85(R) - 2017
Relating to the collection of, and notices and reports regarding,
state sales and use taxes; providing an administrative penalty.
Due to expected litigation over, and noncompliance with, provisions in the bill, the Comptroller will not certify additional revenue available for certification associated with the bill in 2018-19. In the event that the legal issues are resolved and marketplace providers begin to collect the use tax, General Revenue Related collections are expected to increase by $250,000,000 per fiscal year. In addition, there is an estimated cost of $570,000 to implement the provisions of the bill, as described below.
In regards to the administration and collection of the state use tax, SB 1713 would:
- establish the definition of marketplace providers, marketplace sellers, facilitators of a sale, and affilitates;
- authorize certain activities for marketplace providers and sellers;
- require certain retailers, regardless of whether they have a physical presence in this state, to provide annual written notice to purchasers regarding their purchases and potential use tax liability;
- require retailers to submit an annual statement to the Comptroller describing all sales of taxable items made to each purchaser in this state in a calendar year;
- require retailers to notify applicable purchasers stating that the requirement of the purchaser to file a tax report and pay use tax on certain purchases, and other related information; and
- impose administrative penalties for a retailer's failure to to provide the required written notices to customers and the annual statement.
Vote Recommendation Notes
This legislation represents another example of government intervening in the marketplace and creating more costly regulations accompanied by administrative penalties for noncompliance. This bill violates our principles of limited government, free markets, and individual liberty. For these reasons, we oppose SB 1713.