08-R365

2008 -- H 7529

Enacted 07/04/08

H O U S E R E S O L U T I O N

SUPPORTING THE REPEAL OF THE NON-WAGE WITHHOLDING MANDATE

Introduced By: Representatives Lewiss, Gallison, Shanley, Fox, and Costantino

Date Introduced: February 26, 2008

     WHEREAS, Federal Law 109-222, Section 511 was created through passage of a last

minute provision included in H.R. 4297, the “Tax Increase Prevention and Reconciliation Act 0f

2006.” The provision designated a non-wage withholding mandate for federal, state and county

purchasing officials; and

      WHEREAS, The mandate, commencing on January 1, 2011, will raise an estimated $7

billion for the federal government by requiring government purchasing officials that spend at

least $100 million per year on goods and services to withhold three percent (3%) of nearly every

check to a vendor or contractor for federal tax purposes; and

      WHEREAS, In Rhode Island’s revised FY 2007 Budget, “Aid to Local Units of

Government” accounted for $273,023,621 of the state’s operating expenditures, placing the State

of Rhode Island and its municipalities over the minimum threshold for exemption from this

provision, and requiring the implementation of the non-wage withholding mandate; and

      WHEREAS, Implementation of this mandate will be extremely expensive for the State

of Rhode Island, requiring numerous programming changes to financial and accounting systems,

and the hiring of additional staff throughout the state in order to implement the collection and

remittance process; and

      WHEREAS, In addition, reducing and/or discouraging contractors from bidding on

government products could potentially increase prices; now, therefore be it

      RESOLVED, That this House of Representatives of the State of Rhode Island and

Providence Plantations hereby urges the Rhode Island Congressional Delegation to support H.R.

1023, repealing Section 511 of Public Law 109-222 (26 USC 3402(t)), the “Non-Wage

Withholding Mandate”; and be it further

      RESOLVED, That the Secretary of State be and he hereby is authorized and directed to

transmit duly certified copies of this resolution to the members of the Rhode Island Congressional

Delegation.

=======

LC01022

=======