United States

Wyoming: Sales and Use Tax Economic Nexus Bill Introduced in House

Jan 09, 2017
From KPMG TaxWatch

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Recently-introduced House Bill 19 would, if enacted, require retailers that do not have a physical presence in Wyoming to nevertheless collect and remit sales and use tax if certain conditions are met. Specifically, a seller would be required to collect and remit sales and use tax once the seller met one of the following requirements for the current calendar year or the immediately preceding calendar year: (1) having gross revenues from the sale of tangible personal property or services delivered into Wyoming that exceed $100,000 or (2) having 200 or more separate sales transactions delivered into Wyoming.  House Bill 19 would become effective as soon as all necessary acts are completed for a bill to become law under Wyoming’s constitution.  House Bill 19 is similar to SB 106 enacted last year in South Dakota and is also consistent with regulations adopted in Alabama and Tennessee that are designed to spur litigation over the physical presence rule articulated in the Quill case.

Interestingly, House Bill 19 includes provisions to address―and potentially expedite―litigation over its constitutionality. Notably, the Department of Revenue may bring an action in a Wyoming court to obtain a declaratory judgment that a seller’s obligation to remit sales tax is applicable and valid under state and federal law. The filing of a declaratory action operates as an injunction against the state enforcing the collection obligation against the seller (unless the seller consents to collect or voluntarily remits) during the pendency of the action. Once the injunction is lifted or a judgment is entered, the Department will require collection and remittance from the date the judgment is entered or the injunction is lifted. A seller that voluntarily registers and remits tax in response to the bill may not later claim a refund of the tax remitted on the basis that the seller lacked a physical presence in the state. Please stay tuned to TWIST for future updates on remote seller nexus legislation.

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The following information is not intended to be "written advice concerning one or more federal tax matters" subject to the requirements of section 10.37(a)(2) of Treasury Department Circular 230.

The information contained herein is of a general nature and based on authorities that are subject to change. Applicability of the information to specific situations should be determined through consultation with your tax adviser.