TEI holds inaugural liaison meeting with Multistate Tax Commission; April 27, 1995 - Liaison Meeting Special

Tax Executive, The, May-June, 1995

On April 27, 1995, under the leadership of President Linda B. Burke, Tax Executives Institute held its first-ever liaison meeting with representatives from the Multistate Tax Commission (MTC). In connection with its regularly scheduled meeting in Perdido Beach, the Board of Trustees of the MTC invited representatives from TEI to make presentations and discuss issues of mutual concern to both organizations.

In addition to President Burke, TEI's delegation was headed by its Senior Vice President, Jack R. Skinner, and the Institute's State and Local Tax Committee Chair, Christopher W. Baldwin. Other members participating in the meeting were: Kathy M. Blankley, Charles W. Shewbridge, III, Manuel Davila, and Larry L. Ramsey. In addition, TEI's Executive Director, Michael J. Murphy, and Timothy J. McCormally and Jeffery P. Rasmussen from the Institute's legal staff also attended.

Timothy J. Leathers, Commissioner of Revenue for Arkansas, chaired the MTC delegation. Mr. Leathers was joined by numerous state tax officials, including Bob Hanson, North Dakota State Tax Commissioner; Val Oveson, Chair of the Utah State Tax Commission; John Chavez, Secretary of the New Mexico Department of Revenue; Ralph Eagerton, Alabama Commissioner of Revenue; Michael Southcombe, Chair of the Idaho State Tax Commission; Jack Harper, Assistant Secretary for Tax Administration for North Carolina; Jesse Weaver, Director of Business Taxes in Michigan; Wade Anderson, Assistant Director of Revenue for Texas; Burton Oliver, Executive Director of the California Board of Equalization; and Gerald Goldberg of the California Franchise Tax Board. In addition, Dan R. Bucks, MTC Executive Director; Alan Friedman, MTC General Counsel; Les Koenig, Director of MTC's Audit Division; and Paull Mines from the MTC legal staff also participated. The MTC delegation also included representatives from the staffs of a number of other state tax commissioners' offices.

Description of TEI's and MTC's Missions and Activities

Ms. Burke opened the meeting by describing of the Institute's activities and mission in the development of state tax policy and administrative procedures. State tax policy and administration were highly important areas for TEI members, she said--an integral part of their responsibility for administering their companies' overall tax liability. Specifically, tax executives are charged with the responsibility to manage the burden of state and local taxes and to ensure compliance with the manifold forms of income, excise, payroll, sales and use, and alternative tax systems. Ms. Burke explained that the primary objectives of the Institute included: (i) educating its members through conferences, seminars, and meetings; (ii) educating legislators and tax administrators through targeted advocacy on administrative matters; (iii) providing opportunities for networking among members at the Institute's 47 local chapters; and (iv) promoting high ethical standards and principles in interpreting the tax law, complying faithfully with its requirements, and dealing fairly with tax administrators.

Mr. Murphy stated that TEI members accept the duty to comply with the tax laws and continually strive to balance that burden with the counterpart obligation of minimizing their companies' tax liabilities. Mr. Baldwin next summarized the Institute's recent efforts in respect of education for its members and in advocating specific improvements in state and local tax matters.

Mr. Bucks outlined the MTC's twin goals of promoting (i) state sovereignty within the federal system and (ii) compliance with state tax codes. He summarized the historical and political underpinnings leading to the creation of the Multistate Tax Compact and the Commission. He explained that the multistate compact legislation was adopted at the urging of the States to forestall federal legislation responding to the need for greater uniformity in substantive and administrative tax rules affecting interstate commerce. Given its history, he said, the Commission is devoted to preserving the independent tax policy role and authority of the States within the federal system. Mr. Bucks also stressed the MTC's other goal of promoting compliance by ensuring fairness among all business taxpayers, whether large or small, or whether engaged in interstate or wholly in-state commerce.

Mr. Bucks next described the constitution and operating organization of the MTC, explaining that there were 20 full members of the Multistate Tax Compact (including the District of Columbia), 15 associate members, and 5 project members. Much like TEI, he said, the work of the organization is divided among functional committees including the Uniformity Committee, the Audit Committee, the Nexus Committee, a Litigation Committee, the Property Tax Committee, and the Education Committee.

Mr. Leathers inquired about the "forces" impelling TEI to undertake its 1994 State and Local Tax Task Force initiative. Ms. Burke responded that there were no specific "statistics" regarding state and local tax burdens that led to the establishment of the task force. Rather, she said, the task force was a result of feedback at many TEI conferences and chapter meetings regarding the need to refocus the national organization on state and local tax matters. She added that the business downturn of the early nineties had underscored how important the burden of state and local income, sales and use, and property taxes had become. While federal tax liabilities had diminished with the decline in business revenues, she said, many state taxes either declined less or remained at the same level as before, causing a significant reevaluation of the importance of, and the need for continuous attention to, state and local tax matters. Mr. Baldwin added that, with the growth of unfunded mandates from the federal government, the proportion of a company's total tax burden from state and local tax had been increasing, and consequently the Institute had constituted its task force to determine whether and how it could be more effective in state and local tax matters. TEI, he said, was continually identifying common themes and shared goals among companies and between taxpayers and tax administrators.