Grace period extended for new sales tax rules


STATEWIDE  Colorado Department of Revenue Executive Director Mike Hartman issued the following statement on Thursday regarding proposed sales tax rules to implement the U.S. Supreme Court’s South Dakota v Wayfair decision and destination sourcing:

“As part of our rulemaking process to implement sales tax rules for in-state and out-of-state retailers, we have heard from legislators and the business community, and the Department of Revenue agrees it is important for the state to take the time to get this right.

“As such, the department is extending the automatic reprieve for Colorado businesses and out-of-state retailers to comply with the emergency rules from the current March 31, 2019 deadline to May 31, 2019. We will evaluate the need for another extension as May 31 nears. This additional time will give the state legislature an opportunity to find innovative solutions to streamline and simplify our sales tax collection laws in accordance with the wishes of the residents of Colorado.

“Despite the automatic reprieve, the department requests that businesses with the sophistication and capability to collect and remit sales tax on internet sales based on where the good or service is being delivered do so as quickly as possible in advance of the May 31, 2019 enforcement deadline. The Department has upgraded its systems and processes to make compliance as simple as possible. We will continue to engage the business community to address their remaining concerns.

“This is an opportunity to simplify sales tax for all parties: for businesses that collect and remit sales tax, for customers who pay it, and for those of us in state government whose obligation it is to carry out the tax laws passed by the state legislature. No one desires a streamlined and simplified sales tax collection and compliance system more than the Department of Revenue.”

National Federation of Independent Business (NFIB) Colorado State Director Tony Gagliardi issued the following statement following the December 6th announcement by the state Dept. of Revenue that it is delaying implementation of a new online sales tax until further study and legislative input.

“This is a welcome holiday present from the Department of Revenue, but Colorado small businesses will not breathe a big sigh of relief until they see what lies ahead in the coming months. The South Dakota v. Wayfair decision handed down earlier this year by the U.S. Supreme Court now allows states to collect online sales taxes from online sellers. Our Department of Revenue took it as a shot from a starter’s pistol to begin a mad dash to a finish line that wasn’t clearly marked. Rightfully, the department has decided to slow down, but not before causing a collective anxiety in a state that already has a mess of a sales tax structure with more than 700 taxing entities. On behalf of NFIB and the Coalition to Simplify Colorado’s Sales Tax, I commend the Department of Revenue for talking this step and striving to make sure Main Street businesses are fully prepared for the new collection and remittance process, and that all the necessary tools are available. Simplifying and harmonizing its sales tax structure is Colorado’s biggest public policy challenge by far.”

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