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Published on Friday, February 5, 2016

Proposal establishes task force on local business tax & licensing simplification

The House Finance Committee is expected to move HB 2959, establishing a task force to evaluate and recommend legislation and options to continue local business tax and licensing simplification.

By January 1, 2017, the task force must consider and prepare legislation to address the following issues:

  • Options to coordinate administration of local B&O taxes;
  • Options for centralized administration of local B&O taxes for those cities wanting to participate in a state-provided alternative;
  • Options for all cities to partner with the state business licensing service; and
  • Implementation of data sharing and a seamless state and local user interface with FileLocal.

The task force is also directed to prepare a report by January 1, 2017, that:

  • Explores additional alternatives to improve local business taxes and licensing; and /li>
  • Examines differences in apportionment and nexus between state and local B&O taxes and how this impacts taxpayers and cities.

The task force must meet at least once per month and is to be made up of:

  • One representative of the Department of Revenue, who will serve as the chair.
  • Two representatives of the Association of Washington Business.
  • One representative of the National Federation of Independent Business.
  • One representative of the Association of Washington Cities.
  • One representative of a city with a B&O tax and a population greater than 100,000.
  • One representative of a city with a B&O tax and a population less than 100,000.

The bill directs the task force to consider options with the greatest benefit to taxpayers when developing the report and proposed legislation. The legislation and report must be approved by a majority of the members. A minority report must be issued if the task force does not reach consensus.

AWC and representatives from a number of cities have expressed concerns about the proposal and are actively working with the bill’s prime sponsor.

Categories: Budget & finance