Detailed South Carolina Development
The South Carolina Department of Revenue recently ruled that an operator of a peer-to-peer vehicle sharing platform was a marketplace facilitator. Under the rental program, third-party owners and lessors of vehicles listed their vehicles on the taxpayer’s platform so that customers could select a vehicle to rent. After approving the rental transactions, the taxpayer collected the rental fees and any other additional charges, and remitted to the owner/lessor the receipts less its service charges. Under South Carolina law, a retailer includes a marketplace facilitator, which is defined as “any person engaged in the business of facilitating a retail sale of tangible personal property by listing or advertising, or allowing the listing or advertising of, the products of another person in any marketplace where sales at retail occur; and collecting or processing payments from the purchaser….” The Department held that the taxpayer was a marketplace facilitator that was required to collect and remit sales tax on peer-to-peer short term motor vehicle rentals. The taxpayer’s charges were also subject to sales and use tax. For more information on Priv. Ltr. Rul. No. 20-2, please contact Nicole Umpleby at 704-335-5586.
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