SCS/SB 795 - This act requires the Department of Revenue to enter into the Streamlined Sales and Use Tax Agreement. Missouri will be represented by three delegates in meetings with other states regarding the Agreement. One delegate will be appointed by the Governor, one shall be a member of the General Assembly appointed by mutual agreement between the Speaker of the House of Representatives and the President Pro Tem of the Senate, and one will be the Director of the Department of Revenue. These delegates will report annually to the General Assembly regarding the agreement.
All revenue generated under the agreement that exceeds the amount that would have been collected without the agreement shall be deposited into the newly created Streamlined Sales and Use Tax Agreement Special Fund. Upon appropriation, moneys in the fund shall be used solely to make payments to any person or entity providing child care services to certain low-income individuals.
Any sales tax changes due to a boundary change will take effect on the first day of the calendar quarter 120 days after the sellers receive notice of the change.
When a political subdivision changes its local sales tax rate or taxing boundary, such change shall take effect on the first day of the calendar quarter 120 days after the sellers receive notice of the change.
The act requires all state and local sales taxes to have the same bases by requiring identical exemptions at the state and local level. The director of the Department of Revenue is required to perform all functions regarding the administration, collection, enforcement, and operation of all sales taxes.
The act provides uniform sourcing rules to determine what tax rates will apply to certain transactions. The act defines what constitutes engaging in business activities within the state and who is considered a vendor. Political subdivisions are prohibited from opting out of the sales tax holiday.
The act requires the Department to participate in an on-line registration system for sales tax collection. Registration in the system cannot be used as a factor to determine nexus with this state. The Department is required to accept electronic payments. Sellers will be allowed to deduct uncollectible bad debts attributable to taxable sales from sales tax remittances.
The Department must provide electronic databases for taxing jurisdiction boundary changes, tax rates, and a taxability matrix detailing taxable property and services. Sellers will be relieved from liability if they fail to properly collect tax based upon certain information provided by the department.
Amnesty will be available for sellers under certain circumstances following registration with the state. Monetary allowances will be provided to sellers and certified service providers for collecting and remitting state and local taxes. Sellers and certified service providers are prohibited from simultaneously receiving the monetary allowance and the amount under their agreement with the secretary. The act sets out requirements for the seller and purchaser for tax exempt sales.
For products that are bundled, with one item being taxable and the other nontaxable, the entire product will be subject to taxation unless the provider can properly identify the nontaxable portion. For products that are bundled items with different tax rates, the highest tax rate will be used for the entire product unless the provider can properly identify the lower taxed item.
The provisions relating to the Streamlined Sales and Use Tax Agreement have an effective date of January 1, 2018.
Theses provisions are substantially similar to HCS/HB 1356 (2013) and similar to provisions contained in HB 500 (2013), HB 422 (2013), HB 521 (2013), & HB 579 (2013).