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2020 STATE OF WYOMING 20LSO-0082

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INTRODUCTION

HOUSE BILL NO. [BILL NUMBER]

National retail fairness act.

Sponsored by: Joint Revenue Interim Committee

A BILL

for

AN ACT relating to taxation; creating the National Retail 1

Fairness Act; imposing an income tax on businesses as 2

specified; providing for administration of the tax; 3

providing penalties; authorizing rulemaking; and providing 4

for effective dates. 5

6

Be It Enacted by the Legislature of the State of Wyoming: 7

8

Section 1. W.S. 39-12-102 through 39-12-111 are 9

created to read: 10

11

39-12-102. Administration; confidentiality. 12

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(a) This chapter is known and may be cited as the 1

"National Retail Fairness Act". 2

3

(b) The administration of this chapter is vested in 4

the department of revenue. The department shall administer 5

this chapter in accordance with the multistate tax compact 6

to the extent that the compact does not conflict with this 7

chapter or Wyoming law. 8

9

(c) The department shall, to the extent practical, 10

obtain information from the federal internal revenue 11

service to verify taxable income under this chapter. The 12

department shall adopt rules and regulations necessary to 13

efficiently secure the payment, collection and accounting 14

for taxes imposed by this chapter. 15

16

(d) Notices required to be mailed by the department 17

under this chapter if mailed to the address shown on the 18

records of the department shall be sufficient for the 19

purposes of this chapter. 20

21

(e) No state employee or other person who by his 22

employment has knowledge of the business affairs of any 23


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person filing or required to file any tax returns under 1

this chapter shall make known their contents in any manner 2

or permit any person to have access to any returns or 3

information contained therein except as provided by law. 4

The department may also allow the following: 5

6

(i) The delivery to the taxpayer or his legal 7

representatives upon written request of a copy of any 8

return or report in connection with the tax imposed by this 9

chapter; 10

11

(ii) The publication of statistics formatted to 12

prevent the identification of particular returns or 13

reports; 14

15

(iii) The inspection by the attorney general of 16

the state of the report or return of any person who brings 17

an action against the state relating to the report or 18

return, or against whom an action is contemplated or has 19

been instituted; 20

21

(iv) The introduction into evidence of any 22

report or return or information therefrom in any 23


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administrative or court proceeding relating to the report 1

or return and to which the person making the report or 2

return is a party; 3

4

(v) The furnishing of any information to the 5

United States government and its territories, the District 6

of Columbia, any state allowing similar privileges to the 7

department or to the multistate tax commission for relay to 8

tax officials of cooperating states. Information furnished 9

shall be only for tax purposes; 10

11

(vi) The inspection of tax returns and records 12

by the state department of audit; 13

14

(vii) The sharing of information with local 15

governmental entities and other state agencies, provided a 16

written request is made to the department and the 17

governmental entity or agency demonstrates sufficient 18

reason to obtain the information for official business 19

purposes. Information furnished shall be used for official 20

business purposes only. 21

22

(f) No person shall: 23


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(i) Fail or refuse to make any return or payment 2

required by this chapter; 3

4

(ii) Make any false return or statement required 5

by this chapter; 6

7

(iii) Evade the payment of any tax due under 8

this chapter; 9

10

(iv) Aid or abet another in any attempt to evade 11

payment of a tax due under this chapter; 12

13

(v) Knowingly attest by signature to a false or 14

fraudulent return required by this chapter. 15

16

39-12-103. Imposition. 17

18

(a) Taxable event. There is levied an income tax upon 19

the taxable income of each taxpayer in this state as 20

defined in W.S. 39-12-101(b)(iii). 21

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(b) Apportionment of taxable income shall be as 1

