State of South Dakota
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EIGHTY-SEVENTH SESSION
LEGISLATIVE ASSEMBLY, 2012
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717T0080
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HOUSE CONCURRENT RESOLUTION NO. 1007
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Introduced by: Representatives Lucas, Conzet, Cronin, Dennert, Hunhoff (Bernie), Jones,
Turbiville, Vanneman, Willadsen, and Wink and Senators Peters, Bradford,
Hansen (Tom), Nelson (Tom), Novstrup (Al), Putnam, Rampelberg, and
Tidemann
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A CONCURRENT RESOLUTION, Urging the members of the South Dakota Congressional
delegation to sponsor and support the Marketplace Fairness Act and the Marketplace Equity
Act.
WHEREAS, the 1967 Bellas Hess and the 1992 Quill Supreme Court decisions denied states
the authority to require the collection of sales and use taxes by businesses that have no physical
presence in the taxing state; and
WHEREAS, the ability of consumers to make purchases from remote sellers that have no
physical presence has become significantly more accessible via the internet, and the sales tax
base is eroding as consumers are altering their purchasing habits; and
WHEREAS, the constraints imposed by the Supreme Court's decisions threaten the future
viability of the sales tax as a revenue source for state and local governments in this changing
market for consumer goods and services; and
WHEREAS, the federal government continues to shift program and financial responsibilities
to the states, but the inaction of Congress to permit states to require sales and use tax collection
on remote sales limits the states' ability to raise revenues for the funding of such programs from
one of the major state revenue sources; and
WHEREAS, if Congress were to act on this matter, it would provide some fiscal relief for
the states without costing the federal government a single cent or otherwise affect the federal
budget; and
WHEREAS, the Streamlined Sales and Use Tax Agreement (Agreement) provided the states
with one viable blueprint to create a simplified and more uniform sales and use tax collection
system. The states and the business community have worked for over ten years to simplify state
and local sales and use tax systems by establishing common definitions, sourcing rules, and
other factors to provide a streamlined system for the twenty-first century; and
WHEREAS, small businesses that have less than five hundred thousand dollars in gross
annual receipts are exempt from the provisions of the Agreement; and
WHEREAS, the Legislature of South Dakota and our colleagues in the other states have
shown the resolve to acknowledge the complexities of the current sales and use tax collection
system, have worked with the business community to formulate a truly simplified and
streamlined collection system, and have shown the political will to enact the necessary changes
to make the streamlined collection system the law; and
WHEREAS, by June 2011, twenty-one states, Arkansas, Georgia, Indiana, Iowa, Kansas,
Kentucky, Michigan, Minnesota, Nebraska, Nevada, New Jersey, North Carolina, North Dakota,
Oklahoma, Rhode Island, South Dakota, Vermont, West Virginia, Washington, Wisconsin, and
Wyoming, have enacted legislation to bring their states' sales and use tax statutes into
compliance with the Agreement; and
WHEREAS, the Center for Business and Economic Research at the University of Tennessee
has estimated that the states and local governments will lose as much as $14.8 billion in fiscal
year 2012 because they were not able to collect taxes on remote sales, a figure that increases to
$23 billion if mail order sales are included according to the National Conference of State
Legislatures, and the Center has estimated that South Dakota will lose as much as $38.8 million
in fiscal year 2012; and
WHEREAS, the Marketplace Fairness Act has been introduced in the United States Senate
and the Marketplace Equity Act has been introduced in the United States House of
Representatives, and both bills grant those states that comply with the Agreement the authority
to require sellers, regardless of nexus, to collect those states' sales and use taxes; and
WHEREAS, the Marketplace Fairness Act and the Marketplace Equity Act for the first time
would provide a comprehensive national solution to the sales tax collection by permitting states
that are unable to join the Agreement to enact sales and use tax simplifications and be granted
authority to require collection of taxes on remote sales, thereby removing the potential for
competitive advantage among the states; and
WHEREAS, the Marketplace Fairness Act and the Marketplace Equity Act will create fair
market competition between traditional and online only retailers which will enable South
Dakota businesses to grow and expand resulting in more jobs and continued economic growth
for South Dakota; and
WHEREAS, the Marketplace Fairness Act and the Marketplace Equity Act will allow South
Dakota small businesses to compete fairly in order to sustain and increase the fifty-two thousand
retail jobs throughout the state; and
WHEREAS, until Congress and the President enact legislation to permit states to require
collection of tax on remote sales, participation by remote sellers will only ever be voluntary
making it unlikely that the states will close the sales and use tax gap between what is owed on
remote transactions and what is collected:
NOW, THEREFORE, BE IT RESOLVED, by the House of Representatives of the Eighty-seventh Legislature of the State of South Dakota, the Senate concurring therein, that the
Legislature of South Dakota calls upon the members of our congressional delegation, Senators
Tim Johnson and John Thune, to support the Marketplace Fairness Act and Representative
Kristi Noem to support the Marketplace Equity Act; and
BE IT FURTHER RESOLVED, that the Legislature of South Dakota expresses its
appreciation and gratitude to Senator Tim Johnson for cosponsoring the Marketplace Fairness
Act and to Representative Kristi Noem for cosponsoring the Marketplace Equity Act; and
BE IT FURTHER RESOLVED, that the Legislature of South Dakota urges President Barack
Obama to sign into law legislation granting the states authority to collect sales and use tax on
remote sales, upon its passage by the Congress.