Streamlined Sales Tax

I respect Rep. Bob Damron for being one of the smarter legislators in the General Assembly. When it comes to legislation Damron is a policy wonk and at his best when dealing with issues like university debt issues.

But sometimes Bob goes a little far in trying to please his predominately right wing constitutes in Jessamine County.

A piece of legislation he has pre-filed for the 2007 session of the legislature is a perfect example.

“BR 103 - Representative Robert R Damron (11/17/06)
AN ACT relating to sales tax holidays and declaring an emergency. Create a new section of KRS Chapter 139 to exempt the sale or purchase of clothing with a sales price of less than one hundred fifty dollars ($150) per item, school supplies, and computers and computer supplies with a sales price of less than one thousand five hundred dollars ($1,500) per item; define terms; outline procedures; amend KRS 139.210, 139.220 and l39.340 to allow retailers to absorb the tax on other times sold during the sales tax holiday and advertise accordingly; EMERGENCY; EFFECTIVE MAY 1, 2007”

This piece of legislation plays to the “we hate paying any kind of tax group” while appearing to give a break to poor families for school supplies.

This is act poorly written, creates additional regulatory hoops for small businesses and is questionable on how much help it would actually provide for families.

I just don’t see how some of the things in the bill have anything to do with giving a break to families trying to get their kids ready for school.

For example:

The Act defines clothing to include costumes, formal wear and wedding apparel as long as they cost less than $150.00. So I guess as long as the Tux is cheap, little Bobby can wear it to school.

The Act also defines a computer as:

“(c) "Computer" means an electronic device that accepts information in digital or similar form and manipulates it for a result based on a sequence of instructions;”

I’m pretty sure here that my microwave, stereo tuner, DVD player, Cell Phone, and X-Box all qualify as a computer under this definition. They all accept digital information and they manipulate it on a basis of sequential instruction. So as long as the electronic device costs less than $1,500.00, it’s a computer and can be covered under this tax holiday.

Of course the final paragraph of this bill is the kicker.

“Section 5. Whereas Kentucky is a full member state of the Streamlined Sales Tax Agreement (emphasis added), a multistate agreement providing for simplification of the nation's varying sales tax laws, and whereas Kentucky is required by the agreement to provide sufficient notification to both sellers and purchasers located within and without Kentucky of the implementation of a sales tax holiday exemption period, an emergency is declared to exist, and this Act takes effect May 1, 2007.”