Legislature(1993 - 1994)
04/27/1993 08:35 AM House FIN
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
HOUSE BILL NO. 264
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"An Act providing for a fishery resource landing tax;
and providing for an effective date."
HB 264 was held in a subcommittee consisting of Chair
Parnell with members Representatives Navarre, Hoffman,
Therriault and Foster. Representative Parnell provided
members with a Committee Substitute for HB 264 (FIN), Work
Draft, 8-LS0941\X (Attachment 1).
MOLLY MCCAMMON, STAFF, REPRESENTATIVE MOSES explained
amendments adopted in the work draft. She compared the work
draft to CSHB 264 (FSH):
* Page 2, lines 7-11, credit for taxes paid in other
states was expanded to other jurisdictions. Taxes
equivalent in nature would be credited. Foreign
taxes could be credited.
* Page 3, line 12, clarifies that the credit is only
given on the portion of the harvest caught under
the CDQ.
* Language was added to clarified that tax credit
would be given on contributions to non profit for
use "in the state."
* Page 6, line 9, clarified the definition of
"value".
Ms. McCammon noted that amendment A, by Representative
Martin was not adopted by the Subcommittee (Attachment 2).
She discussed amendment A. She stated that the Department
of Community and Regional Affairs felt that the amendment
was redundant. She added that Amendment B, by
Representative Brown was not adopted by the Subcommittee
(Attachment 3). She discussed amendment 3. She stated that
the amendment would have suspended collection of the tax at
the request of a municipality. The Subcommittee concluded
that there is no way of adding a local option without
inclusion of other taxes, such as the Raw Fish Tax.
Representative Parnell MOVED to ADOPT, Work Draft, 8-
LS0941\X, Committee Substitute for HB 264 (FIN). There
being NO OBJECTION, it was so ordered.
Ms. McCammon explained, in response to a question by Co-
Chair MacLean, that section page 6, line 20 - 26 reflects
current statutes regarding the Fisheries Business Tax.
Harvest that is not contributed to a municipality will be
distributed according to a demonstration of community
impact.
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Co-Chair MacLean referred to page 2, lines 7 - 11. She
asked how foreign currency exchange would be calculated.
Ms. McCammon clarified, in response to a question by
Representative Parnell, that the CSHB 264 (FIN) would not
affect the previously adopted fiscal notes.
CARL MEYER, DEPARTMENT OF REVENUE explained that equivalent
taxes paid in foreign countries would be calculated based on
the average annual rate of the equivalent tax paid.
Representative Brown asked the definition of equivalent in
nature. Mr. Meyer explained that page 2, line 9 refers to
taxes similar to the Fisheries Business Tax or the Salmon
Enhancement Tax. Taxes imposed on the processing of the
resources in a foreign country would be credited.
Import/export duty or taxes and sales taxes would not be
credited.
Representative Navarre expressed concern that the
legislation does not clearly state that the tax credit will
only given on the portion of the harvest shared to
municipalities. Ms. McCammon provided members with a chart
demonstrating the formula for assessing the tax credit
(Attachment 4). Mr. Meyer explained attachment 4.
Representative Navarre agreed that the intent is that the
tax credit be given only on the portion shared to
municipalities. He questioned whether language in page 3,
section 43.77.050 clearly stated the intention of the
Committee and sponsor.
Co-Chair Larson asked if the person applying for the credit
could be the beneficiary of the use of the contribution.
Ms. McCammon explained that the legislation did not prevent
the processor from creating a nonprofit organization. She
noted that the processor's harvest would be under contract
to the CDQ community. If the CDQ community is unhappy with
the processor's tax credit contribution arrangement it is
unlikely that they will elect to grant the processor a
contract for future harvests.
Representative Navarre MOVED to ADOPT a conceptional
amendment to be drafted by legal counsel to assure that "the
credit is only against the amount that is to be shared back
with the community." Co-Chair Larson restated the motion to
say that, "the tax credit is only given toward the portion
that would go to the local government, not the state
portion."
Representative Parnell pointed out that the Department of
Revenue testified that the intent is implicit in the
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legislation. He noted that the amendment would make the
intent explicit in statute. There being NO OBJECTION, it
was so ordered.
Representative Parnell MOVED to report CSHB 264 (FIN) out of
Committee with individual recommendations and with the
accompanying fiscal notes. There being NO OBJECTION, it was
so ordered.
CSHB 264 (FIN) was reported out of Committee with a "no
recommendation" and with a fiscal impact note by the
Department of Commerce and Economic Development, dated
4/13/93 and with a fiscal impact note by the Department of
Revenue, dated 4/13/93.
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