DC Passes Emergency Economic Nexus Sales Tax Bill

The District of Columbia has passed sales thresholds for sales tax economic nexus in emergency legislation, effective January 1, 2019. A retailer that doesn’t have a physical presence in District must collect DC sales tax if it:

  • has retail sales deliveries into the District that exceed $100,000; or
  • 200 or more separate sales delivered into the District.

The economic nexus law is part of “Internet Sales Tax” legislation that also covers sales of digital goods and services.

Physical and Electronic Marketplaces

In the past, DC enacted nexus legislation that would let DC collect sales tax from remote sellers if Congress permitted it. In an emergency bill, the DC repeals those rules, replacing them with rules that follow the thresholds in South Dakota v. Wayfair.

The thresholds apply to retailers and facilitators of retail sales made in a marketplace. A marketplace includes:

  • a physical place such as a store; and
  • an electronic place, such as the Internet.

Marketplace Facilitators

Marketplace facilitators must collect tax on all sales it facilitates even if the seller would not have been required to collect DC sales tax.

Act 22-556 (D.C.B. 22-1070), Laws 2018, effective December 31, 2018, for a 90-day period

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CCHTaxGroup

All stories by: CCHTaxGroup