Credit could ease taxing change

? Leading members of a House-Senate tax committee indicated Friday the controversial destination-source sales tax system was here to stay, but that lawmakers would try to help businesses deal with it.

“We’re forcing the change on businesses, it’s only right that we help them recover the cost,” said state Rep. Bruce Larkin of Baileyville, the ranking Democrat in the House on tax issues.

Larkin and Senate tax chairman David Corbin, R-Towanda, said several proposals being discussed would grant small businesses a tax credit to pay for the necessary changes to switch to the new system, which usually entails making upgrades to computers and record-keeping.

“There are businesses that need some help,” Corbin said.

Other measures under consideration are granting exemptions to certain kinds of businesses or all but large businesses. House Speaker Doug Mays, R-Topeka, said he would like to exempt the destination-source tax system on delivered goods within the state.

The issue exploded in June when businesses were told they had several weeks to change the way that they assessed sales taxes for the past 60 years.

Instead of charging sales tax on delivered goods based on the rate of where the goods were purchased, they had to assess the sales tax on the rate at which the goods were delivered to.

Supporters of the change said it was needed to prepare Kansas for the day when states could start collecting sales taxes on Internet sales.

But when businesses complained that the change was too confusing, costly and bureaucratic, most lawmakers confessed they didn’t even know they had voted to approve the July 1 effective date of the destination-source system. Some lawmakers have said the law needs to be repealed.

Gov. Kathleen Sebelius and legislative leaders urged compliance with the law but said it wouldn’t be enforced for an indefinite period of time. Since then, Corbin said many businesses have been able to adjust to the new law.