by Roger Russell
August 8, 2017
With states looking to expand their sales tax reach to include remote sellers, accountants and tax professionals should advise any clients who engage in “marketplace sales” through Amazon or other online marketplaces that there will be a short-lived amnesty period during which they can come into compliance with state sales tax laws, according to Scott Peterson, vice president of U.S. tax policy and government relations at Avalara.
Nexus is the minimum amount of contact between a taxpayer and a state allowing the state to tax the business on its activities. With Amazon warehouses spread across the country, states are eyeing the concept of “inventory nexus” as a means to get at their share of sales tax from the more than $1 trillion generated annually by marketplace sellers.
Peterson, who was the first executive director of the Streamlined Sales Tax Commission Governing Board, observed that retailers participating in marketplaces may be required to pay sales taxes in more states because of where their goods are stored.