| (1) |
A marketplace facilitator shall pay or collect and remit sales and use taxes imposed by this chapter in accordance with Section 59-12-107:
Terms Used In Utah Code 59-12-107.6- Agreement: means the Streamlined Sales and Use Tax Agreement adopted on November 12, 2002, including amendments made to the Streamlined Sales and Use Tax Agreement after November 12, 2002. See Utah Code 59-12-102
- Marketplace: includes a store, a booth, an Internet website, a catalog, or a dedicated sales software application. See Utah Code 59-12-102
- Marketplace facilitator: means a person, including an affiliate of the person, that enters into a contract, an agreement, or otherwise with sellers, for consideration, to facilitate the sale of a seller's product through a marketplace that the person owns, operates, or controls and that directly or indirectly:
| (i) | does any of the following:| (A) | lists, makes available, or advertises tangible personal property, a product transferred electronically, or a service for sale by a marketplace seller on a marketplace that the person owns, operates, or controls; |
| (B) | facilitates the sale of a marketplace seller's tangible personal property, product transferred electronically, or service by transmitting or otherwise communicating an offer or acceptance of a retail sale between the marketplace seller and a purchaser using the marketplace; |
| (C) | owns, rents, licenses, makes available, or operates any electronic or physical infrastructure or any property, process, method, copyright, trademark, or patent that connects a marketplace seller to a purchaser for the purpose of making a retail sale of tangible personal property, a product transferred electronically, or a service; |
| (D) | provides a marketplace for making, or otherwise facilitates, a retail sale of tangible personal property, a product transferred electronically, or a service, regardless of ownership or control of the tangible personal property, the product transferred electronically, or the service that is the subject of the retail sale; |
| (E) | provides software development or research and development activities related to any activity described in this Subsection (69)(a)(i), if the software development or research and development activity is directly related to the person's marketplace; |
| (F) | provides or offers fulfillment or storage services for a marketplace seller; |
| (G) | sets prices for the sale of tangible personal property, a product transferred electronically, or a service by a marketplace seller; |
| (H) | provides or offers customer service to a marketplace seller or a marketplace seller's purchaser or accepts or assists with taking orders, returns, or exchanges of tangible personal property, a product transferred electronically, or a service sold by a marketplace seller on the person's marketplace; or |
| (I) | brands or otherwise identifies sales as those of the person; and |
|
| (ii) | does any of the following:| (A) | collects the sales price or purchase price of a retail sale of tangible personal property, a product transferred electronically, or a service; |
| (B) | provides payment processing services for a retail sale of tangible personal property, a product transferred electronically, or a service; |
| (C) | charges, collects, or otherwise receives a selling fee, listing fee, referral fee, closing fee, a fee for inserting or making available tangible personal property, a product transferred electronically, or a service on the person's marketplace, or other consideration for the facilitation of a retail sale of tangible personal property, a product transferred electronically, or a service, regardless of ownership or control of the tangible personal property, the product transferred electronically, or the service that is the subject of the retail sale; |
| (D) | through terms and conditions, an agreement, or another arrangement with a third person, collects payment from a purchase for a retail sale of tangible personal property, a product transferred electronically, or a service and transmits that payment to the marketplace seller, regardless of whether the third person receives compensation or other consideration in exchange for the service; or |
| (E) | provides a virtual currency for a purchaser to use to purchase tangible personal property, a product transferred electronically, or service offered for sale. See Utah Code 59-12-102- Marketplace seller: means a seller that makes one or more retail sales through a marketplace that a marketplace facilitator owns, operates, or controls, regardless of whether the seller is required to be registered to collect and remit the tax under this part. See Utah Code 59-12-102
- Obligation: An order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period.
- Person: includes any individual, firm, partnership, joint venture, association, corporation, estate, trust, business trust, receiver, syndicate, this state, any county, city, municipality, district, or other local governmental entity of the state, or any group or combination acting as a unit. See Utah Code 59-12-102
- Personal property: includes :Utah Code 68-3-12.5
- Personal property: All property that is not real property.
