A complicated issue dealing
with a motor carrier's place of business has Oklahoma under serious scrutiny
by the International Registration Plan (IRP). The IRP Board of Directors has
voted to suspend the state's IRP voting rights and privileges to participate
on committees until the state tax commission comes up with a compliant plan.
"If you've been
using Oklahoma, as a small business person, it's in your best interest to
re-evaluate where you base plate out of," advises OOIDA's Gary Green.
"It looks to us like the advantages of base plating in Oklahoma has come
to an end."
The IRP has decided Oklahoma's
rules allowing motor carriers to use a service provider in the state to establish
a place of business are insufficient. The Oklahoma Tax Commission has a proposal
making its way through the rulemaking process to address this issue. The IRP
board has set a Feb. 15, 2002, deadline for compliance after which other states
and provinces can withhold fees from Oklahoma. According to published sources,
this could be as much as $1 million a month.
Oklahoma's IRP plates
are due for renewal Dec. 31. This means that the enforcement date is likely
to be around March 1.
OOIDA's business services
department says problems are likely for owner-operators who for registration
purposes use a different principle place of business other than where operating
authority is registered. "We are getting calls daily," says OOIDA's
Paula McGee. For instance, Wisconsin now has a new form for single state registration
renewal that asks what state your IRP account is located in. If the answer
is not Wisconsin, says McGee, they are going to scrutinize which is your actual
principle place of business.
For some years, Oklahoma
has been successful in using certain tax and licensing benefits to attract
the base plate business of motor carriers and owner-operators. While many
trucking companies found those benefits allowed them to save money, states
where these companies had registered operating authority were deprived of
income they felt belonged to them. One state, Illinois, is now asking for
$15.5 million in fees it claims Oklahoma owes for the registration years 1999-2001
over Oklahoma's administration of the established place of business. Part
of the claim is for revenue Illinois feels was diverted from its state coffers
by Oklahoma's practice of allowing first year registrants to estimate their
own miles, while most other states have pre-set miles. Oklahoma no longer
does this and now has a strictly enforced estimated mileage chart in place.