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Idaho Proposes Economic and Marketplace Nexus Legislation
As one of the last holdouts to join every other state with a sales tax, Idaho has proposed economic and marketplace nexus legislation for remote retailers. If passed, the legislation would take effect June 1, 2019. The Idaho House is considering two bills, H.B. 250 and H.B. 239, that would amend and add to existing law to define terms and to provide for the powers and duties of remote retailers and marketplace facilitators regarding the collection of Idaho sales tax.
H.B. 250 provides that on and after June 1, 2019 (H.B. 239 lists July 1, 2019), a remote retailer that lacks physical presence in the state must register to collect tax if, in the previous or current calendar year, the retailer has:
Cumulative gross receipts from sales delivered into Idaho that exceed $100,000
Under both bills, marketplace facilitators will be required to register with the state and collect, report, and pay state sales and use taxes on any retail sales facilitated by the marketplace provider. Marketplace providers without physical presence in Idaho must register once the combined total of its own sales and any sales it facilitates on behalf of its sellers exceed the $100,000 threshold. (H.B. 250, as introduced in the Idaho House of Representatives on March 7, 2019 and H.B. 239, as introduced in the Idaho House of Representatives on March 5, 2019)
Posted on March 12, 2019

This month, Idaho – one of the last holdouts to join every other state with a sales tax – proposed economic nexus legislation. The Idaho legislation also includes marketplace nexus provisions, which is in line with the biggest 2019 sales tax trend across the states: new requirements for marketplace facilitators. More than 20 states are currently considering marketplace facilitator measures. We'll continue to keep you updated as legislation moves forward!

I'm not sure if this will have much of an effect on many CCL stores or not, but often times people don't complain until after it does. We'll probably have a better idea about it this time next year when it's too late......

Virginia Enacts Economic Nexus Provisions for Remote Sellers
Effective Date: July 1, 2019
Threshold: $100,000 or 200 or more separate retail sales transactions
Measurement Date: The previous or current calendar year
Includable Transactions: Retail sales
When You Need to Register Once You Exceed the Threshold: Next transaction
Virginia has enacted economic nexus provisions for remote sellers and marketplace facilitators, effective July 1, 2019. A seller is deemed to have sufficient activity within Virginia to require registration if the seller, in the previous or current calendar year:
Receives more than $100,000 in gross revenue from retail sales in the Commonwealth; or
Engages in 200 or more separate retail sales transactions
These collection requirements for remote sellers do not apply to retail sales transactions occurring before July 1, 2019. However, transactions occurring before July 1, 2019 may be included in the calculation of gross revenue or retail sales transactions towards the threshold, as the measurement is “previous or current calendar year.”
The Virginia Department of Taxation will develop guidelines to implement these provisions, including the creation of a waiver. (S.B. 1083, Laws 2019)

Virginia Enacts Marketplace Nexus Provisions
Virginia has enacted marketplace nexus provisions for marketplace facilitators, effective July 1, 2019. Marketplace facilitators will be required to register to collect and remit sales tax on behalf of its marketplace sellers if the facilitator engages in certain activities on a marketplace platform and exceeds the state’s economic nexus threshold.
A marketplace facilitator is defined as a person that contracts with a marketplace seller to facilitate the sale of marketplace seller’s products through a physical or electronic marketplace operated by the facilitator. Marketplace facilitators do not include payment processor businesses whose sole activity related to marketplace sales is to handle transactions between two parties (PayPal) or platforms/forums that exclusively provide internet advertising services (Craigs List).
A marketplace facilitator is deemed to have sufficient activity within Virginia to require registration if it meets at least one requirement under each subdivision 1, 2, and 3:
It engages, either directly or indirectly, through a commonly controlled person in any of the following activities:
Transmitting or communicating an offer or acceptance between a purchaser and a marketplace seller;
Owning or operating the infrastructure, whether electronic or physical, or technology that brings purchasers and marketplace sellers together; or
Providing a virtual currency that purchasers are allowed or required to use to purchase products from the marketplace seller;
It engages in any of the following activities with respect to a marketplace seller’s products:
Payment processing;
Fulfillment or storage;
Listing products for sale;
Setting prices;
Branding sales as those of the marketplace facilitator; or
Providing customer service or accepting or assisting with returns or exchanges; and
It establishes economic nexus through either of the following activities:
Facilitates sales in Virginia that, in the aggregate, generate more than $100,000 in gross revenue based on sales for either the previous or current calendar year; or
Facilitates 200 or more separate retail sale transactions in the previous or current calendar year.
To determine the amount of a marketplace facilitator’s gross revenue and number of retail sales transactions, all sales made by marketplace sellers using the facilitator’s platform are included. If the marketplace facilitator does not have physical presence in Virginia and has both facilitated and made direct sales into the state, both types of sales will be considered to determine whether the facilitator has established economic nexus.
The marketplace nexus provisions shall not apply to any retail sales transactions occurring before July 1, 2019. However, transactions occurring before July 1, 2019 may be included in calculating sales and revenue towards the economic nexus threshold since the rule is “previous or current calendar year.” (S.B. 1083, Laws 2019)
Posted on March 28, 2019

