SF 102 (LSB 1387XS (3) 88)

SENATE FILE 102

BY  GREENE

A BILL FOR

An Act relating to the liability of a sponsor of an event to collect sales tax, and providing penalties.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:

    Section 1.  Section 423.33, subsection 3, Code 2019, is amended to read as follows:
   3.  a.  (1)  Event sponsor’s liability for sales tax sponsor —— daily log —— penalty.  A person sponsoring a sponsor of an event including a flea market or a craft, antique, coin, or stamp show or similar event shall obtain from keep a daily log of every retailer selling tangible personal property, specified digital products, or taxable services at the event proof that the retailer possesses a valid sales tax permit or secure from the retailer a statement, taken in good faith, that tangible personal property, specified digital products, or services offered for sale are not subject to sales tax. Failure to do so renders a sponsor of the event liable for payment of any sales tax, interest, and penalty due and owing from any retailer selling property or services at the event. Sections 423.31, 423.32, 423.37, 423.38, 423.39, 423.40, 423.41, and 423.42 apply to the sponsors. 
   (2)  The daily log shall include the name and sales tax permit number of the retailer. However, if a retailer does not have a sales tax permit number, the sponsor shall keep in the daily log the retailer’s address and driver’s license number or the equivalent of such an identifying number if the retailer does not have a driver’s license number. The daily log shall be kept on forms provided by the department.
   (3)  The sponsor shall electronically submit to the department, within thirty days of the completion of an event, the daily log of every retailer selling tangible personal property, specified digital products, or taxable services at the event on forms provided by the department.
   b.  The sponsor shall require each retailer to register as a retailer with the sponsor and shall require that a certificate of registration be prominently displayed by each retailer at the event.
   c.  (1)  If the sponsor does not comply with the requirements of paragraph “a”, subparagraph (3), the sponsor shall be subject to a civil penalty in the amount of one thousand dollars plus fifty dollars per day for each day the violation continues up to a maximum civil penalty of ten thousand dollars.
   (2)  For any other violation of this subsection, the sponsor shall be subject to a civil penalty in the amount of one thousand dollars.
   d.  The penalty collected pursuant to this subsection shall be paid to the department and deposited into the general fund of the state. Unpaid penalties and interest may be enforced in the same manner as the taxes imposed by this chapter.
   e.  For purposes of this subsection, a “person sponsoring a flea market or a craft, antique, coin, or stamp show or similar event” “sponsor” means a person sponsoring a flea market or a craft, antique, coin, or stamp show or similar event but does not include an organization which sponsors a person sponsoring an event determined to qualify as an event involving casual sales pursuant to section 423.3, subsection 39, or the state fair or a fair as defined in section 174.1.
EXPLANATION
The inclusion of this explanation does not constitute agreement with
the explanation’s substance by the members of the general assembly.
   This bill relates to the liability of a sponsor of an event to collect sales tax.
   The bill provides that a person sponsoring a flea market or a craft, antique, coin, or stamp show or similar event shall be required to keep a daily log of every retailer selling tangible personal property, specified digital products, or taxable services at the event.
   The bill specifies that the daily log shall include the name and sales tax permit number of the retailer. If a retailer does not have a sales tax permit number, the bill also requires the sponsor to keep in the daily log the retailer’s address and driver’s license number or the equivalent of such an identifying number if the retailer does not have a driver’s license number.
   The bill requires the sponsor to electronically submit to the department of revenue, within 30 days of the completion of the event, the daily log of every retailer selling tangible personal property, specified digital products, or taxable services at the event.
   The bill requires a sponsor to require each retailer to register with the sponsor and also requires each certificate of registration to be prominently displayed at the event.
   If the sponsor does not electronically submit to the department of revenue, within 30 days of the completion of an event, the daily log of every retailer selling at the event, the sponsor shall be subject to a civil penalty in the amount of $1,000 plus $50 per day for each day the violation continues up to a maximum civil penalty of $10,000. For any other violation of the bill by the sponsor, the sponsor shall be subject to a civil penalty in the amount of $1,000.
   Currently, a person sponsoring a flea market or a craft, antique, coin, or stamp show or similar event must obtain from every retailer at the event proof that the retailer possesses a valid sales tax permit or secure from the retailer a statement that the property or taxable services offered for sale are not subject to sales tax. Additionally under current law, failure to obtain proof that the retailer possesses a valid sales tax permit or to secure from the retailer a statement that the property or services offered for sale are not subject to sales tax renders a sponsor of the event liable for payment of any sales tax, interest, and penalty due and owing from any retailer selling property or services at the event.