Title: Online Sales Simplicity and Small Business Relief Act of 2018
Policy area: Taxation

Summary:
Online Sales Simplicity and Small Business Relief Act of 2018
This bill prohibits states from imposing a sales tax collection duty on certain remote sellers. A "remote seller" is a person without a physical presence in a state who makes a sale in the state.
With respect to remote sellers, a state: (1) may not impose a sales tax collection duty for any sale that occurred before June 21, 2018, and (2) may only impose a sales tax collection duty for a sale that occurs after January 1, 2020.
In the case of a small business remote seller (no more than $10 million in gross annual receipts in the United States), a state may not impose a sales tax collection duty on any person other than the purchaser if the sale is made: (1) on or after June 21, 2018; and (2) before the date that is 30 days after the states develop and Congress approves an interstate compact, applicable to the state and sale, governing the imposition of tax collection duties on remote sellers.

[Congressional Bills 115th Congress]
[From the U.S. Government Publishing Office]
[S. 3725 Introduced in Senate (IS)]

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115th CONGRESS
  2d Session
                                S. 3725

 To prohibit States from retroactively imposing a sales tax collection 
            duty on a remote seller, and for other purposes.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                            December 6, 2018

  Mrs. Shaheen (for herself, Mr. Wyden, Ms. Hassan, and Mr. Merkley) 
introduced the following bill; which was read twice and referred to the 
                          Committee on Finance

_______________________________________________________________________

                                 A BILL


 
 To prohibit States from retroactively imposing a sales tax collection 
            duty on a remote seller, and for other purposes.

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

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Online Sales Simplicity and Small 
Business Relief Act of 2018''.

SEC. 2. BAN ON RETROACTIVE TAXATION OF INTERNET COMMERCE.

    A State may not impose a sales tax collection duty on a remote 
seller for any sale that occurred prior to June 21, 2018.

SEC. 3. ORDERLY PHASE-IN OF COMPLIANCE OBLIGATIONS.

    A State may impose a sales tax collection duty on a remote seller 
only for a sale that occurs after January 1, 2020.

SEC. 4. SMALL BUSINESS REMOTE SELLER EXEMPTION.

    In the case of a sale made by a small business remote seller, no 
State may impose a sales tax collection duty on any person other than 
the purchaser if the sale is made on or after June 21, 2018, and before 
the date that is 30 days after the date on which the States develop and 
Congress approves an interstate compact, applicable to the State and 
sale, governing the imposition of tax collection duties on remote 
sellers.

SEC. 5. SENSE OF CONGRESS.

    It is the sense of Congress that the States should develop an 
interstate compact for the collection of sales tax by remote sellers 
that identifies a clearly defined minimum substantial nexus between the 
remote seller and the taxing State, that simplifies registration, 
collection, remittance, auditing, and other compliance processes to the 
greatest extent possible in order to avoid undue burdens on interstate 
commerce, and that, due to such simplification, eliminates the need for 
the continuation of the small business remote seller exemption under 
section 4.

SEC. 6. DEFINITIONS.

    In this Act:
            (1) Remote seller.--The term ``remote seller'' means a 
        person without a physical presence in the State who makes a 
        sale in the State.
            (2) Physical presence.--
                    (A) In general.--Except as provided in subparagraph 
                (B), the term ``physical presence'' means, with respect 
                to a person, that a person's business activities in the 
                State include any of the following during such person's 
                taxable year:
                            (i) Being an individual physically in the 
                        State, or assigning one or more employees to be 
                        in the State.
                            (ii) Using the services of an agent 
                        (excluding an employee) to establish or 
                        maintain a market in the State, if such agent 
                        does not perform business services in the State 
                        for any other person during such taxable year.
                            (iii) The leasing or owning of tangible 
                        personal property (other than digital or 
                        alphanumeric data) or of real property in the 
                        State.
                    (B) Exception.--A person does not have physical 
                presence in a State if the person's physical presence 
                in the State under subparagraph (A) was for less than 
                15 days in a taxable year (or a greater number of days 
                if provided by State law), or if the person's physical 
                presence in the State was solely for the purpose of 
                conducting limited or transient business activity.
            (3) Sales tax collection duty.--The term ``sales tax 
        collection duty'' means--
                    (A) an obligation imposed on a person, including a 
                person other than the actual seller, to--
                            (i) pay or collect a sales, use, or similar 
                        tax upon the sale of a good or service; or
                            (ii) report any information with respect to 
                        such sale of a good or service; or
                    (B) the assessment of a sales, use, or similar tax 
                on a person.
            (4) Small business remote seller.--The term ``small 
        business remote seller'' means a remote seller with gross 
        annual receipts in the United States during the preceding 
        calendar year in an amount that is not more than $10,000,000.
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