follows: 2

3

(i) If a taxpayer has no income from activity 4

that is taxable outside of Wyoming, the taxpayer's entire 5

taxable income shall be allocated to Wyoming; 6

7

(ii) A taxpayer having income from activity that 8

is taxable both within and without Wyoming shall apportion 9

and allocate the taxable income as provided in this 10

section; 11

12

(iii) Income is taxable in another state if: 13

14

(A) In that other state, the income is 15

subject to a net income tax, a franchise tax measured by 16

net income, a franchise tax for the privilege of doing 17

business, a corporate stock tax or any similar tax; or 18

19

(B) That other state has jurisdiction to 20

subject the income to a net income tax regardless of 21

whether, in fact, the state subjects the taxpayer to such 22

tax. 23


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1

(iv) Taxable business income shall be 2

apportioned to Wyoming by multiplying the income by a 3

fraction, the numerator of which is the property factor as 4

provided under subsection (c) of this section plus the 5

payroll factor under subsection (d) of this section plus 6

the sales factor under subsection (e) of this section, and 7

the denominator of which is three (3). 8

9

(c) The property factor shall be calculated as 10

follows: 11

12

(i) The property factor is a fraction, the 13

numerator of which is the average value of the taxpayer's 14

real and tangible personal property owned or rented and 15

used in this state during the tax period and the 16

denominator of which is the average value of all the 17

taxpayer's real and tangible personal property owned or 18

rented and used during the tax period; 19

20

(ii) Property owned by the taxpayer shall be 21

valued at its original cost. Property rented by the 22

taxpayer is valued at eight (8) times the net annual rental 23


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rate. As used in this paragraph, "net annual rental rate" 1

means the annual rental rate paid by the taxpayer less any 2

annual rental rate received by the taxpayer from 3

subrentals; 4

5

(iii) The average value of property shall be 6

determined by averaging the values at the beginning and 7

ending of the tax period but the tax administrator may 8

require the averaging of monthly values during the tax 9

period if reasonably required to reflect properly the 10

average value of the taxpayer's property. 11

12

(d) The payroll factor shall be calculated as 13

follows: 14

15

(i) The payroll factor is a fraction, the 16

numerator of which is the total amount paid in this state 17

during the tax period by the taxpayer for compensation and 18

the denominator of which is the total compensation paid 19

everywhere during the tax period; 20

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(ii) Compensation is paid in this state if: 22

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(A) The individual's service is performed 1

entirely within the state; 2

3

(B) The individual's service is performed 4

both inside and outside the state, but the service 5

performed outside the state is incidental to the 6

individual's service within this state; or 7

8

(C) Some of the individual's service is 9

performed in the state and the base of operations: 10

11

(I) For the service or, if there is no 12

base of operations, the place from which the service is 13

directed or controlled is in the state; or 14

15

(II) The place from which the service 16

is directed or controlled is not in any state in which some 17

part of the service is performed, but the individual's 18

residence is in this state. 19

20

(e) The sales factor shall be calculated as follows: 21

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(i) The sales factor is a fraction, the 1

numerator of which is the total sales of the taxpayer in 2

this state during the tax period, and the denominator of 3

which is the total sales of the taxpayer everywhere during 4

the tax period; 5

6

(ii) Sales of tangible personal property are in 7

this state if the property is: 8

9

(A) Delivered or shipped to a purchaser 10

within this state regardless of the f.o.b. shipping point 11

or other conditions of the sale; or 12

13

(B) Shipped from an office, store, 14

warehouse, factory or other place of storage in this state 15

and the taxpayer is not taxable in the state of the 16

purchaser. 17

18

(iii) Sales, other than sales of tangible 19

personal property, are in this state if the income 20

producing activity is performed: 21

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(A) In this state; or 23


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1

(B) Both in and outside this state and a 2

greater proportion of the income producing activity is 3

performed in this state than in any other state, based on 4

costs of performance. 5

6

(f) The department may require taxpayers to provide 7

additional information and documentation related to 8

apportionment, allocation of income and the property 9

factor, payroll factor and sales factor to support an 10

income tax return under this chapter. 11

12

39-12-104. Taxation rate. 13

14

There is levied and shall be paid by the taxpayer a tax on 15

that portion of taxable income of the taxpayer that is 16

apportioned to Wyoming at a rate of seven percent (7%). 17

18

39-12-105. Exemptions. 19

20

There are no specific applicable provisions for exemptions 21

for this chapter. 22

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39-12-106. Licenses and permits. 1

