Source: https://ribit.rofreg.com/legislations/5330
Timestamp: 2019-04-19 06:18:59+00:00

Document:
Extends the requirement to collect sales tax to remote sellers in a way that conforms to a recent U.S. Supreme Court decision making it easier for states to compel collection/sales tax from retailers who do not have a physical presence in their state.
(1) "Division of taxation" means the Rhode Island department of revenue, division of taxation. The division may also be referred to in this chapter as the "division of taxation", "tax division", or "division."
(2) "In-state customer" means a person or persons who makes a purchase of tangible personal property, prewritten computer software delivered electronically or by load and leave as defined in § 44-18-7.1(g)(v), vendor-hosted prewritten computer software, and/or taxable services as defined under § 44-18-1 et seq. for use, storage, and/or other consumption in this state.
(3) "In-state software" means software used by in-state customers on their computers, smartphones, and other electronic and/or communication devices, including information or software such as cached files, cached software, or "cookies", or other data tracking tools, that are stored on property in this state or distributed within this state, for the purpose of purchasing tangible personal property, prewritten computer software delivered electronically or by load and leave, vendor-hosted prewritten computer software, and/or taxable services.
(4) "Marketplace" means a physical or electronic place including, but not limited to, a store, booth, Internet website, catalog, television or radio broadcast, or a dedicated sales software application where tangible personal property, prewritten computer software delivered electronically or by load and leave, vendor-hosted prewritten computer software, and/or taxable services is/are sold or offered for sale for delivery in this state regardless of whether the tangible personal property, prewritten computer software delivered electronically or by load and leave, vendor-hosted prewritten computer software, or have a physical presence in the state.
(4) "Marketplace" means a physical or electronic place including, but not limited to, a store, booth, Internet website, catalog, television or radio broadcast, or a dedicated sales software application where tangible personal property, prewritten computer software delivered electronically or by load and leave, vendor-hosted prewritten computer software, and/or taxable services is/are sold or offered for sale for delivery in this state regardless of whether the tangible personal property, prewritten computer software delivered electronically or by load and leave, or vendor-hosted prewritten computer software have a physicalpresence in the state.
(viii) Providing customer service or accepting or assisting with returns or exchanges.
(6) "Marketplace seller" means a person, not a related party to a marketplace facilitator, who has an agreement with a marketplace facilitator and makes retail sales of tangible personal property, prewritten computer software delivered electronically or by load and leave, vendor- hosted prewritten computer software, and/or taxable services through a marketplace owned, operated, or controlled by a marketplace facilitator, whether or not such person is required to register to collect and remit sales tax.
(iii) Using a retail sale facilitator to sell, lease, or deliver in this state, or participate in any activity in this state in connection with the selling, leasing, or delivering in this state, of tangible personal property, prewritten computer software delivered electronically or by load and leave, and/or taxable services for use, storage, or consumption in this state.
(vi) Shares management, business systems, business practices, computer resources, communication systems, payroll, personnel, or other such business resources and activities with the non-collecting retailer, and/or engages in intercompany transactions with the non-collecting retailer, either or both of which relate to the activities that establish or maintain the non-collecting retailer's market in this state.
(F) Any person or persons who meets at least one of the criteria in subsections (4)(A) – (4)(E) above shall be presumed to be a non-collecting retailer.
(G) The term "non-collecting retailer" will no longer apply to any entity that meets the definition of this subsection on or after July 1, 2019, at which time such entity shall be classified as a "remote seller" as referenced in R.I. Gen. Laws § 44-18-15.2.
(F) Any personor persons who meets at least one of the criteria in subsections (4)(7)(A) - - (4)(7)(E) above shallbe presumed to be a non-collecting retailer.
(G) The term "non-collecting retailer" will no longer apply to any entity that meets the definition of this subsection effective ninety (90) days after the enactment of this amended chapter, at which time such entity shall be classified as a "remote seller" as referenced in R.I. Gen. Laws § 44-18-15.2.
(58) "Person" means person as defined in § 44-18-6.
(D) Does not collect payments from the in-state customer for the transaction.
(E) A person or persons who engages in the activity set forth in all of the activities set forth in subsections (69)(A) – (69)(D) above shall be presumed to be a referrer.
