Colorado’s Unique Sales Tax Could Cut off Consumers

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Sales tax collection requirements for remote sellers, marketplace facilitators.. States imposing tax collection obligations on remote sellers (louisiana, Nevada, New Hampshire). Colorado’s Unique Sales Tax Could Cut off Consumers (1) 3 weeks ago.

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Still, some revenue hawks worry that tax scofflaws could emerge. In theory, foreign businesses without permanent establishments in the U.S., selling directly to consumers, could avoid the enforcement dragnets of state revenue departments. But Pomp expressed doubts about any concerted strategies to defy the Wayfair tax web. Revenue agencies have important enforcement tools at their disposal.

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Although Colorado is not the only state that has adopted use tax reporting requirements, 20 its law is by far the most extensive. Other states have limited their requirements to ensuring that the seller informs the purchaser at the time of the transaction that use tax may be due on the purchase.

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Colorado’s state sales tax is 2.9% on retail sales. Many counties and cities charge their own rates in addition to the base state rate. Certain county and special district taxes may apply.

Colorado’s home-rule provision in a post-Wayfair world means that each jurisdiction in the state could technically administer its own sales tax rate and collection requirements, creating confusion for companies trying to sell into the state.

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