Sales Tax Update: April 2013 · – Affiliate nexus law expanding definition of nexus – Law included notice and reporting requirements ... – Direct Marketing Association v. Colorado

Sales Tax Update: April 2013ONESOURCE Indirect Tax The Tax & Accounting Business of Thomson Reuters

Upcoming Events

• Webinars:• June 6, 2013 - 10AM PST (2PM EST)

– Understanding Nexus to Avoid Unexpected Liability

• Events:• April 7 – 11: Oracle Applications User Group

• May 14 – 16: ASUG/SAPPHIRE Annual Conference 2013

• May 20 – 22: ACT Annual Conference

REUTERS

Website URL

REUTERS

Visit Our Website at http://tax.thomsonreuters.com/events for more details

Today’s Agenda• Thomson Reuters Overview

• Amnesty Programs

• Amazon Laws

• April Rate Changes

• Current Events

• Upcoming Sales Tax Holidays

• Q & A

Please be aware that NO CPE credit is offered with today’s presentation.

REUTERS

Customer focusGlobal scale and presenceFinancial strength and stability

GLOBAL CAPABILITIES. LOCAL STRENGTH.

• Since formed in 2008 the Thomson Reuters brand is ranked 39 out of 100 in Global Brand Recognition.

• A recognized company• Look at last years annual report • 2010 Revenues:

US $13.1 Billion • 2010 Operating Profit:

$1.4 Billion

• Global presence to better serve multi-national corporations

• Over 50,000 employees in more than 100 countries

• Thomson Reuters is the world’s leading source of intelligent information for businesses and professionals

• We do this by investing in state of the art technology,

• designing solutions that integrate with customer workflows,

• and investing in people so that our solutions are designed by experts like you.

THE THOMSON REUTERS ADVANTAGE

BUSINESS OVERVIEW:ONESOURCE INDIRECT TAX

• Thomson Reuters formed the ONESOURCE Indirect Tax product line from 3 renowned brands to deliver an end-to-end automated solution for managing the indirect tax compliance lifecycle:

TAX DETERMINATION: Sabrix (Sabrix, Inc. acquired by Thomson Reuters in December 2009)

SALES & USE TAX COMPLIANCE: ONESOURCE Sales & Use Tax

VAT COMPLIANCE: Abacus VAT

INDIRECT TAX SOLUTION OFFERINGDOMESTIC

COMPLIANCEU.S. AND CANADA

GLOBALTAX

DETERMINATION

VATCOMPLIANCE

Sales & Use TaxCompliance

RegulatoryCompliance

Consulting

TaxCertificateManager

Reporting

Sales & Use Tax,VAT Determination

Calculation

Global Tax Content & Research

ERP Integrations(i.e. SAP, Oracle)

Consulting Services

Reporting

Data import and consolidation

Working papers and data analysis

Manual adjustments

Returns, eFiling and reconciliation

Speakers

• Nicole Huberty, JDManager, US Tax Research & Content

• Troy SpenceSenior Tax Analyst

Amnesty Programs

• Kentucky: – October 1, 2012 through November 30, 2012– Mid-February, state released revenue stats

• San Jose: – December 1, 2012 through May 31, 2013– City Business Tax Amnesty Program

Amnesty Programs

• Ohio– October 1, 2011 through May 1, 2013– Consumer’s use tax amnesty program

• Ohio, Tennessee and Utah via SSUTA– October 1, 2005 through 12 months after full SST

membership– Limited amnesty for unregistered sellers

Amazon Laws

• Amazon laws aim to collect sales tax for internet sales from companies who otherwise lack sufficient nexus to require them to collect sales and use tax on their Internet sales. They’re named after the biggest online retailer that the law targets.

• Many states are starting to refer to these laws as “click-through-nexus” laws.

