The National Institute for Governmental Purchasing (NIGP) has joined many other organizations in urging Congress to repeal what is known as the 3% withholding law that will go into effect on January 1, 2012.
The law will impact all federal, state, and local governments with annual expenditures in excess of $100 million, by requiring those agencies to withhold 3% of each payment to vendors, contractors, and consultants, and send the money to the federal government for income tax purposes.
NIGP has begun a letter writing campaign urging the repeal of the law. For more information, read a story about NIGP's efforts in GovPro.
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My original posting on this subject erroneously reflected that the new law would apply to federal, state, and local governments with expenditures of $3 million or more. I have corrected this to $100 million. I think I must have had "3" on the brain. Sorry for the confusion.
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