Following months of lobbying by many Printing Industry of America affiliates, the Streamline Sales Tax (SST) Governing Board has approved language which is "friendlier" to our members involved with direct mail. Although the final language is favorable, by no means did the industry receive the exemptions it desired. The previous language was vague enough to allow states to switch from not taxing postage to taxing postage without going through the legislative process. The language approved has been modified so when a state adopts SST, it must make a decision to tax or exempt tax on delivery (postage). Needless to say the states that tax postage on direct mail (Arkansas, Kentucky, Nebraska, New Jersey, Pennsylvania, and Rhode Island) blocked every effort put forth by the committee to exempt postage from taxation.

Another very contentious issue was sourcing. It too was never resolved completely to the industry's liking, but language was clarified making it beneficial to the direct-mail community. Because the issue of direct-mail sourcing (tax is collected based on where the item is delivered) was viewed so differently between large corporate users, the state sales tax agencies, and the commercial printing industry, it took dozens of meetings and numerous "adjustments" in order for the language to pass muster with the various committees comprising the Streamline Sales Tax body. Each state had representation, as did dozens of corporations such as Boeing, DuPont, FedEx, WalMart, JC Penney, Verizon, RSM McGladrey, HCA, Pitney-Bowes, and Microsoft, just to mention a few.  The printing industry represented the small-business perspective.

Although Streamline Sales Tax will still continue to be seen by the direct mail and commercial printing community as a cumbersome process of taxation, the industry's efforts have provided the industry a clearer path for compliance.

House Ways & Means Committee Chairman Rangel (D-NY) this week urged the business community to be open-minded as the Committee considers various corporate tax proposals this year and next. In a presentation to the United States Council for International Business, Rangel restated his intention to lower the corporate tax rate from 35 percent to as low as 28 percent but also cautioned that there would be targeted revenue raisers (i.e., tax hikes) in order to pay for this and other tax relief. The 2001 and 2003 Bush tax cuts sunset at the end of 2010, providing impetus to address the future of certain proposals, including the Alternative Minimum Tax (AMT). Congress has passed multiple AMT "patches," and many lawmakers are pushing to deal permanently with AMT relief.

While health care reform took center stage on the domestic policy front this week, Congressional Democratic leaders sought to clarify the order in which they plan to seek passage of big-ticket items. House Speaker Pelosi (D-CA) announced this week her intention that the House committees would vote on climate-change legislation June 19^th or risk losing their jurisdiction on the issue. While the House Energy & Commerce Committee is the primary committee of jurisdiction, multiple House Committees claim smaller roles of jurisdiction over the issue and are involved in the legislative process. In response, the influential Committee on Ways & Means indicated it will likely pass on its role due to the shortened time frame, lack of consensus, and a priority focus on health care. Intra-party tensions remain in the Democratic caucus as a group of lawmakers from rural, agriculture-based districts led by Rep. Peterson (D-MN) continue talks with the Speaker and with House Energy and Commerce Committee Chair Waxman (D-CA) in an effort to seek compromise language on the current bill. The Senate is on a slower track; Sen. Boxer (D-CA), Chair of the Senate Environment & Public Works Committee, has declined to set a target date for marking up that chamber's version of a climate-change bill.

Our EHS and Government Affairs teams continue to educate policy makers and regulators about the potentially disastrous cost- and operational-disruption impacts printers of children's books and other printed material marketed to children face if no action is taken to exempt these products from the CPSIA. Last week, Senator Kyl (R-AZ), the second highest-ranking GOP Senator (and one of only three Senators to vote against the bill originally as it failed to "narrowly target offenders"), sent a letter to CPSC Acting Chairwoman Nord and Commissioner Moore citing the unintended consequences of this new government mandate and highlighting a children's charitable organization and the printing industry as examples of those who would literally pay the price for the CPSIA if its reach is not narrowed by the Commission. Kyl urged the CPSC to more prudently consider the cost-benefit model concerning "children's books and other products that are historically lead-free." Thanks to PIAZ for their assistance in researching CPSIA impact in Arizona and to Senator Kyl for his leadership on this issue.

The ongoing post-Election Day proceedings to determine whether or not Senator Coleman (R) or Al Franken (D) will be seated as Senator continued this week as the Minnesota Supreme Court began hearing oral arguments from each side this week. A decision is expected to be handed down by the Court within the next two weeks. Minnesota's Governor Pawlenty (R) has indicated he will certify the election's results based on the court's decision. A certification if necessary before a Senate candidate may be formally seated.

Printing Industries of America this week attended a Meet & Greet honoring Rep. Dahlkemper, a freshmen representing Western Pennsylvania. Dahlkemper, who with her husband owned and operated a lawn service business, serves on the House Committee on Small Business, along with the Committees on Agriculture and Science & Technology. The Meet & Greet was hosted by American Forest & Paper Association, and included a number of allied trade associations who served to better acquaint the new Congresswoman with the industry's common challenges and legislative agendas.

Printing Industries of America this week participated in an allied industry Meet & Greet honoring Rep. Roskam (IL-06), who serves on the House Committee on Ways & Means. Roskam represents the western Chicago suburbs and is a key ally on the tax writing committee.

President Obama this week nominated Rep. McHugh to be Secretary of the Army. McHugh, who serves as Ranking Member on the House Committee on Armed Services, is well-respected for his deep knowledge of military personnel and armed services policy and a quick Senate confirmation is expected. McHugh, who also holds a seat on the House Oversight & Government Reform Committee, was the key champion in achieving historic postal reform in the 109^th Congress.