WASHINGTON — A D.C. delegate introduced a bill which would allow sales tax on purchases at gift shops that are on federal property in the District.
The Federal Gift Shop Tax Act was introduced by Del. Eleanor Holmes Norton (D-DC) on Wednesday. It would allow state and local governments to impose a sales tax on these purchases, which could generate millions in new tax revenue.
“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 stated that customers are often unaware that there is an exemption from a sales tax at gift shop on federal property, meaning the introduction of sales tax is unlikely to have a significant impact on gift shop sales. In addition, she also stated that currently items sold at federal gift shops are subject to sales tax if sold on private property.