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  2. TAX MATTERS

Senators Propose Tax Nexus Bill

Please note: This item is from our archives and was published in 2007. It is provided for historical reference. The content may be out of date and links may no longer function.

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A bipartisan proposal introduced by two members of the Senate Finance Com­mittee would establish a so-called bright-line standard for state business activity tax nexus. Sens. Charles E. Schumer, D-N.Y., and Mike Crapo, R-Idaho, introduced the proposal in the Business Activity Tax Simplification Act of 2007 on June 28.

The law would codify the physical presence standard—such as the presence of employees or property—for a state to impose corporate income or business activity taxes. Currently, the physical presence nexus standard is most clearly applied to the imposition of sales and use taxes. The bill, S 1726, is available at www.thomas.gov.