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A BILL TO BE ENTITLED
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AN ACT
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relating to the clarification of the circumstances under which a |
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retailer is considered to be engaged in business in this state, and |
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the information required to be provided by certain retailers, for |
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purposes of the collection of sales and use taxes. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Section 151.024, Tax Code, is amended to read as |
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follows: |
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Sec. 151.024. PERSONS WHO MAY BE REGARDED AS RETAILERS. (a) |
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If the comptroller determines that it is necessary for the |
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efficient administration of this chapter to regard a salesperson |
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[salesman], representative, peddler, or canvasser as the agent of a |
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dealer, distributor, supervisor, or employer under whom the person |
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[he] operates or from whom the person [he] obtains the tangible |
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personal property that the person [he] sells, whether or not the |
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sale is made in the person's [his] own behalf or for the dealer, |
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distributor, supervisor, or employer, the comptroller may so regard |
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the salesperson [salesman], representative, peddler, or canvasser, |
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and may regard the dealer, distributor, supervisor, or employer as |
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a retailer or seller for the purpose of this chapter. |
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(b) A dealer, distributor, supervisor, or employer may not |
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be regarded under this section as a retailer or seller for the |
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purpose of this chapter if the dealer, distributor, supervisor, or |
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employer directly or indirectly, or through a subsidiary, |
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affiliate, or agent by whatever name, maintains, occupies, |
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operates, or uses, permanently or temporarily, only: |
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(1) a fulfillment center as described by Section |
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151.107(i); or |
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(2) a computer server. |
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SECTION 2. Subchapter B, Chapter 151, Tax Code, is amended |
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by adding Section 151.028 to read as follows: |
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Sec. 151.028. INFORMATION NOT REQUIRED FROM CERTAIN |
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RETAILERS. The comptroller or any other official or agency of this |
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state may not require for purposes of this chapter a retailer that |
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is not engaged in business in this state to: |
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(1) file any report, statement, or other information |
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regarding purchases made by customers in this state; or |
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(2) send to a customer in this state any type of notice |
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regarding the customer's purchase. |
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SECTION 3. Section 151.107, Tax Code, is amended by |
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amending Subsection (a) and adding Subsections (f), (g), (h), and |
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(i) to read as follows: |
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(a) Except as otherwise provided by this section, for [For] |
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the purpose of this subchapter and in relation to the use tax, a |
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retailer is engaged in business in this state if the retailer: |
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(1) maintains, occupies, or uses in this state |
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permanently, temporarily, directly, or indirectly or through a |
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subsidiary or agent by whatever name, an office, place of |
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distribution, sales or sample room or place, warehouse, storage |
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place, or any other place of business; |
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(2) has a representative, agent, salesperson |
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[salesman], canvasser, or solicitor operating in this state under |
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the authority of the retailer or its subsidiary for the purpose of |
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selling or delivering or the taking of orders for a taxable item; |
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(3) derives rentals from a lease of tangible personal |
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property situated in this state; |
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(4) engages in regular or systematic solicitation of |
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sales of taxable items in this state by the distribution of |
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catalogs, periodicals, advertising flyers, or other advertising, |
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by means of print, radio, or television media, or by mail, |
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telegraphy, telephone, computer data base, cable, optic, |
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microwave, or other communication system for the purpose of |
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effecting sales of taxable items; |
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(5) solicits orders for taxable items by mail or |
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through other media and under federal law is subject to or permitted |
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to be made subject to the jurisdiction of this state for purposes of |
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collecting the taxes imposed by this chapter; |
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(6) has a franchisee or licensee operating under its |
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trade name if the franchisee or licensee is required to collect the |
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tax under this section; or |
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(7) otherwise does business in this state. |
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(f) A retailer whose physical presence in this state is |
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attributable to the maintenance, occupation, operation, or use by |
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the retailer indirectly, or through the retailer's subsidiary, |
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affiliate, or agent by whatever name, of an office, place of |
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distribution, sales or sample room or place, warehouse, storage |
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place, or any other place of business in this state is engaged in |
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business in this state as provided by Subsection (a)(1) only if: |
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(1) the place of business in this state is a physical |
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location that is open to the public for the sale of goods at retail; |
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and |
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(2) at least one of the following activities is |
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performed on the retailer's behalf at that place of business: |
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(A) promotion of the retailer's business, such as |
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distributing the retailer's coupons or compiling the retailer's |
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mailing list, except that making the retailer's catalog available |
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for use as a reference or providing the catalog to a customer in |
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this state at the customer's request is not considered promotion of |
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the business; |
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(B) acceptance of returns or exchanges of, or |
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credits for, merchandise purchased from or through the retailer; |
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(C) maintenance of telephone or Internet kiosks |
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that allow customers to access inventory and purchase merchandise |
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from or through the retailer; or |
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(D) acceptance or placement of customers' orders |
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with the retailer if a product is unavailable at the place of |
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business. |
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(g) Notwithstanding any other law, a retailer is not |
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considered to be engaged in business in this state if the retailer's |
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physical presence in this state is attributable to: |
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(1) the maintenance, occupation, operation, or use in |
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this state permanently, temporarily, directly, or indirectly or |
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through a subsidiary, affiliate, or agent by whatever name, of a |
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fulfillment center; |
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(2) the ownership of tangible personal property |
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located on the premises of a fulfillment center described by |
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Subdivision (1); or |
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(3) the maintenance, occupation, operation, or use in |
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this state permanently, temporarily, directly, or indirectly or |
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through a subsidiary, affiliate, or agent by whatever name, of a |
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computer server. |
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(h) For purposes of this section, a retailer and another |
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person are affiliates if: |
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(1) either the retailer or the other person has a |
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direct or indirect ownership interest in the other of more than 50 |
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percent; or |
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(2) a third person, or a group of persons affiliated |
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with each other, has a direct or indirect ownership interest of more |
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than 50 percent in the retailer and more than 50 percent in the |
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other person. |
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(i) In this section, "fulfillment center" means an |
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establishment in this state at which shipments of tangible personal |
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property are processed for delivery to customers. The term does not |
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include an establishment at which retail sales of tangible personal |
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property are made to retail customers on more than 12 days per year |
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unless the establishment processes customer sales orders by mail, |
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telephone, or electronic means, also processes shipments of |
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tangible personal property to customers, and, of the goods sold by |
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or shipped through the establishment, the goods sold or shipped to |
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customers outside this state represent at least 75 percent of the |
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fair market value of the total goods sold by or shipped through the |
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establishment. Retail sales made inside an establishment to |
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employees working at the establishment are not considered in |
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determining the number of days per year on which sales are made to |
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retail customers or the value of goods sold by or shipped through an |
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establishment. |
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SECTION 4. Section 151.028, Tax Code, as added by this Act, |
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and Sections 151.024 and 151.107, Tax Code, as amended by this Act, |
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are a clarification of existing law and do not imply that the former |
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law may be construed as inconsistent with the law as amended by this |
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Act. |
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SECTION 5. This Act takes effect immediately if it receives |
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a vote of two-thirds of all the members elected to each house, as |
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provided by Section 39, Article III, Texas Constitution. If this |
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Act does not receive the vote necessary for immediate effect, this |
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Act takes effect September 1, 2011. |