- product transferred electronically: means a product transferred electronically that would be subject to a tax under this chapter if that product was transferred in a manner other than electronically. See Utah Code 59-12-102
- Purchaser: means a person to whom:
| (a) | a sale of tangible personal property is made; |
| (b) | a product is transferred electronically; or |
| (c) | a service is furnished. See Utah Code 59-12-102- Sale: includes :
| (i) | installment and credit sales; |
| (ii) | any closed transaction constituting a sale; |
| (iii) | any sale of electrical energy, gas, services, or entertainment taxable under this chapter; |
| (iv) | any transaction if the possession of property is transferred but the seller retains the title as security for the payment of the price; and |
| (v) | any transaction under which right to possession, operation, or use of any article of tangible personal property is granted under a lease or contract and the transfer of possession would be taxable if an outright sale were made. See Utah Code 59-12-102- sales price: include :
| (i) | the seller's cost of the tangible personal property, a product transferred electronically, or services sold; |
| (ii) | expenses of the seller, including:| (A) | the cost of materials used; |
| (F) | the cost of transportation to the seller; or |
| (G) | a tax imposed on the seller; |
|
| (iii) | a charge by the seller for any service necessary to complete the sale; or |
| (iv) | consideration a seller receives from a person other than the purchaser if:| (A) | | (I) | the seller actually receives consideration from a person other than the purchaser; and |
| (II) | the consideration described in Subsection (104)(b)(iv)(A)(I) is directly related to a price reduction or discount on the sale; |
|
| (B) | the seller has an obligation to pass the price reduction or discount through to the purchaser; |
| (C) | the amount of the consideration attributable to the sale is fixed and determinable by the seller at the time of the sale to the purchaser; and |
| (D) | | (I) | | (Aa) | the purchaser presents a certificate, coupon, or other documentation to the seller to claim a price reduction or discount; and |
| (Bb) | a person other than the seller authorizes, distributes, or grants the certificate, coupon, or other documentation with the understanding that the person other than the seller will reimburse any seller to whom the certificate, coupon, or other documentation is presented; |
|
| (II) | the purchaser identifies that purchaser to the seller as a member of a group or organization allowed a price reduction or discount, except that a preferred customer card that is available to any patron of a seller does not constitute membership in a group or organization allowed a price reduction or discount; or |
| (III) | the price reduction or discount is identified as a third party price reduction or discount on the:| (Aa) | invoice the purchaser receives; or |
| (Bb) | certificate, coupon, or other documentation the purchaser presents. See Utah Code 59-12-102- Seller: includes a marketplace facilitator. See Utah Code 59-12-102
- State: means the state of Utah, its departments, and agencies. See Utah Code 59-12-102
- Tangible personal property: includes :
| (v) | prewritten computer software, regardless of the manner in which the prewritten computer software is transferred. See Utah Code 59-12-102- Use: means the exercise of any right or power over tangible personal property, a product transferred electronically, or a service under Subsection 59-12-103(1), incident to the ownership or the leasing of that tangible personal property, product transferred electronically, or service. See Utah Code 59-12-102
|
| (a) |
if the marketplace facilitator meets one or more of the criteria provided for in Subsection 59-12-107(2)(a) or (b); and |
| (b) |
on the sales the marketplace facilitator made on the marketplace facilitator’s own behalf. |
|
| (2) |
| (a) |
A marketplace facilitator shall pay or collect and remit sales and use taxes imposed by this chapter in accordance with Subsection (3) if the marketplace facilitator, in the previous calendar year or the current calendar year, makes sales of tangible personal property, products transferred electronically, or services on the marketplace facilitator’s own behalf or facilitates sales on behalf of one or more marketplace sellers:
| (i) |
that exceed $100,000; or |
| (ii) |
in 200 or more separate transactions. |
|
| (b) |
For purposes of determining if a marketplace facilitator meets or exceeds one or both thresholds described in this Subsection (2), a marketplace facilitator shall separately total:
| (i) |
the marketplace facilitator’s sales; and |
| (ii) |
any sales the marketplace facilitator makes or facilitates for a marketplace seller. |
|
| (c) |
A marketplace facilitator without a physical presence in this state shall begin collecting and remitting the sales and use taxes imposed by this chapter no later than the first day of the calendar quarter that is at least 60 days after the day on which the marketplace facilitator meets or exceeds either threshold described in Subsection (2)(a). |
|
| (3) |
A marketplace facilitator described in Subsection (2) shall pay or collect and remit sales and use taxes imposed by this chapter for each sale that the marketplace facilitator:
| (a) |
makes on the marketplace facilitator’s own behalf; or |
| (b) |
makes or facilitates on behalf of a marketplace seller, regardless of:
| (i) |
whether the marketplace seller has an obligation to pay or collect and remit sales and use taxes under Section 59-12-107; |
| (ii) |
whether the marketplace seller would have been required to pay or collect and remit sales and use taxes under Section 59-12-107 if the marketplace facilitator had not facilitated the sale; or |
| (iii) |