2

There are no specific applicable provisions for licenses 3

and permits for this chapter. 4

5

39-12-107. Compliance; collection procedures. 6

7

(a) Returns and reports. Except as otherwise provided 8

in this subsection, each taxpayer shall report their total 9

taxable income and the portion of the income that is 10

apportioned to Wyoming as provided in W.S. 39-12-103 to the 11

department not more than thirty (30) days after the date 12

the taxpayer is required to file a federal income tax 13

return under the provisions of the Internal Revenue Code 14

including any extensions authorized for filing of the 15

federal income tax return. 16

17

(b) Payment. Any taxpayer owing a tax under this 18

chapter shall pay the tax once each year at the same time 19

the report under subsection (a) is provided. The tax shall 20

be collected by the department. 21

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(c) Timelines. There are no specific applicable 1

provisions for timelines for this chapter. 2

3

39-12-108. Enforcement. 4

5

(a) Audits. To assess credits and deficiencies 6

against taxpayers, the department is authorized to rely on 7

final audit findings made by the department of audit, 8

taxpayer information or information reported by the 9

taxpayer to the internal revenue service or to the 10

department of revenue subject to the following conditions: 11

12

(i) Audits shall commence when the taxpayer 13

receives written notice of the engagement of the audit. The 14

issuance of the written notice of the audit shall toll the 15

statute of limitations provided in W.S. 39-12-110 for the 16

audit period specified in this subsection; 17

18

(ii) After receiving notice of an audit under 19

this subsection, the taxpayer shall preserve all records 20

and books necessary to determine the amount of tax due for 21

the time period that is being audited; 22

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(iii) Except as otherwise provided in this 1

paragraph, audits shall encompass a time period not to 2

exceed three (3) years immediately preceding the reporting 3

period when the audit is engaged. The three (3) year limit 4

shall not apply to an audit if there is evidence of gross 5

negligence or intent to evade by the taxpayer in reporting 6

or remitting taxes for the reporting period being audited; 7

8

(iv) If a taxpayer is not willing or able to 9

produce adequate records to demonstrate taxes due, the 10

department or the department of audit may project taxes 11

based on the best information available; 12

13

(v) The department of audit may contract with or 14

employ auditors or other technical assistance necessary to 15

determine whether the taxes imposed by this chapter have 16

been properly reported and paid; 17

18

(vi) Audits under this subsection are subject to 19

the authority and procedures provided in W.S. 9-2-2003. 20

21

(b) Interest. The following shall apply: 22

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(i) Interest at an annual rate equal to the 1

average prime interest as determined by the state treasurer 2

during the preceding fiscal year, plus four percent (4%), 3

shall be added to all delinquent taxes under this chapter. 4

To determine the average prime interest rate, the state 5

treasurer shall average the prime interest rate for at 6

least seventy-five percent (75%) of the thirty (30) largest 7

banks in the United States. The interest rate on 8

delinquent taxes shall be adjusted on January 1 of each 9

year following the year in which the taxes first became 10

delinquent. In no instance shall the delinquent interest 11

rate be less than twelve percent (12%) nor greater than 12

eighteen percent (18%); 13

14

(ii) The department may credit or waive interest 15

imposed by this subsection as part of a settlement or for 16

any other good cause. 17

18

(c) Penalties. The following shall apply: 19

20

(i) If any part of a deficiency is due to 21

negligence or intentional disregard of rules and 22

regulations but without intent to defraud there shall be 23


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added a penalty of ten percent (10%) of the amount of the 1

deficiency plus interest as provided by paragraph (b)(i) of 2

this section. The taxes, penalty and interest shall be paid 3

by the taxpayer within ten (10) days after notice and 4

demand is made by the department; 5

6

(ii) If any part of the deficiency is due to 7

fraud with intent to evade there shall be added a penalty 8

of twenty-five percent (25%) of the amount of the 9

deficiency plus interest as provided by paragraph (b)(i) of 10

this section. The taxes, penalty and interest shall be paid 11

by the taxpayer within ten (10) days after notice and 12

demand is made by the department; 13

14

(iii) Any person who files a false or fraudulent 15

return is subject to the provisions of W.S. 6-5-303; 16

17

(iv) Any person who violates any provision of 18

this chapter for which there are no specific penalties is 19

guilty of a misdemeanor and upon conviction shall be fined 20

not more than one thousand dollars ($1,000.00). Each 21

violation is a separate offense; 22

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(v) If a taxpayer fails to file a return as 1

