Daily Tax Report: State provides authoritative coverage of state and local tax developments across the 50 U.S. states and the District of Columbia, tracking legislative and regulatory updates,...
By Tripp Baltz
The Data & Marketing Association reached a settlement today resolving its long-standing court battle with Colorado over the state’s 2010 law requiring out-of-state vendors to report certain information on consumer purchases if they don’t collect and remit state sales and use taxes.
Under the state court agreement, out-of-state sellers won’t be liable for any past penalties for noncompliance with the law’s requirements, and, in exchange, the DMA will drop its case ( Direct Mktg. Ass’n v. Colo. Dep’t of Revenue , Colo. Dist. Ct., No. 13-CV-34855, settlement announced 2/23/17 ).
The parties agreed the law’s notice and reporting requirements will take effect July 1.
Approved by the 2010 Colorado General Assembly, the statute requires out-of-state vendors that don’t collect and remit taxes to provide information on customer transactions to the state Department of Revenue, as well as provide notice to consumers of their obligation to pay the tax.
In December, the U.S. Supreme Court refused to hear the DMA’s appeal in a related federal case in which the U.S. Court of Appeals for the Tenth Circuit found the law constitutional. The DMA alleged the Colorado law violated the interstate commerce clause by imposing on out-of-state sellers requirements not binding on in-state retailers. In a cross-petition to the U.S. Supreme Court, the state asked the court not to take the appeal, but if it did decide to review the case, to also consider overturning its foundational standard in Quill Corp. v. North Dakota,504 U.S. 298 (1992).
That ruling, under attack in many states, bars a state from requiring a remote vendor from collecting sales taxes if the vendor doesn’t have a physical presence in the state.
Since the U.S. Supreme Court refused to wade into the matter, seven states have introduced bills this legislative session to create reporting/notice regimes like Colorado’s. Those states are Alabama, Arkansas, Georgia, Hawaii, Kansas, Nebraska, and Rhode Island. About 25 states have introduced bills on remote sales taxation, generally.
To contact the reporter on this story: Tripp Baltz in Denver at email@example.com
To contact the editor responsible for this story: Ryan C. Tuck at firstname.lastname@example.org
Text of the settlement is at http://src.bna.com/msJ.
Copyright © 2017 Tax Management Inc. All Rights Reserved.
All Bloomberg BNA treatises are available on standing order, which ensures you will always receive the most current edition of the book or supplement of the title you have ordered from Bloomberg BNA’s book division. As soon as a new supplement or edition is published (usually annually) for a title you’ve previously purchased and requested to be placed on standing order, we’ll ship it to you to review for 30 days without any obligation. During this period, you can either (a) honor the invoice and receive a 5% discount (in addition to any other discounts you may qualify for) off the then-current price of the update, plus shipping and handling or (b) return the book(s), in which case, your invoice will be cancelled upon receipt of the book(s). Call us for a prepaid UPS label for your return. It’s as simple and easy as that. Most importantly, standing orders mean you will never have to worry about the timeliness of the information you’re relying on. And, you may discontinue standing orders at any time by contacting us at 1.800.960.1220 or by sending an email to email@example.com.
Put me on standing order at a 5% discount off list price of all future updates, in addition to any other discounts I may quality for. (Returnable within 30 days.)
Notify me when updates are available (No standing order will be created).
This Bloomberg BNA report is available on standing order, which ensures you will all receive the latest edition. This report is updated annually and we will send you the latest edition once it has been published. By signing up for standing order you will never have to worry about the timeliness of the information you need. And, you may discontinue standing orders at any time by contacting us at 1.800.372.1033, option 5, or by sending us an email to firstname.lastname@example.org.
Put me on standing order
Notify me when new releases are available (no standing order will be created)