No Regulation Without Representation Act of 2016

Bill: 114-hr-5893
Sponsor: full_name: Rep. Sensenbrenner, F. James, Jr. [R-WI-5]
Introduced: 2016-07-14
Policy area: Taxation
Subjects: Sales and excise taxes

State and local taxation

Tax administration and collection, taxpayers
Latest action: action_date: 2016-08-10
text: Referred to the Subcommittee on Regulatory Reform, Commercial And Antitrust Law.

Summaries:
action_date: 2016-07-14
action_desc: Introduced in House
text: <p><b>No Regulation Without Representation Act of 2016 </b></p> <p>This bill prohibits a state from imposing sales and use tax obligations or assessments on a person who is not a purchaser or seller with a physical presence in the state during the calendar quarter for which the obligation or assessment is imposed.</p> <p>The person must be physically present for a state to: (1) impose obligations for collecting a sales, use, or similar tax or for collecting related information; (2) assess such a tax on a person; or (3) treat a person as doing business in the state for the purposes of such a tax.</p> <p>A person is physically present if the person's business activities in the state include:</p> <ul> <li> owning or leasing certain property in the state; </li> <li> having one or more employees, agents, or independent contractors in the state specifically soliciting product or service orders from customers in the state or who provide on-site design, installation, or repair services on behalf of the remote seller; or </li> <li> maintaining an office in the state with at least three employees. </li> </ul> <p>Physical presence does not include: (1) certain referral agreements, (2) presence for less than 15 days in a year, (3) delivery and product placement services offered by an interstate or in-state common carrier, or (4) Internet advertising services provided by in-state residents which are not exclusively directed towards or exclusively soliciting in-state customers. </p> <p>The bill specifies that U.S. district courts have original jurisdiction over civil actions to enforce this bill. </p>

tv_txt: I 114th CONGRESS 2d Session H. R. 5893 IN THE HOUSE OF REPRESENTATIVES July 14, 2016 Mr. Sensenbrenner introduced the following bill; which was referred to the Committee on the Judiciary A BILL To regulate certain State impositions on interstate commerce.

1. Short title This Act may be cited as the No Regulation Without Representation Act of 2016 . 2. Minimum jurisdictional standards for State and local sales and use tax collection (a) In general A State may— (1) impose an obligation on a person for— (A) the collection of a sales, use, or similar tax, or (B) the reporting of any information with respect thereto, on a person, (2) assess a sales, use or similar tax on a person, or (3) treat a person as doing business in a State for purposes of such a tax, only if such person had a physical presence in the State during the calendar quarter with respect to which the obligation or assessment is imposed. (b) Requirements for physical presence (1) In general For purposes of subsection (a), a person has a physical presence in a State only if such person’s business activities in the State include any of the following during the calendar year— (A) owns, holds a leasehold interest in, or maintains real property such as a retail store, warehouse, distribution center, manufacturing operation, or assembly facility in the State; (B) leases or owns tangible personal property (other than computer software) of more than de minimis value in the State; (C) has one or more employees, agents or independent contractors present in the State who engage in specific solicitations toward obtaining product or service orders from customers in that State, or prospective customers in that State, on behalf of the person; (D) has one or more employees or independent contractors present in the State who provide on-site design, installation, or repair services on behalf of the remote seller; or (E) maintains an office in the State at which it regularly employs three or more employees for any purpose. (2) De minimis physical presence For purposes of this section, the term physical presence shall not include— (A) entering into an agreement under which a person, for a commission or other consideration, directly or indirectly refers potential purchasers to a person outside the State, whether by an Internet-based link or platform, Internet Web site or otherwise; (B) any presence in a State, as described in section 2(b)(1), for less than 15 days in a taxable year (or a greater number of days if provided by State law); (C) delivery and product placement services offered by an interstate or in-State common carrier; and (D) Internet advertising services provided by in-State residents which are not exclusively directed towards, or do not solicit exclusively, in-State customers. (c) Protection of non-Sellers A State may not impose a sales or use tax collection obligation, or an obligation to report any information with respect thereto, on a person or assess a sales, use or similar tax on any person other than a purchaser or a seller having a physical presence in the State. 3. Dispute resolution The district courts of the United States shall have original jurisdiction over civil actions to enforce the provisions of this Act, including authority to issue declaratory judgments pursuant to section 2201 of title 28, United States Code, and, notwithstanding the provisions of section 1341 of such title, injunctive relief, as necessary to carry out this Act. 4. Definitions and effective date (a) Definitions For purposes of this Act: (1) Marketplace provider The term marketplace provider includes any person, other than a seller, who facilitates a sale. For purposes of this subsection, a person facilitates a sale when the person both— (A) lists or advertises tangible personal property and services for sale in any forum, including a catalog or Internet Web site; and (B) either directly or indirectly through agreements or arrangements with third parties, collects gross receipts from the customer and transmits those receipts to the marketplace seller, whether or not such person deducts any fees from the transmission of those receipts to the marketplace seller. (2) Marketplace seller The term marketplace seller means a person that has any sales facilitated by a marketplace provider. (3) Referrer The term referrer shall mean every person who— (A) contracts or otherwise agrees with a seller to list multiple items of tangible personal property and services for sale and the sales prices thereof in any forum, including a catalog or Internet Web site; (B) receives a fee, commission, or other consideration from a seller for the listing; (C) transfers, via telephone, Internet link, or otherwise, a customer to the seller or the seller’s Web site to complete a purchase; and (D) does not collect receipts from the customer for the transaction. (4) Person The term person has the meaning given such term by section 1 of title 1 of the United States Code. Each corporation that is a member of a group of affiliated corporations, whether unitary or not, is itself a separate person . (5) Seller The term seller does not include— (A) any marketplace provider; (B) any referrer; (C) any carrier, in which the seller does not have an ownership interest, providing transportation or delivery services with respect to tangible personal property; and (D) any credit card issuer, transaction or billing processor, or other financial intermediary. (6) Similar tax The term similar tax means a tax that is imposed with respect to the sale or use of a product or service, regardless whether the tax is imposed on the person making the sale or the purchaser, with the right or obligation of the person making the sale to obtain reimbursement for the amount of the tax from the purchaser at the time of the transaction. (7) State The term State means the several States, the District of Columbia, the Commonwealth of Puerto Rico, Guam, American Samoa, the United States Virgin Islands, the Commonwealth of the Northern Mariana Islands, and any other territory or possession of the United States and includes the State government or political subdivision entity responsible for tax collection and audits. (b) Effective date This Act shall apply with respect to calendar quarters beginning on or after January 1, 2017.