Utah Enacts Economic Nexus Legislation

Effective Date: January 1, 2019

Threshold: $100,000 or 200 or more separate transactions

Measurement Date: Previous or current calendar year

Includable Transactions: Gross sales excluding marketplace sales if facilitator is collecting

When You Need to Register Once You Exceed the Threshold: Next transaction

On July 21, 2018, Utah Governor Gary Herbert signed legislation containing economic nexus provisions. Effective January 1, 2019, a seller is required to pay or collect and remit Utah sales and use tax if the seller sells tangible personal property, products transferred electronically, or services for storage, use, or consumption in the state; and in either the previous calendar year or the current calendar year:

• Receives gross revenue from the sale of tangible personal property, any product transferred electronically, or services for storage, use, or consumption in the state of more than $100,000; or
• Sells tangible personal property, products transferred electronically, or services for storage, use, or consumption in the state in 200 or more separate transactions.

Whether a remote seller exceeds the $100,000 or 200 transactions, sales made through a marketplace facilitator who is collecting tax are excluded.

The legislation notes that sellers not meeting these requirements may voluntarily collect and remit Utah sales and use tax. In exchange for the expanded nexus provisions, exemptions were broadened for manufacturing, mining, web search portals and medical labs. (Utah S.B. 2001, Sec 59-12-107, effective January 1, 2019)