The Fair Tax Act, Part XXIII
Final details on section 401…
`(f) Reinstitution- A State that has had its authority revoked pursuant to subsection (e) shall not be an administering State for a period of not less than 5 years after the date of the order of revocation. For the first calendar year commencing 8 years after the date of the order of revocation, the State shall be regarded without prejudice as eligible to become an administering State.
`(g) Third State Administration Permissible- It shall be permissible for a State to contract with an administering State to administer the State’s sales tax for an agreed fee. In this case, the agreement contemplated by subsection (c) shall have both the State and the Federal Government as parties.
`(h) Investigations and Audits- Administering States shall not conduct investigations or audits at facilities in other administering States in connection with the tax imposed by section 101 or conforming State sales tax but shall instead cooperate with other administering States using the mechanisms established by section 402, by compact or by other agreement.
A state that broke its agreement with the Fed is effectively forgiven after no less than 5 years but no more than 8 years. A tertiary state can administer taxes in lieu of the state in question if such an agreement can be reached between the Fed and both states. And finally, states don’t audit other states.
Next is section 402, which is short enough to include here:
SEC. 402. FEDERAL ADMINISTRATIVE SUPPORT FOR STATES.
`(a) In General- The Secretary shall administer a program to facilitate information sharing among States.
`(b) State Compacts- The Secretary shall facilitate, and may be a party to a compact among States for purposes of facilitating the taxation of interstate purchases and for other purposes that may facilitate implementation of this subtitle.
`(c) Agreement With Conforming States- The Secretary is authorized to enter into and shall enter into an agreement among conforming States enabling conforming States to collect conforming State sales tax on sales made by sellers without a particular conforming State to a destination within that particular conforming State.
`(d) Secretary’s Authority- The Secretary shall have the authority to promulgate regulations, to provide guidelines, to assist States in administering the national sales tax, to provide for uniformity in the administration of the tax and to provide guidance to the public.
This allows the Federal treasury department to do some odds and ends like making regulations and helping states decide interstate issues of tax implementations.
