II 

113TH CONGRESS 

1ST SESSION S. 336 

To restore States’ sovereign rights to enforce State and local sales and 

use tax laws, and for other purposes. 

IN THE SENATE OF THE UNITED STATES 

FEBRUARY 14, 2013 

Mr. ENZI (for himself, Mr. DURBIN, Mr. ALEXANDER, Mr. JOHNSON of South 

Dakota, Mr. BOOZMAN, Mr. REED, Mr. BLUNT, Mr. WHITEHOUSE, Mr. 

CORKER, Mr. PRYOR, Mr. ROCKEFELLER, Ms. KLOBUCHAR, Mr. 

FRANKEN, Ms. HEITKAMP, Mr. CARDIN, Mrs. FEINSTEIN, Ms. LANDRIEU, Mr. MANCHIN, Mr. LEVIN, and Mr. HARKIN) introduced the following bill; which was read twice and referred to the Committee on Finance 

A BILL 

To restore States’ sovereign rights to enforce State and 

local sales and use tax laws, and for other purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Marketplace Fairness 

5 Act of 2013’’. 


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1 SEC. 2. AUTHORIZATION TO REQUIRE COLLECTION OF 

2 SALES AND USE TAXES. 

3 (a) STREAMLINED SALES AND USE TAX AGREE4 MENT.—Each Member State under the Streamlined Sales 

5 and Use Tax Agreement is authorized to require all sellers 

6 not qualifying for the small seller exception described in 

7 subsection (c) to collect and remit sales and use taxes with 

8 respect to remote sales sourced to that Member State pur9 suant to the provisions of the Streamlined Sales and Use 

10 Tax Agreement, but only if the Streamlined Sales and Use 

11 Tax Agreement includes the minimum simplification re12 quirements in subsection (b)(2). A State may exercise au13 thority under this Act beginning 90 days after the State 

14 publishes notice of the State’s intent to exercise the au15 thority under this Act, but no earlier than the first day 

16 of the calendar quarter that is at least 90 days after the 

17 date of the enactment of this Act. 

18 (b) ALTERNATIVE.—A State that is not a Member 

19 State under the Streamlined Sales and Use Tax Agree20 ment is authorized notwithstanding any other provision of 

21 law to require all sellers not qualifying for the small seller 

22 exception described in subsection (c) to collect and remit 

23 sales and use taxes with respect to remote sales sourced 

24 to that State, but only if the State adopts and implements 

25 the minimum simplification requirements in paragraph 

26 (2). Such authority shall commence beginning no earlier 


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1 than the first day of the calendar quarter that is at least 

2 6 months after the date that the State— 

3 (1) enacts legislation to exercise the authority 

4 granted by this Act— 

5 (A) specifying the tax or taxes to which 

6 such authority and the minimum simplification 

7 requirements in paragraph (2) shall apply; and 

8 (B) specifying the products and services 

9 otherwise subject to the tax or taxes identified 

10 by the State under subparagraph (A) to which 

11 the authority of this Act shall not apply; and 

12 (2) implements each of the following minimum 

13 simplification requirements: 

14 (A) Provide— 

15 (i) a single entity within the State re16 sponsible for all State and local sales and 

17 use tax administration, return processing, 

18 and audits for remote sales sourced to the 

19 State; 

20 (ii) a single audit of a remote seller 

21 for all State and local taxing jurisdictions 

22 within that State; and 

23 (iii) a single sales and use tax return 

24 to be used by remote sellers to be filed 


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1 with the single entity responsible for tax 

2 administration. 

3 A State may not require a remote seller to file 

4 sales and use tax returns any more frequently 

5 than returns are required for nonremote sellers. 

6 No local jurisdiction may require a remote sell7 er to submit a sales and use tax return or to 

8 collect sales and use taxes other than as pro9 vided by this paragraph. 

10 (B) Provide a uniform sales and use tax 

11 base among the State and the local taxing juris12 dictions within the State pursuant to paragraph 

13 (1). 

14 (C) Source all interstate sales in compli15 ance with the sourcing definition set forth in 

16 section 4(7). 

