BILL REQ. #:  H-3155.2 

Read first time 12/12/11.   Referred to Committee on Ways & Means.

     TO THE HONORABLE BARACK OBAMA, PRESIDENT OF THE UNITED STATES, AND TO THE PRESIDENT OF THE SENATE AND THE SPEAKER OF THE HOUSE OF REPRESENTATIVES, AND TO THE SENATE AND HOUSE OF REPRESENTATIVES OF THE UNITED STATES, IN CONGRESS ASSEMBLED:
     We, your Memorialists, the Senate and House of Representatives of the State of Washington, in legislative session assembled, respectfully represent and petition as follows:
     WHEREAS, The 1967 Bellas Hess and the 1992 Quill United States Supreme Court decisions denied states the authority to require the collection of sales and use taxes by out-of-state sellers that have no physical presence in the taxing state; and
     WHEREAS, This puts local, in-state sellers, whether electronic or brick and mortar, at a competitive disadvantage in making sales, because they must collect the sales tax and most remote sellers do not collect sales tax; and
     WHEREAS, The combined weight of the inability to collect sales and use taxes on remote sales through traditional carriers and the tax erosion due to electronic commerce threatens the future viability of the sales tax as a stable revenue source for state and local governments; and
     WHEREAS, The following federal legislation has been introduced in the United States Congress to grant states the authority to require all sellers, regardless of nexus, to collect those states' sales and use taxes:
     (1) The Main Street Fairness Act of 2011 (S.1452 sponsored by Senators Richard Durbin, Daniel Akaka, Daniel Inouye, Tim Johnson, Jack Reed, and Sheldon Whitehouse; and H.R. 2701 sponsored by Representatives John Conyers, Jr., Michael Capuano, Jesse Jackson, Henry C. "Hank" Jr. Johnson, Heath Shuler, Adam Smith, and Peter Welch);
     (2) The Marketplace Fairness Act of 2011 (S.1832 sponsored by Senators Michael Enzi, Lamar Alexander, Roy Blunt, John Boozman, Bob Corker, Richard Durbin, Tim Johnson, Mark Pryor, Jack Reed, and Sheldon Whitehouse); and
     (3) The Marketplace Equity Act of 2011 (H.R. 3179 sponsored by Steve Womack, Michael Cupuano, Judy Chu, Eric A. "Rick" Crawford, Theodore E. Deutch, Mario Diaz-Balart, John J. Duncan Jr., Renee L. Ellmers, Gene Green, Carolyn B. Maloney, Betty McCollum, Brad Miller, Kristi L. Noem, Ted Poe, Dennis Ross, Heath Shuler, Jackie Speier, and Peter Welch); and
     WHEREAS, It is estimated that Washington would realize up to $170.3 million in state and local taxes in the 2011-2013 biennium, and $483.0 million in state and local taxes in the 2013-2015 biennium, if it had the ability to require remote sellers to collect our state's sales and use taxes; and
     WHEREAS, Since 1999, state legislators, governors, local elected officials, state tax administrators, and representatives of the private sector have worked to develop a Streamlined Sales and Use Tax Collection System for the 21st century; and
     WHEREAS, On November 12, 2002, state delegates unanimously ratified the Streamlined Sales and Use Tax Agreement, which substantially simplifies state and local sales tax systems, removes the burdens to interstate commerce that were of concern to the Supreme Court, protects state sovereignty, and is consistent with the introduced federal legislation; and
     WHEREAS, The Streamlined Sales and Use Tax Agreement provides the states with a blueprint to create a simplified and more uniform sales and use tax collection system that when implemented, allows justification for Congress to overturn the Bellas Hess and Quill decisions; and
     WHEREAS, Washington State enacted legislation in 2007 to bring this state's sales and use tax statutes into compliance with the Streamlined Sales and Use Tax Agreement; and
     WHEREAS, By November 30, 2011, 24 states: Arkansas, Georgia, Indiana, Iowa, Kansas, Kentucky, Michigan, Minnesota, Nebraska, Nevada, New Jersey, North Carolina, North Dakota, Ohio, Oklahoma, Rhode Island, South Dakota, Tennessee, Utah, Vermont, Washington, West Virginia, Wisconsin, and Wyoming, representing over 40 percent of the total population of the United States enacted legislation to bring their state's sales and use tax statutes into compliance with the Agreement; and
     WHEREAS, Over 1,700 businesses have voluntarily registered under the Streamline Sales and Use Tax Agreement to collect and remit sales and use taxes; and
     WHEREAS, The legislature of Washington and our colleagues in the other states have shown the resolve to acknowledge the complexities of the current sales and use tax collection system, have worked with the business community to formulate a truly simplified and streamlined collection system, and have shown the political will to enact the necessary changes to make the streamlined collection system the law; and
     WHEREAS, Until Congress and the President enact federal legislation, participation by remote sellers is only voluntary and thus states are unlikely to close the revenue gap between what is owed on remote transactions and what is collected; and
     WHEREAS, Governors and state legislatures have made the difficult choices to reduce spending and where necessary to raise revenue during the recent "great" recession to close the $417 billion cumulative budget gaps; and
     WHEREAS, After closing $417 billion in budget gaps for fiscal years 2009-2011, the estimated budget shortfall for states in fiscal year 2012 will be $82 billion and for fiscal year 2013 will be $67 billion; and
     WHEREAS, Federal legislation would provide fiscal relief for the states by enabling collections of taxes that are already due;
     NOW, THEREFORE, Your Memorialists respectfully pray that: The members of our congressional delegation join as cosponsors of the introduced federal legislation and support the Act's swift adoption by the Congress of the United States; and that President Barack Obama sign the legislation, upon its passage by Congress.
     BE IT RESOLVED, That copies of this Memorial be immediately transmitted to the Honorable Barack Obama, President of the United States, the President of the United States Senate, the Speaker of the House of Representatives, and each member of Congress from the State of Washington.