50-State Tax Legislative Update Beth Cooley Council On State - PDF document

4/22/2009 50-State Tax Legislative Update Beth Cooley Council On State Taxation (COST) Albuquerque, New Mexico New Mexico Tax Research Institute April 30 th , 2009 Council On State Taxation • Outline • The Good & Bad News • State Budgets • State Taxation Trends – Combined Reporting – Internet Nexus – Amnesties – “Other” Council On State Taxation 1

4/22/2009 Projected Budget Gaps: FY 2009 As a Percentage of General Fund Budget WA VT ME MT ND OR MN NH MA ID WI SD MI NY WY RI CT PA IA NV NE NJ OH IN IL UT DE CA WV CO MD VA KS DC MO KY NC TN AZ OK NM AR SC GA AL MS AK TX LA HI FL Key: More than 15% of the state’s general fund 10% to 15% of the state’s general fund Less than 10% of the state’s general fund Not applicable Source: National Conference of State Legislatures “Update On State Budget Gaps: FY 2009 & FY 2010,” Jan. 30 2009 Council On State Taxation Projected Budget Gaps: FY 2010 As a Percentage of General Fund Budget WA VT ME MT ND OR MN NH MA ID WI SD MI NY WY RI CT IA PA NV NE NJ OH IL IN UT DE CA CO WV MD VA KS MO DC KY NC TN OK AZ NM AR SC AL GA MS AK TX LA HI FL Key: More than 15% of the state’s general fund 10% to 15% of the state’s general fund Less than 10% of the state’s general fund Not applicable Source: National Conference of State Legislatures “Update On State Budget Gaps: FY 2009 & FY 2010,” Jan. 30 2009 Council On State Taxation 2

4/22/2009 Combined Reporting: April 2009 WA ME MT ND OR VT MN NH ID WI MA SD MI NY WY CT RI PA IA NV NE NJ OH IN IL UT DE CA WV CO MD VA KS DC MO KY NC TN AZ OK NM AR SC GA AL MS AK TX LA HI FL Key No corporate income tax Mandatory unitarycombined reporting Combined reporting – not on a unitary basis – “substantial intercorporate transactions” Provide for combined filing, but taxes are in the form of gross receipts or other hybrid taxes Pending combined reporting legislation in 2009 Council On State Taxation Prediction: Combined • Reporting 2009 & Beyond – Alabama – Maryland (dead for 2009) – Connecticut – North Carolina – Florida – Tennessee (likely dead for 2009) – Louisiana – Rhode Island Council On State Taxation 3

4/22/2009 Addback Statutes • Arkansas • DC • Pennsylvania • Oregon • West Virginia Council On State Taxation Internet Nexus: New York “Starts Spreading The News” • New York: 2008 Budget • Proposals To-Date: – California – Connecticut – Hawaii – Illinois (by regulation) – Maryland (dead for 2009, likely to resurface 2010) – Minnesota – North Carolina (pending introduction) – Tennessee (likely dead) Council On State Taxation 4

4/22/2009 Amnesties • Arizona • Louisiana* • Maryland • New Jersey • New Mexico • Vermont • Virginia Council On State Taxation “Other” • Sales Tax Base Expansion (Exemption Review/Eliminations) – FL, PA, SC • Tax Commissions – AR, CA, MN, RI, SC • Vendor Compensation – CO, IL, TX, VA • Alternative Base Taxes Council On State Taxation 5

4/22/2009 Questions? Beth Cooley 202.484.5226 bcooley@cost.org Council On State Taxation 6