Revise the criteria for remote sellers who must remit sales tax.
Impact
The enactment of SB30 will impact state taxation laws significantly by extending sales tax obligations to a broader range of sellers operating outside of South Dakota. It emphasizes fiscal responsibility by ensuring that remote sales are subject to the same tax requirements as those with a physical presence in the state. This aims to close loopholes that have allowed certain remote sellers to evade sales tax, theoretically enhancing fairness in the retail market and boosting state revenues from e-commerce sales.
Summary
Senate Bill 30 aims to revise the criteria under which remote sellers are required to remit sales tax in South Dakota. Specifically, the bill mandates that remote sellers who sell tangible personal property, electronically transferred products, or services delivered into the state must comply with state sales tax laws if their gross revenue exceeds $100,000 in the previous or current calendar year. This change seeks to ensure that remote sellers contribute to state revenue in line with local businesses, leveling the playing field in the retail market.
Sentiment
The sentiment surrounding SB30 appears to be mixed. Supporters, including state legislators and local business advocates, argue that the bill is a necessary adjustment to reflect the realities of modern commerce, where many sales occur online. Critics, however, express concerns that the new threshold may impose undue burdens on smaller online sellers, potentially discouraging out-of-state businesses from selling to South Dakotans. Overall, the discussion underscores a tension between ensuring fair taxation and supporting small businesses in a digital economy.
Contention
Notable points of contention include the potential economic impact on small remote sellers and the fairness of imposing a tax obligation based solely on sales revenue without a physical presence. While proponents argue that aligning remote sellers with local businesses is fair, opponents fear it could stifle competition and hinder sales for smaller enterprises that may not have the infrastructure to manage tax compliance effectively. The debate raises fundamental questions about the future of retail taxation in an increasingly digital marketplace.
Provides criteria for the definition of "dealer" for purposes of the sales tax imposed on transactions involving a remote seller (Item #26) (EN SEE FISC NOTE GF RV See Note)
Provides criteria for the definition of "dealer" for purposes of the sales tax imposed on transactions involving a remote seller (Item #26) (REF +$507,000,000 GF RV See Note)
Includes accommodations intermediaries within the definition of a marketplace facilitator for purposes of collection and remittance of sales and use taxes on remote sales (EN +$350,000 OF EX See Note)
Authorizes parishes to contract with the Louisiana Sales and Use Tax Commission for Remote Sellers for the collection of local sales and use tax. (1/1/23) (EN SEE FISC NOTE LF RV See Note)