New Sales Tax Bill Proposed By Rep. Senesenbrenner

Rep. Sensenbrenner recently proposed H.R. 5893 “No Regulation Without Representation Act of 2016.”  This bill would provide more objective physical presence threshold for states’ right to subject taxpayers for sales tax collection responsibilities.

If H.R. 5893 passes, states would be limited in what they can consider nexus.  A seller under the new bill would be someone who has physical presence in a state.  Nexus is triggered only if a taxpayer is physically located or have personal property or employee in the state.  This means Amazon FBA sellers are no longer on the hook to collect and remit sales tax in states where the seller’s only connection with a state is inventory in an Amazon fulfillment warehouse.

Still long way to  – need to be passed by House, Senate, and the President.  We expect that states would fight hard to dismiss this new bill, but we will continually monitor the passage of this new bill.