(E) A person or persons who engages in the activity set forth in all of the activities set forth in subsections (69)(A) – (69)(D) above shallbe presumed to be a referrer.
(B) Having one or more ownership relationships and a purpose of having the ownership relationship is to avoid the application of this chapter.
(811) A "retail sale" or "sale at retail" means any retail sale or sale at retail as defined in § 44-18-8.
(811) A "retail sale"or "sale at retail"means any retailsale or sale at retailas defined in § 44-18-8.
(C) Either directly or indirectly through agreements or arrangements with third parties, collecting payments from the in-state customer and transmitting those payments to a retailer. A person or persons may be a retail sale facilitator regardless of whether they deduct any fees from the transaction. The division may define in regulation circumstances under which a retail sale facilitator shall be deemed to facilitate a retail sale.
(D) A person or persons who engages in the type of activity set forth in subsection (912) (A) above or both of the types of activities set forth in subsections (912) (B) and (912) (C) above shall be presumed to be a retail sale facilitator.
(E) The term "retail sale facilitator" will no longer apply to any entity that meets the definition of this subsection on or after July 1, 2019, at which time such entity shall be classified as a "marketplace facilitator" as referenced above in R.I. Gen. Laws § 44-18.2-2(5).
(C) Either directly or indirectly through agreements or arrangements with third parties, collecting payments from the in-state customer and transmitting those payments to a retailer. A person or persons may be a retailsale facilitator regardless of whether they deduct any fees from the transaction. The division may define in regulation circumstances under which a retail sale facilitator shall be deemed to facilitate a retailsale.
(D) A person or persons who engages in the type of activity set forth in subsection (912) (A) above or both of the types of activities set forth in subsections (912) (B) and (912) (C) above shall be presumed to be a retailsale facilitator.
(E) The term "retail sale facilitator" will no longer apply to any entity that meets the definition of this subsection effective ninety (90) days after the enactment of this amended chapter, at which time such entity shall be classified as a "marketplace facilitator" as referenced above in R.I. Gen. Laws § 44-18.2-2(5).
(130) A "retailer" means retailer as defined in § 44-18-15.
(141) "State" means the State of Rhode Island and Providence Plantations.
(152) "Streamlined agreement" means the Streamlined Sales and Use Tax Agreement as referenced in § 44-18.1-1 et seq.
(16) "Vendor-hosted prewritten computer software" refers to the same term as defined in R.I. Gen. Laws § 44-18-7.1(g)(vii) effective October 1, 2018.
(16) "Vendor-hosted prewritten computer software"refers to the same term as defined in R.I. Gen. Laws § 44-18-7.1(g)(vii) effective October 1, 2018.
44-18.2-3. Requirements for non-collecting retailers, referrers, and retail sale facilitators.
(ii) Has sold tangible personal property, prewritten computer software delivered electronically or by load and leave, and/or taxable services for delivery into this state in two hundred (200) or more separate transactions shall comply with the requirements in subsections (EF), (FG), and (GH) as applicable.
(B) A non-collecting retailer, as defined in this chapter, shall comply with subsection (E)(F) below if it meets the criteria of either subsection (A)(i) or (A)(ii) above.
(C) A referrer, as defined in this chapter, shall comply with subsection (FG) below if it meets the criteria of either subsection (A)(i) or (A)(ii) above.
(D) A retail sale facilitator, as defined in this chapter, shall comply with subsection (GH) below if it meets the criteria of either subsection (A)(i) or (A)(ii) above.
(E) Any noncollecting retailer, retail sale facilitator and/or referrer that is collecting and remitting sales tax into this state prior to the enactment of this amended chapter, date to be inserted after enactment, shall be deemed a remote seller and/or marketplace facilitator and/or referrer and shall continue to collect and remit sales tax. Beginning on ninety (90) days after the enactment of this amended chapter, date to be inserted after enactment, any remote seller, referrer, marketplace seller and/or marketplace facilitator, upon amendment of this chapter and shall continue to collect and remit sales tax.
(E) Any noncollecting retailer, retail sale facilitator and/or referrer that is collecting and remitting sales tax into this state prior to the enactment of this amended chapter, date to be inserted after enactment, shall be deemed a remote seller and/or marketplace facilitator and/or referrer and shallcontinue to collect and remit sales tax.
