Washington State recently enacted House Bill 2163 in conjuncture with the State’s recently passed budget. Included in this bill are provisions imposing sales tax obligations on internet sales to Washington consumers. Starting on January 1, 2018 remote sellers who make retail sales of $10,000 a year or more into Washington will be required to either collect sales or use tax on their sales or notify their customers that they are liable for sales/use tax in a manner proscribed in the new law.
Marketplace facilitators (online marketplaces) are required to fulfill these requirements on behalf of remote sellers who do not collect if the Marketplace makes over $10,000 in sales. Sales of certain digital products will be exempted from this requirement until 2020. Failure to fulfill the new requirements can result in penalties that may exceed $100,000.
In enacting these rules, Washington joins a growing chorus of states including Colorado, Maine, Louisiana, Oklahoma and Vermont that have enacted similar rules. As reported in this forum, the Colorado DOR has recently issued detailed guidance on how to comply with these new rules.
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About the Author
Erik Wallin is a Senior Tax Counsel on the Tax Research Team at Sovos Compliance. Erik has been with Sovos Compliance since 2011, and his main areas of focus are on U.S. Transaction Tax Law which includes special expertise in the taxation of technology and the taxation mechanisms that apply throughout the Colorado home rule jurisdictions. Erik is a member of the Massachusetts Bar, has a B.A. from York College of Pennsylvania, a J.D. from New England School of Law, and an LL.M. in Taxation from Boston University.More Content by Erik Wallin