Bill 412 is double taxation
House Bill 412 calls for closing many exemption loopholes to address the budget crisis that our state faces. No doubt, there are many aspects of the Tax Reform Bill that need just that – reform. However, HB 412 also calls for the eliminating the sales tax exemption for Non-Profits – all Non-Profits large, small, 501c3, churches etc. Thus subjecting non-profits to Sales and Gross Receipts Tax.
Under HB 412, Non-Profits would need to collect and pay GRT on all contracts (local, state, federal), grants from foundations and United Way, fees from programs, classes and services. Most non-profits are local, community-oriented, and are responding to community needs. Many exist on grants and contacts to provide services that government is not.
This has the potential to be disastrous for non-profits, and I have a front row seat in that regard, as a volunteer sitting on the board of The Family YMCA.