(ii) Has sold tangible personal property, prewritten computer software delivered electronically or by load and leave, vendor-hosted prewritten computer software, and/or taxable services for delivery into this state in two hundred (200) or more separate transactions.
(5) Beginning on February 15, 2018, and not later than each February 15 thereafter, a non-collecting retailer that has not registered in this state for a permit to make sales at retail and collect and remit sales and use tax on all taxable sales into the state for any portion of the prior calendar year, shall file with the division on such form and/or in such format as the division prescribes an attestation that the non-collecting retailer has complied with the requirements of subsections (EF) (1) – (EF) (4) herein.
LC001249/SUB A - Page 8of 14 non-collecting retailer that has not registered in this state for a permit to make sales at retailand collect and remit sales and use tax on all taxable sales into the state for any portion of the prior calendar year, shall file with the division on such form and/or in such format as the division prescribes an attestation that the non-collecting retailer has complied with the requirements of subsections (EF) (1) – (EF) (4) herein.
(FG) Referrer. At such time during any calendar year, or any portion thereof, that a referrer receives more than ten thousand dollars ($10,000) from fees, commissions, and/or other compensation paid to it by retailers with whom it has a contract or agreement to list and/or advertise for sale tangible personal property, prewritten computer software delivered electronically or by load and leave, and/or taxable services, said referrer shall within thirty (30) days provide written notice to all such retailers that the retailers' sales may be subject to this state's sales and use tax.
(ii) A list of names and addresses of the retailers who during the prior calendar year used the retail sale facilitator to serve in-state customers but for whom the retail sale facilitator did not collect Rhode Island sales and use tax.
(I) Remote sellers, referrers, and marketplace facilitators. A remote seller, referrer, and marketplace facilitator shall register in this state for a permit to make sales at retail and collect and remit sales and use tax on all taxable sales into the state.
(i) A marketplace facilitator shall collect sales and use tax on all sales made through the marketplace to purchasers in this state whether or not the marketplace seller (1) has or is required to have a permit to make sales at retail or (2) would have been required to collect and remit sales and use tax had the sale not been made through the marketplace provider.
(ii) A marketplace facilitator shall certify to its marketplace sellers that it will collect and remit sales and use tax on sales of taxable items made through the marketplace. A marketplace seller that accepts a marketplace provider's collection certificate in good faith may exclude sales made through the marketplace from the marketplace seller's returns under Chapters 18 and 19 of Title 44 of the Rhode Island General Laws.
(A) shall have all the obligations and rights of a retailer under Chapters 18 and 19 of Title 44 of the Rhode Island General Laws and under any regulations adopted pursuant thereto, including, but not limited to, the duty to obtain a certificate of authority, to collect tax, file returns, remit tax, and the right to accept a certificate or other documentation from a customer substantiating an exemption or exclusion from tax, the right to receive a refund or credit allowed by law; and (B) shall keep such records and information and cooperate with the tax administrator to ensure the proper collection and remittance of tax imposed, collected, or required to be collected under Chapters 18 and 19 of Title 44 of the Rhode Island General Laws.
(iv) A marketplace facilitator shall be subject to audit by the tax administrator with respect to all retail sales for which it is required to collect and pay the tax imposed under Chapters 18 and 19 of Title 44 of the Rhode Island General Laws. Where the tax administrator audits the marketplace facilitator, the tax administrator is prohibited from auditing the marketplace seller for the same retail sales unless the marketplace facilitator seeks relief under this subsection (iv).
(v) If the marketplace facilitator demonstrates to the tax administrator's satisfaction that the marketplace facilitator has made a reasonable effort to obtain accurate information from the marketplace seller about a retail sale and that the failure to collect and pay the correct amount of tax imposed under Chapters 18 and 19 of Title 44 of the Rhode Island General Laws was due to incorrect information provided to the marketplace facilitator by the marketplace seller, then the marketplace facilitator shall be relieved of liability of the tax for that retail sale. This subsection (v) does not apply with regard to a retail sale for which the marketplace facilitator is the seller or if the marketplace facilitator and seller are affiliates. Where the marketplace facilitator is relieved under this subsection (v), the seller is liable for the tax imposed under Chapters 18 and 19 of Title 44 of the Rhode Island General Laws.