17 (D) Provide— 

18 (i) information indicating the tax19 ability of products and services along with 

20 any product and service exemptions from 

21 sales and use tax in the State and a rates 

22 and boundary database; 

23 (ii) software free of charge for remote 

24 sellers that calculates sales and use taxes 

25 due on each transaction at the time the 


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1 transaction is completed, that files sales 

2 and use tax returns, and that is updated to 

3 reflect rate changes as described in sub4 paragraph (H); and 

5 (iii) certification procedures for per6 sons to be approved as certified software 

7 providers. 

8 For purposes of clause (iii), the software pro9 vided by certified software providers shall be ca10 pable of calculating and filing sales and use 

11 taxes in all States qualified under this Act. 

12 (E) Relieve remote sellers from liability to 

13 the State or locality for the incorrect collection, 

14 remittance, or noncollection of sales and use 

15 taxes, including any penalties or interest, if the 

16 liability is the result of an error or omission 

17 made by a certified software provider. 

18 (F) Relieve certified software providers 

19 from liability to the State or locality for the in20 correct collection, remittance, or noncollection 

21 of sales and use taxes, including any penalties 

22 or interest, if the liability is the result of mis23 leading or inaccurate information provided by a 

24 remote seller. 


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1 (G) Relieve remote sellers and certified 

2 software providers from liability to the State or 

3 locality for incorrect collection, remittance, or 

4 noncollection of sales and use taxes, including 

5 any penalties or interest, if the liability is the 

6 result of incorrect information or software pro7 vided by the State. 

8 (H) Provide remote sellers and certified 

9 software providers with 90 days notice of a rate 

10 change by the State or any locality in the State 

11 and update the information described in sub12 paragraph (D)(i) accordingly and relieve any re13 mote seller or certified software provider from 

14 liability for collecting sales and use taxes at the 

15 immediately preceding effective rate during the 

16 90-day notice period if the required notice is 

17 not provided. 

18 (c) SMALL SELLER EXCEPTION.—A State is author19 ized to require a remote seller to collect sales and use taxes 

20 under this Act only if the remote seller has gross annual 

21 receipts in total remote sales in the United States in the 

22 preceding calendar year exceeding $1,000,000. For pur23 poses of determining whether the threshold in this sub24 section is met— 


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1 (1) the sales of all persons related within the 

2 meaning of subsections (b) and (c) of section 267 or 

3 section 707(b)(1) of the Internal Revenue Code of 

4 1986 shall be aggregated; or 

5 (2) persons with 1 or more ownership relation6 ships shall also be aggregated if such relationships 

7 were designed with a principal purpose of avoiding 

8 the application of these rules. 

9 SEC. 3. LIMITATIONS. 

10 (a) IN GENERAL.—Nothing in this Act shall be con11 strued as— 

12 (1) subjecting a seller or any other person to 

13 franchise, income, occupation, or any other type of 

14 taxes, other than sales and use taxes; 

15 (2) affecting the application of such taxes; or 

16 (3) enlarging or reducing State authority to im17 pose such taxes. 

18 (b) NO EFFECT ON NEXUS.—This Act shall not be 

19 construed to create any nexus between a person and a 

20 State or locality. 

21 (c) LICENSING AND REGULATORY REQUIREMENTS.— 

22 Nothing in this Act shall be construed as permitting or 

23 prohibiting a State from— 

24 (1) licensing or regulating any person; 


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1 (2) requiring any person to qualify to transact 

2 intrastate business; 

3 (3) subjecting any person to State or local taxes 

4 not related to the sale of goods or services; or 

5 (4) exercising authority over matters of inter6 state commerce. 

7 (d) NO NEW TAXES.—Nothing in this Act shall be 

8 construed as encouraging a State to impose sales and use 

9 taxes on any goods or services not subject to taxation prior 

10 to the date of the enactment of this Act. 

11 (e) NO EFFECT ON INTRASTATE SALES.—The provi12 sions of this Act shall apply only to remote sales and shall 

13 not apply to intrastate sales or intrastate sourcing rules. 

