In just a few weeks into 2019, Congress has already introduced two bills aimed at protecting small businesses and preventing retroactive application of sales tax collection in light of South Dakota v. Wayfair.
Introduced on January 9 by Rep. Bob Gibbs of Ohio, the Protecting Businesses from Burdensome Compliance Cost Act of 2019 attempts to “limit the authority of a State to require remote sellers to collect taxes and fees owed by purchasers when located in such State incident to their purchases of goods and services from such sellers” by delaying a state’s implementation of remote seller economic nexus rules until January 1, 2020. Additionally, states wishing to implement such rules would be required to enact legislation providing a statewide uniform tax rate and taxability rules, as well as permitting out-of-state vendors to remit sales tax to one location. This bill is a rehashing of legislation introduced in 2018.
On January 16, Sens. Jon Tester of Montana, Ron Wyden and Jeff Merkley of Oregon, and Maggie Hassan and Jeanne Shaheen of New Hampshire, which are all states that do not impose a sales tax, introduced the Stop Taxing Our Potential Act of 2019 to prohibit states from requiring businesses to collect or report sales tax unless they have physical presence in those jurisdictions. It would also protect states without a sales tax from the implications of the Supreme Court’s ruling on Wayfair. Tester, Merkley, Hassan and Shaheen introduced a nearly identical bill just days after the Wayfair ruling, but it died without leaving the Senate Finance Committee.
Click here for more on post-Wayfair Congressional action.