Amazon Laws – First Legislation

• New York – First to pass Amazon law in 2008

• North Carolina and Rhode Island– Passed similar versions in 2009

• Colorado and Oklahoma– Expanded nexus presumption for out-of-state retailers– Added noticing requirements

Amazon Laws – 2011

• Arkansas– Click-through-nexus legislation effective October 25, 2011

• Connecticut – Click-through-nexus legislation effective May 4, 2011– Lower gross receipts threshold

• Illinois– Click-through-nexus legislation effective July 1, 2011– April 2012: Law ruled unconstitutional


• South Dakota– Affiliate nexus law expanding definition of nexus– Law included notice and reporting requirements

• Vermont– Delayed implementation: Effective only after 15 other

states adopt click-through-nexus laws


• Arizona– Amazon started collecting tax on TPP February 1, 2013– Tax on digital products starting July 1, 2013

• California– 2011 Amazon legislation repealed for one year– New effective date: September 15, 2012

• Colorado– Direct Marketing Association v. Colorado DOR– March 30th: Permanent injunction blocking enforcement of

notice and reporting provisions of nexus law


• Georgia– Click-through-nexus legislation effective October 1, 2012– Higher gross receipts threshold: $50,000 annually

• Indiana– Agreement with Amazon to start collecting tax in 2014– Amazon to have four distribution centers in the state

• Massachusetts– Agreement with Amazon to start collecting tax in 2013– Governor supports federal legislation


• Nevada– Amazon to start collecting tax in 2014– State expects additional $16 million in revenue

• New Jersey– Agreement with Amazon to start collecting tax in 2013– Amazon to build two new distribution warehouses

• Pennsylvania– Pennsylvania Sales Tax Bulletin 2011-01, 12/01/2011– Remote e-commerce sellers collecting tax September 1,

2012


• South Carolina– Agreement with Amazon to start collecting tax in 2016– Amazon to invest $125 million in distribution center

• Tennessee– Agreement with Amazon to start collecting tax in 2014– Amazon to invest $350 million in TN

• Texas– Agreement with Amazon to start collecting tax in 2012– Amazon to invest $200 million in TX


• Utah– Affiliate nexus legislation– Expanded types of sellers who are required to collect tax

• Virginia– Affiliate nexus legislation– Agreement with Amazon to collect tax September 1, 2013– Amazon to open two distribution centers in VA


• Connecticut– Amazon law effective May 2011– Amazon cut ties with affiliates in state – no tax remitted– Agreement to begin collecting tax November 1, 2013

• Florida– SB 316: Affiliate nexus and click-through-nexus provisions– Bill revises definition of “mail order sale”

• Maine– LD 346 and LD 319: Affiliate nexus and click-through-

nexus provisions


• Michigan– HB 4202 and HB 4203: Affiliate nexus and click-through-

nexus provisions

• Minnesota– SF 8: Typical Amazon tax language– Effective date: June 30, 2013

• New York– New York Court of Appeals: Amazon should not be

exempt from collecting state sales tax– Amazon to take its case to the U.S. Supreme Court


• West Virginia– HB 2754: Affiliate nexus bill– Seeks to expand definition of “retailer engaging in

business” in the state effective June 1, 2013

• Marketplace Fairness Act of 2013– Act introduced February 14, 2013– March 22: Senate included Act in budget resolution– Resolution is non-binding; tax will need to be addressed in

other legislation

Tax Rate Changes: Alabama

Authority Name Previous Rate New RateAL - Carbon Hill Police Jurisdiction, City Sales/Use Rate (Agricultural Sales Rate Only)

0.25% 0.375%

AL - Carbon Hill Police Jurisdiction, City Sales/Use Rate (Agricultural Use Rate Only)

0.0% 0.375%

AL - Carbon Hill Police Jurisdiction, City Sales/Use Rate (Automotive Sales Rate Only)

0.25% 0.375%

AL - Carbon Hill Police Jurisdiction, City Sales/Use Rate (Automotive Use Rate Only)

0.0% 0.375%

AL - Carbon Hill Police Jurisdiction, City Sales/Use Rate (Manufacturing Sales Rate Only)

0.25% 0.375%

AL - Carbon Hill Police Jurisdiction, City Sales/Use Rate (Manufacturing Use Rate Only)

0.0% 0.375%

AL - Carbon Hill Police Jurisdiction, City Sales/Use Rate (Sales Rate Only) 1.0% 1.5%

Tax Rate Changes: Alabama (Continued)

Authority Name Previous Rate New Rate

AL - Carbon Hill Police Jurisdiction, City Sales/Use Rate (Use Rate Only) 0.0% 1.5%