the amount of the sales price or the purchase price that accrues to or benefits the marketplace facilitator, the marketplace seller, or any other person. |
|
|
| (4) |
A marketplace facilitator shall comply with the procedures and requirements in this chapter and Chapter 1, General Taxation Policies, for sellers required to pay or collect and remit sales and use taxes except that the marketplace facilitator shall segregate, in the marketplace facilitator’s books and records:
| (a) |
the sales that the marketplace facilitator makes on the marketplace facilitator’s own behalf; and |
| (b) |
the sales that the marketplace facilitator makes or facilitates on behalf of one or more marketplace sellers. |
|
| (5) |
| (a) |
The commission may audit the marketplace facilitator for sales made or facilitated through the marketplace facilitator’s marketplace on behalf of one or more marketplace sellers. |
| (b) |
The commission may not audit the marketplace seller for sales made or facilitated through the marketplace facilitator’s marketplace on the marketplace seller’s behalf. |
|
| (6) |
Nothing in this section prohibits a marketplace facilitator from providing in a marketplace facilitator’s agreement with a marketplace seller for the recovery of sales and use taxes, and any related interest or penalties to the extent that a tax, interest, or penalty is assessed by the state in an audit of the marketplace facilitator on a retail sale:
| (a) |
that a marketplace facilitator makes or facilitates on behalf of a marketplace seller; and |
| (b) |
for which the marketplace facilitator relied on incorrect or incomplete information provided by the marketplace seller. |
|
| (7) |
| (a) |
Subject to Subsections (7)(b) and (c), a marketplace facilitator is not liable for failing to collect the taxes under this chapter for a sale on which the marketplace facilitator failed to collect sales and use taxes if the marketplace facilitator demonstrates, to the satisfaction of the commission, that:
| (i) |
the marketplace facilitator made or facilitated the sale through the marketplace facilitator’s marketplace on or before December 31, 2022; |
| (ii) |
the marketplace facilitator made or facilitated the sale on behalf of a marketplace seller and not on behalf of the marketplace facilitator; |
| (iii) |
the marketplace facilitator and the marketplace seller are not affiliates; and |
| (iv) |
the failure to collect sales and use taxes was due to a good faith error other than an error in sourcing. |
|
| (b) |
For purposes of Subsection (7)(a):
| (i) |
for sales made or facilitated during the 2019 or 2020 calendar year, the marketplace facilitator is not liable for the amount the marketplace facilitator fails to collect due to error that is equal to the error rate, but not to exceed a 7% error rate; |
| (ii) |
for sales made or facilitated during the 2021 calendar year, the marketplace facilitator is not liable for the amount the marketplace facilitator fails to collect due to error that is equal to the error rate, but not to exceed a 5% error rate; and |
| (iii) |
for sales made or facilitated during the 2022 calendar year, the marketplace facilitator is not liable for the amount the marketplace facilitator fails to collect due to error that is equal to the error rate, but not to exceed a 3% error rate. |
|
| (c) |
The commission shall calculate the percentages described in Subsection (7)(b):
| (i) |
using the total sales and use taxes due on sales that:
| (A) |
a marketplace facilitator made or facilitated in this state on behalf of one or more marketplace sellers during the calendar year that the sale for which the marketplace facilitator seeks relief was made or facilitated; and |
| (B) |
are sourced to the state; and |
|
| (ii) |
not including sales that the marketplace facilitator or the marketplace facilitator’s affiliates directly made during the same calendar year. |
|
|
| (8) |
A marketplace seller shall pay or collect and remit sales and use taxes imposed by this chapter for a sale of tangible personal property, a product transferred electronically, or a service that the marketplace seller makes other than through a marketplace facilitator if:
| (a) |
the sale is sourced to this state; and |
| (b) |
the marketplace seller’s sales in this state, other than through a marketplace facilitator, in the previous calendar year or the current calendar year:
| (ii) |
occur in 200 or more separate transactions. |
|
|
| (9) |
| (a) |
A marketplace seller may not pay or collect and remit sales and use taxes imposed by this chapter for any sale for which a marketplace facilitator is required to pay or collect and remit. |
| (b) |
A marketplace seller is not liable for a marketplace facilitator’s failure to pay or collect and remit, or the marketplace facilitator’s underpayment of, sales and use taxes imposed by this chapter for any sale for which a marketplace facilitator is required to pay or collect and remit the taxes imposed by this chapter. |
|
| (10) |
| (a) |
A purchaser of tangible personal property, a product transferred electronically, or a service may file a claim for a refund with the marketplace facilitator if the purchaser overpaid sales and use taxes imposed under this chapter. |
| (b) |
No person may bring a class action against a marketplace facilitator in any court of the state on behalf of purchasers arising from or in any way related to an overpayment of sales and use taxes collected and remitted on sales made or facilitated by the marketplace facilitator on behalf of a marketplace seller, regardless of whether such claim is characterized as a tax refund claim. |
|
| (11) |
Nothing in this section affects the obligation of a purchaser to remit the use tax described in Subsection 59-12-107(2)(f) on any sale for which a marketplace facilitator or marketplace seller failed to collect and remit a tax imposed by this chapter. |
Enacted by Chapter 486, 2019 General Session
|
|
|
|
|
|
|
|
