The DMA Way

Completely Compliance- Across the Country

by DMA Staff | Jul 03, 2017
Looking Back
Alabama: The Alabama DOR launched a new look-up feature to review distributions to the different localities from the ONE SPOT or Simplified Sellers Use Tax (SSUT) programs. Launched in February, the feature is available through the My Alabama Taxes (MAT) website.

California: SB 11 prevents the state from assessing penalties and interest on a taxpayer for late payment if the late payment was due to the failure of the Board of Equalization’s website.

Okaloosa County, Florida: A 5% Tourism Development Tax was effective April 1, 2017. The new liability is reported on the state return under line D, “Transient Rentals”.

Nebraska: LB 313 could increase the state rate from 5.5% to 6.5%.

Oklahoma: Per a press release issued February 8, the Governor has proposed the elimination of state sales tax on groceries. The local jurisdictions can continue to tax groceries. It is an exception to the SSTP rules.

Oregon: HB 2230 would repeal the current corporate income and excise taxes and enact a 0.7% “commercial activity tax” based on gross receipts, with a one million dollar gross receipts exclusion. However, the measure would only go into effect upon the approval of a constitutional amendment included in House Joint Resolution 4.

Also in Oregon, SJR7 could potentially introduce a sales and use tax in the state on the purchase of tangible personal property and services.

Tennessee: The Nashville Metropolitan Government of Davidson County imposes a Central Business Improvement District (CBID) fee of 0.25% on certain sales in the specific district outlined in the notice. Effective February 1, 2017 and due March 20, the tax will be administered along with the Tennessee state tax on a separate Schedule D. Review the notice for details.

Also in Tennessee, the state launched a new Taxpayer Access Point (TAP) system. The system was available as of March 1, 2107.

The state has announced its sales tax holidays for the year. The back-to-school holiday will be August 11-13 (98-490), hurricane preparedness was April 22-24 (98-1017), and Energy Star was May 27-29 (96-1331). Also in Texas, the website for webfile and eSystems was enhanced to include better management of logins and restricted access.

Virginia: The Governor has approved HB 2246 which will create a tax amnesty program for 2017. The program will be conducted between July 1, 2017 and June 30, 2018 and shall last between 60-75 days. The specific period of amnesty will be determined by the Tax Commissioner.

Washington: In February, SB 5775 was introduced, proposing to repeal many of the exemptions available for sales/use tax, property and B&O taxes. Some exemptions up for consideration are digital goods, many types of raw materials, some healthcare services, and newspapers. For a complete listing, review the bill language.

Also in Washington, HB 1457 will designate the dates for the sales tax holiday in 2017. The dates are the second adjacent Friday, Saturday and Sunday of August.

Looking Forward
Alabama: A review of Rule 810-6-2-.90.02 is on the agenda in the upcoming weeks. The review will determine whether to amend the Simplified Sellers Use Tax Remittance Program so that vendors may continue to participate in the program should physical presence be established, so long as that physical presence is not engaged in retail sales. A hearing is scheduled for July 13.

Arkansas: The Governor signed Act 465 which will reduce the percent threshold for refund allowed for capital replacement and repair projects. Note the breakdown below:
Current  4.875%  July 1, 2020   1.875%
 July 1, 2018  3.875%  July 1, 2021  0.875%
 July 1, 2019  2.875%  July 1, 2022  Exempt

Colorado: After the simplification which occurred in Arizona, the state of Colorado is now reviewing the possibilities of going down a similar path. HB 1216 establishes a Sales and Use Tax Simplification Task Force. The Task Force will be conducting studies on various simplification tactics between state and local jurisdictions, in particular home-ruled jurisdictions.

Connecticut: SB 787 introduced a tax amnesty program, or Fresh Start Agreement, for qualified taxpayers. The program would have fallen between July 1, 2017 and October 31, 2018. Penalty would have been waived and interest would be waived at 50%. The Connecticut session ended June 7, but this could come up again.

Hawaii: In an effort to decrease the instances of taxpayers not abiding by their proper filing frequencies, the state has announced a change in how filing frequencies are determined. Currently, the filing frequencies are established at $2,000 or less liability in a calendar or fiscal year as an annual filer and $4,000 or less as a quarterly filer. Any returns filed on non-quarter or non-annual months will automatically convert the filing frequency to monthly regardless of liability totals. Effective July 1, 2017 for returns due August 20, monthly filing frequencies are the default. If you are currently a quarterly or annual filer, you will continue to be so unless returns are filed on off months.

Illinois: The state is trying to change the license renewal process. HB 819 will establish that any certificate renewed on or after July 1, shall be due one year from the date of issuance. Previously, the renewal rate was for five years.

Also in Illinois, HB 821 will have a significant impact on compliance practices. If passed, effective January 1, 2018, returns will be required to be filed electronically if gross receipts average $20,000 or more. As of May 29, both bills have passed both houses.

Kansas: The state could expand the service types which are subject to sales and use tax in HB 2380. The following NAICS codes would be subject to tax: 488410, 5311310, 561440, 561611, 561612, 561621, 561720, and 812910. The taxable services would be effective July 1, 2017. Also included in this bill is the 5.5% rate on the gross receipts derived from the sale of food items and ingredients. Special food descriptions apply. The rate applies July 1, 2020. No action has been taken on this bill since May 18th in committee hearing.

New Mexico: HB 408 provides updated details on refund request requirements. These requirements include a written statement of facts for the basis of refund and all documentation to substantiate the claim and the necessary amended returns . The bill was signed by Governor Martinez on April 6, 2017.

Oklahoma: There are several bills to note in the state of Oklahoma. The first is HB 2367 which was approved by the Governor on May 24, 2017. The bill will eliminate the ability for the vendor to collect 1% of tax remittance by way of a vendor discount. This is effective July 1, 2017.

Also approved by the Governor was HB 2380 which will allow for a Voluntary Disclosure Initiative. The program will function as a tax amnesty program and will run from September 1, 2017 to November 30, 2017. Penalty, interest and other fees could be waived.

Finally, HB 2131 was approved by the Governor on May 3, 2017. The bill creates the Oklahoma Tourism Development Act. This act will allow an approved company a sales tax credit of 10% if the company expends approved costs of $500,000 to $1,000,000 on tourism improvements on an approved tourist attraction. Costs in excess of $1,000,000 can be entitled to a 25% sales tax credit of the approved costs. The link to the bill verbiage provides definitions on approved companies and approved tourist attractions as well as other limitations which may apply.

Puerto Rico: Per Circular Letter 17-01, the Territory is offering a back-to-school sales tax holiday. The holiday will commence on July 12 to midnight on July 13. An additional holiday will begin January 10 and end on January 11. During the holiday, school uniforms and supplies will be exempt. Descriptions and listings of materials are available at the link. NOTE: the link is in Spanish, but if opened in Google Chrome, can be easily translated into English.

South Carolina: The state’s annual sales tax holiday is scheduled for August 4-6, 2017. No sales tax is owed on products such as school supplies, clothing and computers.