US States May Be Close To SSUTA Threshold, Expert Suggests

by Glen Shapiro, LawAndTax-News.com, New York

03 July 2003

Following the enactment of SSUTA (Streamlined Sales and Use Tax Agreement) provisions by Ohio, there is now some confusion in the United States as to how close to minimum levels of adoption the proposals actually are.

In order to work effectively, the SSUTA must be adopted by at least 10 states, with residents representing at least 20% of the populations of states that collect sales tax. In a statement on Tuesday, e-commerce tax expert, David Hardesty announced that as a result of Ohio's adoption of the provisions: 'the new tax regime is getting close, and multistate sellers must now begin taking steps to comply with it'.

However, in an update issued yesterday, the EcommerceTax.com founder suggested that there is now: 'some doubt as to whether legislation in Minnesota and Washington conform sufficiently to the SSUTA to count these states. If the two states are not counted, states with apparently conforming legislation have only about 16.8% of the population of sales tax states'.

In Minnesota, which represents 1.8% of the necessary population, the governor has signed SF 1505, which was thought to have brought the state into compliance with the SSUTA. In Washington - which brings 2.1% of the population to the equation - meanwhile, SB 5783, which adopts the majority of the streamlined agreement's provisions, has been passed and signed by the governor.

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