HB 2382 — TPT; sourcing; validation

2.

"Ownership" means any right, title or interest in the business.

3.

"Transferable" means the ability to convey or change the right or privilege to engage or continue in business by virtue of the issuance of the transaction privilege tax or municipal privilege tax license.

H.

When the ownership or location of a business on which a transaction privilege tax or municipal privilege tax is imposed has been changed within the meaning of subsection G of this section, the licensee shall surrender the license to the department.

The license shall be reissued to the new owners or for the new location on application by the taxpayer and payment of the $12 fee for a transaction privilege tax license and a fee of up to $50 per jurisdiction for a municipal privilege tax license.

The department must collect, hold, pay and manage the fees in trust for the city or town and may not use the monies for any other purposes.

I.

A person who is engaged in or conducting a business in two or more locations or under two or more business names shall procure a transaction privilege tax license for each location or business name regardless of whether all locations or business names are reported on a consolidated return under a single transaction privilege tax license number.

This requirement shall not be construed as conflicting with section 42-5020.

J.

A person who is engaged in or conducting a business in two or more locations or under two or more business names shall procure a municipal privilege tax license for each location or business name regardless of whether all locations or business names are reported on a consolidated return.

K.

A person who is engaged in or conducting business at two or more locations or under two or more business names and who files a consolidated return under a single transaction privilege tax license number as provided by section 42-5020 is required to pay only a single municipal privilege tax license renewal fee for each local jurisdiction pursuant to subsection D of this section.

A person who is engaged in or conducting business at two or more locations or under two or more business names and who does not - 2 - H.B.

2382 file a consolidated return under a single license number is required to pay a license renewal fee for each location or license in a local jurisdiction.

L.

For the purposes of this chapter and chapter 6 of this title:

1.

Through December 31, 2018, an online lodging marketplace, as defined in section 42-5076, may register with the department for a license for the payment of taxes levied by this state and one or more counties, cities, towns or special taxing districts, at the election of the online lodging marketplace, for taxes due from an online lodging operator on any online lodging transaction facilitated by the online lodging marketplace, subject to sections 42-5076 and 42-6009.

2.

Beginning from and after December 31, 2018, an online lodging marketplace, as defined in section 42-5076, shall register with the department for a license for the payment of taxes levied by this state and one or more counties, cities, towns or special taxing districts for taxes due from an online lodging operator on any online lodging transaction facilitated by the online lodging marketplace, subject to sections 42-5076 and 42-6009.

M.

For the purposes of this chapter and chapter 6 of this title, a person who is licensed pursuant to title 32, chapter 20 and who files an electronic consolidated tax return for individual real properties under management on behalf of the property owners may be licensed with the department for the payment of taxes levied by this state and by any county, city or town with respect to those properties.

There is no fee for a license issued pursuant to this subsection.

N.

For the purposes of this chapter, a peer-to-peer car sharing program shall register with the department for a license for the payment of taxes levied by this state and one or more counties, cities, towns or special districts for taxes due from a shared vehicle owner on any shared vehicle transaction facilitated by the peer-to-peer car sharing program, subject to the limitations in section 28-9616.

A peer-to-peer car sharing program shall remit the surcharges established pursuant to sections 5-839 and 48-4234 only if the peer-to-peer car sharing program allows shared vehicle transactions that involve a vehicle for which the shared vehicle owner has not certified to the department pursuant to section 28-9616, subsection C that it is an individual-owned shared vehicle.

For the purposes of this subsection, "individual-owned shared vehicle", "peer-to-peer car sharing program", "shared vehicle owner" and "shared vehicle transaction" have the same meanings prescribed in section 28-9601.

O.

If a person violates this article or any rule adopted under this article, the department upon hearing may revoke any transaction privilege tax or municipal privilege tax license issued to the person.

The department shall provide ten days' written notice of the hearing, stating the time and place and requiring the person to appear and show cause why the license or licenses should not be revoked.

The department shall - 3 - H.B.

2382 provide written notice to the person of the revocation of the license.

The notices may be served personally or by mail pursuant to section 42-5037.

After revocation, the department shall not issue a new license to the person unless the person presents evidence satisfactory to the department that the person will comply with this article and with the rules adopted under this article.

The department may prescribe the terms under which a revoked license may be reissued.

P.

The department may revoke any transaction privilege tax or municipal privilege tax license issued to any person who fails for thirteen consecutive months to make and file a return required by this article on or before the due date or the due date as extended by the department unless the failure is due to a reasonable cause and not due to wilful neglect.

Q.

THE DEPARTMENT SHALL ESTABLISH AND MAINTAIN A TAXPAYER ASSISTANCE TEAM TO ENSURE TAXPAYERS ARE LEVYING THE CORRECT TRANSACTION PRIVILEGE TAX RATE AND SOURCING THE TRANSACTION TO THE CORRECT JURISDICTIONS.

