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BPAA State Policy Update - July 30

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  • State of Wayfair: Indiana Lawsuit Still Pending, But Oct. 1 Looms: The Indiana Department of Revenue gave out-of-state retailers a heads-up that it still expects them to collect sales and use tax—after it wins dismissal of a lawsuit filed last year. The department issued a notice July 27 that it’s preparing to enforce by Oct. 1 its law requiring tax collection by online sellers with 200 or more transactions or $100,000 in in-state sales, “pending resolution” of the American Catalog Mailers Association (ACMA) lawsuit. The ACMA claims in the suit that Indiana’s law is unconstitutional under Quill Corp. v. North Dakota. Read more at Bloomberg BNA.
  • Utah lawmakers held a one-day special session last week. Tax actions included the reintroduction of a proposal to adopt a state Earned Income Tax Credit (EITC) (which failed to advance), the passage of $30 million in child tax credits aimed to offset tax increases on larger families due to federal tax changes, and passage of legislation requiring the collection of sales and use taxes from online purchases.
  • Montana voters will get to decide in November whether to increases tobacco taxes by $2 per pack to continue to fund Medicaid expansion in the state.
  • Weeks into the start of their fiscal year, Massachusetts legislators agreed upon a permanent state budget. The proposal increases that state’s EITC to 30 percent (up from its current 23 percent) of the federal credit and makes a deposit into the state’s rainy day fund. The plan now heads to Gov. Charlie Baker for consideration.
  • Louisiana can no longer boast the nation’s highest average sales tax rate, but its sales tax systems continues to rank among the most complicated and ripe for reform. Another change to the state’s sales tax system? No more sales tax holidays.
  • New Missouri Governor Mike Parson signed into law yet another income tax cut on the same day the State Treasurer announced the state had hit an arbitrary tax-cut trigger put in place in 2014, so both cuts will occur simultaneously and the top rate will go down to 5.4 percent in 2019.



  • Ohio takes cautious approach to legalizing sports betting: Someday, a local football fan will be able to collect the winnings on a legal wager — put down, maybe, at the JACK Cleveland Casino, or even placed by phone — that picked the Cleveland Browns to make the National Football League playoffs. The U.S. Supreme Court in May ruled that the federal ban on sports betting was unconstitutional. When (and how) that legal bet on the Browns can be made and then cashed in, though, is no clearer today than when the team, winless in 2017, will make the playoffs. But it isn't looking like Ohio will move quickly to make sports betting legal. First, it's unclear what authority exists in Ohio to carry out sports gambling. It may be a valid extension of the current authority of the Ohio Lottery Commission, the Ohio Casino Control Commission or both, to oversee — and tax — sports gambling, but it would first take the Ohio General Assembly to pass legislation to clarify the matter. Read more at Crain’s Cleveland Business.
  • Rundown on current and potential sports betting states:
    • Connecticut: The Nutmeg state would likely would be on the fast track toward legal sports gambling, if it weren’t for ongoing negotiations between the Mashantucket Pequot and Mohegan tribes, who own Foxwoods Resort Casino and Mohegan Sun, respectively. The tribes feel they have the “exclusive right” to legal sports gambling in Connecticut, per the Hartford Courant. Shortly after the United States Supreme Court voted in May to end the federal ban on sports gambling, Gov. Dannel P. Malloy expressed a desire to hold a special summer session to discuss the issue, per the Courant. Since the Supreme Court’s decision enacted an existing law enabling Connecticut to legalize sports betting, the state hoped to have a bill passed in time for the 2018 NFL season. None of that can happen, however, until Connecticut reaches an agreement with the tribes. Those negotiations reportedly haven’t gone exceptionally well, though. Read more at NESN.
    • On June 3, Governor John Carney of Delaware placed the first legal sports wager in the state after the Delaware Lottery moved forward with their launch.
    • Mississippi: Rumors of a July 21 launch were greatly exaggerated. State regulators say Mississippi sports betting won’t launch this weekend, and a timeline is still unclear for the 14 casinos with applications on file.
    • In West Virginia, the state enacted a sports betting law in March 2018 which could now go into effect by this fall.
    • On June 22, Governor Gina Raimondo of Rhode Island signed sports betting into law and wagering could be active within three months.
    • Virginia, is the latest state to see rumblings of sports betting – the VA Secretary of Finance said we’re going to see a big push for sports betting in the beginning of 2019.



