Marketplace Fairness Act, S.743

[Babs Jordan]

Contact your senators if this is something you don't want.  Happening this week:

Received from Cain TV...

"The U.S. Senate will pass a bill this week that would let states collect taxes on out-of-state sales, including sales over the Internet and through catalogs, said Majority Leader Harry Reid."

link: http://thomas.loc.gov/cgi-bin/query

the players:

IN THE SENATE OF THE UNITED STATES April 16, 2013

Mr. ENZI (for himself, Mr. DURBIN, Mr. ALEXANDER, and Ms. HEITKAMP) introduced the following bill; which was read the first time

April 17, 2013   Read the second time and placed on the calendar

the bill:

A BILL

To restore States' sovereign rights to enforce State and local sales and use tax laws, and for other purposes.

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

This Act may be cited as the `Marketplace Fairness Act of 2013'.

SEC. 2. AUTHORIZATION TO REQUIRE COLLECTION OF SALES AND USE TAXES.

(a) Streamlined Sales and Use Tax Agreement- Each Member State under the Streamlined Sales and Use Tax Agreement is authorized to require all sellers not qualifying for the small seller exception described in subsection (c) to collect and remit sales and use taxes with respect to remote sales sourced to that Member State pursuant to the provisions of the Streamlined Sales and Use Tax Agreement, but only if the Streamlined Sales and Use Tax Agreement includes the minimum simplification requirements in subsection (b)(2). A State may exercise authority under this Act beginning 90 days after the State publishes notice of the State's intent to exercise the authority under this Act, but no earlier than the first day of the calendar quarter that is at least 90 days after the date of the enactment of this Act.

(b) Alternative- A State that is not a Member State under the Streamlined Sales and Use Tax Agreement is authorized notwithstanding any other provision of law to require all sellers not qualifying for the small seller exception described in subsection (c) to collect and remit sales and use taxes with respect to remote sales sourced to that State, but only if the State adopts and implements the minimum simplification requirements in paragraph (2). Such authority shall commence beginning no earlier than the first day of the calendar quarter that is at least 6 months after the date that the State--

(1) enacts legislation to exercise the authority granted by this Act--

(A) specifying the tax or taxes to which such authority and the minimum simplification requirements in paragraph (2) shall apply; and

(B) specifying the products and services otherwise subject to the tax or taxes identified by the State under subparagraph (A) to which the authority of this Act shall not apply; and

(2) implements each of the following minimum simplification requirements:

(A) Provide--

(i) a single entity within the State responsible for all State and local sales and use tax administration, return processing, and audits for remote sales sourced to the State;

(ii) a single audit of a remote seller for all State and local taxing jurisdictions within that State; and

(iii) a single sales and use tax return to be used by remote sellers to be filed with the single entity responsible for tax administration.

A State may not require a remote seller to file sales and use tax returns any more frequently than returns are required for nonremote sellers. No local jurisdiction may require a remote seller to submit a sales and use tax return or to collect sales and use taxes other than as provided by this paragraph.

(B) Provide a uniform sales and use tax base among the State and the local taxing jurisdictions within the State pursuant to paragraph (1).

(C) Source all interstate sales in compliance with the sourcing definition set forth in section 4(7).

(D) Provide--

(i) information indicating the taxability of products and services along with any product and service exemptions from sales and use tax in the State and a rates and boundary database;

(ii) software free of charge for remote sellers that calculates sales and use taxes due on each transaction at the time the transaction is completed, that files sales and use tax returns, and that is updated to reflect rate changes as described in subparagraph (H); and

(iii) certification procedures for persons to be approved as certified software providers.

For purposes of clause (iii), the software provided by certified software providers shall be capable of calculating and filing sales and use taxes in all States qualified under this Act.

(E) Relieve remote sellers from liability to the State or locality for the incorrect collection, remittance, or noncollection of sales and use taxes, including any penalties or interest, if the liability is the result of an error or omission made by a certified software provider.

(F) Relieve certified software providers from liability to the State or locality for the incorrect collection, remittance, or noncollection of sales and use taxes, including any penalties or interest, if the liability is the result of misleading or inaccurate information provided by a remote seller.

