Federal Gift Shop Tax Act
H.R. 3650, the Federal Gift Shop Tax Act, would allow each state to levy a sales tax on qualifying purchases made at gift shops located on federal property. In practice, this means states could collect sales tax on items bought in person at federal gift shops (and on online purchases made through those gift shops) at places such as government buildings and federal facilities, including museums and cultural centers like those operated by the Smithsonian. The bill defines “federal property” broadly to cover buildings, land, or other real property owned, leased, or occupied by a federal agency or instrumentality, and includes major institutions such as the Smithsonian, the National Gallery of Art, the Kennedy Center, and the United States Holocaust Memorial Museum. The act does not specify tax rates, exemptions, or administrative details; it simply authorizes states to impose the tax. The bill’s short title is the Federal Gift Shop Tax Act. It was introduced in the 119th Congress by Representative Norton and referred to the Judiciary Committee. The text provides only the core authorization and definitions, with no additional provisions on distribution of revenue, rate structure, or implementation timelines.
Key Points
- 1Authorizes states to levy a sales tax on qualifying purchases at gift shops located on federal property.
- 2Qualifying purchases include in-person purchases at the gift shop and online purchases made through the gift shop.
- 3Federal property is defined very broadly, including federal buildings, lands, and instrumentality-owned facilities, and explicitly listing institutions such as the Smithsonian, the National Gallery of Art, the Kennedy Center, and the United States Holocaust Memorial Museum.
- 4The definition of “State” includes all 50 states, the District of Columbia, American Samoa, Guam, the Northern Mariana Islands, Puerto Rico, the U.S. Virgin Islands, and other territories/possessions and their political subdivisions.
- 5The bill does not specify tax rates, exemptions, revenue use, or administrative procedures; its effect depends on each state choosing to apply its existing sales tax framework to qualifying purchases at federal gift shops.