14 States granted authority under section 2(a) shall comply 

15 with all intrastate provisions of the Streamlined Sales and 

16 Use Tax Agreement. 

17 (f) NO EFFECT ON MOBILE TELECOMMUNICATIONS

18 SOURCING ACT.—Nothing in this Act shall be construed 

19 as altering in any manner or preempting the Mobile Tele20 communications Sourcing Act (4 U.S.C. 116–126). 

21 SEC. 4. DEFINITIONS AND SPECIAL RULES. 

22 In this Act: 

23 (1) CERTIFIED SOFTWARE PROVIDER.—The 

24 term ‘‘certified software provider’’ means a person 

25 that— 


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1 (A) provides software to remote sellers to 

2 facilitate State and local sales and use tax com3 pliance pursuant to section 2(b)(2)(D); and 

4 (B) is certified by a State to so provide 

5 such software. 

6 (2) LOCALITY; LOCAL.—The terms ‘‘locality’’ 

7 and ‘‘local’’ refer to any political subdivision of a 

8 State. 

9 (3) MEMBER STATE.—The term ‘‘Member 

10 State’’— 

11 (A) means a Member State as that term is 

12 used under the Streamlined Sales and Use Tax 

13 Agreement as in effect on the date of the enact14 ment of this Act; and 

15 (B) does not include any associate member 

16 under the Streamlined Sales and Use Tax 

17 Agreement. 

18 (4) PERSON.—The term ‘‘person’’ means an in19 dividual, trust, estate, fiduciary, partnership, cor20 poration, limited liability company, or other legal en21 tity, and a State or local government. 

22 (5) REMOTE SALE.—The term ‘‘remote sale’’ 

23 means a sale into a State in which the seller would 

24 not legally be required to pay, collect, or remit State 


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1 or local sales and use taxes unless provided by this 

2 Act. 

3 (6) REMOTE SELLER.—The term ‘‘remote sell4 er’’ means a person that makes remote sales in the 

5 State. 

6 (7) SOURCED.—For purposes of a State grant7 ed authority under section 2(b), the location to 

8 which a remote sale is sourced refers to the location 

9 where the item sold is received by the purchaser, 

10 based on the location indicated by instructions for 

11 delivery that the purchaser furnishes to the seller. 

12 When no delivery location is specified, the remote 

13 sale is sourced to the customer’s address that is ei14 ther known to the seller or, if not known, obtained 

15 by the seller during the consummation of the trans16 action, including the address of the customer’s pay17 ment instrument if no other address is available. If 

18 an address is unknown and a billing address cannot 

19 be obtained, the remote sale is sourced to the ad20 dress of the seller from which the remote sale was 

21 made. A State granted authority under section 2(a) 

22 shall comply with the sourcing provisions of the 

23 Streamlined Sales and Use Tax Agreement. 

24 (8) STATE.—The term ‘‘State’’ means each of 

25 the several States, the District of Columbia, the 


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1 Commonwealth of Puerto Rico, Guam, American 

2 Samoa, the United States Virgin Islands, the Com3 monwealth of the Northern Mariana Islands, and 

4 any other territory or possession of the United 

5 States. 

6 (9) STREAMLINED SALES AND USE TAX AGREE7 MENT.—The term ‘‘Streamlined Sales and Use Tax 

8 Agreement’’ means the multi-State agreement with 

9 that title adopted on November 12, 2002, as in ef10 fect on the date of the enactment of this Act and as 

11 further amended from time to time. 

12 SEC. 5. SEVERABILITY. 

13 If any provision of this Act or the application of such 

14 provision to any person or circumstance is held to be un15 constitutional, the remainder of this Act and the applica16 tion of the provisions of such to any person or cir17 cumstance shall not be affected thereby. 

18 SEC. 6. PREEMPTION. 

19 Except as otherwise provided in this Act, this Act 

20 shall not be construed to preempt or limit any power exer21 cised or to be exercised by a State or local jurisdiction 

22 under the law of such State or local jurisdiction or under 

23 any other Federal law. 

Æ 


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