(G) Relieve remote sellers and certified software providers from liability to the State or locality for incorrect collection, remittance, or noncollection of sales and use taxes, including any penalties or interest, if the liability is the result of incorrect information or software provided by the State.

(H) Provide remote sellers and certified software providers with 90 days notice of a rate change by the State or any locality in the State and update the information described in subparagraph (D)(i) accordingly and relieve any remote seller or certified software provider from liability for collecting sales and use taxes at the immediately preceding effective rate during the 90-day notice period if the required notice is not provided.

(c) Small Seller Exception- A State is authorized to require a remote seller to collect sales and use taxes under this Act only if the remote seller has gross annual receipts in total remote sales in the United States in the preceding calendar year exceeding $1,000,000. For purposes of determining whether the threshold in this subsection is met--

(1) the sales of all persons related within the meaning of subsections (b) and (c) of section 267 or section 707(b)(1) of the Internal Revenue Code of 1986 shall be aggregated; or

(2) persons with 1 or more ownership relationships shall also be aggregated if such relationships were designed with a principal purpose of avoiding the application of these rules.

SEC. 3. LIMITATIONS.

(a) In General- Nothing in this Act shall be construed as--

(1) subjecting a seller or any other person to franchise, income, occupation, or any other type of taxes, other than sales and use taxes;

(2) affecting the application of such taxes; or

(3) enlarging or reducing State authority to impose such taxes.

(b) No Effect on Nexus- This Act shall not be construed to create any nexus between a person and a State or locality.

(c) Licensing and Regulatory Requirements- Nothing in this Act shall be construed as permitting or prohibiting a State from--

(1) licensing or regulating any person;

(2) requiring any person to qualify to transact intrastate business;

(3) subjecting any person to State or local taxes not related to the sale of goods or services; or

(4) exercising authority over matters of interstate commerce.

(d) No New Taxes- Nothing in this Act shall be construed as encouraging a State to impose sales and use taxes on any goods or services not subject to taxation prior to the date of the enactment of this Act.

(e) No Effect on Intrastate Sales- The provisions of this Act shall apply only to remote sales and shall not apply to intrastate sales or intrastate sourcing rules. States granted authority under section 2(a) shall comply with all intrastate provisions of the Streamlined Sales and Use Tax Agreement.

(f) No Effect on Mobile Telecommunications Sourcing Act- Nothing in this Act shall be construed as altering in any manner or preempting the Mobile Telecommunications Sourcing Act (4 U.S.C. 116-126).

SEC. 4. DEFINITIONS AND SPECIAL RULES.

In this Act:

(1) CERTIFIED SOFTWARE PROVIDER- The term `certified software provider' means a person that--

(A) provides software to remote sellers to facilitate State and local sales and use tax compliance pursuant to section 2(b)(2)(D); and

(B) is certified by a State to so provide such software.

(2) LOCALITY; LOCAL- The terms `locality' and `local' refer to any political subdivision of a State.

(3) MEMBER STATE- The term `Member State'--

(A) means a Member State as that term is used under the Streamlined Sales and Use Tax Agreement as in effect on the date of the enactment of this Act; and

(B) does not include any associate member under the Streamlined Sales and Use Tax Agreement.

(4) PERSON- The term `person' means an individual, trust, estate, fiduciary, partnership, corporation, limited liability company, or other legal entity, and a State or local government.

(5) REMOTE SALE- The term `remote sale' means a sale into a State in which the seller would not legally be required to pay, collect, or remit State or local sales and use taxes unless provided by this Act.

(6) REMOTE SELLER- The term `remote seller' means a person that makes remote sales in the State.

(7) SOURCED- For purposes of a State granted authority under section 2(b), the location to which a remote sale is sourced refers to the location where the item sold is received by the purchaser, based on the location indicated by instructions for delivery that the purchaser furnishes to the seller. When no delivery location is specified, the remote sale is sourced to the customer's address that is either known to the seller or, if not known, obtained by the seller during the consummation of the transaction, including the address of the customer's payment instrument if no other address is available. If an address is unknown and a billing address cannot be obtained, the remote sale is sourced to the address of the seller from which the remote sale was made. A State granted authority under section 2(a) shall comply with the sourcing provisions of the Streamlined Sales and Use Tax Agreement.

