Florida Senate - 2013              PROPOSED COMMITTEE SUBSTITUTE
       Bill No. CS for SB 316
       
       
       
       
       
                                Barcode 277232                          
       
       576-04169A-13                                                   
       Proposed Committee Substitute by the Committee on Appropriations
       (Appropriations Subcommittee on Finance an Tax)
    1                        A bill to be entitled                      
    2         An act relating to taxes; amending s. 212.0596, F.S.;
    3         revising the term “mail order sale” to specifically
    4         include sales of tangible personal property ordered
    5         through the Internet or from a dealer who receives the
    6         order in a foreign country; providing that certain
    7         persons who make mail order sales and who have a nexus
    8         with this state are subject to this state’s power to
    9         levy and collect the sales and use tax when they
   10         engage in certain enumerated activities; specifying
   11         that dealers are not required to collect and remit
   12         sales and use tax unless certain circumstances exist;
   13         creating a rebuttable presumption that a dealer is
   14         subject to the state’s power to levy and collect the
   15         sales or use tax under specified circumstances;
   16         specifying evidentiary proof that may be submitted to
   17         rebut the presumption; amending s. 212.06, F.S.;
   18         revising the definition of the term “dealer”;
   19         requiring that the Department of Revenue develop a
   20         tracking system, in consultation with the Revenue
   21         Estimating Conference, to determine the amount of
   22         sales tax remitted by out-of-state dealers who would
   23         otherwise not be required to collect and remit sales
   24         taxes but for the amendments made by the act;
   25         requiring that the department submit a report to the
   26         Governor and Legislature by a specified date each
   27         year; requiring that the Revenue Estimating Conference
   28         use such report to determine the amount of sales taxes
   29         remitted in the previous calendar year by such out-of
   30         state dealers and estimate the amount that may be
   31         expected in the following fiscal year; requiring that
   32         the Legislature use the information to reduce
   33         communication services tax rates and provide a sales
   34         tax holiday as deemed appropriate; providing an
   35         effective date.
   36  
   37  Be It Enacted by the Legislature of the State of Florida:
   38  
   39         Section 1. Section 212.0596, Florida Statutes, is amended
   40  to read:
   41         212.0596 Taxation of mail order sales.—
   42         (1) For purposes of this chapter, a “mail order sale” is a
   43  sale of tangible personal property, ordered by mail, the
   44  Internet, or other means of communication, from a dealer who
   45  receives the order in another state of the United States, or in
   46  a commonwealth, territory, or other area under the jurisdiction
   47  of the United States, or in a foreign country, and transports
   48  the property or causes the property to be transported, whether
   49  or not by mail, from any jurisdiction of the United States,
   50  including this state, to a person in this state, including the
   51  person who ordered the property.
   52         (2) Every dealer as defined in s. 212.06(2)(c) who makes a
   53  mail order sale is subject to the power of this state to levy
   54  and collect the tax imposed by this chapter if when:
   55         (a) The dealer is a corporation doing business under the
   56  laws of this state or is a person domiciled in, a resident of,
   57  or a citizen of, this state;
   58         (b) The dealer maintains retail establishments or offices
   59  in this state, whether the mail order sales thus subject to
   60  taxation by this state result from or are related in any other
   61  way to the activities of such establishments or offices;
   62         (c) The dealer has agents or representatives in this state
   63  who solicit business or transact business on behalf of the
   64  dealer, whether the mail order sales thus subject to taxation by
   65  this state result from or are related in any other way to such
   66  solicitation or transaction of business, except that a printer
   67  who mails or delivers for an out-of-state print purchaser
   68  material the printer printed for it is shall not be deemed to be
   69  the print purchaser’s agent or representative for purposes of
   70  this paragraph;
   71         (d) The property was delivered in this state in fulfillment
   72  of a sales contract that was entered into in this state, in
   73  accordance with applicable conflict of laws rules, when a person
   74  in this state accepted an offer by ordering the property;
   75         (e) The dealer, by purposefully or systematically
   76  exploiting the market provided by this state by any media
   77  assisted, media-facilitated, or media-solicited means,
   78  including, but not limited to, direct mail advertising,
   79  unsolicited distribution of catalogs, computer-assisted
   80  shopping, television, radio, or other electronic media, or
   81  magazine or newspaper advertisements or other media, creates
   82  nexus with this state;
   83         (f) Through compact or reciprocity with another
   84  jurisdiction of the United States, that jurisdiction uses its
   85  taxing power and its jurisdiction over the retailer in support
   86  of this state’s taxing power;
   87         (g) The dealer consents, expressly or by implication, to
   88  the imposition of the tax imposed by this chapter;
   89         (h) The dealer is subject to service of process under s.
