Tax News

CCH (cch.taxgroup.com) reports:

Ohio retailers who source their delivery sales by origin for sales tax purposes will not be required to switch to destination-based sourcing for delivery sales on January 1, 2008. The January 1st requirement was dependent upon certification that the Streamlined Sales and Use Tax (SST) Governing Board had adopted amendments to, or an interpretation of, the Agreement that allowed an exception from the Agreement's destination-based sourcing provisions for Ohio retailers with less than $500,000 in delivery sales in the previous calendar year. The Ohio Tax Commissioner has determined that the required certification will not happen and, consequently, all vendors currently permitted to source delivery sales on an origin basis may continue to do so. Vendors who have previously changed to destination-based sourcing voluntarily, and vendors who are currently required to use destination-based sourcing for having made $30 million in Ohio delivery sales in calendar year 2005, must continue to use destination-based sourcing for delivery sales.
Vendors who voluntarily opt to change to destination-based sourcing for their delivery sales may do so irrevocably at any time without providing formal notice to the Ohio Department of Taxation. The change should be made at the beginning of the retailer's monthly or semi-annual tax return period.
Telecommunications service providers that source their sales under Sec. 5739.034, Ohio R.C. must continue to do so. Out-of-state sellers who collect Ohio sales tax must continue to do so on a destination basis.
Ohio is currently an associate member of the Agreement through the end of 2007. A shift from origin-based sourcing to destination-based sourcing on January 1st was necessary to make Ohio a full member of the Streamlined Sales and Use Tax (SST) Agreement.
For more Tax Day coverage of the Ohio sourcing issue, see TAXDAY, 2007/09/24, S.1; TAXDAY, 2007/08/16, S.1; TAXDAY, 2007/08/14, S.12; TAXDAY, 2007/07/03, S.31; TAXDAY, 2007/06/26, S.1; TAXDAY, 2007/06/22, S.18; TAXDAY, 2007/04/27, S.21; and TAXDAY, 2007/02/06, S.11.
Subscribers to CCH Tax Research NetWork may view the Department's Information Release and News Release on the sourcing issue.
Sales and Use Tax Information Release ST 2007-03 , Ohio Department of Taxation, October 2007; News Release , Ohio Department of Taxation, October 1, 2007; E-mail , Ohio Department of Taxation, October 1, 2007.