AL - Carbon Hill, City Sales/Use Rate (Agricultural Sales Rate Only) 0.5% 0.75%

AL - Carbon Hill, City Sales/Use Rate (Agricultural Use Rate Only) 0.0% 0.75%

AL - Carbon Hill, City Sales/Use Rate (Automotive Sales Rate Only) 0.5% 0.75%

AL - Carbon Hill, City Sales/Use Rate (Automotive Use Rate Only) 0.0% 0.75%

AL - Carbon Hill, City Sales/Use Rate (Manufacturing Sales Rate Only) 0.50% 0.75%

AL - Carbon Hill, City Sales/Use Rate (Manufacturing Use Rate Only) 0.00% 0.75%



AL - Carbon Hill, City Sales/Use Rate (Sales Rate Only) 2.0% 3.0%

AL - Carbon Hill, City Sales/Use Rate (Use Rate Only) 0.0% 3.0%

AL - Margaret Police Jurisdiction, City Sales/Use Rate (Agricultural Sales and Use Rate)

1.0% 0.5%

AL - Margaret Police Jurisdiction, City Sales/Use Rate (Manufacturing Sales and Use Rate)

1.0% 0.5%

AL - Margaret Police Jurisdiction, City Sales/Use Rate (Sales Rate Only) 1.0% 2.0%

AL - Margaret Police Jurisdiction, City Sales/Use Rate (Use Rate Only) 1.0% 0.5%

AL - Margaret, City Sales/Use Rate (Agricultural Sales/Use Rate) 2.0% 1.0%



AL - Jemison, City Sales/Use Tax (Sales Tax Only) 3.0% 4.0%

AL - Jemison Police Jurisdiction, City Sales/Use Tax (Sales Tax Only)

1.5% 2.0%

Tax Rate Changes: Alaska


AK - Seldovia, City Sales Tax Tiered Rate: 2.0%; Invoice Amount up to $500.00

Tiered Rate: 4.5%; Invoice Amount up to $500.00

AK - Sitka, Borough/City Sales Tax Tiered Rate: 5.0%; Invoice Amount up to $1,500.00

Tiered Rate: 6.0%; Invoice Amount up to $1,500.00

AK - Skagway, Borough Sales/Use Tax 3.0% 5.0%

AK - Whittier, City Sales Tax 0.0% 5.0%

Tax Rate Changes: Arkansas


AR - Dermott, City Sales/Use Tax (Consumer’s Use Tax)

Tiered Rate: 2.0%; Invoice amount up to $2,500.00


AR - Dermott, City Sales/Use Tax (Max Tax - Sales Tax and Max Tax - Seller’s Use Tax)

Tiered Rate: 2.0%; Item amount up to $2,500.00


AR - Dermott, City Sales/Use Tax (Sales and Seller’s Use Tax) 2.00% 2.50%

AR - Devalls Bluff, City Sales/Use Tax (Consumer’s Use Tax)



AR - Devalls Bluff, City Sales/Use Tax (Max Tax - Sales Tax and Max Tax - Seller’s Use Tax)



AR - Devalls Bluff, City Sales/Use Tax (Sales and Seller’s Use Tax) 2.00% 3.00%

Tax Rate Changes: Arkansas (Continued)


AR - Garland, County Sales/Use Tax (Consumer’s Use Tax)



AR - Garland, County Sales/Use Tax (Max Tax - Sales Tax and Max Tax - Seller’s Use Tax)



AR - Garland, County Sales/Use Tax (Sales and Seller’s Use Tax) 1.125% 1.50%

AR - Independence, County Sales/Use Tax (Consumer’s Use Tax)



AR - Independence, County Sales/Use Tax (Max Tax - Sales Tax and Max Tax - Seller’s Use Tax)



AR - Independence, County Sales/Use Tax (Sales and Seller’s Use Tax)

1.50% 2.00%

Tax Rate Changes: Arkansas (Continued)


AR - Ola, City Sales/Use Tax (Consumer’s Use Tax)



AR - Ola, City Sales/Use Tax (Max Tax - Sales Tax and Max Tax -Seller’s Use Tax)



