Texas ~ Sales and Use Tax: Remote-Seller Nexus Bill Passed by Senate in Special Session

The Texas Senate has passed a bill in special session that contains the same sales and use tax nexus provisions for remote sellers that were contained in a bill (H.B. 2403) that was recently vetoed by Governor Rick Perry. (TAXDAY, 2011/06/02, S.30) The bill has been sent to the House of Representatives for consideration.

Under the bill, the following retailers are considered to be engaged in business in Texas for use tax collection purposes: (1) a retailer that holds a substantial ownership interest in, or is owned in whole or in substantial part by, a person who maintains a business location in Texas, provided that certain conditions are met and (2) a retailer that holds a substantial ownership interest in, or is owned in whole or in substantial part by, a person who maintains a distribution center, warehouse, or similar location in Texas and who delivers property sold by the retailer to consumers. In addition, the bill expands the definition of a “seller” or “retailer” to include a person who has been entrusted with the possession of property and has the power to sell, lease, or rent the property without further action by the owner.

The bill (see Section 39.01) is available on the Legislature’s website at http://www.capitol.state.tx.us/tlodocs/821/billtext/pdf/SB00001E.pdf#navpanes=0.

S.B. 1, as passed by the Senate in Special Session on June 3, 2011

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