Recent SST Meeting Generated Two Significant Results: Origin Sourcing Defeated; CSP Contract Approved

During the SST Governing Board meeting, both sourcing amendments proposed by Texas and Ohio were defeated. The proposals aimed to give states the option of local sourcing in contrast to the current destination sourcing of SSTP states. The Ohio amendment would have allowed states to source most intrastate sales on an origin basis, while either a state-wide rate or destination-based rules would apply to out-of-state sellers making sales into the state. The Texas amendment would have given states the option to source intrastate sales and leases on an origin basis, without a single rate option for interstate sales. On another front, the contract between the Board and Certified Service Providers (CSPs) was approved. The Executive Committee may now enter into contract with two approved CSPs. The CSPs will be compensated by a percentage of taxes remitted on behalf of volunteer sellers. A “most-favored-nation” clause of the contract forces the CSPs to offer services to member states on the same conditions it offers to nonmember states. (Streamlined Sales Tax Implementing States and Governing Board Meetings, Indianapolis, April 17-19, 2006)

Posted on October 1, 2006