Entering 2021, only a few states remained without an Internet sales tax (IST) law for remote sellers and marketplace facilitators/providers following the US Supreme Court decision in the South Dakota v. Wayfair case in June 2018. By midyear, the remaining sales tax states were all active on IST legislation with Florida and Kansas enacting laws and legislation in Missouri pending approval by the Governor. If Missouri enacts a law as expected, 45 states, the District of Columbia, and Puerto Rico will all have IST laws in place.
In states with marketplace facilitator or provider laws, eBay is required to calculate, collect, and remit sales tax on behalf of sellers for items shipped to customers in the state. For the full list of states that eBay is currently collecting sales tax and those scheduled for future implementation, please visit eBay’s Customer Service site.
A recap of recent state IST-related activity follows below:
- Florida Governor Ron DeSantis signed legislation in April imposing sales and use tax collection requirements on remote sellers and marketplace providers such as eBay. The law takes effect July 1, 2021.
- In Kansas, the legislature passed an IST bill, SB 50, requiring out of state sellers with $100,000 in sales into the state and marketplace facilitators to collect and remit tax. The legislation was initially rejected by Governor Kelly but later the legislature voted to override the Governor’s veto meaning that the requirements will now go into effect on July 1, 2021.
- The Missouri legislature approved a bill requiring marketplace facilitators and remote sellers that is pending action by Governor Mike Parson. The Governor has signaled his support for IST and is expected to sign the bill, which will take effect January 1, 2023. Missouri is the last state with statewide sales tax to pass an IST law.
- In Illinois, legislation supported by eBay to fix an issue affecting IL-based sellers under the state’s marketplace facilitator law was unanimously approved by both the House and Senate. The bill now goes to Governor JB Pritzker (D) for his consideration. If signed, the bill, SB 2066, would provide the state the authority to grant retroactive credits to Illinois-based marketplace sellers for transactions in 2020 when tax was remitted to the state by both the marketplace and the seller.
As states consider revisions to their IST collection requirements, eBay will continue to advocate for workable tax policies that provide reasonable small business protections and streamline collecting and remitting standards across the states to avoid confusion, mistakes, and costly penalties.