Kansas: onerous sales tax law

Neil Diamond and Deep Purple

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This is a bit arcane, especially if you’re not in the United States. On October 1, “Texas and Kansas will be the latest states to tax remote sales – think online/mail order purchases – “leaving only two holdouts (Florida and Missouri) among the 45 states with sales tax.”

A business “must have nexus — a connection with a state — for the state to require the business to collect and remit sales tax.” It used to be that “sales tax nexus was based solely on physical presence: States couldn’t require an out-of-state seller with no physical presence in the state (remote seller) to collect and remit sales tax.”

Got that?

The Supreme Court’s 2018 “ruling in South Dakota v. Wayfair, Inc. enables states to tax remote sales… Wayfair authorizes states to require remote sellers in one state to collect and remit sales tax” based on their sales volume or the number of transactions in another state, what they call “economic nexus.”

OK.

Up until now, every state has had a minimum dollar amount or number of transactions before a business, say in New York, had to collect sales tax from Connecticut residents. New York business then sends that sales tax money to Connecticut, but only if that New York business had 200 transactions AND $100,000 in sales in Connecticut.

This generally exempted tiny businesses, such as most folks with an Etsy account.

“Many retailers are hoping Kansas will enact a small seller exception because as of this writing, it doesn’t have one.” This would be onerous for someone outside of Kansas selling online products to people in Kansas. This is especially true because each state has different sales tax rates and rules.

Why would the state enact such a draconian measure? The state is recovering from the multiple rounds of devastating budget cuts that occurred under former governor Sam Brownback.

On the other hand, there are the Eight Wonders of Kansas. There’s the world’s largest hand-dug well, the largest freshwater marsh in the interior U.S. and a massive underground salt museum.

KS Kansas – Abbreviation is the first and last letters, traditionally Kan. or Kans. Its capital is Topeka and its largest city is Wichita. I have never been there.

My favorite song by the group Kansas is Carry On, Wayward Son (#11 pop in 1977).

KY Kentucky – abbreviation the first and last letters, traditionally Ky., Ken., or Kent. Kentucky is one of four states designated as a Commonwealth.

I’ve been to Kentucky once, I think, to an ASBDC conference in 1993(?)

My favorite song about the state is Kentucky Woman, recorded by Neil Diamond, who wrote it (#22 pop hit in 1967), and Deep Purple (#38 in 1968). Considering the frequency I heard both versions in the day, their disappointing chart action surprises me.

The letter K for ABC Wednesday.