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H.R. 1643, Digital Goods and Services Tax Fairness Act of 2015 1 (December 16, 2015)

handle is hein.congrec/cbo2714 and id is 1 raw text is: CONGRESSIONAL BUDGET OFFICE COST ESTIMATE December 16, 2015 H.R. 1643 Digital Goods and Services Tax Fairness Act of 2015 As ordered reported by the House Committee on Judiciary on June 17, 2015 SUMMARY H.R. 1643 would prohibit state and local governments from imposing taxes on the sale of some digital goods and services that are taxable under current law. CBO estimates that enacting H.R. 1643 would have no direct impact on the federal budget. Enacting H.R. 1643 would not affect direct spending or revenues; therefore pay-as-you-go procedures do not apply. Enacting the bill also would not increase net direct spending or on-budget deficits in any of the four 10-year periods beginning in 2026. The prohibition on the ability of state and local governments to tax the sale of some digital goods and services would be an intergovernmental mandate as defined in the Unfunded Mandates Reform Act (UMRA). CBO estimates that the cost of complying with that mandate would far exceed the threshold established in UMRA for intergovernmental mandates ($77 million in 2015, adjusted annually for inflation). H.R. 1643 also would impose a private-sector mandate, as defined in UMRA, on sellers of digital goods and services by requiring them to maintain tax information on their customers. CBO estimates that the incremental cost to comply with the mandate would fall below the annual threshold for private-sector mandates established in UMRA ($154 million in 2015, adjusted annually for inflation). ESTIMATED COST TO THE FEDERAL GOVERNMENT: None. ESTIMATED IMPACT ON STATE, LOCAL, AND TRIBAL GOVERNMENTS H.R. 1643 would impose an intergovernmental mandate as defined in UMRA by prohibiting state and local governments from taxing some sales of digital goods and services. CBO estimates that the cost-in the form of forgone revenues-to state and local governments would total about $1 billion in at least one of the first five years after the mandate becomes effective and at least that amount in each subsequent year. The costs

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