Limiting tax authority of out-of-state truckers pursued on Capitol Hill

| 5/6/2011

More and more states, as well as cities, are cashing in on out-of-state truckers doing business in the area. That patchwork of tax laws is the target of a new bill introduced in the U.S. House of Representatives.

The “Business Activity Tax Simplification Act of 2011,” was introduced by Rep. Robert Goodlatte, R-VA, in the House on April 8. It addresses such taxes as corporate taxes, franchise taxes, income taxes and business activity taxes.

The bill seeks to establish a national standard on these taxes so they can only apply to businesses located in a city or state.

The bill would allow the taxes on businesses that are physically located in the state or local jurisdiction. That means businesses with employees, a building, etc. The bill seeks to prevent taxes on “transient business activity,” for example trucks picking up and delivering freight.

Support for the bill is growing by leaps and bounds. A letter delivered to Rep. Lamar Smith and Rep. Howard Coble, who are the chairman of the House Judiciary Committee and Subcommittee on Courts, Commercial and Administrative Law respectively, voiced support of the bill by 172 business, groups and trade organizations such as OOIDA.

“The most maddening thing in the world for a small-business trucker is to one day receive a bill in the mail for simple operations through a state collecting on some obscure tax you’ve never heard of and no rational human being would think you have any obligation to pay,” said Todd Spencer, executive vice president of the Owner-Operator Independent Drivers Association.

“We appreciate the efforts of Congressman Goodlatte to interject some sanity into the way small-business truckers are preyed upon with these random taxes.”

The House Judiciary Subcommittee has a hearing on the bill, HR1439, slated for May 13. The letter of support was submitted to the official record.