"The National Conference of State Legislatures (NCSL) is once again adding its voice to the effort to pass the Federal Digital Goods and Services Tax Fairness Act. We are thankful for their continued support in this effort to pass a common sense solution that creates transparency around the taxation of digital goods."
- Samuel Whitehorn, Download Fairness Coalition
Below is the text of the NCSL Standing Committee on Budgets and Revenue's resolution related to digital goods:
"WHEREAS, digital goods and services are online purchases that are downloaded directly by, or services that are provided electronically to, consumers that regularly transcend numerous state and local boundaries across the United States; and
WHEREAS, the exponential growth of digital commerce has demonstrated the importance of digital products to the American economy; and
WHEREAS, state policymakers recognize that the continued deployment of broadband infrastructure and adoption of broadband services is vital to economic growth and participation in the global economy; and
WHEREAS, digital goods and services are a major driver of the rapidly growing 21st Century digital economy and as such, fair and rational tax policies are needed that will not impede the continued growth of this segment of the economy; and
WHEREAS, state and local governments continue to seek to modernize their tax base to include various forms of digital commerce, doing so without establishing a national framework could potentially subject consumers to multiple states claiming the right to tax the same transaction or subject such transactions to discriminatory taxation at rates higher than the rates imposed on the in-state sales of similar goods or services; and
WHEREAS, establishing a national framework would clearly identify which state and local jurisdiction can tax a digital transaction, which providers are required to collect taxes, and allow state and local governments seeking to tax such goods and services to do so in a fair, uniform and rational manner; and
WHEREAS, the U.S. Supreme Court ruled in South Dakota v. Wayfair that businesses need not be physically present in a state before their sales can be taxed, granting states the ability to collect taxes from out-of-state retailers, and providing an opportunity for state tax modernization; and
WHEREAS, establishing a national framework as set forth in the Digital Goods and Services Tax Fairness Act as introduced in the 116th Congress preserves state sovereignty as the decision to tax digital commerce or not remains solely with the states; and
WHEREAS, the Mobile Telecommunications Sourcing Act (P.L. 106-252) established uniformity in sourcing mobile telecommunications services for state and local tax purposes using similar concepts to those contained in the Digital Goods and Services Tax Fairness Act as introduced in the 116th Congress; and
WHEREAS, the National Conference of State Legislatures for nearly two decades has championed the efforts in Congress and in the states and has worked with members of the Download Fairness Coalition to develop the principles contained in the legislation and is poised to assist states as needed in complying with the federal legislation; and
NOW, THEREFORE, BE IT RESOLVED, that the National Conference of State Legislatures urges Congress to pass legislation that provides a framework for the taxation of digital goods and services consistent with NCSL principles to establish a national framework providing certainty and uniformity for state and local governments in the taxation of digital goods and services, while protecting consumers from multiple and discriminatory taxation and supporting the continued growth of the digital economy."
Expires August 2020