85R11173 CJC-F

By: Springer H.B. No. 3875

A BILL TO BE ENTITLED

AN ACT

relating to establishing certain facilitators of sale, lease, or rental transactions as retailers engaged in business in this state for purposes of collection of the use tax.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

SECTION 1. Section 151.008(b), Tax Code, is amended to read as follows:

(b) "Seller" and "retailer" include:

(1) a person in the business of making sales at auction of tangible personal property owned by the person or by another;

(2) a person who makes more than two sales of taxable items during a 12-month period, including sales made in the capacity of an assignee for the benefit of creditors or receiver or trustee in bankruptcy;

(3) a person regarded by the comptroller as a seller or retailer under Section 151.024;

(4) a hotel, motel, or owner or lessor of an office or residential building or development that contracts and pays for telecommunications services for resale to guests or tenants;

(5) a person who engages in regular or systematic solicitation of sales of taxable items in this state by the distribution of catalogs, periodicals, advertising flyers, or other advertising, by means of print, radio, or television media, or by mail, telegraphy, telephone, computer data base, cable, optic, microwave, or other communication system for the purpose of effecting sales of taxable items; [and]

(6) a person who, under an agreement with another person, is:

(A) entrusted with possession of tangible personal property with respect to which the other person has title or another ownership interest; and

(B) authorized to sell, lease, or rent the property without additional action by the person having title to or another ownership interest in the property; and

(7) a person who is a marketplace provider as defined by Section 151.109.

SECTION 2. Subchapter D, Chapter 151, Tax Code, is amended by adding Section 151.109 to read as follows:

Sec. 151.109. MARKETPLACE PROVIDERS. (a) In this section, "marketplace provider" means a person who:

(1) facilitates the sale, lease, or rental of the tangible personal property of a retailer that is not the person to a purchaser in this state in any manner, including by the use of a catalog or an Internet website;

(2) directly or indirectly collects from a purchaser in this state receipts derived from the sale, lease, or rental of the retailer's tangible personal property to the purchaser and transmits those receipts to the retailer, other than any amount the person is authorized to retain as a fee for facilitating the sale, lease, or rental; and

(3) is engaged in business in this state by means of any of the activities listed in Section 151.107(a).

(b) A marketplace provider's facilitation of a sale, lease, or rental described by Subsection (a)(1) that results in a sale, lease, or rental by the other retailer is considered the making of a sale by the marketplace provider for purposes of Sections 151.008(a) and 151.103. Notwithstanding Section 151.103, the marketplace provider is not required to collect a use tax imposed under this subchapter that is due from a purchaser if the retailer for whom the marketplace provider facilitates the sale, lease, or rental collects the tax from the purchaser.

(c) For purposes of Subsection (b), a marketplace provider may presume that a retailer registered with the comptroller under Section 151.106 collects the use tax from a purchaser.

(d) Subject to Subsection (e), a marketplace provider is not subject to liability under Subchapter L for failing to collect or remit the appropriate amount of use tax if, in determining the amount, the marketplace provider relies exclusively on information provided by the retailer for whom the marketplace provider facilitates the sale, lease, or rental of the tangible personal property on which the tax is due.

(e) Subsection (d) does not apply if the marketplace provider holds a substantial ownership interest in the retailer for whom the marketplace provider facilitated the sale, lease, or rental of tangible personal property, or the retailer holds a substantial ownership interest in the marketplace provider. For purposes of this subsection, "ownership" and "substantial" have the meanings assigned by Section 151.107(d).

(f) The comptroller may adopt rules necessary to implement and administer this section, including rules establishing the requirements for an entity to be considered a marketplace provider.

SECTION 3. Section 151.403(b), Tax Code, is amended to read as follows:

(b) A retailer engaged in business in this state as provided by Section 151.107 or 151.109 [of this code] shall file a tax report with respect to the use tax.

SECTION 4. The change in law made by this Act does not affect tax liability accruing before the effective date of this Act. That liability continues in effect as if this Act had not been enacted, and the former law is continued in effect for the collection of taxes due and for civil and criminal enforcement of the liability for those taxes.

SECTION 5. This Act takes effect September 1, 2017.