On June 21, 2018 the Supreme Court of the United States broadened the authority for states to impose sales tax collection requirements on out-of-state vendors in South Dakota v. Wayfair, Inc., 138 S. Ct. 2080 (2018). As a result, NASCOOP customers may be subject to increased incidence of sales tax collection if the laws of their taxing jurisdiction require it. NASCOOP believes that states will use their broadened authority to aggressively pursue additional tax revenue. Therefore we are systematically registering with states when conditions for compliance are required. In the interim, NASCOOP requests that its customers provide exemption certificates to document exempt sales or remit use tax on any taxable sales on which NASCOOP does not collect tax. Acceptable certificates include those issued by the customer’s state, Streamlined Sales Tax Governing Board, or Multistate Tax Commission. For sales tax purposes, sales are sourced to the shipping destination of the product and the sale is subject to the sales tax laws and rates applicable at that location. Accordingly, customers with operations in multiple states will need to submit certificates for each shipping address at which they receive delivery of products from NASCOOP.
In response to the Wayfair decision, multiple states have already begun broadening the scope of their sales tax collection requirements and enforcement activities. NASCOOP urges its customers to submit exemption certificates as quickly as possible. If NASCOOP is audited by any taxing jurisdiction in the interim, NASCOOP will be compelled to issue invoices to customers in order to collect sales tax for any sales that have not been documented as exempt. The Wayfair decision’s effects will become more evident as states impose additional collection rules and interstate sellers are forced to comply with new requirements. Much of the media coverage around the case has been focused on its application to internet sales. However, the case will impact the sales tax compliance requirements for many other transactions, regardless of how they originate. If you have any question or need any further information regarding sales tax and NASCOOP, please contact Bob Bedard.