By Larry Jones
May 11, 2009

Reacting to concerns expressed by mayors and other local leaders to an original version of a bill introduced last year, Representative Hank Johnson (GA) revised and reintroduced the Mobile Workforce State Income Tax Fairness and Simplification Act, H.R. 2110, on April 27. Mayors raised concerns about the earlier version because it would have prohibited state and local governments from taxing the income of out-of'state workers performing duties within their borders for 60 days or less.

As introduced, the original bill would have caused many cities to lose a significant amount in revenues. According to the Internal Revenue Service (IRS), 17 states have cities that levy taxes on mobile workers. It is estimated that 25 percent of the nation’s cities levy an income tax on mobile workers.

In a meeting last year with the U S Conference of Mayors and other groups representing local and state governments, Rep. Johnson made clear that he never intended for the bill to apply to local governments and he made a commitment to rewrite the bill to clarify his intentions. In the revised bill all references to local governments were dropped. Also, the bill clarifies that in'state residents will be fully taxable for any work time spent in municipalities which impose a tax on income.

The Conference and other local groups are still in the process of reviewing the revised bill and discussing it with their members to make sure it does not apply to local governments. Currently there are seven other members joining Rep. Johnson in cosponsoring the bill: Representatives Bob Goodlatte (VA), G.K. Butterfield (NC), Virginia Fox (NC), Jim Jordan (OH), Trent Franks (AZ), Walter Jones (NC) and Frank Pallone (NJ). No further action has been scheduled on the bill at this time.