Sales Tax State Activity Update - September 2005

New Jersey Streamlines Direct Mail

A notice has been issued by the New Jersey Department of Revenue concerning the taxability of direct mail material. The notice offers guidelines that conform to the Streamlined Sales and Use Tax Agreement and will go into effect starting October 1, 2005.

Some of the highlights include:

• Definition (N.J.S.A. 54:32B-2(ss)
  The definition now includes tangible personal property supplied directly or indirectly by the purchaser to the direct mail seller for inclusion in the package containing the printed material.

• Exemption and Sourcing (N.J.S.A. 54:32B-3.3)
  Direct mail ultimately delivered outside of New Jersey, free of charge for use and consumption remains exempt. The services connected with direct mail delivered out of New Jersey are also exempt. Separately stated charges for postage are exempt. Acceptable direct mail forms are the New Jersey Exempt Use Certificate (Form ST-4) or the Streamlined Sales Tax Agreement Certificate of Exemption.
  
  Under prior law, the ST-4 exemption certificate was only valid for the portion of the receipt that related to out of state delivery. If the purchaser provides a direct mail form, the seller is relieved of all obligations to collect, pay, or remit the applicable tax and the purchaser is obligated to pay or remit the applicable tax on a direct pay basis.
  
  Alternatively, the purchaser may provide information showing the states to which the direct mail is to be delivered to recipients. The seller must collect the tax according to the delivery information provided by the purchaser.

View the full notice here.

(NOTICE TO THE DIRECT MAIL INDUSTRY, New Jersey Sales and Use Tax Act – Streamlined Legislation, P.L. 2005, c.126, 7/25/05)

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