(vi) A class action may not be brought against a marketplace facilitator on behalf of purchasers arising from or in any way related to an overpayment of sales or use tax collected by the marketplace facilitator, regardless of whether such action is characterized as a tax refund claim. Nothing in this subsection (vi) shall affect a purchaser's right to seek a refund as otherwise allowed by law.
(HJ) Any person or entity that engages in any activity or activities of a non-collecting retailer, referrer, and/or retail sale facilitator as defined herein shall be presumed to be a non- collecting retailer, referrer, and/or retail sale facilitator as applicable even if referred to by another name or designation. Said person or entity shall be subject to the terms and conditions set forth in this chapter.
(ii) A list of names and addresses of the retailers who during the prior calendar year used the retail sale facilitator to serve in-state customers but for whom the retailsale facilitator did not collect Rhode Island sales and use tax.
(I) Remote sellers, referrers,andmarketplace facilitators. A remote seller, referrer, and marketplace facilitator shall register in this state for a permit to make sales at retail and collect and remit sales and use tax on alltaxable sales into the state.
(i) A marketplace facilitator shall collect sales and use tax on all sales made through the marketplace to purchasers in this state whether or not the marketplace seller (1) has or is required to have a permit to make sales at retailor (2) would have been required to collect and remit sales and use tax had the sale not been made through the marketplace provider.
(ii) A marketplace facilitator shall certify to its marketplace sellers that it will collect and remit sales and use tax on sales of taxable items made through the marketplace. A marketplace seller that accepts a marketplace provider's collection certificate in good faith may exclude sales made through the marketplace from the marketplace seller's returns under Chapters 18 and 19 of Title 44 of the Rhode Island GeneralLaws.
(A) shall have all the obligations and rights of a retailer under Chapters 18 and 19 of Title 44 of the Rhode Island General Laws and under any regulations adopted pursuant thereto, including, but not limited to, the duty to obtain a certificate of authority, to collect tax, file returns, remit tax, and the right to accept a certificate or other documentation from a customer substantiating an exemption or exclusion from tax, the right to receive a refund or credit allowed by law; and (B) shall keep such records and information and cooperate with the tax administrator to ensure the proper collection and remittance of tax imposed, collected, or required to be collected under Chapters 18 and 19 of Title 44 of the Rhode Island GeneralLaws.
(iv) A marketplace facilitator shall be subject to audit by the tax administrator with respect to allretailsales for which it is required to collect and pay the tax imposed under Chapters 18 and 19 of Title 44 of the Rhode Island General Laws. Where the tax administrator audits the marketplace facilitator, the tax administrator is prohibited from auditing the marketplace seller for the same retailsales unless the marketplace facilitator seeks relief under this subsection (iv).
(v) If the marketplace facilitator demonstrates to the tax administrator's satisfaction that the marketplace facilitator has made a reasonable effort to obtain accurate information from the marketplace seller about a retail sale and that the failure to collect and pay the correct amount of tax imposed under Chapters 18 and 19 of Title 44 of the Rhode Island GeneralLaws was due to incorrect information provided to the marketplace facilitator by the marketplace seller, then the marketplace facilitator shall be relieved of liability of the tax for that retail sale. This subsection (v) does not apply with regard to a retail sale for which the marketplace facilitator is the seller or if the marketplace facilitator and seller are affiliates. Where the marketplace facilitator is relieved under this subsection (v), the seller is liable for the tax imposed under Chapters 18 and 19 of Title 44 of the Rhode Island GeneralLaws.
(vi) A class action may not be brought against a marketplace facilitator on behalf of purchasers arising from or in any way related to an overpayment of sales or use tax collected by the marketplace facilitator, regardless of whether such action is characterized as a tax refund claim. Nothing in this subsection (vi) shallaffect a purchaser's right to seek a refund as otherwise allowed by law.
(HJ) Any person or entity that engages in any activity or activities of a non-collecting retailer, referrer, and/or retail sale facilitator as defined herein shall be presumed to be a non- collecting retailer, referrer, and/or retailsale facilitator as applicable even if referred to by another name or designation. Said person or entity shall be subject to the terms and conditions set forth in this chapter.
44-18.2-4. Exceptions for referrers and retail sale facilitators.
(2) Evidence of a fully completed Rhode Island or Streamlined agreement sales and use tax exemption certificate.
