1.1 A bill for an act
1.2 relating to taxation; sales and use; providing a vendor allowance; amending
1.3 Minnesota Statutes 2024, sections 289A.20, subdivision 4; 297A.77, subdivision
1.4 3; proposing coding for new law in Minnesota Statutes, chapter 297A.
1.5BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
1.6 Section 1. Minnesota Statutes 2024, section 289A.20, subdivision 4, is amended to read:
1.7 Subd. 4.Sales and use tax.(a) The taxes imposed by chapter 297A are due and payable
1.8to the commissioner monthly on or before the 20th day of the month following the month
1.9in which the taxable event occurred, or following another reporting period as the
1.10commissioner prescribes or as allowed under section 289A.18, subdivision 4, paragraph (f)
1.11or (g), except that use taxes due on an annual use tax return as provided under section
1.12289A.11, subdivision 1, are payable by April 15 following the close of the calendar year.
1.13 (b) A vendor having a liability of $250,000 or more during a fiscal year ending June 30,
1.14except a vendor of construction materials as defined in paragraph (e), must remit the June
1.15net liability for the next year in the following manner:
1.16 (1) Two business days before June 30 of calendar year 2020 and 2021, the vendor must
1.17remit 87.5 percent of the estimated June liability to the commissioner. Two business days
1.18before June 30 of calendar year 2022 and thereafter, the vendor must remit 84.5 percent of
1.19the estimated June net liability, or a reduced percentage as certified by the commissioner
1.20under section 16A.152, subdivision 2, paragraph (a), clause (6), of the estimated June net
1.21liability to the commissioner.
1.22 (2) On or before August 20 of the year, the vendor must pay any additional amount of
1.23tax not remitted in June.
1Section 1.
25-04488 as introduced02/28/25 REVISOR EAP/CH
SENATE
STATE OF MINNESOTA
S.F. No. 2609NINETY-FOURTH SESSION
(SENATE AUTHORS: NELSON and Drazkowski)
OFFICIAL STATUSD-PGDATE
Introduction and first reading03/17/2025
Referred to Taxes 2.1 (c) A vendor having a liability of:
2.2 (1) $10,000 or more, but less than $250,000, during a fiscal year must remit by electronic
2.3means all net liabilities on returns due for periods beginning in all subsequent calendar years
2.4on or before the 20th day of the month following the month in which the taxable event
2.5occurred, or on or before the 20th day of the month following the month in which the sale
2.6is reported under section 289A.18, subdivision 4; or
2.7 (2) $250,000 or more during a fiscal year must remit by electronic means all net liabilities
2.8in the manner provided in paragraph (a) on returns due for periods beginning in the
2.9subsequent calendar year, except that a vendor subject to the remittance requirements of
2.10paragraph (b) must remit the percentage of the estimated June net liability, as provided in
2.11paragraph (b), clause (1), which is due two business days before June 30. The remaining
2.12amount of the June liability is due on August 20.
2.13 (d) Notwithstanding paragraph (b) or (c), a person prohibited by the person's religious
2.14beliefs from paying electronically shall be allowed to remit the payment by mail. The filer
2.15must notify the commissioner of revenue of the intent to pay by mail before doing so on a
2.16form prescribed by the commissioner. No extra fee may be charged to a person making
2.17payment by mail under this paragraph. The payment must be postmarked at least two business
2.18days before the due date for making the payment in order to be considered paid on a timely
2.19basis.
2.20 (e) For the purposes of paragraph (b), "vendor of construction materials" means a retailer
2.21that sells any of the following construction materials, if 50 percent or more of the retailer's
2.22sales revenue for the fiscal year ending June 30 is from the sale of those materials:
2.23 (1) lumber, veneer, plywood, wood siding, wood roofing;
2.24 (2) millwork, including wood trim, wood doors, wood windows, wood flooring; or
2.25 (3) concrete, cement, and masonry.
2.26 (f) For purposes of this subdivision, "net liability" means liability minus the amount of
2.27vendor allowance authorized under section 297A.816.
2.28 (f) (g) Paragraph (b) expires after the percentage of estimated payment is reduced to
2.29zero in accordance with section 16A.152, subdivision 2, paragraph (a), clause (6).
2.30 EFFECTIVE DATE.This section is effective for sales and purchases made after June
2.3130, 2025.
2Section 1.
25-04488 as introduced02/28/25 REVISOR EAP/CH 3.1 Sec. 2. Minnesota Statutes 2024, section 297A.77, subdivision 3, is amended to read:
3.2 Subd. 3.Tax must be remitted.The tax collected by a retailer under this section, except
3.3for the amount allowed to be retained by a retailer under section 297A.816, must be remitted
3.4to the commissioner as provided in chapter 289A and this chapter.
3.5 EFFECTIVE DATE.This section is effective for sales and purchases made after June
3.630, 2025.
3.7 Sec. 3. [297A.816] VENDOR ALLOWANCE.
3.8 Subdivision 1.Eligibility.A retailer may retain a portion of sales tax collected as a
3.9vendor allowance in compensation for the costs of collecting and administering the tax
3.10under this chapter. This section applies only if the tax minus the vendor allowance is both
3.11reported and remitted to the commissioner in a timely manner as required under chapter
3.12289A.
3.13 Subd. 2.Tax not eligible for allowance.Use taxes paid by the retailer on the retailer's
3.14own purchases are not included in calculating the vendor allowance under this section. All
3.15other sales and use taxes collected by a retailer are eligible for the vendor allowance under
3.16this section.
3.17 Subd. 3.Calculation of allowance; minimum amounts.(a) A retailer's vendor allowance
3.18is equal to a percentage of eligible taxes collected by the retailer in the reporting period as
3.19determined in paragraph (c). The vendor allowance per reporting period must not be less
3.20than the lesser of $10 or the amount of eligible taxes collected during the reporting period.
3.21 (b) For the purposes of this section:
3.22 (1) "reporting period" means the period applicable to the retailer as determined under
3.23section 289A.18, subdivision 4; and
3.24 (2) "eligible taxes" means the total amount of taxes collected by a retailer at all locations
3.25in Minnesota.
3.26 (c) The vendor allowance authorized under this section must be calculated using the
3.27following thresholds and rates:
3.28 (1) for vendors with sales tax liability not more than $60,000 in the fiscal year ending
3.29June 30, two percent;
3.30 (2) for vendors with sales tax liability more than $60,000 and not more than $600,000
3.31in the fiscal year ending June 30, $1,200 plus 1.5 percent of the amount over $60,000, but
3.32not over $600,000; and
3Sec. 3.
25-04488 as introduced02/28/25 REVISOR EAP/CH 4.1 (3) for vendors with sales tax liability more than $600,000 in the fiscal year ending June
4.230, $9,300 plus two percent of the amount over $600,000.
4.3 EFFECTIVE DATE.This section is effective for sales and purchases made after June
4.430, 2025.
4Sec. 3.
25-04488 as introduced02/28/25 REVISOR EAP/CH