Online Sales Simplicity and Small Business Relief Act of 2019

I 116TH CONGRESS 1ST SESSION H. R. 1933 To prohibit States from retroactively imposing a sales tax collection duty on a remote seller, and for other purposes. IN THE HOUSE OF REPRESENTATIVES MARCH 27, 2019 Mr. SENSENBRENNER (for himself, Ms. ESHOO, Mr. DUNCAN, Ms. LOFGREN, and Ms. KUSTER of New Hampshire) introduced the following bill; which was referred to the Committee on the Judiciary A BILL To prohibit States from retroactively imposing a sales tax collection duty on a remote seller, and for other purposes. Be it enacted by the Senate and House of Representa- 1 tives of the United States of America in Congress assembled, 2 SECTION 1. SHORT TITLE. 3 This Act may be cited as the ‘‘Online Sales Simplicity 4 and Small Business Relief Act of 2019’’. 5 SEC. 2. RETROACTIVITY BAN AND ORDERLY PHASE-IN OF 6 COMPLIANCE OBLIGATIONS. 7 A State may impose a sales tax collection duty on 8 a remote seller only for a sale that occurs after January 9 1, 2019. 10 VerDate Sep 11 2014 19:41 Apr 11, 2019 Jkt 089200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\H1933.IH H1933 pamtmann on DSKBFK8HB2PROD with BILLS 2 •HR 1933 IH SEC. 3. SMALL BUSINESS REMOTE SELLER EXEMPTION. 1 In the case of a sale made by a small business remote 2 seller, no State may impose a sales tax collection duty on 3 any person other than the purchaser if the sale is made 4 on or after June 21, 2018, and before the date that is 5 30 days after the date on which the States develop and 6 Congress approves an interstate compact, applicable to the 7 State and sale, governing the imposition of tax collection 8 duties on remote sellers. 9 SEC. 4. SENSE OF CONGRESS. 10 It is the sense of Congress that the States should de- 11 velop an interstate compact for the collection of sales tax 12 by remote sellers that identifies a clearly defined minimum 13 substantial nexus between the remote seller and the taxing 14 State, that simplifies registration, collection, remittance, 15 auditing, and other compliance processes to the greatest 16 extent possible in order to avoid undue burdens on inter- 17 state commerce, and that, due to such simplification, 18 eliminates the need for the continuation of the small busi- 19 ness remote seller exemption under section 4. 20 SEC. 5. DEFINITIONS. 21 In this Act: 22 (1) REMOTE SELLER.—The term ‘‘remote sell- 23 er’’ means a person without a physical presence in 24 the State who makes a sale in the State. 25 (2) PHYSICAL PRESENCE.— 26 VerDate Sep 11 2014 19:41 Apr 11, 2019 Jkt 089200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H1933.IH H1933 pamtmann on DSKBFK8HB2PROD with BILLS 3 •HR 1933 IH (A) IN GENERAL.—Except as provided in 1 subparagraph (B), the term ‘‘physical presence’’ 2 means, with respect to a person, that a person’s 3 business activities in the State include any of 4 the following during such person’s taxable year: 5 (i) Being an individual physically in 6 the State, or assigning one or more em- 7 ployees to be in the State. 8 (ii) Using the services of an agent (ex- 9 cluding an employee) to establish or main- 10 tain a market in the State, if such agent 11 does not perform business services in the 12 State for any other person during such 13 taxable year. 14 (iii) The leasing or owning of tangible 15 personal property (other than digital or al- 16 phanumeric data) or of real property in the 17 State. 18 (B) EXCEPTION.—A person does not have 19 physical presence in a State if the person’s 20 physical presence in the State under subpara- 21 graph (A) was for less than 15 days in a tax- 22 able year (or a greater number of days if pro- 23 vided by State law), or if the person’s physical 24 presence in the State was solely for the purpose 25 VerDate Sep 11 2014 19:41 Apr 11, 2019 Jkt 089200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H1933.IH H1933 pamtmann on DSKBFK8HB2PROD with BILLS 4 •HR 1933 IH of conducting limited or transient business ac- 1 tivity. 2 (3) SALES TAX COLLECTION DUTY.—The term 3 ‘‘sales tax collection duty’’ means— 4 (A) an obligation imposed on a person, in- 5 cluding a person other than the actual seller, 6 to— 7 (i) pay or collect a sales, use, or simi- 8 lar tax upon the sale of a good or service; 9 or 10 (ii) report any information with re- 11 spect to such sale of a good or service; or 12 (B) the assessment of a sales, use or simi- 13 lar tax on a person. 14 (4) SMALL BUSINESS REMOTE SELLER.—The 15 term ‘‘small business remote seller’’ means a remote 16 seller with gross annual receipts in the United 17 States during the preceding calendar year in an 18 amount that is not more than $10,000,000. 19 Æ VerDate Sep 11 2014 19:41 Apr 11, 2019 Jkt 089200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6301 E:\BILLS\H1933.IH H1933 pamtmann on DSKBFK8HB2PROD with BILLS