Tax & Accounting Blog

Vermont Amazon Tax Law On Its Way to Governor for Signature

Indirect Tax, Sales Tax Nexus June 3, 2011

Vermont Amazon tax law on its way to Governor

The Vermont legislature recently passed click-through or affiliate nexus provisions and the bill is on its way to the Governor for signature.  However, unlike the affiliate nexus bills already passed in other states, the Vermont law has an unusual effective date provision: it won’t go into effect until 15 other states adopt affiliate nexus laws first.   So far, only 6 other states have enacted such legislation:  New York (2008), North Carolina, Rhode Island (2009), Illinois (2011), Arkansas (2011) and Connecticut (2011).

Under the Vermont law, a person is presumed to be soliciting business through a Vermont representative if the person entered into an agreement with a resident of Vermont under which the resident, for a commission or other consideration, directly or indirectly referred potential customers, whether by a link on an Internet website or otherwise, to the person and such referrals generated cumulative gross receipts in excess of $10,000 during the preceding tax year.  The presumption may be rebutted by establishing that the in-state representative did not engage in any solicitation that would satisfy the requirements of the United States Constitution.  However, these nexus provisions would not become effective until 15 or more states adopted similar or comparable provisions, as determined by the Vermont Attorney General.