I
106TH CONGRESS
2D SESSION
H. R. 4462
To provide for the simplification of sales and use taxes on interstate commerce
and to ensure that such taxes are equitably applied.
IN THE HOUSE OF REPRESENTATIVES
MAY 16, 2000
Mr. BACHUS (for himself, Ms. MCCARTHY of Missouri, Mr. ISTOOK, and Mr.
DELAHUNT) introduced the following bill; which was referred to the Com-
mittee on the Judiciary, and in addition to the Committee on Rules, for
a period to be subsequently determined by the Speaker, in each case for
consideration of such provisions as fall within the jurisdiction of the com-
mittee concerned
A BILL
To provide for the simplification of sales and use taxes
on interstate commerce and to ensure that such taxes
are equitably applied.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ‘‘Fair and Equitable
Interstate Tax Compact Simplification Act of 2000’’.
SEC. 2. FINDINGS.
The Congress finds that—
(1) the moratorium of the Internet Tax Free-
dom Act on new taxes on Internet access and on
multiple and discriminatory taxes on electronic com-
merce should be extended;
(2) States should be encouraged to simplify
their sales and use tax systems;
(3) as a matter of economic policy and basic
fairness, similar sales transactions should be treated
equitably, without regard to the manner in which the
sales are transacted, whether in person, through the
mails, over the telephone, on the Internet, or by
other means;
(4) Congress may facilitate such equitable tax-
ation consistent with the Supreme Court’s decision
in Quill Corp. v. North Dakota, 502 U.S. 808
(1992), which based its decision not to extend
States’ collection powers in significant part on its
view that Congress has, by virtue of its constitu-
tional power to regulate interstate commerce, the
ability to authorize States to require out-of-State
sellers to collect taxes on sales to in-State residents;
(5) States that adequately simplify their tax
systems should be authorized to correct the present
inequities in taxation by requiring sellers to collect
taxes on sales of goods or services delivered in-State,
without regard to the location of the seller or to the
means by which the good or service is sold;
(6) the States have experience, expertise, and a
vital interest in the collection of sales and use taxes,
and thus should take the lead in developing and im-
plementing sales and use tax collection systems that
are fair, efficient, and nondiscriminatory in their ap-
plication;
(7) States, by their own initiative, have formed
the Streamlined Sales Tax System Project, a cooper-
ative effort with local governments to radically sim-
plify the sales and use tax system by bringing uni-
formity to tax bases, definitions, and administration,
by simplifying the tax rate structure and administra-
tion, and by incorporating stringent privacy controls
and technology into the collection process to preserve
the basic tenets of consumer privacy, and that such
project should be allowed to proceed without inter-
vention by Congress; and
(8) online consumer privacy is of paramount
importance to the growth of electronic commerce
and must be protected.
SEC. 3. EXTENSION OF INTERNET TAX FREEDOM ACT MOR-
ATORIUM THROUGH 2006.
Section 1101(a) of the Internet Tax Freedom Act (47
U.S.C. 151 note) is amended by striking ‘‘3 years after
the date of the enactment of this Act—’’ and inserting
‘‘on October 21, 2006:’’.
SEC. 4. STREAMLINED SALES AND USE TAX SYSTEM.
(a) DEVELOPMENT OF STREAMLINED SYSTEM.—It is
the sense of the Congress that States and localities should
work together to develop a streamlined sales and use tax
system that addresses the following:
(1) A centralized, one-stop, multi-state registra-
tion system for sellers.
(2) Uniform definitions for goods or services
that may be included in the tax base.
(3) Uniform and simple rules for attributing
transactions to particular taxing jurisdictions.
(4) Uniform rules for the designation and iden-
tification of purchasers exempt from sales and use
taxes, including a database of all exempt entities
and a rule ensuring that reliance on such database
shall immunize sellers from liability.
(5) Uniform procedures for the certification of
software that sellers rely on to determine State and
local use tax rates and taxability.
(6) Uniform bad debt rules.
(7) Uniform tax returns and remittance forms.
(8) Consistent electronic filing and remittance
methods.
(9) State administration of all State and local
sales taxes.
(10) Uniform audit procedures.
(11) Reasonable compensation for sellers for
tax collection obligations that reflects the complexity
of an individual State’s tax structure, including the
structure of its local taxes.
(12) Exemption from use tax collection require-
ments for remote sellers falling below a specified de
minimis threshold.
(13) Appropriate protections for consumer pri-
vacy.
(14) Such other features that the member
States deem warranted to promote simplicity, uni-
formity, neutrality, efficiency, and fairness.
(b) NO UNDUE BURDEN.—Congress finds that if
States adopt the streamlined system described in sub-
section (a), such a system does not place an undue burden
on interstate commerce or burden the growth of electronic
commerce and related technologies in any material way.