California’s Department of Tax and Fee Administration proposed amendments to their regulations that clarify that marketplace sales are not drop shipments. In the past, drop shipment “means and includes any delivery of tangible personal property by an owner or former owner thereof, or factor or agent of that owner or former owner, to a California consumer pursuant to the instructions of a true retailer.” The new regulation clarifies that when marketplace sellers purchase from a supplier who directly delivers the property to California, the supplier is not considered a drop shipper or “true retailer” who is responsible for collecting tax. The responsibility for tax collection remains with the marketplace facilitator. (California Department of Tax and Fee Administration, Regulation 1706, September 10, 2021)