Bill Text: IN SB0397 | 2012 | Regular Session | Introduced
Bill Title: Use tax collection on remote sales.
Spectrum: Partisan Bill (Republican 1-0)
Status: (Introduced - Dead) 2012-01-09 - First reading: referred to Committee on Tax and Fiscal Policy [SB0397 Detail]
Download: Indiana-2012-SB0397-Introduced.html
Citations Affected: IC 6-2.5-2-1; IC 6-2.5-3.
Synopsis: Use tax collection on remote sales. Provides that for
purposes of the Indiana sales and use tax law, a "retail merchant
engaged in business in Indiana" includes any retail merchant who: (1)
makes retail transactions in which a person acquires personal property
or taxable services for use, storage, or consumption in Indiana; and (2)
enters into an arrangement with any person, other than a common
carrier, to facilitate the retail merchant's delivery of property to
customers in Indiana by allowing customers to pick up property sold by
the retail merchant at a place of business maintained by the person in
Indiana. Specifies that a retail merchant may not be required to collect
and remit sales or use taxes unless: (1) the retail merchant has a
physical presence in Indiana; or (2) the activities conducted in Indiana
on behalf of the retail merchant are significantly associated with the
retail merchant's ability to establish and maintain a market in Indiana.
Provides that a retail merchant is presumed to be engaged in business
in Indiana if an affiliate of the retail merchant has substantial nexus in
Indiana and certain additional conditions are satisfied. Provides that a
retail merchant is presumed to be engaged in business in Indiana if the
retail merchant enters into an agreement with one or more residents of
Indiana under which the resident directly or indirectly refers potential
customers to the retail merchant, if the cumulative gross receipts from
the sales by the retail merchant to customers in Indiana who are
referred to the retail merchant by all residents is greater than $10,000
during the preceding 12 months. Specifies that the presumptions may
be rebutted. Provides that these changes regarding remote sellers take
effect January 1, 2013. Provides that a person's unpaid use tax liability
that was due and payable for tangible personal property acquired before
January 1, 2012, is forgiven.
Effective: Upon passage; January 1, 2013.
January 9, 2012, read first time and referred to Committee on Tax and Fiscal Policy.
PRINTING CODE. Amendments: Whenever an existing statute (or a section of the Indiana Constitution) is being amended, the text of the existing provision will appear in this style type, additions will appear in this style type, and deletions will appear in
Additions: Whenever a new statutory provision is being enacted (or a new constitutional provision adopted), the text of the new provision will appear in this style type. Also, the word NEW will appear in that style type in the introductory clause of each SECTION that adds a new provision to the Indiana Code or the Indiana Constitution.
Conflict reconciliation: Text in a statute in this style type or
A BILL FOR AN ACT to amend the Indiana Code concerning
taxation.
(b) The person who acquires property in a retail transaction is liable for the tax on the transaction and, except as otherwise provided in this chapter, shall pay the tax to the retail merchant as a separate added amount to the consideration in the transaction.
(a) "Use" means the exercise of any right or power of ownership over tangible personal property.
(b) "Storage" means the keeping or retention of tangible personal
property in Indiana for any purpose except the subsequent use of that
property solely outside Indiana.
(c) "A retail merchant engaged in business in Indiana" includes any
retail merchant who makes retail transactions in which a person
acquires personal property or services for use, storage, or consumption
in Indiana and who:
(1) maintains an office, place of distribution, sales location,
sample location, warehouse, storage place, or other place of
business which is located in Indiana and which the retail
merchant maintains, occupies, or uses, either permanently or
temporarily, either directly or indirectly, and either by the retail
merchant or through a representative, agent, or subsidiary, or
affiliate;
(2) maintains a representative, agent, salesman, canvasser, or
solicitor who, while operating in Indiana under the authority of
and on behalf of the retail merchant or a subsidiary or an affiliate
of the retail merchant, sells, delivers, installs, repairs, assembles,
sets up, accepts returns of, bills, invoices, or takes orders for sales
of tangible personal property or services to be used, stored, or
consumed in Indiana;
(3) enters into an arrangement with any person, other than a
common carrier, to facilitate the retail merchant's delivery of
property to customers in Indiana by allowing the retail
merchant's customers to pick up property sold by the retail
merchant at an office, distribution facility, warehouse, storage
place, or similar place of business maintained by the person
in Indiana;
(3) (4) is otherwise required to register as a retail merchant under
IC 6-2.5-8-1; or
(4) (5) may be required by the state to collect tax under this article
to the extent allowed under the Constitution of the United States
and federal law.
