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A BILL TO BE ENTITLED
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AN ACT
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relating to local sales and use tax administration. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Section 321.002(a)(3), Tax Code, is amended to |
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read as follows: |
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(3)(A) "Place of business of the retailer" means an |
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established outlet, office, or location operated by the retailer, |
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or operated by the retailer's agent or employee, for the purpose of |
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receiving orders, regardless of the method by which orders are |
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transmitted or received, for taxable items and includes any |
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location at which three or more orders are received by the retailer |
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during a calendar year. A warehouse, storage yard, or |
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manufacturing plant is not a "place of business of the retailer" |
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unless at least three orders are received by the retailer during the |
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calendar year at the warehouse, storage yard, or manufacturing |
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plant. |
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(B) An outlet, office, facility, or any location |
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that contracts with a retail or commercial business to process for |
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that business invoices, purchase orders, bills of lading, or other |
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equivalent records onto which sales tax is added, including an |
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office operated for the purpose of buying and selling taxable goods |
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to be used or consumed by the retail or commercial business, is not |
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a "place of business of the retailer" if the comptroller determines |
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that the outlet, office, facility, or location functions or exists |
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to avoid the tax legally due under this chapter or exists solely to |
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rebate a portion of the tax imposed by this chapter to the |
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contracting business. An outlet, office, facility, or location |
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does not exist to avoid the tax legally due under this chapter or |
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solely to rebate a portion of the tax imposed by this chapter if the |
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outlet, office, facility, or location provides significant |
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business services, beyond processing invoices, to the contracting |
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business, including logistics management, purchasing, inventory |
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control, or other vital business services. |
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(C) Notwithstanding any other provision of this |
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subdivision, a kiosk is not a "place of business of the retailer." |
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In this subdivision, "kiosk" means a small stand-alone area or |
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structure that: |
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(i) is used solely to display merchandise |
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or to submit orders for taxable items from a data entry device, or |
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both; |
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(ii) is located entirely within a location |
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that is a place of business of another retailer, such as a |
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department store or shopping mall; and |
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(iii) at which taxable items are not |
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available for immediate delivery to a customer. |
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SECTION 2. Section 321.203, Tax Code, is amended by |
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amending Subsections (b) and (e-1) and adding Subsection (o) to |
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read as follows: |
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(b) If a retailer has only one place of business in this |
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state, all of the retailer's retail sales of taxable items, |
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regardless of the method by which orders for the taxable items are |
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transmitted or received, are consummated at that place of business |
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except as provided by Subsection (e) or (o). |
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(e-1) Notwithstanding any other provision of this section, |
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a sale of a taxable item made [by a marketplace seller] through a |
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marketplace as provided by Section 151.0242 is consummated at the |
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location in this state to which the item is shipped or delivered or |
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at which possession is taken by the purchaser. |
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(o) The sale of a taxable item purchased by the retailer |
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from a related entity, including a related entity acting as a |
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third-party drop shipper of taxable items, is consummated at the |
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place of business of the related entity where the order for the |
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taxable item is fulfilled or from which the taxable item is shipped |
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if: |
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(1) the retailer has only one place of business in this |
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state; |
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(2) the retailer purchases the taxable item from the |
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related entity using a resale certificate; and |
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(3) the order for the taxable item is fulfilled at, or |
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the taxable item is shipped from, a place of business of the related |
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entity in this state that would constitute a place of business of |
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the retailer if the related entity were the retailer. |
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SECTION 3. Section 323.203, Tax Code, is amended by |
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amending Subsections (b) and (e-1) and adding Subsection (n) to |
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read as follows: |
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(b) If a retailer has only one place of business in this |
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state, all of the retailer's retail sales of taxable items, |
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regardless of the method by which orders for the taxable items are |
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transmitted or received, are consummated at that place of business |
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except as provided by Subsection (e) or (n). |
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(e-1) Notwithstanding any other provision of this section, |
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a sale of a taxable item made [by a marketplace seller] through a |
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marketplace as provided by Section 151.0242 is consummated at the |
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location in this state to which the item is shipped or delivered or |
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at which possession is taken by the purchaser. |
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(n) The sale of a taxable item purchased by the retailer |
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from a related entity, including a related entity acting as a |
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third-party drop shipper of taxable items, is consummated at the |
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place of business of the related entity where the order for the |
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taxable item is fulfilled or from which the taxable item is shipped |
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if: |
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(1) the retailer has only one place of business in this |
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state; |
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(2) the retailer purchases the taxable item from the |
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related entity using a resale certificate; and |
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(3) the order for the taxable item is fulfilled at, or |
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the taxable item is shipped from, a place of business of the related |
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entity in this state that would constitute a place of business of |
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the retailer if the related entity were the retailer. |
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SECTION 4. The changes in law made by this Act do not affect |
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tax liability accruing before the effective date of this Act. That |
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liability continues in effect as if this Act had not been enacted, |
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and the former law is continued in effect for the collection of |
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taxes due and for civil and criminal enforcement of the liability |
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for those taxes. |
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SECTION 5. This Act takes effect January 1, 2022. |