2018 -- H 7010

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LC003221

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     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2018

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A N   A C T

RELATING TO TAXATION -- SALES AND USE TAXES--ENFORCEMENT AND

COLLECTION

     

     Introduced By: Representative Joseph M. McNamara

     Date Introduced: January 03, 2018

     Referred To: House Finance

     It is enacted by the General Assembly as follows:

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     SECTION 1. Section 44-19-15.2 of the General Laws in Chapter 44-19 entitled "Sales

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and Use Taxes - Enforcement and Collection" is hereby amended to read as follows:

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     44-19-15.2. Flea markets.

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     (a) (1) Notwithstanding any other provision of law, all persons making retail sales at a

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flea market shall register and pay the sales tax as provided in this section.

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     (2) "Flea market" is defined as a place of business that provides space more than six (6)

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times a year under a single promoter's permit at the same location to two (2) or more people

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making retail sales of property, usually, but not exclusively, second-hand property that is not

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permanently displayed or stored at the flea market.

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     (3) Excluded from this definition of "flea market" are shows such as art shows, antique

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shows, industry, trade, and professional shows.

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     (b) (1) Persons engaging in the business of making retail sales at flea markets shall

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register and pay an annual registration fee of one hundred twenty dollars ($120), this fee being

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due on July 1 of each year. This registration fee is credited against that person's actual annual

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sales tax liability. This registration is valid at any location in the state during the period for which

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it is issued. In the event that the annual sales tax liability is less than one hundred twenty dollars

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($120), then the person is not required to file an annual sales tax return, but in no event shall any

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person receive a refund of any portion of the registration fee; provided, any person who possesses

 

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a valid retail sales permit pursuant to the provisions of §44-19-1 shall not be required to pay the

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annual registration fee required by this subsection, but that person shall be required to pay all

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taxes due pursuant to this section.

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     (2) Should any person's tax liability exceed one hundred twenty dollars ($120), then that

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person must file an annual return. The annual return is submitted upon forms prescribed, prepared

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and furnished by the tax division accounting for all sales or purchases taxable under this chapter

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during the preceding January 1 through December 31. The annual return is due on or before

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January 20 of the subsequent calendar year. Any person beginning business subsequent to

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January 1 is responsible for transmitting an annual return on or before January 20 of the

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subsequent calendar year for all months in which he or she made taxable sales or purchases

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through December 31 of the preceding year; or

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     (c) (1) Persons engaging in the business of making retail sales at flea markets, not on a

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permanent basis, may, at their option, register as follows:

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     (i) On a quarterly basis for a fee of forty dollars ($40.00). This registration is valid at any

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location in the state during the period for which it is used. In no event shall a refund be payable

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from the registration fee. This registration fee is credited against any person's actual sales tax

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liability;

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     (ii) On a monthly basis for a fee of ten dollars ($10.00). This registration fee is to be paid

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per location at which retail sales are made. In no event shall a refund be payable from the

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registration fee. This registration fee is credited against any person's actual sales tax liability; and

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     (iii) Persons registering on a quarterly or monthly basis shall file quarterly returns if their

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tax liability exceeds the amount of the registration fees paid during that quarter. The quarterly

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returns are submitted upon forms prescribed, prepared and furnished by the tax administrator,

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showing the gross sales, or purchases, as the case may be, arising from all sales or purchases

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taxable under this chapter during the preceding quarter. The quarterly return is due on or before

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the twentieth day of the subsequent month following the last day of the preceding quarterly

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period; and

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     (iv) Any person who possesses a valid retail sales permit pursuant to the provisions of

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§44-19-1 shall not be required to pay the annual registration fee provided for by this subsection,

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but that person shall be required to pay all taxes due pursuant to this section.

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     (2) All permits issued pursuant to this section must be prominently displayed at the

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retailer's booth.

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     (d) At the time of transmitting any of the returns required under paragraph (c)(1)(iii) of

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this section to the tax administrator, the retailer shall remit with the return the amount of tax due,

 

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and failure to remit the tax or to file the return causes the tax to become delinquent. The failure to

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remit the tax or to file the returns subjects the retailer to the penalty provided in this title for

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delinquent tax payments to the tax administrator.

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     (e) (1) The flea market operator/promoter is responsible for ensuring that all retailers

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operating at his or her flea market are properly registered with the division of taxation. The flea

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market promoter/operator is empowered to accept applications for registration on a monthly basis

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from retailers not otherwise registered, along with all fees required under this section. The flea

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market promoter/operator shall supply the retailer with the application/permit, along with

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evidence of the amount of fee submitted. This permit shall be displayed by the retailer and serves

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as evidence of proper registration.

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     (2) The flea market promoter/operator shall submit the fees collected under this section

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within three (3) business days of receipt of fees on a form prescribed, prepared and furnished by

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the division of taxation. The failure to remit the fee or to file the return subjects the flea market

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promoter/operator to the penalty provided in this title for delinquent tax payments to the tax

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administrator.

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     (f) There is a penalty upon the retailer of ten dollars ($10.00) per booth per day for

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violations of this section. The division of taxation also imposes a penalty upon the flea market

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promoter/operator of twenty dollars ($20.00) per booth per day, up to a maximum fine of two

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hundred dollars ($200) per day at any location where it is determined by the tax administrator that

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the flea market operator has been negligent in allowing retailers to operate at the flea market

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without proper registration. For the purposes of this section, "negligent" includes, but is not

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limited to, any failure of the flea market promoter/operator to make a reasonable attempt to

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ensure that every dealer renting space from him or her is properly registered for tax purposes. A

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determination by the tax administrator that a flea market promoter/operator has been negligent is

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deemed presumptively correct. That determination may be rebutted only if the flea market

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promoter/operator makes a showing of due care. As used in this subdivision, "due care" means

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that the flea market promoter/operator has made every reasonable effort to ensure that every

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retailer renting space from him or her is properly registered for tax purposes.

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     (g) Persons selling only nontaxable items such as clothing are required to register for a

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special permit and display the permit but are not required to pay a registration fee.

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     (h) The provisions of this section do not apply to retailers selling prepared foods at flea

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markets for consumption.

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     (i) Any person who possesses a retail sales permit pursuant to the provisions §44-19-1

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shall be required to obtain a flea market vendor's permit to make sales at the flea markets so long

 

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as the retail sales permit is in force and effect; provided, any person utilizing a retail sales permit

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in lieu of a flea market vendor's permit shall be obligated to display the retail sales permit in the

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same manner as any other permit required by this section.

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     SECTION 2. This act shall take effect upon passage.

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EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N   A C T

RELATING TO TAXATION -- SALES AND USE TAXES--ENFORCEMENT AND

COLLECTION

***

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     This act would provide that any person who has a retail sales permit would not be

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required to pay a separate registration fee to make sales at flea markets; provided, however, the

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person would remain responsible to pay all taxes due as a result of sales at a flea market.

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     This act would take effect upon passage.

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