Salt Report 3560 – On January 12, 2015, Chairman Goodlatte released a discussion draft (Online Sales Simplification Act of 2015) describing an origin based sales and use tax collection system for states participating in a, to be established, “distribution agreement”. Pursuant to the discussion draft the distribution agreement would be established by commission comprised of 4 appointed representatives from each participating state. The distribution agreement would provide for a single origin-based collection point for Online Remote Sales and for a percentage distribution of the collected tax to participating states.
Physical Nexus – It should be noted that the discussion draft excludes commission based click-thru nexus from the definition of physical presence. Section 5(7)(B), “Physical presence does not include entering into an agreement under which a person, for a commission or other consideration, directly or indirectly refers potential purchasers to a seller outside the state, whether by an Internet-based link or platform, Internet Website or otherwise.”
Resale and Exemption Certificate – The discussion draft also sets forth guidance related to support for exempt sales. Section 3(8) describes the ” uniform compliant purchaser certificate” intended to support resales, direct payments and entity or use based exemptions.