NFIB Opposes TN House Bill 2310 Authorizing Third-Party Sales & Use Tax Audits

Date: April 18, 2018

NFIB State Director Jim Brown released the following statement today in response to legislation authorizing sales and use tax audits by third parties:
 
“This morning, fast-moving legislation that would be damaging to small business cleared the House Finance Ways & Means Subcommittee and full Committee with little discussion. House Bill 2310 originally dealt with a reasonable pro-business attempt to ‘decouple’ components from the Tax Cuts & Jobs Act, but now contains a provision to authorize third-party sales & use tax audits.
 
“NFIB strongly supports tax compliance but sales and use tax audits should be a direct function of state government, not farmed out to incentivized or flat-fee contractors who are paid to find problems until they leave or utilize software programs to issue assessments. The original amendment presented in the subcommittee called for flat-fee arrangements and had a $100,000 fiscal note, which is virtually impossible if any auditors are to be hired by the state. Flat-fee arrangements aren’t good; contingency fee arrangements are worse. NFIB opposes both.
 
“NFIB is willing to discuss ways to improve sales & use tax compliance, as we have in the past, but our 6,000-strong membership in Tennessee opposes the introduction of very substantive legislation that is important to the business community in the closing days of session. Washington has a reputation for operating behind closed doors. Tennessee doesn’t and shouldn’t operate in similar fashion. We oppose House Bill 2310 in its current form and encourage legislators to remove the third-party audit provision.”

NFIB is the nation’s leading small-business association. To learn more, visit www.NFIB.com/TN and follow @NFIB_TN.

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