CHEYENNE – One of the biggest battles of the 2019 Wyoming Legislature was over a bill to place a corporate income tax on big box retailers, restaurants and hotels with more than 100 shareholders.
House Bill 220, sponsored by Rep. Jerry Obermueller, R-Casper, was rejected in the last days of the session, despite leadership in both chambers throwing their support behind it. But a new version of that idea is up for debate in the Joint Revenue Interim Committee.
On Tuesday, Obermueller presented the committee with a revised approach to a tax on large companies operating in Wyoming. Instead of focusing only on retailers, restaurants and the lodging industry, the bill would impose a 7% tax on companies with more than 100 shareholders, no matter the business sector.
The proposed legislation would allow sales, use and excise taxes paid by a company to be deducted from its overall tax bill. Any revenues generated from the bill would be directed toward state education funding.
The Revenue Committee voted by a slim margin to allow Legislative Service Office staff to work on the proposed legislation. It will be presented for full consideration and debate during the committee’s next two-day meeting in September.
The bill’s goal was more than just increasing revenues. It also was about protecting local businesses that were being driven out by large corporations, Obermueller said.
“Wyoming is the last holdout in the United States, and possibly the civilized world, for laissez-faire economic policies toward big business,” Obermueller said. “Our ability to tax and regulate is our only refuge and defense. If we legislators can’t buck up and handle the global economy, what good are we to the folks that we represent?”
One of the biggest arguments against HB 220 in the 2019 Legislature was it singled out specific industries to target for taxing. While opponents of HB 220 called out that improvement in the new proposal, many were still opposed to singling out businesses that had more than 100 shareholders.
Chris Brown, executive director of the Wyoming Retail Association and the Wyoming Lodging & Restaurant Association, said the 100-shareholder threshold for taxation still created an uneven playing field. He made the argument a company like McDonalds would pay the tax on its profits but Chick-fil-A, a similar business, would be immune from paying it.
“It’s important to understand that we’re not talking about (the bill picking) David vs. Goliath,” Brown said. “It’s that unfair disparity to like businesses, selling similar products, competing for the same customers that gives us the same concern.”
Supporters of the proposed legislation praised lawmakers for trying to find ways to fund Wyoming’s K-12 education system. Tammy Johnson, government relations director for the Wyoming Education Association, said her organization would wait until they had time to study the bill before making extensive comments on it.
But Johnson said the focus on placing any revenue generated from the tax toward solving the state’s education funding deficit was a win in her book.