  • How High Are Wine Taxes in Your State?: Today’s map shows wine excise tax rates across states, expressed in dollars per gallon. Due to differences in alcohol content, states tend to tax wine at a higher rate than beer but at a lower rate than distilled spirts. Kentucky has the highest wine excise tax rate at $3.47 per gallon, followed by Alaska ($2.50), Florida ($2.25), Iowa ($1.75), and Alabama and New Mexico (tied at $1.70). The lowest rates are found in California and Texas ($0.20), Wisconsin ($0.25), and Kansas and New York ($0.30). Read the report at the Tax Foundation.
  • Pennsylvania Supreme Court upholds Philadelphia soda ban: The Pennsylvania Supreme Court on Wednesday upheld Philadelphia's soda tax in a ruling that rebuked the beverage industry and merchants who have rallied against these taxes across the country. The high court ruled Philadelphia has the right to charge the 1.5-cents-per-ounce levy on sweetened beverages, according to multiple reports. Philadelphia is the largest city with a soda tax in the U.S., and it has inspired health advocates in other cities to introduce similar proposals. Philadelphia has raised $79 million since passing the levy in January, according to the Associated Press, but dissenters claim it has also cost more than 1,000 jobs. Read more at The Hill.



  • As of Jan. 1, 2020, companies around the world will have to comply with additional regulations related to processing of personal data of California residents. Pursuant to the California Consumer Privacy Act of 2018 ("CCPA"), covered companies have to observe restrictions on data monetization business models; accommodate rights to access, deletion, and porting of personal data; and issue or update privacy notices to provide detailed disclosures about data handling practices. For a general overview of the statute and its unusual history, see Lothar Determann, The California Consumer Privacy Act of 2018: Broad Data and Business Regulation, Applicable Worldwide, IAPP Privacy Tracker (Jul. 2, 2018). Read more at Bloomberg BNA.



  • Alaska bans mandatory tip pooling: ANCHORAGE (KTUU) - A new regulation issued by the state Department of Labor and Workforce Development puts an end to mandatory tip pooling starting Friday. The change comes after the Trump Administration announced last year that it would roll back Obama-era regulations that ban employers from forcing employees to share tips. Some businesses say they're not sure how they are going to make up the difference in tips lost by the kitchen staff, which they say will contribute to the wage gap between servers and the back of the house. Suite 100 owner Kelly Nichols just learned Thursday that he has one day to change the way his restaurant distributes tips. He says his restaurant couldn’t run without a team effort, and the tips should reflect that. "If your glass has lipstick on it, your silverware is spotted, your plate is cold, your steak is overcooked, you're going to leave a different tip than if you had a good experience all the way around," Nichols said. The Alaska Department of Labor and Workforce Development is reinstating tip pooling protections, which means tip money stays in the servers' pockets unless they choose to tip out the back of the house staff voluntarily. Read more at KTUU.
  • Delaware, Virginia Enact Paid Family Leave for State Workers: State employees in Delaware and Virginia now have access to paid family leave, unlike some private-sector workers in those states. The benefit for public workers is the first step toward a push by lawmakers in both states to pursue a broader paid leave mandate. Both Gov. Ralph Northam (D-Va.) and Gov. John Carney (D-Del.) say the leave helps the state governments attract and retain top talent. Virginia and Delaware are just the latest localities to provide public employees with paid family leave. Over 40 municipalities across the country have paid family leave for municipal workers, and six states and the District of Columbia have passed laws that mandate some form of paid family leave for private sector employees. Paid family leave has “really taken off over the past couple of years,” and the impetus for these laws is that people in these localities want to see change happen, Sarah Fleisch Fink, general counsel and director of workplace policy for the National Partnership for Women & Families, told Bloomberg Law July 12. Beginning April 1, 2019, full-time state workers in Delaware—including educators—will be eligible for 12 weeks of paid maternity or paternity leave after the birth or adoption of a child six or younger. Workers are eligible for the benefit after one year of employment. Carney signed the bill June 30. Delaware is the biggest employer in the state, so the paid leave benefits will be significant in terms of increasing the number of workers in the state who have access to paid leave, Fleisch Fink said. In Virginia, Gov. Northam signed an executive order June 26 that authorizes paid parental leave for employees of executive branch state agencies. Eligible workers will be able to take up to eight weeks of paid parental leave to bond with a newborn, or to care for a child under the age of 18 newly placed for adoption, foster care, or custodial care. Read more at Bloomberg Government with subscription.
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