SENATE BILL REPORT

SSB 6561

BYSenate Committee on Ways & Means (originally sponsored by Senators Saling, Gaspard, Bailey, Patterson, Deccio, Barr and Garrett)

Exempting from use tax certain property acquired by institutions of higher education.

Senate Committee on Higher Education

Senate Hearing Date(s):February 2, 1988

Majority Report:  Do pass and refer to Ways & Means.

      Signed by Senators Saling, Chairman; Patterson, Vice Chairman; Anderson, Hansen, McMullen, Smitherman, von Reichbauer.

Senate Staff:Scott Huntley (786-7421)

                  February 2, 1988

Senate Committee on Ways & Means

Senate Hearing Date(s):February 4, 1988; February 5, 1988

Majority Report:  That Substitute Senate Bill No. 6561 be substituted therefor, and the substitute bill do pass.

      Signed by Senators McDonald, Chairman; Craswell, Vice Chairman; Bauer, Cantu, Deccio, Fleming, Gaspard, Johnson, Lee, Moore, Newhouse, Saling, Talmadge, Vognild, Warnke, Williams, Wojahn, Zimmerman.

Senate Staff:William Bafus (786-7437)

                  February 12, 1988

AS PASSED SENATE, FEBRUARY 11, 1988

BACKGROUND:

In the past there has been confusion over whether or not institutions of higher education are liable for the use tax on equipment which they receive through intergovernmental transfer or loan.  Some of the institutions have maintained records and paid the tax on this loaned equipment while others have not.  A memorandum written by the Attorney General's Office in 1979 originally raised questions about whether colleges and universities are liable for the use tax on such equipment.  It is argued that clarification is needed about the liability of institutions of higher education for the use tax on equipment which they receive through intergovernmental transfer or loan, and that the use of equipment received through such transfers and loans should be exempted from the use tax provisions.

SUMMARY:

An exemption from the use tax is provided to public and private institutions of higher education for equipment which is acquired through intergovernmental transfer or loan and is accepted by the institution for direct use in instruction or research.  The title for this equipment which is exempt from the use tax must not be vested in the institution.

Appropriation:    none

Revenue:    yes

Fiscal Note:      available

Senate Committee - Testified: HIGHER EDUCATION:  Reid Miller, Washington State University (for)

Senate Committee - Testified: WAYS & MEANS:  Bob Smith, WSU (for)