The director shall not enter into the agreement unless the agreement requires each state to abide by the following requirements:
 1.

 Uniform state rate.

 The agreement must set restrictions to achieve more uniform state rates through the following:

 a. Limiting the number of state rates.
 b. Limiting the application of maximums on the amount of state tax that is due on a transaction.
 c. Limiting the application of thresholds on the application of state tax.

Terms Used In Iowa Code 423.11

  • Agreement: means the streamlined sales and use tax agreement authorized by subchapter IV of this chapter to provide a mechanism for establishing and maintaining a cooperative, simplified system for the application and administration of sales and use taxes. See Iowa Code 423.1
  • Director: means the director of revenue. See Iowa Code 423.1
  • Electronic: means relating to technology having electrical, digital, magnetic, wireless, optical, electromagnetic, or similar capabilities. See Iowa Code 423.1
  • following: when used by way of reference to a chapter or other part of a statute mean the next preceding or next following chapter or other part. See Iowa Code 4.1
  • Member state: is a ny state which has signed the agreement. See Iowa Code 423.1
  • seller: includes an affiliated group of sellers using the same proprietary system. See Iowa Code 423.1
  • State: means any state of the United States, the District of Columbia, and Puerto Rico. See Iowa Code 423.1
  • System: means the central electronic registration system maintained by Iowa and other states which are signatories to the agreement. See Iowa Code 423.1
  • Use: means and includes the exercise by any person of any right or power over or access to tangible personal property or a specified digital product incident to the ownership of that property, or any right or power over or access to the product or result of a service. See Iowa Code 423.1
  • Use tax: means the tax levied under subchapter III of this chapter. See Iowa Code 423.1
 2.

 Uniform standards.

 The agreement must establish uniform standards for the following:

 a. The sourcing of transactions to taxing jurisdictions.
 b. The administration of exempt sales.
 c. The allowances a seller can take for bad debts.
 d. Sales and use tax returns and remittances.
 3.

 Uniform definitions.

 The agreement must require states to develop and adopt uniform definitions of sales and use tax terms. The definitions must enable a state to preserve its ability to make policy choices not inconsistent with the uniform definitions.

 4.

 Central registration.

 The agreement must provide a central, electronic registration system that allows a seller to register to collect and remit sales and use taxes for all member states.

 5.

 No nexus attribution.

 The agreement must provide that registration with the central registration system and the collection of sales and use taxes in the member states must not be used as a factor in determining whether the seller has nexus with a state for any tax.

 6.

 Local sales and use taxes.

 The agreement must provide for reduction of the burdens of complying with local sales and use taxes through the following:

 a. Restricting variances between the state and local tax bases.
 b. Requiring states to administer any sales and use taxes levied by local jurisdictions within the state so that sellers collecting and remitting these taxes must not have to register or file returns with, remit funds to, or be subject to independent audits from local taxing jurisdictions.
 c. Restricting the frequency of changes in the local sales and use tax rates and setting effective dates for the application of local jurisdictional boundary changes to local sales and use taxes.
 d. Providing notice of changes in local sales and use tax rates and of changes in the boundaries of local taxing jurisdictions.
 7.

 Monetary allowances.

 The agreement must outline any monetary allowances that are to be provided by the states to sellers or certified service providers.

 8.

 State compliance.

 The agreement must require each state to certify compliance with the terms of the agreement prior to joining and to maintain compliance, under the laws of the member state, with all provisions of the agreement while a member.

 9.

 Consumer privacy.

 The agreement must require each state to adopt a uniform policy for certified service providers that protects the privacy of consumers and maintains the confidentiality of tax information.

 10.

 Advisory councils.

 The agreement must provide for the appointment of an advisory council of private sector representatives and an advisory council of nonmember state representatives to consult with in the administration of the agreement.

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