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Streamlined Sales Tax Project (SSTP)

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Streamlined Sales Tax Project (SSTP) Overview. Society for Information Management (SIM) April 13, 2005. Streamlined Sales Tax Project (SSTP). Agenda. SSTP Overview Wisconsin Legislation Federal Legislation Technology Pending Issues. Who’s Involved. 45 States & DC impose sales tax - PowerPoint PPT Presentation
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No Slide TitleStreamlined Sales
April 13, 2005
21 States enacted conforming legislation
Business community
State level administration of local sales and use taxes
Common state and local tax bases within a state after December 31, 2005
Uniform sourcing rules: destination based
Streamlined Sales Tax Project
What it does - - Rules
Menu of uniform definitions -- legislatures decide what is taxable or exempt
Simplified exemption processing
Streamlined Sales Tax Project
What it does - - Rules
Hold harmless provisions if use data bases
Uniform return
One rounding rule
Adopt uniform definitions
Adopt sourcing rules
Adopt exemption administration provisions (e.g., relieve seller from burden of proof)
Streamlined Sales Tax Project
Wisconsin Legislation -- Governor’s Budget Bill
Adopt hold harmless provisions for sellers and providers who uses the state’s taxability matrix and rate/jurisdiction database
Effective October 1, 2005 (interstate agreement on January 1, 2006)
Streamlined Sales Tax Project
H.R. 3184 introduced 9-25-03
S. 1736 introduced 10-15-03
Authorization to require collection if adopt provisions of Streamlined Sales and Use Tax Agreement
Small business exception
Reasonable seller compensation
Taxability matrix
Model 3 - Certification of In-house (Proprietary) System
Continue with system “as is”
Streamlined Sales Tax Project
States contract with CSPs
States compensate CSPs
Retailer selects CSP to perform all sales tax functions
CSP determines tax due, pays the tax to the states, and files the return with the states
Streamlined Sales Tax Project
CSP is liable for tax due with two exceptions:
errors by the states
fraud by the retailer
Retailer subject to audit on purchases (use tax)
Streamlined Sales Tax Project
States compensate retailer for use of CAS
Streamlined Sales Tax Project
Model 2 - Certified Automated Systems (CAS)
Person/company who obtained certification of CAS from states is liable for failure of CAS
Person/company who obtained certification of CAS is not liable for errors by states
Retailer is liable for paying tax due and accuracy of returns
Streamlined Sales Tax Project
Retailer subject to audit on tax remittance and return filing
Retailer subject to audit on purchases (use tax)
Streamlined Sales Tax Project
Certification of CSPs and CASs by Governing Board
Contract between Governing Board of states and CSPs
Certification of CASs for determining state and local sales and use tax rates, determining whether an item is taxable or exempt, any other requirement set by Governing Board
Streamlined Sales Tax Project
Model 1 - Monetary allowance to CSP per contract
Model 2 - All retailers will receive a base rate for a period not to exceed 24 months following commencement of participation by a retailer
Streamlined Sales Tax Project
Compensation
Retailers using Model 1 (CSPs) will not get vendor discounts otherwise provided in state law
Retailers using Model 2 (CAS) will get vendor discounts otherwise provided in state law
Streamlined Sales Tax Project
Proposals due on 1-3-2005
Some CSPs will provide CASs
Other CASs will be certified after CSPs certified
Streamlined Sales Tax Project
Streamlined Sales Tax Project
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Streamlined Sales Tax Project Streamlined Sales Tax Project (SSTP) Streamlined Sales Tax Project (SSTP) Overview Society for Information Management (SIM) April 13, 2005
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