BILL REQ. #:  H-3888.2 

Read first time 01/11/2006.   Referred to Committee on Technology, Energy & Communications.

     AN ACT Relating to a tax exemption for the sale of telecommunications or internet services to customers; adding a new section to chapter 82.08 RCW; and providing an expiration date.

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

NEW SECTION.  Sec. 1   A new section is added to chapter 82.08 RCW to read as follows:
     (1) The tax levied by RCW 82.08.020 shall not apply to tangible personal property for use or consumption directly and predominantly in the receiving, initiating, amplifying, processing, monitoring, transmitting, retransmitting, or switching of telecommunications services for sale, internet access services for sale, or any combination thereof, including tangible personal property used or consumed to upgrade systems used to provide those same services.
     (2) The tax levied by RCW 82.08.020 shall not apply to machinery, equipment, and other tangible personal property for use in a data center or call center that supports the sale of telecommunications or internet services for customers.
     (3) Where otherwise taxable services are rendered directly to or in relation to tangible personal property as outlined in subsection (1) of this section, those services are also exempt from the tax levied by RCW 82.08.020.
     (4) The joint legislative audit and review committee, with the cooperation of the department of revenue, shall report on the effectiveness of the tax incentives in this section to the appropriate committees of the legislature by December 1, 2007. The report shall measure the effectiveness of the tax incentives on promoting build out of telecommunications infrastructure and any other factors the committee may select.
     (5) This section expires June 30, 2013.