Business tax fairness bill introduced in Senate

WASHINGTON – The National Marine Manufacturers Association applauded Senator Charles Schumer, D-N.Y., for introducing S. 2721, a bill to stop unfair tax burdens on businesses that do not have a physical presence in a state, NMMA said in a statement Friday.

NMMA has joined with various trade associations, businesses and interest groups advocating for the 109th Congress to pass the Business Activity Tax Simplification Act (BATSA).

BATSA’s purpose is to clarify the term “presence” so businesses will know which activities trigger nexus in a state. The bipartisan legislation would significantly reduce room for interpretation of “presence,” to the point that a “bricks and mortar” facility would be required in a state before a company would be required to pay state income, franchise or sales taxes. Along with Schumer, George Allen, R-Va.; Mike Crapo, R-Idaho; Jim DeMint, R-S.C.; Tim Johnson, D-S.D.; and John Thune, R-S.D.; are sponsoring the bill. S. 2721 is virtually identical to H.R. 1956, legislation Reps. Bob Goodlatte, R-Va., and Rick Boucher, D-Va., sponsored; which cleared the House Judiciary Subcommittee on Commerce and Administrative Law in December 2005.

“The complexity and cost of understanding and complying with inconsistent and vague ‘nexus’ rules is detrimental to interstate commerce and hurts marine manufacturers doing business across state lines,” said Monita Fontaine, NMMA vice president of government affairs. “This is critical legislation to the boating industry, and Congress needs to act before the summer recess to protect our businesses and promote a healthy business economy.”

”In the last two years, some state tax enforcement agencies have demanded that boat manufacturers pay millions of dollars in back-taxes, interest, and fines in states where they had unknowingly established nexus,” said Thom Dammrich, NMMA president. “BATSA would clarify which business actions provide nexus for states to tax out-of-state businesses – reducing administrative overhead, minimizing litigation, increasing economic growth and creating new jobs in the recreational boating industry.”

NMMA’s coalition partners include, among others, the American Bankers Association, American Electronics Association, Chevron Texaco, Citigroup, Microsoft, Sony and the U.S. Chamber of Commerce.

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