Title
A Resolution Approving The Intergovernmental Agreement Between The City Of Colorado Springs And Colorado Department Of Revenue For The Purpose Of Permitting Access To The Sales And Use Tax Software (SUTS System)
Presenter:
Charae McDaniel, Chief Financial Officer
Body
Summary:
The IGA with the State of Colorado Department of Revenue (CDOR) grants the city access to the SUTS system for the collection and payment of sales and use tax for online purchases.
A separate and related Ordinance amends and creates new sections within the Sales Tax Code to require retailers who do not have a physical presence in the City to collect and remit sales tax on online purchases.
Another separate and related Ordinance amending the Lodgers, Campgrounds and Automobile Rental Tax (LART) portion of code provides necessary updates in the terminology used to ensure consistency with the updates in the Sales Tax section.
The Ordinances do not constitute a tax policy change - they reflect current policy for taxation, collection and remittance.
Background:
The United States Supreme Court ruled on the South Dakota v. Wayfair, Inc. 138 S.Ct. 2080 (2018) (hereinafter "Wayfair") case. South Dakota enacted a statute requiring internet sellers with no physical presence in the state to collect and remit sales tax. This was previously prohibited under Quill Corporation v. North Dakota, which required a retailer to have a physical presence in a taxing jurisdiction. The Supreme Court overturned the prior ruling and held that out-of-state sellers' physical presence in a taxing state is not necessary for the state to require sellers to collect and remit its sales tax. This provided for a new definition of economic nexus, which is the connection established when a person or marketplace facilitator makes retail sales into the City. However, the Wayfair case includes a provision that indicates the seller is to collect and remit sales tax, unless it is unduly burdensome to ...
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