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TEI and FTA hold liaison meeting on state and local issues.

On December 11, 1992, Tax Executives Institute met with the Board of Trustees of the Federation of Tax Administrators (FTA). FTA is the organization of state tax commissioners, which is dedicated to improving the standards and techniques of tax administration. Its current President is Ronald Schreiner, Secretary of the South Dakota Department of Revenue, and its Executive Director is Harley T. Duncan.

In addition to Messrs. Schreiner and Duncan, the FTA's delegation to the liaison meeting included representatives of the following States: Arizona, California, Delaware, Illinois, Iowa, New Hampshire, Maryland, New York, Rhode Island, South Carolina, Tennessee, Texas, Utah, and Virginia. TEI's delegation to the meeting was chaired by TEI President Bob Perlman and Harry McKeon, chair of the Institute's State and Local Tax Committee. In addition, Thomas Nied and Sandy Navin (both members of TEI's Executive Committee) and Robert Meehan (vice chair of the State and Local Tax Committee) participated, as did Michael Murphy and Timothy McCormally of the Institute's staff.

The liaison meeting featured lively discussions of a number of prominent, even controversial, state and local issues. For example, the efforts of some States to tax the pension income of nonresidents generated considerable discussion about the likelihood (and desirability) of federal legislation to preempt the States' rights in this area. The question of the refund of unconstitutionally collected taxes -- which is currently before the Supreme Court in Harper v. Virginia -- also sparked diverse comments both between TEI and the FTA Board and among FTA Board members themselves. The discussion focused on how to best vindicate the constitutional rights of taxpayers while being cognizant of the revenue needs of the States. Suffice it to say that, pending the decision in Harper, the parties "agreed to disagree."

Among the other issues discussed during the liaison meeting were the Institute's continuing efforts to promote uniform and equitable administrative procedures in the States and the need for definitive guidance on the effect of the Supreme Court's decisions in Quill, Wrigley, Allied-Signal, and Kraft. With respect to the former, the Institute recently completed work on a series of position papers on so-called level playing field issues (which are reprinted elsewhere in this issue). With respect to the latter issue, individual state tax commissioners (including those from Tennessee and Virginia) outlined their efforts of provide guidance to taxpayers.

The States found an ally in the Institute's delegation when it came to the question of the personal liability of invalidated state tax officials for enforcing state revenue statutes. TEI President Perlman stated that even though the Institute felt strongly that unconstitutional taxes should be refunded,it disagreed with decisions holding state tax commissioners potentially liable for enforcing the statutes under which those taxes were unlawfully extracted. Mr. Perlman said that in his view any damages payable in such a case should be paid by the state, not the government employee. (TEI had earlier opposed federal legislation to subject IRS employees to possible personal liability.) Mr. Perlman emphasized, moreover, that the same principle should apply to insulate corporate tax officials from personal liability, except with respect to clearly improper behavior in respect of trust fund taxes.

Liason Meeting on State and Local Issues

The FTA provided a status report on its efforts to develop a uniform exchange of information agree among the States. (A copy of the uniform agreement is reprinted elsewhere in this issue.) During the discussion, TEI representatives received assurances that privacy and confidentiality interests would protected under the agreement.

Finally, TEI and the FTA discussed ways in which the level and quality of communication between ta and tax administrators could be improved. TEI agreed to place all state tax commissioners on its mai and invited the FTA (or individual commissioners) to prepare articles on issues of widespread intere possible publication in The Tax Executive. The FTA agreed to act as a conduit for the flow of inform the Institute of the States. The two groups also agreed to pursue the communications issue further.
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Title Annotation:Tax Executives Institute and Federation of Tax Administrators
Publication:Tax Executive
Date:Jan 1, 1993
Previous Article:U.S. Model Income Tax Treaty.
Next Article:State tax administration provisions.

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