AR - Ola, City Sales/Use Tax (Sales and Seller’s Use Tax) 1.00% 2.00%

Tax Rate Changes: Georgia & IndianaAuthority Name Previous Rate New Rate

GA - Pike Educational, County Sales/Use Tax 0.0% 1.0%

GA - Rockdale Educational, County Sales/Use Tax 1.0% 0.0%

GA - Treutlen Special Purpose, County Sales/Use Tax 0.0% 1.0%

Authority Name Previous Rate New RateIN - Marion, County Rental Tax (Automotive Rental Tax) 4.0% 6.0%1

Tax Rate Changes: KansasAuthority Name Previous Rate New Rate

KS - Abilene, City Sales/Use Tax 0.85% 1.1%

KS - Augusta, City Sales/Use Tax 1.0% 2.0%

KS - Hays, City Sales/Use Tax 2.25% 1.75%

KS - Marysville, City Sales/Use Tax 1.0% 1.6%

KS - Mission, City Sales/Use Tax 1.25% 1.625%

KS - Norton, City Sales/Use Tax 0.5% 1.25%

KS - Osage City, City Sales/Use Tax 1.0% 1.5%

KS - Riley, County Sales/Use Tax 0.5% 1.0%

Tax Rate Changes: Minnesota & MissouriAuthority Name Previous Rate New Rate

MN - Hermantown, City Sales/Use Tax 0.5% 1.0%

Authority Name Previous Rate New RateMO - Blue Ridge Town Centre Transportation Development District, District Sales/Use Tax (Sales Tax Only)

0.5% 0.625%

MO - Boone, County Sales Tax 1.125% 1.375%

MO - Boonville, City Sales Tax 1.5% 2.0%

MO - Concordia, City Sales Tax 2.0% 2.25%

MO - Gerald, City Sales Tax 1.5% 2.5%

Tax Rate Changes: Missouri (Continued)

Authority Name Previous Rate New RateMO - Imperial Main Community Improvement District, District Sales/Use Tax

1.0% 0.0%

MO - Jackson, City Sales Tax 1.75% 2.0%

MO - Johnson, County Sales/Use Tax 2.0% 2.25%

MO - Johnson, County Sales/Use Tax (Utility Sales and Use Tax) 2.0% 2.25%

MO - Lake Ozark (Camden Co), City Sales Tax 2.5% 2.75%

MO - Lake Ozark (Miller Co), City Sales Tax 2.5% 2.75%

MO - Moniteau, County Sales Tax 1.5% 1.75%

MO - Sarcoxie, City Sales Tax 2.0% 2.5%

Tax Rate Changes: NebraskaAuthority Name Previous Rate New Rate

NE - Alma, City Sales/Use Tax 1.5% 2.0%

NE - Bennington, City Sales/Use Tax 1.0% 1.5%

NE - Sargent, City Sales/Use Tax 1.0% 1.5%

NE - Verdigre, City Sales/Use Tax 1.0% 1.5%

NE - Waterloo, City Sales/Use Tax 1.5% 2.0%

Tax Rate Changes: N. Carolina & N. DakotaAuthority Name Previous Rate New Rate

NC - Edgecombe County Sales/Use Tax 2.0% 2.25%

NC - Greene County Sales/Use Tax 2.0% 2.25%

Authority Name Previous Rate New RateND - Crosby, City Sales/Use Tax (Consumer’s Use Tax)

Tiered Rate: 1.0%; Invoice amount up to $2,500.00.


ND - Crosby, City Sales/Use Tax (Sales and Seller’s Use Tax) 1.0% 2.0%

ND - Stanley, City Sales/Use Tax (Consumer’s Use Tax)



ND - Stanley, City Sales/Use Tax (Sales and Seller’s Use Tax) 1.0% 1.5%

ND - Tioga, City Sales/Use Tax (Consumer’s Use Tax)



