COMMITTEE ON LEGISLATIVE RESEARCH
OVERSIGHT DIVISION
FISCAL NOTE
L.R. No.: 0328-06
Bill No.: Perfected SCS #2 for SB 52
Subject: Taxation and Revenue - Income; Arts and Humanities; Libraries and Archives; Entertainers and Sports
Type: Original
Date: March 17, 2003
FISCAL SUMMARY
| FUND AFFECTED | FY 2004 | FY 2005 | FY 2006 |
| General Revenue | Unknown | Unknown | Unknown |
| Total Estimated
Net Effect on General Revenue Fund |
UNKNOWN | UNKNOWN | UNKNOWN |
| FUND AFFECTED | FY 2004 | FY 2005 | FY 2006 |
| Total Estimated
Net Effect on Other State Funds |
$0 | $0 | $0 |
Numbers within parentheses: ( ) indicate costs or losses.
This fiscal note contains 5 pages.
| FUND AFFECTED | FY 2004 | FY 2005 | FY 2006 |
| Total Estimated
Net Effect on All Federal Funds |
$0 | $0 | $0 |
| FUND AFFECTED | FY 2004 | FY 2005 | FY 2006 |
| Local Government | $0 | $0 | $0 |
ASSUMPTION
Officials of the Department of Higher Education and the Department of Economic Development, Missouri Arts Council assume this legislation extends the time period that funds from the taxation of nonresident entertainers and athletes can be transferred from year 2008 to 2015, and would not fiscally impact their agencies.
Secretary of State (SOS), State Library officials assume current law allocates, subject to appropriation, ten percent of the nonresident income taxes from out of state professional athletes and entertainers to the Secretary of State for distribution to public libraries for the acquisition of library materials. These funds assist libraries in their efforts to provide accurate information for their communities. SOS assumes the Department of Revenue would have increased ability to collect taxes owed from entertainment venues. This bill also would extend the period for allocation of these taxes through 2015, an extension of seven years. Section 143.183.2 adds a $300 compensation minimum.
No additional staff will be needed by SOS for this program. Cost for administration of the program can be absorbed by the agency.
ASSUMPTION (continued)
Officials of the Department of Revenue (DOR) assume this legislation requires venues to collect withholding tax from nonresident entertainers and athletes who perform in venues located in Missouri, as long as the compensation paid by the venue is in excess of $300. It also allows the collection of additions to tax and interest for non-payment of taxes and extends the sunset for the earmarking of the revenues collected from nonresident entertainers and athletes from 2008 to 2015.
DOR assumes changes to the mainframe computer systems and to tax forms will be needed. However, these changes are minimal and any costs associated with these changes will be absorbed by DOR.
DOR assumes the Office of Administration, Budget and Planning should estimate the revenue impact. However, DOR notes that this legislation will increase the collection of taxes paid by nonresident entertainers and athletes.
Officials from the Department of Natural Resources (DNR) assumes currently the taxation of nonresident professional athletes and entertainers has a specific distribution schedule, subject to appropriation, which is set to expire in 2008. This proposal would extend the sunset to the distribution schedule to 2015.
By statute 10% of the revenue from this bill will be allocated to the Historic Preservation Revolving Fund, subject to appropriation.
This legislation could increase Total State Revenues.
| FISCAL IMPACT - State Government | FY 2004
(10 Mo.) |
FY 2005 | FY 2006 |
|
GENERAL REVENUE FUND |
|||
| Income - General Revenue | |||
| Increase in tax compliance | Unknown | Unknown | Unknown |
| TOTAL ESTIMATED NET EFFECT ON GENERAL REVENUE FUND |
UNKNOWN |
UNKNOWN |
UNKNOWN |
| FISCAL IMPACT - Local Government | FY 2004
(10 Mo.) |
FY 2005 | FY 2006 |
| $0 | $0 | $0 |
FISCAL IMPACT - Small Business
Entertainment, sports and amusement venues that are small businesses could be impacted by this legislation.
DESCRIPTION
Currently, the taxation of nonresident professional athletes and entertainers has a specific distribution schedule, subject to appropriation, which is set to expire in 2008. This proposal extends the expiration date of the distribution schedule to 2015.
This proposal requires any person, venue, or entity who pays more than three hundred dollars compensation to a nonresident entertainer to deduct and withhold from the compensation an amount equal to two percent of the total compensation.
The proposal also specifies that any person, venue, or entity subject to the tax is to be considered an employer under the income tax law and thereby subject to the same penalties, interest and additions to tax for failure to collect the tax.
This legislation is not federally mandated, would not duplicate any other program and would not require additional capital improvements or rental space.
SOURCES OF INFORMATION
Department of Higher Education
Department of Revenue
Department of Economic Development
Missouri Arts Council
Secretary of State
State Library
Department of Natural Resources
Mickey Wilson, CPA
Director
March 17, 2003