October 16, 2003, Meeting Minutes
Mike Ralston, Co-chair, opened the meeting.
Kristi Magill, Co-chair, updated the group on the Chicago meeting. She discussed the Certified Service Providers and Request for Proposal (RFP) session in Chicago. Don Cooper and Rod Erickson attended this session. All agreed it was very preliminary. Mainly identifying vendors interested in being Certified Service Providers or Certified Software Providers. Technology is supposed to be ready by July 1, 2004, which could be iffy.
Working Group discussions in Chicago pertained to:
- Exemption Certificates
- Rates & Boundary Data bases
- Registration, Returns, Remittances
- Taxability Matrix
- Digital Equivalent of Tangible Personal Property (definition to finalize in November)
Warren Townsend was also in Chicago. He and Kristi wanted more information on who's going to pay for software? Both could find out very little. Additional generated revenue will pay for vendors, but methodology and amounts still need to be worked out.
Jim Henter asked about the Cost of Compliance Study. MTC signed with KPMG to study. Wayne Zakrzewski (J.C. Penney) and Dan Bucks (MTC) head up the study. This study will expand on the concept of paying for certified service providers or certified software. A question was also raised about a test project regarding compliance through a certified service provider. Four states were the pilot project. There has not been much feedback on the pilot. Had trouble fining companies willing to participate.
Rod Erickson mentioned a positive step is that a Technology Workshop will be scheduled at the December SSTP meeting. The first session will be government only.
Federal Legislative Update: H.R. 3184 introduced September 25 and a companion Senate bill was introduced October 15 (S.B. 1736). Federal bills would provide for vendor compensation.
Also, Business Activity Tax (BAT) introduced. Needs to remain separate from SSTP. Mike handed out an article from the Wall Street Journal on Amazon.com.
Update on IDR Activity: David Casey reminded people to check the streamlined website at www.streamlinedsalestax.org. Most of the issue papers can be found under the headings Meetings & Materials.
The department has been working on the Compliance Checklist, which we call "Certificate of Compliance."
October 31st goal to complete so Don can take to Arizona. Darwin's working on rules which are really preliminary at this time. We should have a portion of them by next meeting which we will seek input and review of.
In the area of Iowa Legislation, things we need to look at and identify:
- Utility phase out
- Rental of tangible personal property (including rents, royalties, copyrights)
- Sales tax provisions
- Common state and local tax base
Taxability Matrix - We have a draft. We are waiting for more information regarding this draft.
The department had created an index of new legislation referenced to current Iowa code. This index will be updated and then distributed.
Systems - Rod discussed the registration side. Discussed with registration vendors. Sales tax reports will be 3 line items:
1. Location in-state
2. Retail use
3. Goods consumed for inventory
Jurisdiction Databases - South Dakota gave a presentation on their database. We have 3 databases to create.
Seventeen companies have already came forward. $850,000 in projected annual collections.
Discussed Model Sellers, i.e., certified service providers, certified software and certified proprietary systems.
Went through the Agreement. Ended with Sourcing on page 18. Sourcing will be one of the largest impacts on Iowa.
Any feedback or examples of sourcing scenarios please provide to Don or Kristi before the November 17-19 meetings in Phoenix.
Next meeting will be December 3, 2003 at 10:00 A.M. in the fourth floor conference rooms at the Hoover Building. Agenda items already identified:
1. Update on Phoenix
2. Update on Federal Legislation
3. Communication of July 1, 2004 Changes (Education)
The meeting was adjourned.