(d) Notwithstanding any other law, a retail merchant may not
be required to collect and remit gross retail tax or use tax as a
retail merchant engaged in business in Indiana under subsection
(c) unless:
(1) the retail merchant has a physical presence in Indiana; or
(2) the activities conducted in Indiana on behalf of the retail
merchant are significantly associated with the retail
merchant's ability to establish and maintain a market in
Indiana.
(d) (e) Notwithstanding any other provision of this section, tangible
or intangible property that is:
(1) owned or leased by a person that has contracted with a
commercial printer for printing; and
(2) located at the premises of the commercial printer;
shall not be considered to be, or to create, an office, a place of
distribution, a sales location, a sample location, a warehouse, a storage
place, or other place of business maintained, occupied, or used in any
way by the person. A commercial printer with which a person has
contracted for printing shall not be considered to be in any way a
representative, an agent, a salesman, a canvasser, or a solicitor for the
person.
(f) A retail merchant is presumed to be engaged in business in
Indiana if an affiliate of the retail merchant has substantial nexus
in Indiana and:
(1) the retail merchant sells a line of products similar to a line
of products sold by the affiliate, and the retail merchant does
so under a business name that is the same as or is similar to
the affiliate's business name;
(2) the affiliate uses its Indiana employees or its Indiana
facilities to advertise, promote, or facilitate sales by the retail
merchant to customers; or
(3) the affiliate uses trademarks, service marks, or trade
names in Indiana that are the same as or substantially similar
to those used by the retail merchant.
(g) The presumption under subsection (f) may be rebutted by
demonstrating that the affiliate's activities in Indiana are not
significantly associated with the retail merchant's ability to
establish or maintain a market in Indiana for the retail merchant's
sales.
(h) A retail merchant is presumed to be engaged in business in
Indiana if the retail merchant enters into an agreement with one
(1) or more residents of Indiana under which the resident, for a
commission or other consideration, directly or indirectly refers
potential customers, whether by a link on an Internet web site, an
in-person oral presentation, or otherwise, to the retail merchant,
if the cumulative gross receipts from the sales by the retail
merchant to customers in Indiana who are referred to the retail
merchant by all residents with this type of an agreement with the
retail merchant are greater than ten thousand dollars ($10,000)
during the preceding twelve (12) months.
(i) The presumption under subsection (h) may be rebutted by
submitting proof that the residents with whom the retail merchant
has an agreement did not engage in any activity within Indiana
that was significantly associated with the retail merchant's ability
to establish or maintain the retail merchant's market in Indiana
during the preceding twelve (12) months. This proof may consist of
sworn written statements that:
(1) are from all of the Indiana residents with whom the retail
merchant has an agreement described in subsection (h);
(2) are provided and obtained in good faith; and
(3) state that the Indiana residents did not engage in any
solicitation in Indiana on behalf of the retail merchant during
the preceding twelve (12) months.
(j) For purposes of this section, "affiliate" means any:
(1) person that is a member of the same controlled group of
corporations (as defined in 26 U.S.C. 1563(a)) as the retail
merchant; or
(2) other entity that, notwithstanding its form of organization,
bears the same ownership relationship to the retail merchant
as a corporation that is a member of the same controlled
group of corporations (as defined in 26 U.S.C. 1563(a)).
(k) The amendments to this section made by this act in 2012 that
concern collecting use tax on sales of tangible personal property do
not apply as of the first day of the month that follows the month
that the budget agency certifies under IC 6-2.5-3-12 that the state
is requiring sellers not located in Indiana to collect use tax on
remote sales of tangible personal property under a law enacted by
the United States Congress.
(1) the department has not issued to the person:
(A) a use tax assessment and demand for payment under IC 6-8.1-5-3; or
(B) a demand notice for payment of use tax under IC 6-8.1-8-2; or
(2) the person has not filed a return or an amended return reporting a liability for the use tax.
fifteenth day of each month determine whether the state is
requiring sellers not located in Indiana to collect use tax on remote
sales of tangible personal property under a law enacted by the
United States Congress. If there is such a requirement, the budget
agency shall certify this fact to the budget committee.
