This bill proposes to amend current statutes regarding local excise taxes, specifically capping the transaction privilege tax (TPT) or excise tax rate at 2.5% for cities and towns with populations of 550,000 or more. The bill introduces new provisions that require any proposed increase in TPT or excise tax to be submitted to voters, and it exempts voter-approved tax increases from the cap. Additionally, the Attorney General is mandated to withhold state shared revenues from municipalities that violate the tax rate cap or fail to obtain voter approval for tax increases.

The bill also clarifies that the tax rate cap applies separately to each TPT classification and defines terms related to excise taxes and transaction privilege tax classifications. It maintains existing language regarding enforcement and the handling of violations, ensuring that any tax or excise tax approved by voters is not invalidated by the new provisions. Overall, the bill aims to enhance local tax governance by imposing stricter controls on tax rates and requiring voter engagement for tax increases.

Statutes affected:
Introduced Version: 9-500.54
Senate Engrossed Version: 9-500.54