required by this chapter, the department shall give written 2

notice by mail to the taxpayer to file a return on or 3

before the last day of the month following the notice of 4

delinquency. If a taxpayer then fails to file a return the 5

department shall make a return from the best information 6

available which will be prima facie correct and the tax due 7

therein is a deficiency and subject to penalties and 8

interest as provided by this chapter; 9

10

(vi) The department may credit or waive 11

penalties imposed by this subsection as part of a 12

settlement or for any other good cause. 13

14

(d) Liens. The following shall apply: 15

16

(i) Any tax due under this chapter constitutes a 17

debt to the state from the taxpayer, and is a lien from the 18

date the tax is due on all the real and personal property 19

of the taxpayer in this state. Notice of the lien shall be 20

filed with the county clerk of the county in which the 21

taxpayer resides or conducts business. The lien does not 22

have preference over preexisting secured indebtedness but 23


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shall have priority from and after the date of filing or 1

recording. The department shall cancel lien statements 2

within sixty (60) days after taxes due are paid or 3

collected. No other action by the department is required to 4

perfect a lien under this paragraph regardless of the type 5

of property involved. 6

7

(e) Tax sales. The following shall apply: 8

9

(i) The tax due together with interest, 10

penalties and costs may be collected by appropriate 11

judicial proceedings or the department, with board 12

approval, or its representative, may seize and sell at 13

public auction so much of the taxpayer's property as will 14

pay all the tax then due plus interest, penalties and 15

costs. Notice of the auction must be published for four (4) 16

weeks in a newspaper published in the resident county of 17

the taxpayer or the county in which the majority of the 18

property is located. 19

20

39-12-109. Taxpayer remedies. 21

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(a) Interpretation requests. A taxpayer may request 1

and the department shall provide written interpretations of 2

this chapter and rules adopted by the department. When 3

requesting an interpretation, a taxpayer shall set forth 4

the facts and circumstances pertinent to the issue. If the 5

department deems the facts and circumstances provided to be 6

insufficient, it may request additional information. A 7

taxpayer may act in reliance upon a written interpretation 8

through the end of the calendar year in which the 9

interpretation was issued, or until revoked by the 10

department, whichever occurs last if the pertinent facts 11

and circumstances were substantially correct and fully 12

disclosed. 13

14

(b) Appeals. Except as provided by this subsection, 15

no person aggrieved by the payment of the taxes, penalty 16

and interest imposed by this chapter may appeal a decision 17

of the state board of equalization until all taxes, penalty 18

and interest have been paid. For good cause shown, the 19

court to which the decision of the board is appealed may 20

stay enforcement of the tax during the pendency of the 21

appeal. The court's stay of enforcement shall not affect 22

the accruing of interest upon any assessment and levy. 23


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1

(c) Refunds. The following shall apply: 2

3

(i) Any tax, penalty or interest which has been 4

erroneously paid, computed or remitted to the department by 5

a taxpayer shall either be credited against any subsequent 6

tax liability of the taxpayer or refunded. No credit or 7

refund shall be allowed after three (3) years from the date 8

of overpayment. The receipt of a claim for a refund by the 9

department shall toll the statute of limitations under W.S. 10

39-12-110. All refund requests received by the department 11

shall be approved or denied within ninety (90) days of 12

receipt. Any refund or credit erroneously made or allowed 13

may be recovered in an action brought by the attorney 14

general in any court of competent jurisdiction. 15

16

(d) Credits. The following shall apply: 17

18

(i) Each taxpayer is entitled to a credit 19

against tax liability under this chapter for all excise, 20

sales, use, severance and ad valorem taxes paid in the 21

taxable year by the same taxpayer to any taxing authority 22

in Wyoming. No credit shall be allowed for any tax 23


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collected or remitted by the taxpayer on behalf of another 1

