Oklahoma Enacts Changes to Economic Nexus Provisions

Effective Date: November 1, 2019

Threshold: $100,000 in aggregate sales of TPP (for remote sellers only) excluding marketplace sales where marketplace collects tax

Measurement Date: Preceding or current calendar year

Includable Transactions: Taxable sales

When You Need to Register Once You Exceed the Threshold: The first calendar month following the month when the threshold is met

Effective November 1, 2019, Oklahoma has enacted changes to its existing economic and marketplace nexus provisions. Under the newly enacted legislation, remote sellers with aggregate sales of tangible personal property in Oklahoma subject to tax of $100,000 or more during the during the preceding or current calendar year are required to collect and remit Oklahoma sales tax. The tax collection and remittance obligation will apply to the first calendar month following the month when the threshold is met.

Note that this is a change to the existing provisions that require remote sellers with taxable sales in excess of $10,000 to elect to collect tax or comply with notice and reporting provisions which became effective July 1, 2018. This new legislation also eliminates the option for remote sellers to elect between tax collection/remittance or complying with notice and reporting requirements.

Oklahoma sales that a remote seller makes through a marketplace forum or a referrer’s forum where the tax is collected by the marketplace facilitator or referrer should not be included when calculating the threshold for the remote seller.

For marketplace facilitators and referrers, the threshold remains at $10,000 and they still have the option to elect to collect and remit tax or comply with notice and reporting requirements.

The requirement that a marketplace facilitator elect between tax collection/remittance and complying with notice and reporting requirements only applies to sales made through its marketplace forum by or on behalf of marketplace sellers. It does not apply to sales made by a marketplace facilitator on its own behalf.

The requirement that a referrer elect between tax collection/remittance and complying with notice and reporting requirements applies to sales:

  • Directly resulting from a referral of a purchaser to a marketplace seller
  • Directly resulting from a referral of a purchaser to a remote seller; and
  • Of the referrer’s own products

A marketplace facilitator or a referrer may change an election to comply with the notice and reporting requirements to an election to collect and remit tax at any time during a fiscal year by filing a new election with the Commission and obtaining a permit. The new election will be effective 30 days after the filing and will be effective for the balance of the fiscal year in which the new election was filed and for the next succeeding fiscal year.

To see our previous news item on this topic, click here. (S.B. 513, Laws 2019)

Posted on May 30, 2019