Online sales tax amnesty program launched in 13 states, including Utah

Paul Sakuma, Associated Press

FILE – In this Oct. 18, 2010 file photo, an package is prepared for shipment by a United Parcel Service (UPS) driver in Palo Alto, Calif. 

SALT LAKE CITY — A new multi-state sales tax amnesty agreement will allow online sellers in several states, including Utah, to collect sales tax in an effort to increase conformity nationwide.

The Multistate Tax Commission, in cooperation with 13 member states, Wednesday announced the launch of a sales tax amnesty program aimed at helping online sellers become compliant with retail sales tax regulations.

The commission’s voluntary disclosure agreement is a way for taxpayers with potential sales tax liability to negotiate a settlement during the amnesty period of Aug. 17 to Oct. 17, explained Utah State Tax Commission chair John Valentine. Taxpayers that have not been contacted by any of the participating states will be able to apply to start remitting sales tax on relevant future sales without penalty or liability for unpaid, prior accumulated sales tax in those states, he noted.

“What we’re doing is encouraging states — and Utah will be one of them — to have affiliates of Amazon (and other online sellers) to come in and not have exposure for prior tax liability they should have collected,” he said. “Instead of having exposure for the back tax, if they start collecting under this amnesty program, they’ll just have to start collecting tax going forward.”

The states participating in this program include Alabama, Arkansas, Colorado, Connecticut, Kansas, Kentucky, Louisiana, Nebraska, New Jersey, Oklahoma, Texas, Utah and Vermont. Eight other states considering participation must decide before the Aug. 17 start date, the release stated.

Some of these additional states may require a limited look-back period for back tax liability, the release stated.

“The program is directed at any online retailer that doesn’t have a physical presence in the state, but sells into the state,” Valentine said. While sellers will be eligible for amnesty, he noted that buyers will still be responsible for reporting…

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