Utah Governor Jon Huntsman, Jr. recently signed H.B. 107, which delays the effective date of legislation that would enable Utah to conform to the rules set forth under the Streamlined Sales and Use Tax Agreement. Originally set for July 1, 2005, the effective date for legislation involving direct pay permits, multiple use (MPU) transactions, and rules for destination-based sourcing, among other things, has been changed to July 1, 2006. Provisions of HB 107 also delay the enactment of legislation that provides monetary allowances for sellers registered under the Agreement, and postpones the amnesty period set to occur during the first year after the effective date of conforming legislation. The monetary allowances set forth by the Agreement relate to insignificant amounts provided to businesses that have an undue hardship in conforming with the implemenation of the Agreement.
During the 2005 interim period, the Revenue and Tax Interim Commission and the State Tax Commission will be required to conduct studies to determine if the Streamlined Sales Tax Project is prepared to provide the software necessary as outlined in the Agreement for businesses to implement destination-based sourcing rules, and if amendments to the Agreement allow for businesses to easily comply with the sourcing requirements. The destination-based sourcing software will tentatively be available in October 2005 after the enactment of the Agreement and the establishment of Certified Service Providers (CSPs) and Certified Automated Systems (CASs). Amendments to the Agreement that would facilitate the “easy” implementation of destination-based sourcing rules will be voted on at the April 16, 2005 meeting of the SST Implementing States. If after examining these two issues the Revenue and Tax Interim Commission and the State Tax Commission feel that the effective date of conforming legislation should be moved from July 1, 2006 to an earlier time, the Commissions may report their findings to the Legislative Management Commission along with the recommendation that the Governor call a special session to change the effective date. (HB 107, Utah 2005 General Session, effective July 1, 2005)