PUBLIC HEARING HB 2452

PUBLIC HEARING AND WORK SESSION

HB 2453, HB 2454

WORK SESSION

HB 2451

 

TAPES 45-46 A

 

HOUSE REVENUE COMMITTEE

FEBRUARY 17, 2005   1:00 PM   STATE CAPITOL BUILDING

 

Members Present:                      Rep. Tom Butler, Chair

                                                Rep. Vicki Berger, Vice-Chair

                                                Rep. Mark Hass, Vice-Chair

                                                Rep. Sal Esquivel                                       

                                                Rep. Larry Galizio

                                                Rep. Andy Olson

                                                Rep. Chuck Riley                

 

Members Excused:                     Rep. Brian Boquist

                                                Rep. Betty Komp

 

Witnesses Present:                      Debra Buchanan, Dept. of Revenue

 

Staff Present:                          Paul Warner, Legislative Revenue Officer

                                                Lizbeth Martin-Mahar, Economist

                                                Kristi Bowman, Committee Assistant

                                               

 

TAPE 45, SIDE A

 

 

 

003

Chair Butler

Calls meeting as a subcommittee to order at 1:05 p.m.

Full committee at 1:10 p.m.

 

OPENS PUBLIC HEARING FOR HOUSE BILL 2452

 

009

Lizbeth Martin-Mahar

Gives overview of HB 2452 (Exhibit 1) authorizing pass-through entities to file composite tax returns on behalf of non resident individuals, corporations or trusts.. Major change in bill is in section 3. The pass-through entity does not have to withhold taxes.  Changes current law ORS 314.760 (Exhibit 2). Refers to revenue impact (Exhibit 4).

 

 

 

055

Chair Butler

Asks about the impact of the bill on general trusts.

 

 

 

067

Martin-Mahar

Defers answer to Debra Buchanan, Dept. of Revenue. Discusses timing of withholding not specified in section 3 of the bill.

 

 

 

085

Debra Buchanan

Testifies in support of HB 2452 (see executive summary in Exhibit 5). It is a proposal that brings uniformity recommendation from the Multistate Tax Commission.

 

 

 

112

Chair Butler

Asks: what rate would the tax be calculated?

 

 

 

114

Buchanan

Responds that it would be at the highest marginal rate, and an example of how the return is calculated is on the last page of the handout.

127

Chair Butler

Asks about partnership and corporate tax rates.

 

130

Buchanan

Responds that the rates are stated in the bill on page 2, beginning at line 17.

 

 

 

136

Hass

Asks for clarification of multi-state partnership.

 

 

 

138

Buchanan

Discusses a multi-state partnership scenario.

 

 

 

158

Chair Butler

Questions and answers exchanged with Debra Buchanan regarding multi-state partnerships.

 

 

 

202

Rep. Berger

Asks clarifying question about what’s new in the bill.

 

 

 

210

Buchanan

Responds that there is a small change in the language to adopt the recommendations for uniformity from the Multistate Tax Commission. The bill does provide an incentive to for an individual to file if they have not joined into a composite filing.

 

 

 

215

Chair Butler

Additional comments about multi-state scenarios and tax distribution.

 

 

 

250

Buchanan

Concurs with the Chair’s comments.

 

 

 

283

Chair Butler

Discussion with Ms. Buchanan regarding trustee issues. Questions and answers exchanged.

 

 

 

366

Chair Butler

Finishes discussion on HB 2452.

 

 

 

CLOSES PUBLIC HEARING FOR HOUSE BILL 2452

 

 

 

OPENS PUBLIC HEARING FOR HOUSE BILL 2453

 

 

 

380

Martin-Mahar

Gives overview of HB 2453 (Exhibit 6) which permits claim of refund to be made by taxpayer pertaining to pass-through entity status. The extension of the time period for the Dept. of Revenue to verify any deficiencies could bring in additional revenue. The revenue impact is minimal (Exhibit 7).  

 

TAPE 46, SIDE A

 

006

Buchanan

Testifies in support of HB 2453 because the bill extends the time limit as stated by Martin-Mahar.

 

 

 

031

Chair Butler

General comments about HB 2453.

 

 

 

CLOSES PUBLIC HEARING FOR HOUSE BILL 2453

 

 

 

OPENS WORK SESSION FOR HOUSE BILL 2453

 

 

 

 

046

Rep. Olson

MOTION: MOVES HB 2453 TO THE HOUSE FLOOR WITH A DO PASS RECOMMENDATION.

 

 

 

048

Chair Butler

Calls meeting at ease at 1:37 p.m.

Calls meeting to order at 1:39 p.m.

 

 

 

050

Chair Butler

ORDER: THERE BEING NO OBJECTION, THE CHAIR SO ORDERS. MOTION PASSES 7-0-2. VOTING AYE: BERGER, ESQUIVEL, GALIZIO, HASS, OLSON, RILEY, BUTLER. EXCUSED: BOQUIST, KOMP.

 

 

 

CLOSES WORK SESSION FOR HOUSE BILL 2453.

