New York Redefines the Term Vendor

The New York State Department of Taxation and Finance released new rules regarding who is presumed to be a vendor, particularly pertaining to online retailers. The new rule states that merely placing an advertisement via a link on a representative’s Web site that, directly or indirectly, links to the Web site of the seller, is not enough to be considered a vendor required to register for sales tax purposes. However, placing an advertisement does not include the placement of a link on a Web site where consideration is based on the volume of completed sales generated by the link. If a representative solicits sales on the seller’s behalf, the seller must register as a vendor for New York State and local sales tax purposes. (New York State Department of Taxation and Finance, TSB-M08{3}S, May 8, 2008)

Posted on November 11, 2008