SALT Report 2059 – The Florida State Legislature introduced a Bill to amend certain statutes regarding the taxability of mail order sales to include click-through and affiliate nexus provisions. Specifically, the Bill revises the term “mail order sale” to include sales of tangible personal property ordered online. The Bill also states that individuals who make mail order sales and who have substantial nexus in Florida will required to charge and collect sales and use tax when they engage in certain activities.
The Bill states that a person, other than a person acting in the capacity of a common carrier, has substantial nexus with the state if they:
- Sell a similar line of products as the dealer and does so under the same or a similar business name,
- Maintains an office, distribution facility, warehouse, storage place, or any other place of business in the state that facilitates the delivery of property or services sold by the dealer to the dealer’s customers,
- Uses trademarks, service marks, or trade names that are the same or similar to those used by the dealer,
- Delivers, installs, assembles, or performs maintenance services for the dealer’s Florida customers,
- Facilitates the delivery of property to Florida customers by allowing the dealer’s customers to pick up property sold by the dealer at an office, distribution facility, warehouse, storage place, or similar place of business, or
- Conducts any activities in Florida that are significantly associated with the dealer’s ability to establish and maintain a market in Florida
The Bill provides a rebuttable presumption that every dealer who makes a mail order sale will be required to levy and collect sales and use tax if the dealer enters into an agreement with a Florida resident in which the resident, for some form of consideration, refers potential customers either by a link on a website, an in-person presentation, telemarketing, etc. The presumption may be rebutted if the cumulative gross receipts from sales to the in-state customers who were referred to the dealer are greater than $10,000 during the previous 12 months.
The dealer will be required to submit evidence proving that the resident with whom the dealer has an agreement did not engage in any activity within the state that was significantly associated with the dealer’s ability to establish or maintain a market in Florida during the previous 12 months. The evidence could be in the form of a sworn affidavit, obtained and given in good faith from each resident confirming that they did not engage in any solicitation on the dealer’s behalf during the previous year.
SB 316 was pre-filed on January 16, 2013 and if enacted will take effect on July 1, 2013.
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