 

 

 

OPENS PUBLIC HEARING FOR HOUSE BILL 2454.

 

 

 

072

Martin-Mahar

Gives overview of HB 2454 (Exhibit 10) which prescribes an allocation formula for part-year and nonresident taxpayers pertaining to pass-through entities.

 

 

 

094

Buchanan

Testifies in support of HB 2454 because it codifies the Oregon Tax Court’s decision pertaining to pass-through entity income (Exhibit 12).

 

 

 

111

Chair Butler

Questions and discussions about pass-through entities pertaining to part-year residents.

 

 

 

CLOSES PUBLIC HEARING FOR HOUSE BILL 2454.

 

 

 

OPENS WORK SESSION FOR HOUSE BILL 2454

 

 

 

170

Rep. Galizio

MOTION: MOVES HB 2454 TO THE HOUSE FLOOR WITH A DO PASS RECOMMENDATION.

 

 

 

187

Chair Butler

ORDER: THERE BEING NO OBJECTION, THE CHAIR SO ORDERS. MOTION PASSES 7-0-2. VOTING AYE: BERGER, ESQUIVEL, GALIZIO, HASS, OLSON, RILEY, BUTLER. EXCUSED: BOQUIST, KOMP.

 

 

 

CLOSES WORK SESSION FOR HOUSE BILL 2454

 

 

 

OPENS WORK SESSION FOR HOUSE BILL 2451

 

 

 

195

Martin-Mahar

Gives overview of House Bill 2451 (Exhibit 1) which adds a requirement to the working family child care tax credit. Refers to the HB 2451-1 amendment (Exhibit 2) and the revenue impact statement (Exhibit 3). The amendment pertains to the working family child care tax credit threshold of at least $6000 of earned income from Oregon sources only.

 

 

 

259

Rep. Berger

MOTION: MOVES THE ADOPTION OF THE HB 2451-1 AMENDMENT.

263

Chair Butler

ORDER: THERE BEING NO OBJECTION, THE CHAIR SO ORDERS. MOTION PASSES 7-0-2. VOTING AYE: BERGER, ESQUIVEL, GALIZIO, HASS, OLSON, RILEY, BUTLER. EXCUSED: BOQUIST, KOMP.

 

 

 

268

Rep. Berger

MOTION: MOVES HB 2451 AS AMENDED TO THE HOUSE WITH A DO-PASS RECOMMENDATION.

 

 

 

271

Chair Butler

ORDER: THERE BEING NO OBJECTION, THE CHAIR SO ORDERS. MOTION PASSES 7-0-2. VOTING AYE: BERGER, ESQUIVEL, GALIZIO, HASS, OLSON, RILEY, BUTLER. EXCUSED: BOQUIST, KOMP.

 

 

 

CLOSES WORK SESSION FOR HB 2451-1

 

 

 

270

Chair Butler

Committee administrative business discussed.

 

 

 

300

Chair Butler

Adjourns meeting at 1:55 p.m.

 

 

 

 

 

Tape Log Submitted by:

Reviewed by:

 

 

 

Kristi Bowman, Committee Assistant

Kim Taylor James, Committee Coordinator

 

Exhibit Summary:

  1. 1.      HB 2452, Staff Measure Summary, Martin-Mahar, 1 pg., 02/17/05
  2. 2.      HB 2452, ORS 314.760, Martin-Mahar, 1 pg., 02/17/05
  3. 3.      HB 2452, Fiscal Statement, Legislative Fiscal, 1 pg., 02/17/05
  4. 4.      HB 2452, Revenue Impact Statement, Martin-Mahar, 1 pg., 02/17/05
  5. 5.      HB 2452, Executive Summary, Dept. of Revenue, Buchanan, 8 pp., 02/17/05
  6. 6.      HB 2453, Staff Measure Summary, Martin-Mahar, 1 pg., 02/17/05
  7. 7.      HB 2453, Revenue Impact Statement, Martin-Mahar, 1 pg., 02/17/05
  8. 8.      HB 2453, Fiscal Statement, Legislative Fiscal, 1 pg., 02/17/05
  9. 9.      HB 2453, Executive Summary, Dept. of Revenue, Buchanan, 1 pg., 02/17/05
  10. 10.  HB 2454, Staff Measure Summary, Martin-Mahar, 1 pg., 02/17/05
  11. 11.  HB 2454, Fiscal Statement, Legislative Fiscal, 1 pg., 02/17/05
  12. 12.  HB 2454, Executive Summary, Dept. of Revenue, Buchanan, 6 pp., 02/17/05
  13. 13.  HB 2451, Amendment, Legislative Counsel, 1 pg., 02/14/05
  14. 14.  HB 2451, Staff Measure Summary, Martin-Mahar, 1 pg., 02/17/05
  15. 15.  HB 2451, Revenue Impact Statement, Martin-Mahar, 1 pg., 02/17/05
  16. 16.  HB 2451, Executive Summary, Dept. of Revenue, Buchanan, 3 pp., 02/17/05