Sales and Use Tax

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On February 14, 2019, the Georgia House Ways and Means Committee voted in favor of House Bill 182. Effective for January 1, 2020, the bill would amend O.C.G.A. § 48-8-2(8)(M.1) to lower the sales threshold on the requirement to collect or report sales and use tax from $250,000 to $100,000 and would repeal subsection (c.2) of O.C.G.A. § 48-8-30 in its entirety to eliminate the option to provide notification to the purchaser and state in lieu of collecting and remitting tax.

O.C.G.A. § 48-8-2 currently requires out-of-state sellers to collect and remit sales tax if the seller obtains gross revenue of more than $250,000 from the retail sales of tangible personal property delivered within Georgia or if the seller conducts 200 or more separate retail sales of tangible personal property delivered within Georgia. Alternatively, O.C.G.A. § 48-8-30 currently gives retailers that reach that threshold the option to instead provide specified information and notification to the purchaser and to the Department of Revenue stating that sales or use tax may be due. House Bill 182 would remove the option for sellers to provide the required notification instead of collecting and remitting tax.

House Bill 182 adopts the same sales threshold used by the South Dakota statute at issue in South Dakota v. Wayfair, 138 S. Ct. 2080 (2018). If enacted, the legislation would be effective for sales made on or after January 1, 2020.

A Georgia marketplace bill has also been introduced, House Bill 276, that if enacted would also become effective January 1, 2020.

The Missouri Department of Revenue, in a letter ruling, found that a taxpayer’s sales of exercise products were subject to state and local sales taxes because the transactions were not in commerce, since the orders were fulfilled and shipped to Missouri customers by a third-party warehouse in Missouri. The Department of Revenue also found that the taxpayer had substantial nexus with the state, through its use of a third-party warehouse in Missouri, to require it to collect state and local use tax for the sales of its products, fulfilled and shipped outside of the state directly to Missouri customers. (Missouri Director of Revenue, Letter Ruling No. 7972 (Aug. 23, 2018)).