SALT Report 1413 – Legislation has been introduced in the Kansas Senate that, if passed, would enact sales and use tax affiliate and click-through nexus provisions and provide a temporary severance tax exemption for oil production.
Affiliate and Click-Through Nexus
Under the bill, a retailer would be presumed to be doing business in Kansas if the retailer enters into an agreement with at least one Kansas resident who, for a commission or other consideration, refers potential customers through a website, telephone solicitations, or in-person presentations.
Cumulative gross receipts from all sales by the retailer to Kansas customers that are referred to by the Kansas resident must be more than $10,000 during the 12 months preceding the effective date of the bill.
These presumptions may be rebutted by submitting proof that the resident with whom the retailer has an agreement did not engage in any activity within the state that was significantly associated with the retailer’s ability to establish or maintain a market during the preceding 12 months.
Severance Tax Exemptions
The bill would provide a 24-month exemption from the severance tax for the severance and production of oil. Production must not be greater than 50 barrels per day from any pool from which oil was first produced on or after July 1, 2012.
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