Florida
Economic nexus legislation for remote sellers not yet enacted
State Activity:
S.B. 1112 – would adopt a threshold of $100,000 or 200 transactions and require marketplace providers to collect tax effective July 1, 2019 (Given a favorable report from the Senate Commerce and Tourism Committee on March 11, 2019, now in Finance and Tax)

The California legislature has passed AB-147 to increase the state's economic nexus threshold from $100,000 or 200 transactions to $500,000. The bill also implements marketplace facilitator collection requirements.

April Sales Tax Updates:
Nebraska Codifies Economic Nexus and Enacts Marketplace Nexus Legislation
Effective April 1, 2019, Nebraska has enacted legislation with economic and marketplace nexus provisions. The legislation codifies Nebraska’s administrative position, effective January 1, 2019 and creates new requirements for marketplace facilitators. A remote seller or a multivendor marketplace platform (marketplace facilitator) is required to collect and remit Nebraska sales and use tax if it either:
Made or facilitated total retail sales (per specific legislation) of property or services subject to sales tax in Nebraska exceeding $100,000 in the previous or current calendar year; or
Made or facilitated retail sales in Nebraska in 200 or more separate transactions in the previous or current calendar year.
For purposes of calculating the threshold, remote seller should include sales they make through a multivendor marketplace platform. Note that Nebraska had previously issued guidance on July 27, 2018 indicating that remote sellers meeting an economic nexus threshold of $100,000 or 200 transactions were required to collect and remit Nebraska sales and use tax effective January 1, 2019.
Remote sellers, including multivendor marketplace platforms, must obtain a sales tax permit and begin collecting and remitting Nebraska sales tax on April 1, 2019 if they exceeded the threshold amount in 2018 or in the first two months of 2019.
Remote sellers, including multivendor marketplace platforms, who exceed the threshold in March 2019 or later in 2019 must obtain a sales tax permit and begin collecting and remitting Nebraska sales tax on or before the first day of the second calendar month after the threshold(s) are exceeded. Affected retailers will also be subject to the Local Option Revenue Act and shall collect and remit the sales tax due under the act.

Kentucky Enacts Marketplace Nexus Provisions
Kentucky has enacted legislation that affects marketplace providers that exceed the state’s economic nexus threshold, effective July 1, 2019. Kentucky has enacted marketplace nexus provisions that affect marketplace providers (facilitators), effective July 1, 2019. The provisions replace the definition of “marketplace facilitator” with “marketplace provider” and expand it.
Marketplace providers are required to register and collect tax in Kentucky if, in the immediately preceding or current calendar year, the marketplace provider:
; orMakes $100,000 in retail sales on its own behalf or in facilitated retail sales of tangible personal property, digital property, or services that are delivered or transferred electronically to a Kentucky purchaser
Makes 200 or more separate retail sales transactions on its own behalf or in facilitated sales
Marketplace providers that exceed either of these thresholds must register for a sales and use tax permit number to report and remit tax due on their own sales through the marketplace and register for a separate sales and use tax permit number to report and remit tax due on sales it facilitates for its marketplace retailers.
Marketplace providers must begin collecting tax by the first day of the calendar month that begins no later than 30 days after it meets either of the thresholds.

North Dakota Enacts Marketplace Nexus Legislation
Effective October 1, 2019, North Dakota has enacted marketplace nexus provisions.

North Carolina Codifies Economic Nexus Provisions
North Carolina has enacted legislation that codifies economic provisions that the state previously issued in a policy directive.

Kentucky Enacts Exemption for Specified Services if Certain Conditions Are Met
Kentucky has enacted legislation that exempts specified services from taxation if certain conditions are met.

