A government enterprise would be AMTRACK or USPS.`(12) TAXABLE EMPLOYER-
`(A) IN GENERAL- The term `taxable employer' includes--
`(i) any household employing domestic servants, and
`(ii) any government except for government enterprises (as defined in section 704).
`(B) EXCEPTIONS- The term `taxable employer' does not include any employer which is--
`(i) engaged in a trade or business,
`(ii) a not-for-profit organization (as defined in section 706), or
`(iii) a government enterprise (as defined in section 704).
`(C) CROSS REFERENCE- For rules relating to collection and remittance of tax on wages by taxable employers, see section 103(b)(2).
`SEC. 703. GOVERNMENT PURCHASES.
`(a) Government Purchases-
`(1) PURCHASES BY THE FEDERAL GOVERNMENT- Purchases by the Federal Government of taxable property and services shall be subject to the tax imposed by section 101.
`(2) PURCHASE BY STATE GOVERNMENTS AND THEIR POLITICAL SUBDIVISIONS- Purchases by State governments and their political subdivisions of taxable property and services shall be subject to the tax imposed by section 101.
`(b) Cross References- For purchases by government enterprises see section 704.
Ignorance is bliss.
Thanks for the clarification, lewislynn. I was going to address that gross misstatement by Hostage, but you beat me to it. HR25 is quite clear, and it will lead to a major constitutional crisis, imho. There is no precedent for the federal government taxation of State and Local government consumption. It would be totally improper, and I don’t believe it would stand. Over $2 trillion of the AFFT approved tax base was Government consumption. If that gets thrown out, the new sales tax rate would approach 43%. Add the typical State sales tax and we would be looking at a 50% sales tax rate. Never happen!!!