ND - Tioga, City Sales/Use Tax(Sales and Seller’s Use Tax) 2.0% 2.5%

Tax Rate Changes: OklahomaAuthority Name Previous Rate New Rate

OK - Blaine, County Sales/Use Tax 0.5% 0.75%

OK - Carter, County Sales/Use Tax 0.25% 0.75%

OK - Coal, County Sales/Use Tax 1.0% 2.0%

OK - Healdton, City Sales/Use Tax 3.5% 4.0%

OK - Johnston, County Sales/Use Tax 1.25% 1.5%

OK - Locust Grove, City Sales/Use Tax 3.0% 4.0%

Tax Rate Changes: Oklahoma (Continued)Authority Name Previous Rate New Rate

OK - Moore, City Sales/Use Tax 3.5% 3.75%

OK - Payne, County Sales/Use Tax 0.75% 0.813%

OK - Pontotoc, County Sales/Use Tax 0.6875% 0.875%

OK - Stephens, County Sales/Use Tax 0.55% 0.7%

OK - Tahlequah, City Sales/Use Tax 2.5% 3.25%

Tax Rate Changes: Texas

TX - Baird, City Sales/Use Tax 1.5% 2.0%

TX - Freer, City Sales/Use Tax 1.5% 1.75%

TX - Ivanhoe, City Sales/Use Tax 0.25% 1.25%

TX - Krum, City Sales/Use Tax 1.75% 1.5%

TX - Lyford, City Sales/Use Tax 1.0% 2.0%

TX - Nevada, City Sales/Use Tax 1.75% 1.5%

TX - San Antonio, City Sales/Use Tax 1.125% 1.25%

TX - Yorktown, City Sales/Use Tax 1.5% 1.25%

Tax Rate Changes: UtahAuthority Name Previous Rate New Rate

UT - Centerfield, City Sales/Use Tax 1.0% 1.1%

UT - Gunnison, City Sales/Use Tax 1.3% 1.4%

UT - Mayfield, City Sales/Use Tax 1.0% 1.1%

UT - Park City East, City Resort Community Sales/Use Tax 1.1% 1.6%

UT - Park City, City Resort Community Sales/Use Tax 1.1% 1.6%

Tax Rate Changes: Washington

WA - Castle Rock TBD, City Sales/Use Tax 1.1% 1.4%

WA - Cowlitz County Unincorporated Areas, County Sales/Use Tax

1.1% 1.2%

WA - Kalama, City Sales/Use Tax 1.1% 1.2%

WA - Kelso, City Sales/Use Tax 1.4% 1.5%

WA - La Conner, City Sales/Use Tax 1.7% 1.8%

WA - Longview, City Sales/Use Tax 1.4% 1.5%

Tax Rate Changes: Washington (Continued)

WA - Lynden TBD, City Sales/Use Tax 2.0% 2.2%

WA - Mill Creek, City Sales/Use Tax 3.0% 3.1%

WA - Okanogan City, City Sales/Use Tax 1.2% 1.3%

WA - Olympia, City Sales/Use Tax 2.2% 2.3%

WA - Sedro Woolley, City Sales/Use Tax 1.7% 1.8%

WA - Woodland, City Sales/Use Tax 1.2% 1.3%

Tax Rate Changes: WyomingAuthority Name Previous Rate New Rate

WY - Converse, County Sales/Use Tax 1.0% 2.0%

WY - Fremont, County Sales/Use Tax 0.0% 1.0%

WY - Sweetwater, County Sales/Use Tax 1.0% 2.0%

Current Events

• Federal Medical Device Excise Tax• Applies to manufacturers, producers and importers

• 2.3% excise tax on sales of medical devices

• H.R. 523: Protect Medical Innovation Act of 2013

• Idaho: HB 250 elimination of tax on Girl Scout cookies

• Kentucky:• No local sales tax – only state sales tax

• SB 30: Proposes constitutional amendment to allow local option sales taxes

Current Events

• Massachusetts– Governor announced budget proposal– Decrease in state sales tax rate– Expansion of sales tax base

• Ohio– Governor’s FY 2014-15 budget bill– Proposal to tax all services with limited exclusions

Current Events

• Tennessee– Most food items currently taxed at reduced rate– HB0484 and SB0550 propose to exempt unprepared food

• Vermont– H.0528 to impose sales tax on candy, soda, dietary

supplements and bottled water – Information sheet issued regarding tax on remotely

accessed prewritten software

Tax Holidays: AprilState Effective

DatesExemptionAmount

General Category

Missouri and all participating local

jurisdictions

4/19/2013 -4/25/2013

$1,500.00 or less per item

Purchase of Qualified Energy Star Products

Question & Answer

THANK YOU

Contact us with questions:

[email protected]

(888) 885-0206

Documents

Sales Tax Update: April 2013 · – Affiliate nexus law expanding definition of nexus – Law included notice and reporting requirements ... – Direct Marketing Association v. Colorado