TOPEKA -- Tax exemptions for non-profits will be re-examined if Senate Bill 178 is passed. Any new legislation enactment establishing an exemption after Jan. 1, 2020 will be reviewed and many existing exemptions of the same value will be repealed to enact a new exemption or none at all. The bill would review the sales tax exemptions being offered to make sure they are still fair and the companies meet requirements to receive the tax break.
Jim Rankin, representative for Midland Care Connection, spoke in support of the bill saying House Bill 2134, which was presented over a month ago and is very similar this Senate bill, should be passed in order for non-profits to continue receiving sales tax benefits. He spoke on behalf of a client who is applying to get a sales tax exemption to buy tangible personal property. Rankin says the bill's language is generic enough that most non-profits will have the ability to apply and receive help.
The Senate Committee of the Whole amended the bill March 20 to say those already qualified to receive assistance must be reviewed again. Rankin disagrees with this clause, urging the committee to find a better way to go about it as many companies receiving the sales tax exemption are deserving and need the benefit.
Sen. Ken Corbet (R-Topeka) says the problem with the amendment is that those who have to qualify for it may not receive the tax exemption they need. He supports the bill but believes the amendment should be taken out so that no companies who need the help are hurt.
Rep. Jack Thimesch (R-Cunningham) says sometimes that temporary tax exemptions are given to companies dealing with emergencies. A couple years ago there were many fires in western Kansas and a company was issued a tax exemption to buy a new firing hose. He says because these disasters are over, companies need to be re-examined to see if they still need the money or if that money could help someone else.
Thimesch agrees that the bill's language needs to be cleaned up so it can be easily understood, but believes everyone who receives sales tax exemptions in Kansas needs to be reviewed yearly. He says those deserving will not be hurt by this bill, only the companies who no longer fit the qualification to receive the tax cut will.
Opponents of the bill include InterHab Executive Director Matt Fletcher, and Natalie Bright, of the Kansas Nonprofit Coalition. Bright was the only one to speak against the bill. She says her coalition has no problem with the underlying bill but with the language surrounding the new amendment. She is worried that non-profit organizations who use the exemption to reinvest in communities and their missions will suffer if reviewed and denied the sales tax exemption. She says her group reviews organization yearly to deem them worthy of the exemption and that there is no need for further interpretation from another outside source. Although she is not opposed to a better system of review, she wants to remind the committee how necessary these exemptions are to non-profits.
Senate Bill 178 is to be reviewed and voted on in the coming weeks. As most agree the bill is necessary, concern over whether or not the amendment, will affect non-profits receiving the tax break leads to further discussion.
Samantha Gilstrap is a University of Kansas senior from Charlotte, North Carolina, majoring in journalism.