HOUSE CONCURRENT RESOLUTION NO. 28
(By Delegates Guthrie, Hrutkay, Kessler,
Mahan, Moore and Perdue)
Requesting that the Joint Committee on Government and Finance study
the potential revenue generating system referred to as the
"automatic transaction fee" and the effect the implementation
of a revenue collection system based on a simple percentage of
each transaction over five hundred dollars would have on the
current tax structure of this state, the impact it would have
on the economy of this state and the potential the system may
have in diversifying and converting the revenue streams of
state government, county governments and municipal governments
which rely disproportionately on a relatively small number of
revenue sources.
Whereas, Under the automatic transaction fee system, payment
would be collected by state financial institutions through the
state treasury or through the Department of Revenue. Transaction
fee payors would become liable for the fee at the moment they are
able to exercise control over a piece of property, goods or
services over five hundred dollars regardless of the payment
instrument or method (cash, check, credit, debit or wire transfer)
and although the transaction fee may appear similar to the sales
and use tax, there is a major distinction in that a sales tax is charged only on sales to the final consumer of the product, while
the automatic transaction fee would apply to both sellers and
buyers in each transaction over five hundred dollars; and
Whereas, An automatic transaction fee revenue system can
provide a broad revenue base at the lowest possible rate which
could potentially simplify tax collections, lower the tax burden
for citizens and businesses while capturing underground economic
activity that currently avoids taxation and transactions made by
foreign investors and corporations; and
Whereas, It is both prudent and necessary to begin planning for
major future contingent issues that may affect current revenue
streams, especially, the potential loss of federal funding, the
continued loss of manufacturing jobs and the escalating costs of
essential services; and
Whereas, By addressing the possibility of initiating an
automatic transaction fee collection system, it may be possible to
eliminate the sales tax on food and clothing, all current business
taxes and personal state income taxes; therefore, be it
Resolved by the Legislature of West Virginia:
That the Joint Committee on Government and Finance is
requested to study the potential revenue generating system referred
to as the "automatic transaction fee" and the effect the
implementation of a revenue collection system based on a percentage
of each transaction would have on replacing the current tax structure of this state, the impact it would have on the economy of
this state and the potential the system may have in diversifying
the revenue streams of state government, county governments and
municipal governments which rely disproportionately on a relatively
small number of revenue sources; and, be it
Further Resolved, That the Joint Committee on Government and
Finance examine ways to introduce a system of automatic transaction
fees as a replacement source of revenue on a pilot basis in this
state and to involve qualified economic and tax researchers from
the major research education institutions in this state to support
the study; and, be it
Further Resolved, That the Joint Committee on Government and
Finance report to the regular session of the Legislature, 2008, on
its findings, conclusions and recommendations, together with drafts
of any legislation necessary to effectuate its recommendations;
and, be it
Further Resolved, That the expenses necessary to carry out its
duties, to prepare a report and to draft necessary legislation be
paid from legislative appropriations to the Joint Committee On
Government and Finance.
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