I 
113TH CONGRESS 
1ST SESSION H. R. 3724 
To promote neutrality, simplicity, and fairness in the taxation of digital 
goods and digital services. 
IN THE HOUSE OF REPRESENTATIVES 
DECEMBER 12, 2013 
Mr. SMITH of Texas (for himself, Mr. COHEN, Mr. COBLE, Mr. BACHUS, and 
Mr. CHABOT) introduced the following bill; which was referred to the 
Committee on the Judiciary 
A BILL 
To promote neutrality, simplicity, and fairness in the 
taxation of digital goods and digital services. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Digital Goods and 
Services Tax Fairness Act of 2013’’. 
SEC. 2. MULTIPLE AND DISCRIMINATORY TAXES PROHIB-
ITED. 
No State or local jurisdiction shall impose multiple 
or discriminatory taxes on the sale or use of a digital good 
or a digital service. 
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SEC. 3. SOURCING LIMITATION. 
Subject to section 6(a), taxes on the sale of a digital 
good or a digital service may only be imposed by a State 
or local jurisdiction whose territorial limits encompass the 
customer tax address. 
SEC. 4. CUSTOMER TAX ADDRESS. 
(a) SELLER OBLIGATION.— 
(1) IN GENERAL.—Subject to subsection (e)(2), 
a seller shall be responsible for obtaining and main-
taining in the ordinary course of business the cus-
tomer tax address with respect to the sale of a dig-
ital good or a digital service, and shall be responsible 
for collecting and remitting the correct amount of 
tax for the State and local jurisdictions whose terri-
torial limits encompass the customer tax address if 
the State has the authority to require such collection 
and remittance by the seller. 
(2) CERTAIN
TRANSACTIONS.—When a cus-
tomer tax address is not a business location of the 
seller under clause (i) of section 7(2)(A)— 
(A) if the sale is a separate and discrete 
transaction, then a seller shall use reasonable 
efforts to obtain a customer tax address, as 
such efforts are described in clauses (iii), (iv), 
and (v) of section 7(2)(A), before resorting to 
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using a customer tax address as determined by 
clause (vi) of such section 7(2)(A); and 
(B) if the sale is not a separate and dis-
crete transaction, then a seller shall use reason-
able efforts to obtain a customer tax address, 
as such efforts are described in clauses (ii), 
(iii), (iv), and (v) of section 7(2)(A), before re-
sorting to using a customer tax address as de-
termined by clause (vi) of such section 7(2)(A). 
(b) RELIANCE ON CUSTOMER-PROVIDED INFORMA-
TION.—A seller that relies in good faith on information 
provided by a customer to determine a customer tax ad-
dress shall not be held liable for any additional tax based 
on a different determination of that customer tax address 
by a State or local jurisdiction or court of competent juris-
diction, except if and until binding notice is given as pro-
vided in subsection (c). 
(c) ADDRESS CORRECTION.—If a State or local juris-
diction is authorized under State law to administer a tax, 
and the jurisdiction determines that the customer tax ad-
dress determined by a seller is not the customer tax ad-
dress that would have been determined under section 
7(2)(A) if the seller had the additional information pro-
vided by the State or local jurisdiction, then the jurisdic-
tion may give binding notice to the seller to correct the 
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customer tax address on a prospective basis, effective not 
less than 45 days after the date of such notice, if— 
(1) when the determination is made by a local 
jurisdiction, such local jurisdiction obtains the con-
sent of all affected local jurisdictions within the 
State before giving such notice of determination; and 
(2) before the State or local jurisdiction gives 
such notice of determination, the customer is given 
an opportunity to demonstrate in accordance with 
applicable State or local tax administrative proce-
dures that the address used is the customer tax ad-
dress. 
(d) COORDINATION WITH SOURCING
OF MOBILE 
TELECOMMUNICATIONS SERVICE.— 
(1) IN GENERAL.—If— 
(A) a digital good or a digital service is 
sold to a customer by a home service provider 
of mobile telecommunications service that is 
subject to being sourced under section 117 of 
title 4, United States Code, or the charges for 
a digital good or a digital service are billed to 
the customer by such a home service provider; 
and 
(B) the digital good or digital service is de-
livered, transferred, or provided electronically 
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by means of mobile telecommunications service 
that is deemed to be provided by such home 
service provider under section 117 of such title, 
then the home service provider and, if different, the 
seller of the digital good or digital service, may pre-
sume that the customer’s place of primary use for 
such mobile telecommunications service is the cus-
tomer tax address described in section 7(2)(B) with 
respect to the sale of such digital good or digital 
service. 
(2) DEFINITIONS.—For purposes of this sub-
section, the terms ‘‘home service provider’’, ‘‘mobile 
telecommunications service’’, and ‘‘place of primary 
use’’ have the same meanings as in section 124 of 
title 4, United States Code. 
(e) MULTIPLE LOCATIONS.— 
(1) IN GENERAL.—If a digital good or a digital 
service is sold to a customer and available for use 
by the customer in multiple locations simultaneously, 
the seller may determine the customer tax addresses 
using a reasonable and consistent method based on 
the addresses of use as provided by the customer 
and determined in agreement with the customer at 
the time of sale. 
(2) DIRECT CUSTOMER PAYMENT.— 
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