Tax reform 2020.

2018
STATE OF WYOMING
18LSO-0393
Numbered
1.2

SENATE FILE

NO.
SF0109

Tax reform 2020.

Sponsored by:
Senator(s) Rothfuss, Burns, Peterson and Von Flatern and Representative(s) Connolly, Madden and Miller

A BILL

for

AN ACT relating to taxation and revenue; creating the tax reform 2020 committee as specified; requiring a report; providing an appropriation; and providing for an effective date.

Be It Enacted by the Legislature of the State of Wyoming:

Section 1.

(
a)

The Wyoming l
egislature finds that
Wyoming's
tax structure
is disproportionately based on
mineral extraction
, which has historically provided
approximately sixty-five percent (65%) to seventy percent (70%) of state
tax revenues. Under the current tax structure, if the state economy were to become more diversified in the future those new industries may be assessed taxes in amounts disproportionate to the
tax
burdens on other industries. In order to address the state tax structure,
there is created the tax reform 2020 committee
consisting of

ten (10)
members
as follows
:

(i)

Five (5) members of the senate appointed by the president of the senate, not more than four (4) of whom shall be of the same political party. One (1) of the members shall be a member of the joint revenue interim committee and one (1) of the members shall be a member of the joint appropriations committee;

(ii)

Five (5) members of the house of representatives appointed by the speaker of the house, not more than four (4) of whom shall be of the same political party. One (1) of the members shall be a member of the joint revenue interim committee and one (1) of the members shall be a member of the joint appropriations committee.

(b)

The committee is authorized to sponsor legislation for consideration by the Wyoming legislature. No legislation shall be sponsored by the committee unless it is approved by a majority of the members of the committee from the senate and a majority of the members of the committee from the house of representatives.

(c)

The mission of the committee shall be to develop comprehensive legislation for a fair, viable and economically competitive state and local tax structure capable of generating revenues to meet the needs of the state and its citizens for a diversified economy
, independent of the distribution of industry
. In developing legislation
,
the committee shall:

(i)

Examine the tax structures of neighboring states as well as the tax structures of states with high business growth rates;

(ii)

Analyze the current state and local revenue system including:

(A)

The relative burden imposed by the current tax system on taxpayers and the relative equity of that burden;

(B)

The burden imposed by the tax system on individual industries and the relative equity or uniformity of that burden;

(C)

The dependability of the current tax system relative to the needs of the state and its citizens;

(D)

The relationship between taxes and the revenue needs of the state and local governments;

(E)

The relationship between the tax burden and the benefits citizens receive from government including the relative tax benefits and burdens generated by new positions and new citizens entering the state
,

including differences among different

industries
.

(iii)

Consider the impact of the state tax structure on economic development and the potential impact
of any changes to the tax structure on existing industries and future economic development in the state;

(iv)

Identify the path to an equitable tax structure for Wyoming
and a diversified economy
through the year 2040. The committee shall establish the proposed approximate percentages of state gross domestic product applicable to the energy production industry, agriculture, tourism, information technology, biotechnology, the financial industry, manufacturing, the service industry and other economic drivers of the state and evaluate the relative tax burdens applicable to each industry including considerations of taxes applicable to the secondary economies related to each industry;

(v)

Determine a
method or model
to test
different
scenarios for the tax structure or structures considered by the committee and use that
method or model
to consider the stability of recommendations to revisions of the tax structure;

(vi)

Identify incentives to attract industries to Wyoming and diversify the state economy including reviewing the actions of other states, considering options to promote internal commerce, providing partial tax rebates or credits and avoiding double taxation;

(vii)

Consider options for increasing autonomy in the tax structures of cities, towns and counties.

(d)

Nothing in this section shall be interpreted to require the committee to
consider solutions for
the near term revenue issues of Wyoming or to specify that the objective of the committee is to increase or decrease revenues.

(e)

The committee shall provide a report on the study completed by the committee under subsection (c) of this section to the legislature
not later than December 31, 2019
. The report shall include any proposed legislation sponsored by the committee to overhaul, diversify and modernize the Wyoming tax structure.

(f)

The committee shall be staffed by the legislative service office. The department of revenue shall serve in an advisory capacity to the committee and shall provide technical and other relevant information as requested.

(g)

The committee sha
ll exist until December 31, 2019
.

Section 2.

There is appropriated sixty thousand dollars ($60,000.00)
from the
general
fund to the
legislative service office.
This appropriation shall be for the period beginning with the effective date of t
his act and ending June 30, 20
20
.

This appropriation shall only be expended for the purpose of
the tax reform 2020 committee as provided in section 1 of this act.
Notwithstanding any other provision of law, this appropriation shall not be transferred or expended for any other purpose and any unexpended, unobligated funds remaining from this appropriation sha
ll revert as provided by law on June 30, 20
20
.

Section 3.

This act is effective immediately upon completion of all acts necessary for a bill to become law as provided by Article 4, Section 8 of the Wyoming Constitution.

(END)

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SF0109