West Virginia Enacts Marketplace Nexus Legislation
West Virginia has enacted legislation that requires remote sellers, marketplace facilitators, and referrers that satisfy the state’s economic nexus requirements to collect use tax, effective July 1, 2019. The new legislation codifies the state’s economic nexus rules.
Remote sellers, referrers, and marketplace facilitators are required to collect and remit use tax on all taxable sales of tangible personal property or services made on its own behalf or facilitated for marketplace sellers. A remote seller, referrer, or marketplace facilitator shall collect tax when, in the immediately preceding or current calendar year:
The remote seller, referrer, or marketplace facilitator makes or facilitates sales of $100,000 or more in gross revenue; or
The remote seller, referrer, or marketplace facilitator makes or facilitates sales in 200 or more separate transactions
Under the legislation, a “remote seller” means a seller that does not have physical presence in West Virginia that sells tangible personal property or services to in-state purchasers that are subject to sales or use tax under the state’s economic nexus legislation.
A “marketplace facilitator” is defined as a person that contracts with one or more sellers to facilitate (for consideration) sales of the seller’s products through an electronic of physical marketplace. A marketplace facilitator engages in activities, directly or indirectly, such as communicating offers between buyers and marketplace sellers, owning or operating electronic or physical infrastructure that brings together buyers and sellers, or providing a virtual currency used by purchasers.

Utah Enacts Law for Marketplace Facilitators
Utah has enacted marketplace nexus legislation, effective October 1, 2019. Under the legislation, marketplace facilitators are required to collect tax if, in the previous or current calendar year, the marketplace facilitator makes sales on its behalf or facilitates sales on behalf of one or more marketplace sellers that:
Exceed $100,000 in gross revenue; or
Are made in 200 or more separate transactions
Once a marketplace facilitator without physical presence in Utah meets or exceeds either threshold, they are required to begin collecting and remitting sales and use taxes no later than the first day of the calendar quarter that is at least 60 days after the day the marketplace facilitator met a threshold.
“Marketplace facilitator” means a person, including an affiliate of the person, that enters into a contract, an agreement, or otherwise with sellers, for consideration, to facilitate the sale of a seller’s product through a marketplace that the person owns, operates, or controls and that directly or indirectly and does any of the following:
(A) lists, makes available, or advertises tangible personal property, a product transferred electronically, or a service for sale by a marketplace seller on a marketplace that the person owns, operates, or controls;
(B) facilitates the sale of a marketplace seller’s tangible personal property, product transferred electronically, or service by transmitting or otherwise communicating an offer or acceptance of a retail sale between the marketplace seller and a purchaser using the marketplace;
(C) owns, rents, licenses, makes available, or operates any electronic or physical infrastructure or any property, process, method, copyright, trademark, or patent that connects a marketplace seller to a purchaser for the purpose of making a retail sale of tangible personal property, a product transferred electronically, or a service;
(D) provides a marketplace for making, or otherwise facilitates, a retail sale of tangible personal property, a product transferred electronically, or a service, regardless of ownership or control of the tangible personal property, the product transferred electronically, or the service that is the subject of the retail sale;
(E) provides software development or research and development activities related to any activity described in this Subsection (68)(a)(i), if the software development or research and development activity is directly related to the person’s marketplace;
(F) provides or offers fulfillment or storage services for a marketplace seller;
(G) sets prices for the sale of tangible personal property, a product transferred electronically, or a service by a marketplace seller;
(H) provides or offers customer service to a marketplace seller or a marketplace seller’s purchaser or accepts or assists with taking orders, returns, or exchanges of tangible personal property, a product transferred electronically, or a service sold by a marketplace seller on the person’s marketplace; or
(I) brands or otherwise identifies sales as those of the person; and
(ii) does any of the following:
(A) collects the sales price or purchase price of a retail sale of tangible personal property, a product transferred electronically, or a service;
(B) provides payment processing services for a retail sale of tangible personal property, a product transferred electronically, or a service;
(C) charges, collects, or otherwise receives a selling fee, listing fee, referral fee, closing fee, a fee for inserting or making available tangible personal property, a product transferred electronically, or a service on the person’s marketplace, or other consideration for the facilitation of a retail sale of tangible personal property, a product transferred electronically, or a service, regardless of ownership or control of the tangible personal property, the product transferred electronically, or the service that is the subject of the retail sale;
(D) through terms and conditions, an agreement, or another arrangement with a third person, collects payment from a purchase for a retail sale of tangible personal property, a product transferred electronically, or a service and transmits that payment to the marketplace seller, regardless of whether the third person receives compensation or other consideration in exchange for the service; or
(E) provides a virtual currency for a purchaser to use to purchase tangible personal property, a product transferred electronically, or service offered for sale.
“Marketplace facilitator” does not include a person that only provides payment processing services.
For sales made or facilitated during the 2019 or 2020 calendar year, the marketplace facilitator is not liable for the amount the marketplace facilitator fails to collect due to error that is equal to rate of 7%. During the 2021, the error rate is not to exceed 5% and in 2022, the error rate is not to exceed 3%.
Marketplace sellers are not to pay, collect, or remit sales and use taxes for any sales facilitated by a marketplace facilitator. In addition, marketplace sellers can exclude sales made through the marketplace facilitatory who is collecting tax on the facilitated sales. Marketplace sellers are not liable for a marketplace facilitator’s failure to pay, collect, or remit or any underpayment of tax. No class action cases can be filed against a marketplace facilitator on behalf of purchasers related to the overpayment of sales and use taxes collected and remitted on sales facilitated by the marketplace facilitator on behalf of the marketplace seller. (S.B. 168, Laws 2019)

