NACDS supports H.R. 5267 to clarify taxation of out-of-state businesses

April 18, 2008

NACDS supports legislation to clarify taxation of out-of-state businesses.

The letter to leaders of the U.S. House Judiciary Committee and the Subcommittee on Commercial and Administrative Law, NACDS joined a coalition of more than 100 businesses and organizations to support H.R. 5267, the Business Activity Simplification Act (BATSA) of 2008. A growing trend among some states has been to tax out-of-state businesses that have minimal contact within their boundaries. For example, a company could be subject to business activity taxes if its trucks pass through certain states fewer than six times in a year without even delivering or picking up goods. Other states contend that the presence of a Web site server is sufficient for imposing these taxes. As a result many businesses are reluctant to expand their activities into states where they could face significant taxation. "BATSA would ensure fairness; minimize costly litigation for both state governments and taxpayers; and create the kind of legally certain and stable business environment that encourages business to make investments, expand interstate commerce, and create new jobs," the letter stated. "At the same time, the bill would ensure that businesses continue to pay business activity taxes to states

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