(8) STATE- The term `State' means each of the several States, the District of Columbia, the Commonwealth of Puerto Rico, Guam, American Samoa, the United States Virgin Islands, the Commonwealth of the Northern Mariana Islands, and any other territory or possession of the United States.

(9) STREAMLINED SALES AND USE TAX AGREEMENT- The term `Streamlined Sales and Use Tax Agreement' means the multi-State agreement with that title adopted on November 12, 2002, as in effect on the date of the enactment of this Act and as further amended from time to time.

SEC. 5. SEVERABILITY.

If any provision of this Act or the application of such provision to any person or circumstance is held to be unconstitutional, the remainder of this Act and the application of the provisions of such to any person or circumstance shall not be affected thereby.

SEC. 6. PREEMPTION.

Except as otherwise provided in this Act, this Act shall not be construed to preempt or limit any power exercised or to be exercised by a State or local jurisdiction under the law of such State or local jurisdiction or under any other Federal law.

Calendar No. 41

113th CONGRESS 1st Session S. 743 A BILL

To restore States' sovereign rights to enforce State and local sales and use tax laws, and for other purposes.

 

[Patricia M. McBride]

Great explanation Paul!

[Paul Huffine]

Amanda, your argument about this bill helping business with in the state is flawed,  Florida has many internet only based business with a large customer base from other states.  If I accept your argument of this helping the companies with physical stores within the state, then you would also have to conclude the internet only business would suffer.  While one group may gain business and have to hire more people the other group would likely have to lay off workers.  Additionally, this potentially opens the door for the Federal Government to add a sales tax to internet sales.  The Fed is way out of control now and the last think we want to do is give them an opening to tax us.  This bill needs to be stopped.  If it gets passed in the senate hopefully the congress will have enough sense to vote it down,

[amanda choate]

Patrcia, what is th meaning of your reference to federal intervention? It restores to the states the right to collect sales taxes. If you by a car in Georgia, you still pay Florida sales taxes. It isn't that hard to implement.

[Patricia M. McBride]

[Patricia M. McBride]

And this bill will force businesses on line to keep track of around 7,500 states and municipality's tax rates and collect for them.  It is ludicrous, and it is the fed once again trying to grab more money to spend, because I feel quite sure if they start messing with state's sales tax, you can count on the fact there will be a skim in it for the feds.  The states need to push back from the federal government interferring in their taxes (sales or other wise).

And more liberal Amanda logic.  Leave it to you to support the feds overstepping yet again.

[amanda choate]

The rational thing for a retailer to do is avoid states with large populations so that more transactions would be free from sales tax. If we here in florida do not collect sales taxes, a significant portion of which are paid by tourists, we will have to make up the shortfall elsewhere, either property taxes or an income tax or other onerous user fees. Taxes can do good things too. This tax at least benfits in-state retailers by leveling the playing field, which means they can create jobs. I prefer to support these my neighbors. Support this tax, it means jobs and fairness.

[Babs Jordan]

Thanks Amanda. We never used to pay tax across state lines.  There have always been Russians running businesses in Seattle and Japanese in South Carolina. There are also Americans in all of these states trying to find a way to stay alive. Small business is being run out with all of the taxes and regulations. I too believe in keeping it fair...but this is just another way for us to be taxed. The big box stores will benefit from this and the little guy will suffer. Sorry, I disagree. I'm also not convinced it will change the behavior of the shopper and get them to shop locally other than going back to the big box stores for sales. People have become used to shopping from their computers. I just see it as another tax. The internet has been a vehicle for small business owners to make it in many cases. This bit about leveling the playing field is something that's been used to tax us out of house and home. Hope the weather is great for the parade at the Beaches today! Enjoy the weekend

[amanda choate]

Babs here is how I feel. This law would level the playing field for companies that are located in Florida. Right now we pay less to shop out of state or over the internet than we do with business located right here in Florida. Seems to that we should reward those who pay local property taxes and hire our citizens, and contribute to our communities, rather the than give to the breaks to a Russian in Seattle who runs an internet Goliath. Keep it fair.