II 

116TH CONGRESS 

1ST SESSION S. 128 

To regulate certain State impositions on interstate commerce. 

IN THE SENATE OF THE UNITED STATES 

JANUARY 15, 2019 

Mr. TESTER (for himself, Mr. WYDEN, Mrs. SHAHEEN, Ms. HASSAN, and Mr. 

MERKLEY) introduced the following bill; which was read twice and referred to the Committee on Finance 

A BILL 

To regulate certain State impositions on interstate commerce. 

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 ‘‘Stop Taxing Our Po5 tential Act of 2019’’. 

6 SEC. 2. MINIMUM JURISDICTIONAL STANDARDS FOR STATE 

7 AND LOCAL SALES AND USE TAX COLLEC8 TION. 

9 (a) IN GENERAL.—A State may not— 

10 (1) impose an obligation on a person for— 


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1 (A) the collection of a sales tax, use tax, 

2 or any similar tax; or 

3 (B) the reporting of any information with 

4 respect to a tax described in subparagraph (A); 

5 (2) assess any tax described in paragraph 

6 (1)(A) on a person; or 

7 (3) treat a person as doing business in a State 

8 for purposes of any tax described in paragraph 

9 (1)(A), 

10 unless such person had a physical presence in the State 

11 during the calendar quarter with respect to which such 

12 obligation or assessment is imposed. 

13 (b) REQUIREMENTS FOR PHYSICAL PRESENCE.— 

14 (1) IN GENERAL.—For purposes of subsection 

15 (a), a person has a physical presence in a State only 

16 if such person’s business activities in the State in17 clude any of the following during the calendar quar18 ter: 

19 (A) Maintains its commercial or legal 

20 domicile in the State. 

21 (B) Owns, holds a leasehold interest in, or 

22 maintains real property such as a retail store, 

23 warehouse, distribution center, manufacturing 

24 operation, or assembly facility in the State. 


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1 (C) Leases or owns tangible personal prop2 erty (other than computer software) of more 

3 than de minimis value in the State. 

4 (D) Has one or more employees, agents, or 

5 independent contractors present in the State 

6 who provide on-site design, installation, or re7 pair services on behalf of the remote seller. 

8 (E) Has one or more employees, exclusive 

9 agents or exclusive independent contractors 

10 present in the State who engage in activities 

11 that substantially assist the person to establish 

12 or maintain a market in the State. 

13 (F) Maintains an office in the State at 

14 which it regularly employs three or more em15 ployees for any purpose. 

16 (2) DE MINIMIS PHYSICAL PRESENCE.—For 

17 purposes of this section, the term ‘‘physical pres18 ence’’ shall not include— 

19 (A) entering into an agreement under 

20 which a person, for a commission or other con21 sideration, directly or indirectly refers potential 

22 purchasers to a person outside the State, 

23 whether by an internet-based link or platform, 

24 internet website or otherwise; 


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1 (B) any presence in a State, as described 

2 in section 2(b)(1), for less than 15 days in a 

3 taxable year (or a greater number of days if 

4 provided by State law); 

5 (C) product placement, setup, or other 

6 services offered in connection with delivery of 

7 products by an interstate or in-State carrier or 

8 other service provider; 

9 (D) internet advertising services provided 

10 by in-State residents which are not exclusively 

11 directed towards, or do not solicit exclusively, 

12 in-State customers; 

13 (E) ownership by a person outside the 

14 State of an interest in a limited liability com15 pany or similar entity organized or with a phys16 ical presence in the State; 

17 (F) the furnishing of information to cus18 tomers or affiliates in such State, or the cov19 erage of events or other gathering of informa20 tion in such State by such person, or his rep21 resentative, which information is used or dis22 seminated from a point outside the State; or 

23 (G) business activities directly relating to 

24 such person’s potential or actual purchase of 


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1 goods or services within the State if the final 

2 decision to purchase is made outside the State. 

