Multistate: Marketplace Facilitator Law Roundup

On June 30, 2021, Governor Mike Parson of Missouri signed Senate Bill 153, which adopts an economic nexus standard for sales tax purposes and requires marketplace facilitators to collect and remit sales tax on facilitated sales, effective January 1, 2023. With that, all U.S. states that impose sales and use taxes have economic nexus and marketplace facilitator laws. In addition, certain Colorado home rule jurisdictions and Alaska localities have ordinances imposing economic nexus and requiring marketplace facilitators to collect local sales and use tax.  In other news, the marketplace facilitator statutes enacted this year in Kansas and Florida both became effective July 1, 2021. In a Florida Tax Information Publication (TIP No, 21A01-03), the Department of Revenue issued guidance on the marketplace provider requirement and stated that marketplace providers and persons making remote sales who register by October 1, 2021, will not be held liable for the remittance of sales tax on untaxed remote sales made prior to July 1, 2021, unless the provider or person was under audit; had been issued a bill, notice, or demand for payment; or was under an administrative or judicial proceeding as of July 1, 2021.  It does not appear that the Kansas Department of Revenue has issued any guidance on the new marketplace facilitator collection requirement. 

Finally, the Illinois Department of Revenue revised certain guidance documents addressing the state’s marketplace facilitator law that became effective January 1, 2021. Importantly, a new emergency regulation dated July 13 revises certain provisions of a previously issued Compliance Alert addressing the obligations of marketplace facilitators that facilitate sales by food service establishments. Under the revised emergency regulation, food delivery services that are considered marketplace facilitators must collect and remit the Metropolitan Pier and Exposition Authority (MPEA) Retailers' Occupation Tax and the Chicago Home Rule Municipal Soft Drink Tax, as well as sales tax on the sale.   Previously, a Compliance Alert indicated marketplaces did not have to collect the MPEA tax and that marketplace sellers would continue to collect and remit MPEA.  The emergency regulation provides that marketplace facilitators must certify to food service establishments that the food delivery service assumes the rights and duties of a retailer under the Retailers' Occupation Tax Act and all applicable local taxes administered by the Department for sales made by the food service establishment on the marketplace, and that it will remit all such taxes for such sales.  Please stay tuned to TWIST for additional marketplace facilitator updates.