THE TEAM SHALL SELECT AT RANDOM A SAMPLE OF TRANSACTION PRIVILEGE TAX LICENSES AND MUNICIPAL PRIVILEGE TAX LICENSES TO VERIFY THAT THE BUSINESS LOCATION IDENTIFIED ON THE LICENSE CORRESPONDS TO THE TRANSACTION PRIVILEGE TAX RATE AND SOURCE OF THE TRANSACTION USED BY THE TAXPAYER.

IF THE TEAM IDENTIFIES A TAXPAYER THAT IS NOT LEVYING THE CORRECT TRANSACTION PRIVILEGE TAX RATE OR IS NOT SOURCING THE TRANSACTION TO THE CORRECT JURISDICTION, THE TEAM SHALL NOTIFY THE TAXPAYER AND PROVIDE RESOURCES TO ASSIST THE TAXPAYER IN DETERMINING THE CORRECT RATE AND SOURCING INFORMATION FOR THAT TAXPAYER.

INFORMATION COLLECTED BY THE TAXPAYER ASSISTANCE TEAM MAY NOT BE USED FOR ENFORCEMENT PURPOSES.

Q.

R.

A person who violates any provision of this section is guilty of a class 3 misdemeanor.

Sec.

2.

Section 42-5040, Arizona Revised Statutes, is amended to read:

42-5040.

Sourcing of certain transactions involving tangible personal property;

definitions A.

Except as provided in section 42-5075, retail sales of tangible personal property shall be sourced as follows:

1.

To the seller's business location if the seller receives the order at a business location in this state AND THE SELLER REGULARLY CONDUCTS RETAIL SALES AT THAT BUSINESS LOCATION.

2.

Except as provided in section 42-5008.01, to the purchaser's location DELIVERY ADDRESS in this state if the seller receives DOES NOT RECEIVE the order at a business location outside IN this state WHERE THE SELLER REGULARLY CONDUCTS RETAIL SALES or, if there is no delivery address, to the purchaser's billing address.

B.

A shared vehicle transaction shall be sourced as follows:

1.

To the permanent street address of the registered shared vehicle owner if the shared vehicle is registered in this state.

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2382 2.

To the street address in this state where the shared vehicle owner resides while in this state if the shared vehicle is registered in another state or country.

3.

To the location of the shared vehicle at the car sharing start time if the shared vehicle owner does not reside in this state and the shared vehicle is registered in another state or country.

C.

For the purposes of subsection A of this section, an order is received when all of the PURCHASER'S information necessary to accept PROCESS the order has been received by or on behalf of the seller, regardless of FROM where the order is accepted, or approved OR DELIVERED.

The place of business or residence of the purchaser does not determine where the order is received.

D.

The gross receipts from leasing or renting tangible personal property shall be sourced as follows:

1.

To the lessor's business location if the lessor has a business location in this state.

2.

To the lessee's address if the lessor does not have a business location in this state or, if there is no lessee's address, to the lessee's billing address.

The gross receipts are taxable when the property is shipped, delivered or otherwise brought into this state for use in this state.

E.

For the purposes of this section:

1.

"Car sharing start time" has the same meaning prescribed in section 28-9601.

2.

"Lessee's address" means the residential address of an individual lessee and the primary business address of any other lessee.

3.

"Lessor's business location" means the business address that appears on the lessor's transaction privilege tax license.

4.

"Shared vehicle" has the same meaning prescribed in section 28-9601.

5.

"Shared vehicle owner" has the same meaning prescribed in section 28-9601.

6.

"Shared vehicle transaction" has the same meaning prescribed in section 28-9601.

Sec.

3.

-B. 5 - H.B.

2382 B.

THE TAXPAYER IS LIABLE FOR FAILING TO PAY THE CORRECT AMOUNT OF TAX IF THE FAILURE TO PAY THE CORRECT AMOUNT OF TAX WAS DUE TO AN- ERROR1 OTHER- THANH.B. AN ERROR IN SOURCING THE TRANSACTION.

2382 AN ERROR OTHER THAN AN ERROR IN SOURCING THE TRANSACTION.

Sec.APPROVED BY THE GOVERNOR APRIL 10, 2024.

4.FILED IN THE OFFICE OF THE SECRETARY OF STATE APRIL 10, 2024.

Department- of2 revenue;-

taxpayer education campaign;

report A.

On or before December 31, 2024, the department of revenue shall conduct a taxpayer education campaign to educate and obtain feedback from remote sellers and marketplace facilitators as defined in section 42-5001, Arizona Revised Statutes, and other transaction privilege tax license holders located in unincorporated areas of a county on issues related to - 6 - H.B.

2382 the correct use of transaction privilege tax rates and transaction sourcing methods.

B.

On or before March 31, 2025, the department of revenue shall submit a report on the taxpayer education campaign and the feedback the department received during the campaign to the governor, president of the senate and the speaker of the house of representatives and shall provide a copy of this report to the secretary of state.

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