3 (c) PROTECTION OF NON-SELLERS.—A State may 

4 not impose or assess a sales, use, or similar tax on a per5 son or impose an obligation to collect or report any infor6 mation with respect thereto, unless such person is either 

7 a purchaser or a seller having a physical presence in the 

8 State. 

9 SEC. 3. DISPUTE RESOLUTION. 

10 The district courts of the United States shall have 

11 original jurisdiction over civil actions to enforce the provi12 sions of this Act, including authority to issue declaratory 

13 judgments pursuant to section 2201 of title 28, United 

14 States Code, and, notwithstanding the provisions of sec15 tion 1341 of such title, injunctive relief, as necessary to 

16 carry out any provision of this Act. 

17 SEC. 4. DEFINITIONS AND EFFECTIVE DATE. 

18 (a) DEFINITIONS.—For purposes of this Act: 

19 (1) MARKETPLACE PROVIDER.—The term 

20 ‘‘marketplace provider’’ includes any person, other 

21 than a seller, who facilitates a sale. For purposes of 

22 this subsection, a person facilitates a sale when the 

23 person both— 


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1 (A) lists or advertises products for sale in 

2 any forum, including a catalog or internet 

3 website; and 

4 (B) either directly or indirectly through 

5 agreements or arrangements with third parties, 

6 collects gross receipts from the customer and 

7 transmits those receipts to the marketplace sell8 er, whether or not such person deducts any fees 

9 or other amounts from those receipts prior to 

10 transferring them to the marketplace seller. 

11 (2) MARKETPLACE SELLER.—The term ‘‘mar12 ketplace seller’’ means a person that has any sales 

13 facilitated by a marketplace provider. 

14 (3) PERSON.—The term ‘‘person’’ has the 

15 meaning given such term by section 1 of title 1, 

16 United States Code. Each corporation that is a 

17 member of a group of affiliated corporations, wheth18 er unitary or not, is itself a separate person. 

19 (4) PRODUCT.—The term ‘‘product’’ includes 

20 any good or service, tangible or intangible. 

21 (5) REFERRER.—The term ‘‘referrer’’ shall 

22 mean every person who— 

23 (A) contracts or otherwise agrees with a 

24 seller to list multiple products for sale and the 


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1 sales prices thereof in any forum, including a 

2 catalog or internet website; 

3 (B) receives a fee, commission, or other 

4 consideration from a seller for the listing; 

5 (C) transfers, via telephone, internet link, 

6 or otherwise, a customer to the seller or the 

7 seller’s website to complete a purchase; and 

8 (D) does not collect receipts from the cus9 tomer for the transaction. 

10 (6) SELLER.—The term ‘‘seller’’ does not in11 clude— 

12 (A) any marketplace provider (except with 

13 respect to the sale through the marketplace of 

14 products owned by the marketplace provider); 

15 (B) any referrer; 

16 (C) any carrier, in which the seller does 

17 not have an ownership interest, providing trans18 portation or delivery services with respect to 

19 tangible personal property; and 

20 (D) any credit card issuer, transaction or 

21 billing processor, or other financial inter22 mediary. 

23 (7) SIMILAR TAX.—The term ‘‘similar tax’’ 

24 means a tax that is imposed with respect to the sale 

25 or use of a product, regardless of whether the tax 


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1 is imposed on the person making the sale or the pur2 chaser, with the right or obligation of the person 

3 making the sale to obtain reimbursement for the 

4 amount of the tax from the purchaser at the time 

5 of the transaction. 

6 (8) STATE.—The term ‘‘State’’ means the sev7 eral States, the District of Columbia, the Common8 wealth of Puerto Rico, Guam, American Samoa, the 

9 United States Virgin Islands, the Commonwealth of 

10 the Northern Mariana Islands, and any other terri11 tory or possession of the United States and includes 

12 any political subdivision thereof. 

13 (b) EFFECTIVE DATE.—This Act shall apply with re14 spect to calendar quarters beginning on or after August 

15 1, 2019. 

Æ 


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