Amends TCA Title 67, Chapter 4, Part 32 and Title 67, Chapter 6.

This bill revises and enacts sales tax provisions regarding sales made by persons with no physical presence in this state.<br /> <br /> Under present law, the Local Option Revenue Act provides that dealers with no location in this state may choose to pay, in lieu of the tax otherwise authorized by the Act, local tax at the rate of 2.25 percent of the sales price on all sales made in this state. Proceeds from the tax are distributed to the counties according to a ratio and requirement detailed in present law.<br /> <br /> This bill deletes the above provisions and instead provides the following:<br /> <br /> (1) A dealer with no physical presence in this state must collect and remit sales tax as if the dealer has a physical presence in this state if, in the previous 12-month period the person's gross revenue from sales made in this state exceeds $100,000 or the person made 200 or more separate sales transactions in this state. This provision will not require a dealer to collect or remit the sales tax for sales made before January 1, 2020;<br /> (2) Notwithstanding the Local Option Revenue Act, a dealer with no physical presence in this state may choose to pay, in lieu of the tax otherwise authorized by the Act, local tax at the rate of 2.25 percent of the sales price on all sales made in this state;<br /> (3) Similar to present law, proceeds of the tax provided for in (1) must be distributed to the counties based on the ratio of local tax collections in the county over total tax collections in all counties;<br /> (4) A dealer that is required to collect and remit sales tax must register with the department of revenue; and<br /> (5) This bill does not change the substantial nexus criteria for determining when a person is required to pay the business tax, excise tax, or franchise tax.<br /> <br /> This bill will take effect January 1, 2020.<br /> <br />