   90  48.181;
   91         (i) The dealer’s mail order sales are subject to the power
   92  of this state to tax sales or to require the dealer to collect
   93  use taxes pursuant to federal law under a statute or statutes of
   94  the United States;
   95         (j) The dealer owns real property or tangible personal
   96  property that is physically in this state, except that a dealer
   97  whose only property, (including property owned by an affiliate,)
   98  in this state is located at the premises of a printer with which
   99  the vendor has contracted for printing, and is either a final
  100  printed product, or property that which becomes a part of the
  101  final printed product, or property from which the printed
  102  product is produced, is not deemed to own such property for
  103  purposes of this paragraph;
  104         (k) The dealer, while not having nexus with this state on
  105  any of the bases described in paragraphs (a)-(j) or paragraphs
  106  (l)-(m) paragraph (l), is a corporation that is a member of an
  107  affiliated group of corporations, as defined in s. 1504(a) of
  108  the Internal Revenue Code, whose members are includable under s.
  109  1504(b) of the Internal Revenue Code and whose members are
  110  eligible to file a consolidated tax return for federal corporate
  111  income tax purposes and any parent or subsidiary corporation in
  112  the affiliated group has nexus with this state on one or more of
  113  the bases described in paragraphs (a)-(j) or paragraphs (l)-(m)
  114  paragraph (l); or
  115         (l)A person, other than a person acting in the capacity of
  116  a common carrier, has nexus with this state and:
  117         1. Sells a similar line of products as the dealer and does
  118  so under the same or a similar business name;
  119         2. Maintains an office, distribution facility, warehouse,
  120  storage place, or similar place of business in this state to
  121  facilitate the delivery of property or services sold by the
  122  dealer to the dealer’s customers;
  123         3. Uses trademarks, service marks, or trade names in this
  124  state which are the same or substantially similar to those used
  125  by the dealer;
  126         4. Delivers, installs, assembles, or performs maintenance
  127  services for the dealer’s customers in this state;
  128         5. Facilitates the dealer’s delivery of property to
  129  customers in this state by allowing the dealer’s customers to
  130  pick up property sold by the dealer at an office, distribution
  131  facility, warehouse, storage place, or similar place of business
  132  maintained by the person in this state; or
  133         6. Conducts any other activities in this state which are
  134  significantly associated with the dealer’s ability to establish
  135  and maintain a market in this state for the dealer’s sales; or
  136         (m)(l) The dealer or the dealer’s activities have
  137  sufficient connection with or relationship to this state or its
  138  residents of some type other than those described in paragraphs
  139  (a)-(l) (a)-(k) to create a nexus empowering this state to tax
  140  its mail order sales or to require the dealer to collect sales
  141  tax or accrue use tax.
  142  
  143  Notwithstanding other provisions of law, a dealer, other than a
  144  dealer described in paragraphs (g) and (i), is not required to
  145  collect and remit sales or use tax under this subsection unless
  146  the dealer has a physical presence in this state or the
  147  activities conducted in this state on the dealer’s behalf are
  148  significantly associated with the dealer’s ability to establish
  149  and maintain a market for sales in this state.
  150         (3)(a) Notwithstanding other provisions of law or this
  151  section, there is a rebuttable presumption that every dealer, as
  152  defined in s. 212.06, who makes a mail order sale is also
  153  subject to the power of this state to levy and collect the tax
  154  imposed by this chapter if the dealer enters into an agreement
  155  with one or more persons in this state under which the person in
  156  this state, for a commission or other consideration, directly or
  157  indirectly refers potential customers, whether by a link on an
  158  Internet website, an in-person oral presentation, telemarketing,
  159  or otherwise, to the dealer, if the cumulative gross receipts
  160  from sales by the dealer to customers in this state who are
  161  referred to the dealer by all persons in this state having this
  162  type of an agreement with the dealer is in excess of $10,000
  163  during the 12 months immediately before the rebuttable
  164  presumption arose. Beginning July 1, 2018, and every 5 years
  165  thereafter, the department shall calculate and publish an
  166  adjustment to the $10,000 gross receipts amount based on the
  167  average percentage change in the Consumer Price Index for All
  168  Urban Consumers, U.S. City Average, All Items, compiled by the
  169  United States Department of Labor for the immediately preceding
  170  5 calendar years. The adjustment to the $10,000 minimum shall be
  171  rounded to the nearest $50 increment and take effect on the
  172  January 1 following the publication of the adjustment by the
  173  department.
  174         (b) The presumption in paragraph (a) may be rebutted by the
  175  submission of evidence proving that the persons in this state
  176  with whom the dealer has an agreement did not engage in any
  177  activity within this state which was significantly associated
  178  with the dealer’s ability to establish or maintain the dealer’s
  179  market in this state during the 12 months immediately before the
  180  rebuttable presumption arose. The evidence may consist of sworn
  181  affidavits, obtained and given in good faith, from each person
  182  in this state with whom the dealer has an agreement attesting
  183  that he or she did not engage in any solicitation in this state
  184  on the dealer’s behalf during the previous year.
