Tennessee has enacted legislation that adds a sales and use tax click-through nexus provision, effective July 1, 2015. Under the click-through nexus provision, a dealer is presumed to have a representative, agent, salesperson, canvasser, or solicitor operating in this state for the purpose of making sales and is presumed to have a substantial nexus with Tennessee if:
The presumption can be rebutted by evidence that the person with whom the dealer has an agreement or contract did not conduct any activities in Tennessee that would substantially contribute to the dealer’s ability to establish and maintain a market in the state during the preceding 12 months.
The Tennessee Department of Revenue has provided additional guidance on the click-through nexus provision. Effective July 1, 2015, a rebuttable presumption is created that out-of-state retailers have nexus, and must collect sales and use tax from Tennessee customers, if the retailer pays an in-state party a fee or commission to route customers to the retailer. A dealer that makes sales of tangible personal property or services in Tennessee is presumed to have substantial nexus with Tennessee and is required to collect and remit sales and use tax on all of its taxable sales in Tennessee if the two conditions above are met. (H.B. 644, Laws 2015, effective as noted; Important Notice No. 15-12, Tennessee Department of Revenue, June 2015)