person. The taxpayer shall report the credit to the 2

department on the return filed under W.S. 39-12-107. The 3

department may require supporting documentation on the 4

credit claimed under this paragraph. In no case shall any 5

refund be due or payable if the amount of the credit 6

claimed by any taxpayer under this paragraph exceeds the 7

amount of tax due under this chapter. False claims are 8

punishable as provided by W.S. 6-5-303; 9

10

(ii) The taxpayer is entitled to receive an 11

offsetting credit for any overpaid tax identified by an 12

audit that is within the scope of the audit period, without 13

regard to the limitation period for requesting refunds. 14

15

(e) Redemption. There are no specific applicable 16

provisions for redemption for this chapter. 17

18

(f) Escrow. There are no specific applicable 19

provisions for escrow for this chapter. 20

21

39-12-110. Statute of limitations. 22

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(a) Except as otherwise provided in this chapter, no 1

credit or refund shall be allowed after three (3) years 2

from the date of overpayment. The receipt of a claim for a 3

refund by the department shall toll the statute of 4

limitations. 5

6

(b) The department may bring an action to recover any 7

delinquent taxes, penalty or interest in any appropriate 8

court within three (3) years following the delinquency. In 9

the case of an assessment created by an audit, the 10

delinquency period is deemed to start thirty (30) days 11

after the date the assessment letter is sent. Any tax 12

penalty and interest related to the audit assessment shall 13

be calculated from the filing period during which the 14

deficiency occurred. In any such action a certificate by 15

the department is prima facie evidence of the amount due. 16

17

39-12-111. Distribution. 18

19

Revenues collected under W.S. 39-12-104 during each fiscal 20

year shall be recognized as revenue during that fiscal year 21

for accounting purposes. For all revenue collected by the 22

department under W.S. 39-12-104 the department shall credit 23


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one hundred percent (100%) to the school foundation program 1

account. 2

3

Section 2. W.S. 39-12-101 is amended to read: 4

5

39-12-101. Preemption by state; definitions. 6

7

(a) The state of Wyoming does hereby preempt for 8

itself the field of imposing and levying income taxes, 9

earning taxes, or any other form of tax based on wages or 10

other income and no county, city, town or other political 11

subdivision shall have the right to impose, levy or collect 12

such taxes except as provided in this chapter. 13

14

(b) As used in this chapter: 15

16

(i) "Tax year" means the taxable year used by 17

the taxpayer for purposes of federal income tax; 18

19

(ii) "Taxable income" means the net taxable 20

income reported by the taxpayer to the Internal Revenue 21

Service on federal form 1120, adjusted to remove any 22

deductions taken for sales, use and ad valorem taxes paid 23


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in the taxable year by the same taxpayer to any taxing 1

authority in Wyoming; 2

3

(iii) "Taxpayer" means any person who: 4

5

(A) Has taxable income earned in Wyoming; 6

7

(B) Is a vendor with a North American 8

Industry Classification System (NAICS) classification in 9

the sector of retail trade, sector 44 or 45 or in the 10

sector of accommodation and food services, sector 72. This 11

subparagraph includes a person who is a franchisor that 12

collects franchise fees in Wyoming from a vendor in NAICS 13

sector 44, 45 or 72; and 14

15

(C) Files or is required to file federal 16

form 1120 with the internal revenue service if the 17

corporation or the affiliated group as defined in 26 U.S.C. 18

§ 1504 has more than one hundred (100) shareholders unless 19

the person makes an election as an unincorporated entity. 20

21

Section 3. The department of revenue shall adopt 22

rules under W.S. 39-11-102 as necessary to begin collection 23


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of the tax created by this act for tax years beginning in 1

tax year 2021. 2

3

Section 4. 4

5

(a) Section 3 of this act is effective immediately 6

upon completion of all acts necessary for a bill to become 7

law as provided by Article 4, Section 8 of the Wyoming 8

Constitution. 9

10

(b) Except as otherwise provided in subsection (a) of 11

this section, this act is effective January 1, 2021. 12

13

(END) 14

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