Arkansas Enacts Economic and Marketplace Nexus Legislation
Effective Date: July 1, 2019
Threshold: $100,000 or 200 or more separate transactions
Measurement Date: Previous or current calendar year
Includable Transactions: Gross sales
When You Need to Register Once You Exceed the Threshold: Next transaction
Under an emergency clause, Arkansas has enacted economic and marketplace nexus legislation, effective July 1, 2019. Remote sellers and marketplace facilitators that sell or facilitate the sale of tangible personal property, taxable services, a digital code, or specified digital products into Arkansas are required to collect and remit sales and use tax if, in the previous or current calendar year, the remote seller or marketplace facilitator had:
$100,000 in aggregate sales; or
200 transactions
The new requirement to collect and remit sales or use tax will not be applied retroactively.
The legislation defines a “remote seller” as a person that does not maintain a place of business in Arkansas but makes sales into the state that are subject to tax.
A “marketplace facilitator” is defined as a person that facilitates the sale of tangible personal property, taxable services, a digital code or magazine, or specified digital products by listing or advertising the products/services previously listed for sale in a forum. Marketplace facilitators either directly or indirectly facilitate payments between purchasers and sellers. The legislation also repeals the previous provisions requiring sellers to collect tax based on affiliated relationships and payments of referral fees which are often referred to as “click-through” nexus. (S.B. 576, Laws 2019, Effective July 1, 2019)

Hawaii Enacts Legislation with Marketplace Nexus and Notice & Reporting Requirements Provisions
Hawaii has enacted legislation with marketplace nexus and notice and reporting requirements provisions, effective January 1, 2020. Per the legislation, a marketplace facilitator is considered the seller of tangible personal property, intangible property, or services for Hawaii sales and use tax purposes. The seller on whose behalf the sale is made shall be deemed to be making a sale at wholesale and subject to the wholesale rate of tax (0.005%). A marketplace facilitator’s gross income or gross proceeds include receipts from sales on behalf of other sellers.
Per the legislation, “marketplace facilitator” is defined as any person who sells or assists in the sale of tangible personal property, intangible property, or services on behalf of another seller by:
Providing a forum, whether physical or electronic, in which sellers list or advertise tangible personal property, intangible property, or services for sale; and
Collecting payment from the purchaser, either directly or indirectly through an agreement with a third party.
Effective January 1, 2020, any person other than a marketplace facilitator who provides a forum, whether physical or electronic, in which sellers list or advertise tangible personal property, intangible property, or services for sale and takes or processes sales orders can elect to be deemed the seller or comply with the following notice and reporting requirements:
Post a conspicuous notice on its forum informing purchasers intending to purchase tangible personal property, intangible property, or services for delivery to or use in Hawaii that they are required to pay use tax if the sale is made from an unlicensed seller;
Provide a written notice to each purchaser at the time of each sale of tangible personal property, intangible property, or services for delivery to or use in Hawaii that the purchaser may be required to remit use tax directly to the Hawaii Department of Taxation (DOT) and provide instructions for obtaining additional information from the DOT on whether and how to remit use tax to the DOT; and
No later than the twentieth day of the fourth month following the close of the taxable year, submit a report to the DOT that includes, with respect to purchasers of tangible personal property, intangible property, or services delivered to or used in Hawaii, the following information:
The purchaser’s name, billing address, and mailing address;
The address in Hawaii to where tangible personal property was delivered to the purchaser (only if tangible personal property was purchased);
The aggregate dollar amount of the purchaser’s purchases from the seller; and
The name and address of the seller.
Anyone who fails to comply with the notice and reporting requirements and has not elected to be deemed the seller will assessed a penalty of $1,000 if the failure is not for more than one month, with an additional $1,000 for each additional month or fraction thereof during which the failure continues, not to exceed $12,000 total.
The legislation also amends the definition of “import” to include the sale of tangible personal property, intangible property, or services by a marketplace facilitator with a valid license on behalf of an unlicensed seller for delivery to or use by a purchaser in Hawaii. (Act. 002 (S.B. 396), Laws 2019)