HomeMy WebLinkAboutReg 2003-12-01 Item 6C - Resolution - Support Streamlined Sales Taxll l
I Meeting Date
I 12/1/03
Meeting Date
12/1/03
COUNCIL AGENDA SYNOPSIS
Initials
1 Meeting Date Prepared by 1 Mayor's review 1 Council review I
I 12/1/03 ARD I 1 1
I I 1 I
I I I I
I I I I
CAS Number: 03-157 I Original Agenda Date: 12/1/03
1 Agenda Item Title: Resolution for Sales Tax Sourcing proposed changes.
Original Sponsor: Council Admin. X
I Timeline: Approve at December 1, 2003 Regular Meeting
Sponsor's Summary: To attempt to hold cities harmless from proposed sales tax rules, which will change point of
sale to final destination.
Recommendations:
Sponsor: Approve as submitted
Committee: Finance Safety Committee will review on December 1, 2003.
Administration: Same as sponsor
Cost Impact (if known): N/A
Fund Source (if known): N/A
ri ,%/i1 Gi Or 3 i;4# .i•;
Staff ff report dated November 26,2003
Proposed resolution
Action
ITEM NO.
Attachments
To: Mayor City Council
From: Alan R. Doerschel G i2 0
Date: November 26, 2003
Subject: Sales Tax Sourcing Resolution
To supplement our effort to convince the State Legislature and State
Agencies to consider not changing the point of sale rules in Washington,
many cities are passing resolutions.
The resolutions essentially are intended to "hold harmless" cities that
would by negatively impacted. The City of Tukwila is projected to be a
major loser, second most impacted after the City of Kent. The estimated
loss if no mitigation is put into place, is over $1 million.
The resolution before you is a composite of several resolutions passed by
other cities (Kent Woodinville).
MAT
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TUICWILA,
WASHINGTON, SUPPORTING THE WASHINGTON STATE ADOPTION
AND IMPLEMENTATION OF THE STREAMLINED SALES TAX
AGREEMENT, PROVIDING THAT THE STATE: 1) ENSURES A FULL
MITIGATION OR "HOLD HARMLESS" METHOD IS PUT IN PLACE FOR
SOURCING IMPACTED CITIES; AND 2) UTILIZES A TIMELINE THAT IS
CLOSELY LINKED TO CONGRESSIONAL AUTHORIZATION OF
INTERNET AND CATALOG SALES TAXES.
WHEREAS, the City of Tukwila understands and supports the concept of
streamlining definitions and sales tax rates for interstate sales; and
WHEREAS, the City of Tukwila believes it is important to make the State sales tax
system effective and efficient for private businesses both within the State of
Washington and outside our geographic boundaries; and
WHEREAS, the State of Washington's tax structure is highly dependent upon sales
tax receipts; and
WHEREAS, the City of Tukwila has committed to its citizens and businesses
capital improvements, repayment of outstanding debt, and the delivery of services that
depend upon present and future sales tax income projected on a point of sale basis; and
WHEREAS, many cities, including the City of Tukwila, have worked hard to
develop economic, transportation, and land use policies that meet regional needs for
employment in warehousing, manufacturing, and retail activities, and have expended
significant resources to address infrastructure, traffic and law enforcement demands
that result from those policies; and
WHEREAS, if the State changes the distribution of sales tax receipts from point of
sale to point of distribution, there is a tax shift between cities who have developed the
economic and land use policies to support regional growth to areas where cities have
chosen not to have this activity in their geographic boundaries; and
WHEREAS, if the State changes the distribution of sales tax receipts from point of
sale to point of distribution, a few dozen cities will bear the largest share of the burden;
and
WHEREAS, there are fundamental fairness issues that need to be honored when a
major shift in tax policy would result in significant adverse impacts to dozens of
jurisdictions, such as the City of Tukwila, that have simply been following Washington
State's tax policy and rules for many years; and
WHEREAS, issues of equality are of great importance to the City of Tukwila;
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF TUICWILA,
WASHINGTON, HEREBY RESOLVES AS FOLLOWS:
Section 1. The above recitals are found to be true and correct in all respects.
STREAMLINED SALES TAX AGREEMENT 11/26,03
Section 2. The City of Tukwila supports the concept of streamlining sales tax
information and definitions to make it easier to collect sales taxes for interstate and
intra -state Internet -based commerce.
Section 3. The City of Tukwila strongly urges that the Department of Revenue
recommend, and ultimately the Washington State Legislature adopt, sales tax
streamlining in a way that contains strong mitigation or hold harmless measures for
sourcing impacted cities, such as a method that protects intra -state sales tax revenues
by adopting point -of- delivery collection measures on the one hand, but using
distribution methods that protect City revenues on the other.
Section 4. The City of Tukwila strongly urges that the Department of Revenue
recommend, and ultimately the Washington State Legislature adopt, measures that
either fully link, or more closely link any implementation of the Streamlined Sales Tax
Agreement to Congressional authorization of sales tax imposition on Internet -based
and mail -order catalog sales.
PASSED BY THE CITY COUNCIL OF THE CITY OF TUKWILA, WASHINGTON,
at a Regular Meeting thereof this day of 2003.
ATTEST /AUTHENTICATED:
Jane E. Cantu, CMC, City Clerk
APPROVED AS TO FORM BY:
Office of the City Attorney
STREAMLINED Saes Tax AGREEMENT 1l/26,03
Filed with the City Clerk:
Passed by the City Council:
Resolution Number.
Pam Carter, Council President