[Congressional Bills 107th Congress]
[From the U.S. Government Publishing Office]
[H.R. 3398 Introduced in House (IH)]







107th CONGRESS
  1st Session
                                H. R. 3398

 To provide Federal reimbursement to State and local governments for a 
       30-day sales, use, and retailers' occupation tax holiday.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                            December 4, 2001

  Mr. Israel introduced the following bill; which was referred to the 
                      Committee on Ways and Means

_______________________________________________________________________

                                 A BILL


 
 To provide Federal reimbursement to State and local governments for a 
       30-day sales, use, and retailers' occupation tax holiday.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Consumer and Retail Sales Stimulus 
Act of 2001''.

SEC. 2. STATE AND LOCAL SALES TAX RELIEF FOR CONSUMERS.

    (a) In General.--The Secretary shall reimburse each State for the 
amount of State and local sales tax payable and not collected during 
the sales tax holiday period.
    (b) Determination and Timing of Reimbursement.--
            (1) Predetermined amount.--Not later than 30 days after the 
        expiration of the sales tax holiday period, the Secretary shall 
        pay to each State an amount equal to the sum of--
                    (A)(i) the amount of State and local sales tax 
                payable and collected in such State during the same 
                period in 2000 as the sales tax holiday period, times
                    (ii) an acceleration factor equal to 1.73, plus
                    (B) an amount equal to 1 percent of the amount 
                determined under subparagraph (A) for State 
                administrative costs.
            (2) Reconciliation amount.--Not later than 60 days after 
        the expiration of the sales tax holiday period, the Secretary 
        shall pay to each electing State under subsection (c)(2) an 
        amount equal to the excess (if any) of--
                    (A) the amount of State and local sales tax payable 
                and not collected in such State during the sales tax 
                holiday period, over
                    (B) the amount determined under paragraph (1)(A) 
                and paid to such State.
    (c) Requirement for Reimbursement.--The Secretary may not pay a 
reimbursement under this section unless--
            (1) the chief executive officer of the State informs the 
        Secretary, not later than 10 days after the date of the 
        enactment of this Act, of the intention of the State to qualify 
        for such reimbursement by not collecting sales tax payable 
        during the sales tax holiday period,
            (2) in the case of a State which elects to receive the 
        reimbursement of a reconciliation amount under subsection 
        (b)(2)--
                    (A) the chief executive officer of the State 
                informs the Secretary and the Director of Management 
                and Budget and the retail sellers of tangible property 
                in such State, not later than 10 days after the date of 
                the enactment of this Act, of the intention of the 
                State to make such an election,
                    (B) the chief executive officer of the State 
                informs the retail sellers of tangible property in such 
                State, not later than 10 days after the date of the 
                enactment of this Act, of the intention of the State to 
                make such an election and the additional information 
                (if any) that will be required as an addendum to the 
                standard reports required of such retail sellers with 
                respect to the reporting periods including the sales 
                tax holiday period,
                    (C) the chief executive officer reports to the 
                Secretary and the Director of Management and Budget, 
                not later than 45 days after the expiration of the 
                sales tax holiday period, the amount determined under 
                subsection (b)(2) in a manner specified by the 
                Secretary,
                    (D) if amount determined under subsection (b)(1)(A) 
                and paid to such State exceeds the amount determined 
                under subsection (b)(2)(A), the chief executive officer 
                agrees to remit to the Secretary such excess not later 
                than 60 days after the expiration of the sales tax 
                holiday period, and
                    (E) the chief executive officer of the State 
                certifies that such State--
                            (i) in the case of any retail seller unable 
                        to identify and report sales which would 
                        otherwise be taxable during the sales tax 
                        holiday period, shall treat the reporting by 
                        such seller of sales revenue during such 
                        period, multiplied by the ratio of taxable 
                        sales to total sales for the same period in 
                        2000 as the sales tax holiday period, as a good 
                        faith effort to comply with the requirements 
                        under subparagraph (B), and
                            (ii) shall not treat any such retail seller 
                        of tangible property who has made such a good 
                        faith effort liable for any error made as a 
                        result of such effort to comply unless it is 
                        shown that the retailer acted recklessly or 
                        fraudulently,
            (3) in the case of any home rule State, the chief executive 
        officer of such State certifies that all local governments that 
        impose sales taxes in such State agree to provide a sales tax 
        holiday during the sales tax holiday period,
            (4) the chief executive officer of the State agrees to pay 
        each local government's share of the reimbursement (as 
        determined under subsection (d)) not later than 20 days after 
        receipt of such reimbursement, and
            (5) in the case of not more than 20 percent of the States 
        which elect to receive the reimbursement of a reconciliation 
        amount under subsection (b)(2), the Director of Management and 
        Budget certifies the amount of the reimbursement required under 
        subsection (b)(2) based on the reports by the chief executive 
        officers of such States under paragraph (2)(C).
    (d) Determination of Reimbursement of Local Sales Taxes.--For 
purposes of subsection (c)(4), a local government's share of the 
reimbursement to a State under this section shall be based on the ratio 
of the local sales tax to the State sales tax for such State for the 
same time period taken into account in determining such reimbursement, 
based on data published by the Bureau of the Census.
    (e) Definitions.--For purposes of this section--
            (1) Home rule state.--The term ``home rule State'' means a 
        State that does not control imposition and administration of 
        local taxes.
            (2) Local.--The term ``local'' means a city, county, or 
        other subordinate revenue or taxing authority within a State.
            (3) Sales tax.--The term ``sales tax'' means--
                    (A) a tax imposed on or measured by general retail 
                sales of taxable tangible property, or services 
                performed incidental to the sale of taxable tangible 
                property, that is--
                            (i) calculated as a percentage of the 
                        price, gross receipts, or gross proceeds, and
                            (ii) can or is required to be directly 
                        collected by retail sellers from purchasers of 
                        such property,
                    (B) a use tax, or
                    (C) the Illinois Retailers' Occupation Tax, as 
                defined under the law of the State of Illinois,
        but excludes any tax payable with respect to food and beverages 
        sold for immediate consumption on the premises, beverages 
        containing alcohol, and tobacco products.
            (4) Sales tax holiday period.--The term ``sales tax holiday 
        period'' means the 30-day period beginning on the 21st day 
        occurring after the date of the enactment of this Act.
            (5) Secretary.--The term ``Secretary'' means the Secretary 
        of the Treasury.
            (6) State.--The term ``State'' means any of the several 
        States, the District of Columbia, or the Commonwealth of Puerto 
        Rico.
            (7) Use tax.--The term ``use tax'' means a tax imposed on 
        the storage, use, or other consumption of tangible property 
        that is not subject to sales tax.
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