  185         (4)(3)A Every dealer engaged in the business of making
  186  mail order sales is subject to the requirements of this chapter
  187  for cooperation of dealers in collection of taxes and in
  188  administration of this chapter, except that a no fee may not
  189  shall be imposed upon such dealer for carrying out any required
  190  activity.
  191         (5)(4) The department shall, with the consent of another
  192  jurisdiction of the United States whose cooperation is needed,
  193  enforce this chapter in that jurisdiction, either directly or,
  194  at the option of that jurisdiction, through its officers or
  195  employees.
  196         (6)(5) The tax required under this section to be collected
  197  and any amount unreturned to a purchaser which that is not tax
  198  but was collected from the purchaser under the representation
  199  that it was tax constitute funds of this the state of Florida
  200  from the moment of collection.
  201         (7)(6) Notwithstanding other provisions of law, a dealer
  202  who makes a mail order sale in this state is exempt from
  203  collecting and remitting any local option surtax on the sale,
  204  unless the dealer is located in a county that imposes a surtax
  205  within the meaning of s. 212.054(3)(a), the order is placed
  206  through the dealer’s location in such county, and the property
  207  purchased is delivered into such county or into another county
  208  in this state which that levies the surtax, in which case the
  209  provisions of s. 212.054(3)(a) are applicable.
  210         (8)(7) The department may establish by rule procedures for
  211  collecting the use tax from unregistered persons who but for
  212  their mail order purchases would not be required to remit sales
  213  or use tax directly to the department. The procedures may
  214  provide for waiver of registration and registration fees,
  215  provisions for irregular remittance of tax, elimination of the
  216  collection allowance, and nonapplication of local option
  217  surtaxes.
  218         Section 2. Subsection (2) of section 212.06, Florida
  219  Statutes, is amended to read:
  220         212.06 Sales, storage, use tax; collectible from dealers;
  221  “dealer” defined; dealers to collect from purchasers;
  222  legislative intent as to scope of tax.—
  223         (2)(a) The term “dealer,” as used in this chapter, means a
  224  includes every person who:
  225         (a) Manufactures or produces tangible personal property for
  226  sale at retail; for use, consumption, or distribution; or for
  227  storage to be used or consumed in this state.
  228         (b) The term “dealer” is further defined to mean every
  229  person, as used in this chapter, who Imports, or causes to be
  230  imported, tangible personal property from any state or foreign
  231  country for sale at retail; for use, consumption, or
  232  distribution; or for storage to be used or consumed in this
  233  state.
  234         (c) The term “dealer” is further defined to mean every
  235  person, as used in this chapter, who Sells at retail or who
  236  offers for sale at retail, or who has in his or her possession
  237  for sale at retail; or for use, consumption, or distribution; or
  238  for storage to be used or consumed in this state, tangible
  239  personal property as defined herein, including a retailer who
  240  transacts a mail order sale.
  241         (d) The term “dealer” is further defined to mean any person
  242  who Has sold at retail; or used, or consumed, or distributed; or
  243  stored for use or consumption in this state, tangible personal
  244  property and who cannot prove that the tax levied by this
  245  chapter has been paid on the sale at retail, the use, the
  246  consumption, the distribution, or the storage of such tangible
  247  personal property. However, The term “dealer” does not include
  248  mean a person who is not a “dealer” as otherwise defined in
  249  under the definition of any other paragraph of this subsection
  250  and whose only owned or leased property, (including property
  251  owned or leased by an affiliate,) in this state is located at
  252  the premises of a printer with which it has contracted for
  253  printing, if such property consists of the final printed
  254  product, property which becomes a part of the final printed
  255  product, or property from which the printed product is produced.
  256         (e) The term “dealer” is further defined to mean any
  257  person, as used in this chapter, who Leases or rents tangible
  258  personal property, as defined in this chapter, for a
  259  consideration, permitting the use or possession of such property
  260  without transferring title thereto, except as expressly provided
  261  in this chapter for to the contrary herein.
  262         (f) The term “dealer” is further defined to mean any
  263  person, as used in this chapter, who Maintains or has within
  264  this state, directly or by a subsidiary, an office, distributing
  265  house, salesroom, or house, warehouse, or other place of
  266  business, or uses within this state an office, distributing
  267  house, salesroom, or house, warehouse, or other place of
  268  business operated by any person other than a common carrier
  269  acting in the capacity of a common carrier.
