NORTON INTRODUCES BILL TO ALLOW STATE AND LOCAL GOVERNMENTS TO CHARGE SALES TAX AT GIFT SHOPS ON FEDERAL PROPERTY

WASHINGTON, D.C. – RealEstateRama – Congresswoman Eleanor Holmes Norton (D-DC) introduced her Federal Gift Shop Tax Act today to allow state and local governments to impose a sales tax on purchases at gift shops located on federal property.

“State and local governments often provide uncompensated services to federal property, such as EMS and fire service, and allowing them to impose a sales tax on gift shops would allow them to recoup some of those costs,” Norton said. “This bill is of particular importance to the District of Columbia, as it is home to a number of gift shops on federal property, such as at the Smithsonian Institution, the National Gallery of Art and the John F. Kennedy Center for the Performing Arts.”

Norton’s introductory statement follows.

Statement of Congresswoman Eleanor Holmes Norton

On the Introduction of the Federal Gift Shop Tax Act

October 25, 2023

Ms. Norton.  Mr. Speaker.

Today, I introduce the Federal Gift Shop Tax Act, which would allow state and local governments to impose a sales tax at gift shops on federal property.  These governments would be able to generate millions of dollars in new tax revenue.

When the federal government engages in activity that is not inherently governmental, such as operating a gift shop, there is no reason to exempt customer purchases from a sales tax. Theitems sold at federal gift shops, such as jewelry, apparel, accessories, games and books, are subject to a sales tax if sold on private property.  Customers are often unaware of the exemption from a sales tax at gift shops on federal property, so the introduction of a sales tax is unlikely to have a significant impact on gift shop sales.  It would, however, create a valuable revenue stream for state and local governments.  In addition, state and local governments often provide uncompensated services on federal property, such as fire service, and allowing them to impose a sales tax at gift shops on federal property would allow them to recoup some of these costs.

This bill is of particular importance to the District of Columbia, which is home to a number of gift shops on federal property, such as at the Smithsonian Institution and the John F. Kennedy Center for the Performing Arts.

I strongly urge my colleagues to support this bill.

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