VIRGINIA GENERAL ASSEMBLY MANUFACTURING DEVELOPMENT COMMISSION o http://10.23.1.165/magento/1.9.2.4/i1/index.php STREAMLINE SALES TAX SEPTEMBER 2016
EXACTOR Confidential SALES TAX – FUN FACTS 3,088 rates have been changed in FY 2016 Exactor averages 1,320 content changes a month
Did you know: • In PA; TX; NJ: carve a pumpkin: taxable; eat – exempt • CT: adult diapers – exempt; child – taxable • AZ & WA: ice cubes exempt; blocks of ice – taxable • CO: non essential food packing: taxable; essential – exempt o Paper cup lids & stirrers – taxable; paper cup – exempt • UK: gingerbread man with 2 chocolate eyes –0%; other decorations: taxable • KS: tethered rides are amusement, subject to amusement tax; untethered rides – exempt because they are a form of air transport.
EXACTOR Confidential AGENDA Pending Federal legislation
State Responses to Quill
Data Analysis
What Do CSPs Do
System Demo
EXACTOR Confidential PENDING FEDERAL LEGISLATION Marketplace Fairness Act • Destination based rules • Single state entity handle all sales/use tax administration (state and local level), processing of the returns, and audits for remote sales; • Tax collection and allocation to remote states – shifted to market Remote Transactions Parity Act • Similar concepts to MFA Online Sales Simplification Act of 2016 (Goodlatte) • Hibrid source base • Rate not to exceed state plus weighted average locals • Tax collection and allocation to remote states – Federal level clearinghouse == new government administration
EXACTOR Confidential STATE RESPONSES TO QUILL Quill Amazon Law Colorado • Direct Marketing Association vs. Brohl -- Out of state sellers without nexus have new reporting requirements o Notify purchasers that sales or use tax is due o Send a report to all Colorado consumers on an annual basis, listing the amount paid for each purchase, the date of each purchase, and category of each purchase. o File an annual statement for each purchase with the Colorado Department of Revenue on a form provided by the Department for purchases during the previous calendar year. • Amazon Law – test for how this could spread Supreme Court, Justice Kennedy, revisit Quill • States have rushed to respond (TN; AL & SD)
EXACTOR Confidential DATA ANALYSIS
Exactor State Confirmatio Data Ranking n U.S. ## of business 2.57% 2.45% SBA Total Sales 3.03% Total Sales Tax 1.51% 21 Non-Nexus Tax $ 414 M 15 $ 441 M National Taxpayers Union Non-Nexus Tax / Total tax 6.10% 6.80% National Taxpayers Union
How does Virginia compare? What can we extrapolate from existing data? • With 1.5% of total sales tax collected, VA is ranked 21 • Adding remote sales to mix o Will generate over $400M in tax revenue o Increase tax collections by over 6.0% o Increase VA share to 1.7% of total sales tax collected in the U.S., increasing the state ranking to 15
EXACTOR Confidential WHAT DO CSPS DO? Merchant Systems EXACTOR PLUGINS State & Local e-Commerce Tax Agencies
Exactor Systems
ERP & Exactor Exactor Accounting Calculation Reporting Engine Engine
POS Merchant Systems Management & Admin
EXACTOR Confidential SYSTEMS DEMO
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