Senate Bill 322 and HB 1352 do essentially the same thing: They require online facilitators, online platforms, to collect and remit state sales tax like a retail merchant when they facilitate a retail sale via the internet. They both also have a number of special provisions necessary to address the unique nature of these online transactions. The only real differences as they passed out of each chamber pertained to the furnishing of rooms, lodgings or accommodations in Indiana. These issues are still being kicked around, but they don’t really impact the underlying provisions. The primary provisions of the bills are on a path to passage. The only question is which bill ends up the home for those provisions. Amendments were made to SB 322 in the House, and amendments are likely to be made to HB 1352 when/if it is passed out of the Senate committee next week. Right now, it looks like SB 322 has the best shot to be the marketplace facilitator bill at the end of the day. But legislators like to keep their options open, so even if it’s SB 322, you could see HB 1352 become a vehicle for other unrelated tax provisions before the session ends.
Chamber Position: Support
The Latest: Senate Bill 322, authored by Sen. Travis Holdman (R-Fort Wayne), was amended and passed by the House Ways and Means Committee 21-0.
House Bill 1352, authored by Rep. Greg Porter (D-Indianapolis), was heard by the Senate Tax and Fiscal Policy Committee and held for possible amendment.
Indiana Chamber Action/Commentary: The Chamber has now testified numerous times in support of these two bills. They provide a reasonable approach to addressing the administrative and compliance issues that exist now since online sales are subject to tax following the U.S. Supreme Court decision in Wayfair v. South Dakota last May. Under the new scheme of things, states across the country are obligating those who operate internet platforms to bring buyers and sellers together, referred to as “marketplace facilitators,” to collect the associated sales tax from the buyers at the point of the online transaction. These bills provide a sensible and convenient mechanism to collect the tax. The Chamber has not participated in ancillary debate concerning whether sales tax should be applied to the fee paid to online hotel booking platforms.
Senate Bill 131 – Sales Tax on Recreational Vehicles
Authored by Sen. Blake Doriot (R-Syracuse)
Provides a five-year sales tax exemption on sales to residents of a nonreciprocal state and calls for the Legislative Services Agency to evaluate the economic impact of the exemption.
Chamber Position: Support
The Latest: The House Ways and Means Committee amended the bill and passed it 13-4 on Wednesday.
Indiana Chamber Action/Commentary: The amendments already made by the Ways and Means Committee – including providing an exemption for a set period of five years – are designed to stem the contraction of Indiana dealerships that has occurred in recent years due to complications attached to sales made to residents of nonreciprocal states. The exemption sunsets in 2024. Prior to the sunset, the Legislative Services Agency is to look at how the exemption has influenced Indiana dealership sales. The idea is to determine if the exemption is having the intended effect of increasing Indiana transactions and stabilizing the Indiana dealership sales. The Chamber has supported all efforts to address this problem and finds this approach to have promise.
Resource: Bill Waltz at (317) 264-6887 or e-mail: [email protected]