  270         (g) “Dealer” also means and includes every person who
  271  Solicits business either by direct representatives, indirect
  272  representatives, or manufacturers’ agents within this state; by
  273  distribution of catalogs or other advertising matter; or by any
  274  other means whatsoever, and by reason thereof receives orders
  275  for tangible personal property from consumers for use,
  276  consumption, distribution, and storage for use or consumption in
  277  the state.; Such dealer shall collect the tax imposed by this
  278  chapter from the purchaser, and no action, either in law or in
  279  equity, on a sale or transaction as provided by the terms of
  280  this chapter may be had in this state by any such dealer unless
  281  it is affirmatively shown that the provisions of this chapter
  282  have been fully complied with.
  283         (h) “Dealer” also means and includes every person who, As a
  284  representative, agent, or solicitor of an out-of-state principal
  285  or principals, solicits, receives, and accepts orders from
  286  consumers in the state for future delivery and whose principal
  287  refuses to register as a dealer.
  288         (i) Constitutes “Dealer” also means and includes the state
  289  or any, county, municipality, district any political
  290  subdivision, agency, bureau, or department, or other state or
  291  local governmental instrumentality.
  292         (j) The term “dealer” is further defined to mean any person
  293  who Leases, or grants a license to use, occupy, or enter upon,
  294  living quarters, sleeping or housekeeping accommodations in
  295  hotels, apartment houses, roominghouses, tourist or trailer
  296  camps, real property, space or spaces in parking lots or garages
  297  for motor vehicles, docking or storage space or spaces for boats
  298  in boat docks or marinas, or tie-down or storage space or spaces
  299  for aircraft at airports. The term includes “dealer” also means
  300  any person who has leased, occupied, or used or was entitled to
  301  use any living quarters, sleeping or housekeeping accommodations
  302  in hotels, apartment houses, roominghouses, tourist or trailer
  303  camps, real property, space or spaces in parking lots or garages
  304  for motor vehicles, or docking or storage space or spaces for
  305  boats in boat docks or marinas, or who has purchased
  306  communication services or electric power or energy, and who
  307  cannot prove that the tax levied by this chapter has been paid
  308  to the vendor or lessor on any such transactions. The term
  309  “dealer” does not include a any person who leases, lets, rents,
  310  or grants a license to use, occupy, or enter upon any living
  311  quarters, sleeping quarters, or housekeeping accommodations in
  312  apartment houses, roominghouses, tourist camps, or trailer
  313  camps, and who exclusively enters into a bona fide written
  314  agreement for continuous residence for longer than 6 months in
  315  duration with a any person who leases, lets, rents, or is
  316  granted a license to use such property.
  317         (k) “Dealer” also means any person who Sells, provides, or
  318  performs a service taxable under this chapter. The term includes
  319  a “Dealer” also means any person who purchases, uses, or
  320  consumes a service taxable under this chapter who cannot prove
  321  that the tax levied by this chapter has been paid to the seller
  322  of the taxable service.
  323         (l) “Dealer” also means any person who Solicits, offers,
  324  provides, enters into, issues, or delivers any service warranty
  325  taxable under this chapter, or who receives, on behalf of such a
  326  person, any consideration from a service warranty holder.
  327         Section 3. (1) The Department of Revenue shall develop a
  328  tracking system, in consultation with the Revenue Estimating
  329  Conference, to determine the amount of sales taxes remitted by
  330  out–of-state dealers who would otherwise not be required to
  331  collect and remit sales taxes in the absence of the amendments
  332  made to s. 212.0596, Florida Statutes, in section 1 of this act.
  333  By February 1 of each year, the Department of Revenue shall
  334  submit a report to the Governor, the President of the Senate,
  335  and the Speaker of the House of Representatives which sets forth
  336  the amount of sales taxes collected and remitted by such dealers
  337  in the previous calendar year and the methodology used to
  338  determine the amount.
  339         (2) By March 1 of each year, the Revenue Estimating
  340  Conference shall use the information provided by the Department
  341  of Revenue pursuant to subsection (1) to determine the amount of
  342  sales taxes remitted in the previous calendar year by such out
  343  of-state dealers who would otherwise not be required to collect
  344  and remit sales taxes and estimate the amount that may be
  345  expected in the following fiscal year.
  346         (3) The Legislature shall use the information provided by
  347  the Department of Revenue and the Revenue Estimating Conference
  348  to develop legislation designed to return the amount of those
  349  sales taxes collected to the taxpayers of this state. If the
  350  amount collected is determined to be of a recurring nature and
  351  sufficient to lower tax rates, the Legislature shall reduce the
  352  communication services tax rate set forth in chapter 202,
  353  Florida Statutes. The Legislature shall also implement a 3-day
  354  sales tax holiday to reduce taxes. Both actions shall reduce tax
  355  collections in an amount not less than the amount determined by
  356  the Revenue Estimating Conference.
  357         Section 4. This act shall take effect February 1, 2014.