(B) Nothing in this section shall be construed to interfere with the ability of a non- collecting retailer, referrer, or retail sale facilitator and a retailer to enter into agreements with each other; provided, however, the terms of said agreements shall not in any way be inconsistent with or contravene the requirements of this chapter.
(C) The provisions of subsections (A) and (B) herein will not be applicable as of July 1, 2019 or the effective date of the amendment of this chapter.
(C) The provisions of subsections (A) and (B) herein will not be applicable as of ninety (90) days after the effective date of the amendment of this chapter.
Prior to the effective date of the enactment of the amendment of this chapter or date to be inserted upon enactment, Aany non-collecting retailer, referrer, or retail sale facilitator that fails to comply with any of the requirements of this chapter shall be subject to a penalty of ten dollars ($10.00) for each such failure, but not more less than a total penalty of ten thousand dollars ($10,000) per calendar year. As of July 1, 2019, any remote seller, referrer, or marketplace facilitator that fails to comply with any of the requirements of this chapter shall be subject to a penalty of ten dollars ($10.00) for each such failure, but not less than a total penalty of ten thousand dollars ($10,000) per calendar year. Each instance of failing to comply with the requirements of this chapter shall constitute a separate violation for purposes of calculating the penalty under this section. This penalty shall be in addition to any other applicable penalties under title 44.
LC001249/SUB A - Page 11of 14 subject to a penalty of ten dollars ($10.00) for each such failure, but not less than a totalpenalty of ten thousand dollars ($10,000) per calendar year. Each instance of failing to comply with the requirements of this chapter shall constitute a separate violation for purposes of calculating the penalty under this section. This penalty shall be in addition to any other applicable penalties under title 44.
(A) Nothing in this section affects the obligation of any in-state customer to remit use tax as to any applicable transaction in which the seller, non-collecting retailer, or retail sale facilitator, remote seller, Marketplace Seller, or Marketplace Facilitator has not collected and remitted the sales tax for said transaction.
(B) Nothing in this chapter shall be construed as relieving any other person or entity otherwise required to collect and remit sales and use tax under applicable Rhode Island law from continuing to do so.
(C) In the event that any section of this chapter is later determined to be unlawful, no person, persons, or entity shall have a cause of action against the person that collected and remitted the sales and use tax pursuant to this chapter.
SECTION 7. Section 44-18-15.2 of the General Laws in Chapter 44-18 entitled "Sales and Use Taxes - Liability and Computation" is hereby repealed.
44-18-15.2. "Remote seller" and "remote sale" defined – Collection of sales and use tax by remote seller.
44-18-15.2."Remote seller"and"remote sale"defined – Collectionofsales and use tax by remote seller.
(1) "Remote seller" means a person who makes remote sales in this state. any seller, other than a marketplace facilitator or referrer, who does not have a physical presence in this state and makes retail sales to purchasers.
(2) "Remote sale" means a sale into this state for which the seller would not legally be required to pay, collect, or remit state or local sales and use taxes unless provided by federal law.
(b) Upon passage of any federal law authorizing states to require remote sellers to collect and remit sales and use taxes, this state will require a remote seller making remote sales in the state to pay, collect, and remit sales and use taxes at the rate imposed under § 44-18-18, and in accordance with the provisions of this article, chapters 18.1 and 19 of this title, and applicable federal law.
(1) "Remote seller" means a person who makes remote sales in this state. any seller, other than a marketplace facilitator or referrer, who does not have a physicalpresence in this state and makes retailsales to purchasers.
(2) "Remote sale" means a sale into this state for which the seller would not legally be required to pay, collect, or remit state or localsales and use taxes unless provided by federallaw.
(b) Upon passage of any federallaw authorizing states to require remote sellers to collect and remit sales and use taxes, this state will require a remote seller making remote sales in the state to pay, collect, and remit sales and use taxes at the rate imposed under § 44-18-18, and in accordance with the provisions of this article, chapters 18.1 and 19 of this title, and applicable federallaw.
This act would extend the requirement to collect sales tax to remote sellers in a way that conforms to a recent U.S. Supreme Court decision making it easier for states to compel collection of the sales tax from retailers who do not have a physical presence in their state.
This act would extend the requirement to collect sales tax to remote sellers in a way that conforms to a recent U.S. Supreme Court decision making it easier for states to compelcollection of the sales tax from retailers who do not have a physicalpresence in their state.

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