a joint return under this title.

(2) If neither spouse is required to file a federal income tax return for the taxable year, a joint return shall be filed under this title under the same conditions under which a joint return may be filed for purposes of the federal income tax.

(3) If the federal income tax liability of either spouse is determined on a separate federal return for the taxable year, they shall file separate returns under this title.

(4) In any case in which a joint return is filed under this section, the liability of the husband and wife is joint and several, unless the spouse is relieved of liability under section 6013 of the internal revenue code.

NEW SECTION. Sec. 605. RECORDS--RETURNS. (1) Every taxpayer and every person required to deduct and withhold the tax imposed under this title shall keep records, render statements, make returns, file reports, and perform other acts as the department requires by rule. Each return shall be made under penalty of perjury and on forms prescribed by the department. The department may require other statements and reports be made under penalty of perjury and on forms prescribed by the department. The department may require any taxpayer and any person required to deduct and withhold the tax imposed under this title to furnish to the department a correct copy of any return or document that the taxpayer has filed with the internal revenue service or received from the internal revenue service.

(2) All books and records and other papers and documents required to be kept under this title are subject to inspection by the department at all times during business hours of the day.

NEW SECTION. Sec. 606. PROVISIONS OF INTERNAL REVENUE CODE CONTROL. (1) To the extent possible without being inconsistent with this title, all of the provisions of the internal revenue code relating to the following subjects apply to the taxes imposed under this title:

(a) Time of payment of tax deducted and withheld under section 501 of this act;

(b) Liability of transferees;

(c) Time and manner of making returns, extensions of time for filing returns, verification of returns, and the time when a return is deemed filed.

(2) The department by rule may provide modifications and exceptions to the provisions listed in subsection (1) of this section, if reasonably necessary to facilitate the prompt, efficient, and equitable collection of tax under this title.

Sec. 607. RCW 41.40.380 and 1989 c 360 s 27 are each amended to read as follows:

EXEMPTION FROM TAXATION AND JUDICIAL PROCESS--EXCEPTIONS--ASSIGNABILITY--DEDUCTIONS AUTHORIZED. (1) Subject to subsections (2) and (3) of this section, the right of a person to a pension, an annuity, or retirement allowance, any optional benefit, any other right accrued or accruing to any person under the provisions of this chapter, the various funds created by this chapter, and all moneys and investments and income thereof, are hereby exempt from any state, county, municipal, or other local tax, and shall not be subject to execution, garnishment, attachment, the operation of bankruptcy or insolvency laws, or other process of law whatsoever, and shall be unassignable.

(2) This section shall not be deemed to prohibit a beneficiary of a retirement allowance from authorizing deductions therefrom for payment of premiums due on any group insurance policy or plan issued for the benefit of a group comprised of public employees of the state of Washington or its political subdivisions and which has been approved for deduction in accordance with rules and regulations that may be promulgated by the state health care authority and/or the department of retirement systems, and this section shall not be deemed to prohibit a beneficiary of a retirement allowance from authorizing deductions therefrom for payment of dues and other membership fees to any retirement association or organization the membership of which is composed of retired public employees, if a total of three hundred or more of such retired employees have authorized such deduction for payment to the same retirement association or organization.

(3) Subsection (1) of this section shall not prohibit the department of retirement systems from complying with (a) a wage assignment order for child support issued pursuant to chapter 26.18 RCW, (b) an order to withhold and deliver issued pursuant to chapter 74.20A RCW, (c) a notice of payroll deduction issued pursuant to RCW 26.23.060, (d) a mandatory benefits assignment order issued pursuant to chapter 41.50 RCW, or (e) any administrative or court order expressly authorized by federal law.

(4) Subsection (1) of this section does not exempt any pension or other benefit received under this chapter from tax under Title 82A RCW (Parts I through V of this act and sections 601 through 606 and 608 through 610 of this act), nor does it prohibit the department of retirement systems from complying with the tax withholding requirements of that title.

NEW SECTION. Sec. 608. REFUNDS OF OVERPAYMENTS--OTHER ADMINISTRATIVE PROVISIONS. (1) The department shall refund all taxes improperly paid or collected.

(2) The following sections apply to the administration of taxes imposed under this title: RCW 82.32.020, 82.32.050, 82.32.060, 82.32.070, 82.32.090, 82.32.100, 82.32.105, 82.32.110, 82.32.120, 82.32.130, 82.32.140, 82.32.150, 82.32.160, 82.32.170, 82.32.180, 82.32.190, 82.32.200, 82.32.210, 82.32.220, 82.32.230, 82.32.235, 82.32.237, 82.32.240, 82.32.245, 82.32.260, 82.32.265, 82.32.300, 82.32.310, 82.32.320, 82.32.330, 82.32.340, 82.32.350, 82.32.360, and 82.32.380.

NEW SECTION. Sec. 609. RULES. The department may adopt rules under chapter 34.05 RCW for the administration and enforcement of this title. The rules, to the extent possible without being inconsistent with this title, shall follow the internal revenue code and the regulations and rulings of the United States department of the treasury with respect to the federal income tax. The department may adopt as a part of these rules any portions of the internal revenue code and treasury department regulations and rulings, in whole or in part.

