Bill implementation timeline: Substitute Senate Bill (SSB) 5581

• Remote sellers and marketplace facilitators (without physical presence nexus) with more than $100,000 in retail sales or 200 retail transactions in the current or previous year must register, collect, and submit sales tax.
• The business must begin to collect and send sales tax on the first day of the month that starts at least 30 days after the date the remote seller or marketplace facilitator first reaches the threshold.

Note: the bill puts the Department’s prior action into legal code.

• The 200 transaction threshold is eliminated—exceeding this threshold no longer creates a requirement to register, collect and submit sales tax.
• If a business has substantial nexus with the state, it must pay all other applicable taxes or fees on its business activities in addition to B&O
• Click-through nexus is eliminated.
• Retail sales tax (RST) and B&O tax exemptions for tangible personal property imported into Washington are eliminated, except for wholesale sales between a parent company and its wholly owned subsidiary and wholesale sales of unroasted coffee beans.

• Parts of the marketplace fairness law (HB 2163) are repealed:
  • referrers no longer need to make a collection/notice and reporting election
  • use tax notice and reporting requirements
  • digital products delay for facilitators
• Adds a definition of marketplace and clarifies the current definitions of marketplace facilitator and affiliated person.
• Marketplace facilitators must provide a monthly sales report to all of their marketplace sellers, due 15 days after the end of each month.
  • If a marketplace facilitator does not provide the monthly report to their sellers, they no longer qualify for liability relief and marketplace sellers may estimate their B&O tax liability in a manner required or approved by the Department.

• Nexus thresholds for B&O tax and sales tax collection are now the same – both are $100,000, will be calculated using all gross income, and will not be adjusted for inflation.
• For apportionable activities, the property, payroll thresholds are eliminated and replaced with a mere physical presence nexus standard.
• Physical presence nexus establishes nexus for all tax classifications
• In addition to sales tax, remote sellers must now collect all other applicable taxes and fees imposed on the buyer (such as wood stove fee, lodging taxes, tire fee).
• Liability relief for marketplace facilitators when the marketplace seller provides correct information is eliminated.