SENATE BILL REPORT

SB 6323

BYSenators Zimmerman, DeJarnatt, Vognild and Johnson

Changing provision relating to sales tax on mail order sales within the state.

Senate Committee on Ways & Means

Senate Hearing Date(s):February 1, 1988

Senate Staff:Gary Benson (786-7715)

AS OF FEBRUARY 1, 1988

BACKGROUND:

Counties and cities may levy a local sales tax of up to 1 percent on retail sales.  The tax is collected by the Department of Revenue in the same manner as the state retail sales tax.

The local sales tax portion is rebated to local governments according to information which retailers show on their tax returns.  If a business is such that a local tax is collected for more than one taxing jurisdiction, it is necessary to keep a record of retail sales taxable to each such county or city.  Retailers are responsible for determining the appropriate tax rate for each locality in which sales are made and for collecting from their purchasers the correct amount of tax due upon each sale.

For retailers of goods and merchandise, the place of sale occurs at the retail outlet at which or from which delivery is made to the consumer.  The origin of the goods determines the local tax, and destination or fact of delivery elsewhere in the state are immaterial.

SUMMARY:

For local sales tax purposes, the place of sale for in-state mail order sales is the county in which the buyer places the order.

Appropriation:    none

Revenue:    yes

Fiscal Note:      requested January 31, 1988