NEW SECTION. Sec. 610. CRIMES. (1) Any person who knowingly attempts to evade the tax imposed under this title or payment thereof is guilty of a class C felony as provided in chapter 9A.20 RCW.

(2) Any person required to collect tax imposed under this title who knowingly fails to collect, truthfully account for, or pay over the tax is guilty of a class C felony as provided in chapter 9A.20 RCW.

(3) Any person who knowingly fails to pay tax, pay estimated tax, make returns, keep records, or supply information, as required under this title, is guilty of a gross misdemeanor as provided in chapter 9A.20 RCW.

NEW SECTION. Sec. 611. CODIFICATION. Parts I through V of this act and sections 601 through 606, and 608 through 610 of this act shall constitute a new title, to be codified as Title 82A RCW.

PART VII

INCOME TAX--APPEALS

Sec. 701. RCW 82.03.130 and 1989 c 378 s 4 are each amended to read as follows:

APPEALS TO BOARD‑-JURISDICTION AS TO TYPES OF APPEALS. The board shall have jurisdiction to decide the following types of appeals:

(1) Appeals taken pursuant to RCW 82.03.190.

(2) Appeals from a county board of equalization pursuant to RCW 84.08.130.

(3) Appeals by an assessor or landowner from an order of the director of revenue made pursuant to RCW 84.08.010 and 84.08.060, if filed with the board of tax appeals within thirty days after the mailing of the order, the right to such an appeal being hereby established.

(4) Appeals by an assessor or owner of an intercounty public utility or private car company from determinations by the director of revenue of equalized assessed valuation of property and the apportionment thereof to a county made pursuant to chapter 84.12 RCW and 84.16 RCW, if filed with the board of tax appeals within thirty days after mailing of the determination, the right to such appeal being hereby established.

(5) Appeals by an assessor, landowner, or owner of an intercounty public utility or private car company from a determination of any county indicated ratio for such county compiled by the department of revenue pursuant to RCW 84.48.075: PROVIDED, That

(a) Said appeal be filed after review of the ratio under RCW 84.48.075(3) and not later than fifteen days after the mailing of the certification; and

(b) The hearing before the board shall be expeditiously held in accordance with rules prescribed by the board and shall take precedence over all matters of the same character.

(6) Appeals from the decisions of sale price of second class shorelands on navigable lakes by the department of natural resources pursuant to RCW 79.94.210.

(7) Appeals from urban redevelopment property tax apportionment district proposals established by governmental ordinances pursuant to RCW 39.88.060.

(8) Appeals from interest rates as determined by the department of revenue for use in valuing farmland under current use assessment pursuant to RCW 84.34.065.

(9) Appeals from revisions to stumpage value tables used to determine value by the department of revenue pursuant to RCW 84.33.091.

(10) Appeals from denial of tax exemption application by the department of revenue pursuant to RCW 84.36.850.

(11) Appeals relating to income tax deficiencies and refunds including penalties and interest under Title 82A RCW (Parts I through V of this act and sections 601 through 606 and 608 through 610 of this act).

Sec. 702. RCW 82.03.140 and 1988 c 222 s 4 are each amended to read as follows:

ELECTION OF FORMAL OR INFORMAL HEARING. In all appeals over which the board has jurisdiction under RCW 82.03.130, a party taking an appeal may elect either a formal or an informal hearing, such election to be made according to rules of practice and procedure to be promulgated by the board: PROVIDED, That nothing shall prevent the assessor or taxpayer, as a party to an appeal pursuant to RCW 84.08.130, within twenty days from the date of the receipt of the notice of appeal, from filing with the clerk of the board notice of intention that the hearing be a formal one: PROVIDED, HOWEVER, That nothing herein shall be construed to modify the provisions of RCW 82.03.190: AND PROVIDED FURTHER, That upon an appeal under RCW 82.03.130 (5) or (6), the director of revenue may, within ten days from the date of its receipt of the notice of appeal, file with the clerk of the board notice of its ((~~intention that the hearing be held pursuant to chapter 34.04 RCW~~)) election of a formal hearing. In the event that appeals are taken from the same decision, order, or determination, as the case may be, by different parties and only one of such parties elects a formal hearing, a formal hearing shall be granted.

PART VIII

MISCELLANEOUS

NEW SECTION. Sec. 801. SEVERABILITY CLAUSE. If any provision of this act or its application to any person or circumstance is held invalid, the remainder of the act or the application of the provision to other persons or circumstances is not affected.

NEW SECTION. Sec. 802. CAPTIONS AND HEADINGS. Captions and part headings as used in this act constitute no part of the law.

NEW SECTION. Sec. 803. Parts I through VII of this act shall take effect January 1, 1992, if the proposed amendment to Article VII of the state Constitution authorizing an income tax is validly submitted and is approved and ratified by the voters at a general election held in November 1991. If the proposed amendment is not so approved and ratified, this act shall be null and void in its entirety.