H-0186.1  _______________________________________________

                          HOUSE BILL 2183

          _______________________________________________

State of Washington      55th Legislature     1997 Regular Session

By Representatives Buck, Hatfield, Doumit, Lantz, Dunshee and Kessler

Read first time 02/25/97.  Referred to Committee on Natural Resources.

Eliminating shellfish from the tax on enhanced food fish.

    AN ACT Relating to eliminating shellfish from the tax on enhanced food fish; and amending RCW 82.27.010, 82.27.020, 82.27.030, and 43.06.400.

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

    Sec. 1.  RCW 82.27.010 and 1995 c 372 s 4 are each amended to read as follows:

    As used in this chapter, the following terms have the meanings indicated unless the context clearly requires otherwise.

    (1) "Enhanced food fish" includes all species of food fish, except all species of tuna, mackerel, and jack; ((shellfish;)) and anadromous game fish, including byproducts and parts thereof, originating within the territorial and adjacent waters of Washington and salmon originating from within the territorial and adjacent waters of Oregon, Washington, and British Columbia, and all troll-caught Chinook salmon originating from within the territorial and adjacent waters of southeast Alaska.  As used in this subsection, "adjacent" waters of Oregon, Washington, and Alaska are those comprising the United States fish conservation zone; "adjacent" waters of British Columbia are those comprising the Canadian two hundred mile exclusive economic zone; and "southeast Alaska" means that portion of Alaska south and east of Cape Suckling to the Canadian border.  For purposes of this chapter, point of origination is established by a document which identifies the product and state or province in which it originates, including, but not limited to fish tickets, bills of lading, invoices, or other documentation required to be kept by governmental agencies.

    (2) "Commercial" means related to or connected with buying, selling, bartering, or processing.

    (3) "Possession" means the control of enhanced food fish by the owner and includes both actual and constructive possession.  Constructive possession occurs when the person has legal ownership but not actual possession of the enhanced food fish.

    (4) "Anadromous game fish" means steelhead trout and anadromous cutthroat trout and Dolly Varden char and includes byproducts and also parts of anadromous game fish, whether fresh, frozen, canned, or otherwise.

    (5) "Landed" means the act of physically placing enhanced food fish (a) on a tender in the territorial waters of Washington; or (b) on any land within or without the state of Washington including wharves, piers, or any such extensions therefrom.

    Sec. 2.  RCW 82.27.020 and 1993 sp.s. c 17 s 12 are each amended to read as follows:

    (1) In addition to all other taxes, licenses, or fees provided by law there is established an excise tax on the commercial possession of enhanced food fish as provided in this chapter.  The tax is levied upon and shall be collected from the owner of the enhanced food fish whose possession constitutes the taxable event.  The taxable event is the first possession in Washington by an owner.  Processing and handling of enhanced food fish by a person who is not the owner is not a taxable event to the processor or handler.

    (2) A person in possession of enhanced food fish and liable to this tax may deduct from the price paid to the person from which the enhanced food fish (((except oysters))) are purchased an amount equal to a tax at one-half the rate levied in this section upon these products.

    (3) The measure of the tax is the value of the enhanced food fish at the point of landing.

    (4) The tax shall be equal to the measure of the tax multiplied by the rates for enhanced food fish as follows:

    (a) Chinook, coho, and chum salmon and anadromous game fish:  Five and twenty-five one-hundredths percent.

    (b) Pink and sockeye salmon:  Three and fifteen one-hundredths percent.

    (c) Other food fish ((and shellfish, except oysters)):  Two and one-tenth percent.

    (((d) Oysters:  Eight one-hundredths of one percent.))

    (5) An additional tax is imposed equal to the rate specified in RCW 82.02.030 multiplied by the tax payable under subsection (4) of this section.

    Sec. 3.  RCW 82.27.030 and 1995 2nd sp.s. c 7 s 1 are each amended to read as follows:

    The tax imposed by RCW 82.27.020 shall not apply to:  (1) Enhanced food fish originating outside the state which enters the state as (a) frozen enhanced food fish or (b) enhanced food fish packaged for retail sales; (2) the growing, processing, or dealing with food fish ((or shellfish)) which are raised from eggs, fry, or larvae and which are under the physical control of the grower at all times until being sold or harvested; and (3) food fish, ((shellfish,)) anadromous game fish, and byproducts or parts of food fish shipped from outside the state which enter the state, except as provided in RCW 82.27.010, provided the taxpayer must have documentation showing shipping origination of fish exempt under this subsection to qualify for exemption.  Such documentation includes, but is not limited to fish tickets, bills of lading, invoices, or other documentation required to be kept by governmental agencies.

    Sec. 4.  RCW 43.06.400 and 1987 c 472 s 16 are each amended to read as follows:

    Beginning in January, 1984, and in January of every even-numbered year thereafter, the department of revenue shall submit to the legislature prior to the regular session a listing of the amount of reduction for the current and next biennium in the revenues of the state or the revenues of local government collected by the state as a result of tax exemptions.  The listing shall include an estimate of the revenue lost from the tax exemption, the purpose of the tax exemption, the persons, organizations, or parts of the population which benefit from the tax exemption, and whether or not the tax exemption conflicts with another state program.  The listing shall include but not be limited to the following revenue sources:

    (1) Real and personal property tax exemptions under Title 84 RCW;

    (2) Business and occupation tax exemptions, deductions, and credits under chapter 82.04 RCW;

    (3) Retail sales and use tax exemptions under chapters 82.08, 82.12, and 82.14 RCW;

    (4) Public utility tax exemptions and deductions under chapter 82.16 RCW;

    (5) Food fish ((and shellfish)) tax exemptions under chapter 82.27 RCW;

    (6) Leasehold excise tax exemptions under chapter 82.29A RCW;

    (7) Motor vehicle and special fuel tax exemptions and refunds under chapters 82.36 and 82.38 RCW;

    (8) Aircraft fuel tax exemptions under chapter 82.42 RCW;

    (9) Motor vehicle excise tax exclusions under chapter 82.44 RCW; and

    (10) Insurance premiums tax exemptions under chapter 48.14 RCW.

    The department of revenue shall prepare the listing required by this section with the assistance of any other agencies or departments as may be required.

    The department of revenue shall present the listing to the ways and means committees of each house in public hearings.

    Beginning in January, 1984, and every four years thereafter the governor is requested to review the report from the department of revenue and may submit recommendations to the legislature with respect to the repeal or modification of any tax exemption.  The ways and means committees of each house and the appropriate standing committee of each house shall hold public hearings and take appropriate action on the recommendations submitted by the governor.

    As used in this section, "tax exemption" means an exemption, exclusion, or deduction from the base of a tax; a credit against a tax; a deferral of a tax; or a preferential tax rate.

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