South Carolina: Peer-to-peer car sharing operator required to collect tax

Listen to a brief overview of state tax developments this week, including South Carolina, or read full South Carolina development below.

Detailed South Carolina Development

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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.


This Week's Developments

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Sarah McGahan

Sarah McGahan

Managing Director, State & Local Tax, KPMG US