ST 2009-01 - Sales and Use Tax: Vendor Compensation – Issued
July 2009
Recent legislation (Am. Sub. H.B.429 of the 127th Ohio
General Assembly) requires vendors (retailers) of tangible
personal property that switched to tax collections based on
delivery (destination-based sourcing), or were initially set
up to collect tax based on delivery, in Ohio to charge the
sales tax rate that exists at the Ohio location where the
vendor receives an order for the sale of such property
(origin-based sourcing) as opposed to where the property is
delivered, if the receipt of the property by the consumer
takes place in Ohio. This change must be made by
January 1, 2010, but vendors who desire to do so may make the
change at any time prior to that date.
Vendors that switched from origin-based sourcing to
destination-based sourcing under the prior law may be
eligible to apply for one-time compensation to offset some of
the cost they incur associated with their compliance
efforts.
In order to be eligible for the compensation, a vendor must
have received temporary compensation for the original switch
from origin-based sourcing to destination-based sourcing
under section 5739.123 of the Revised Code. The compensation
shall be a one-time payment equal to the actual total costs
the vendor incurred in converting back to the origin-based
sourcing requirements, subject to the reimbursement caps in
the next paragraph.
The compensation can not exceed one thousand dollars for
vendors that were required by law to convert to
destination-based sourcing prior to April 18, 2008, or six
hundred dollars for vendors that irrevocably elected to
convert to destination-based sourcing prior to that
date. The vendor shall not receive compensation that
exceeds its total cost of complying with the origin-based
sourcing requirements.
Compensation can be applied for by completing and filing an
Application for Compensation of Expenses Incurred for Origin
Based Sourcing Tax Collections (form ST-AR-OBS).
Vendors are required to submit the following information with
their ST-AR-OBS:
- a numerical list of all active vendor’s licenses for the
entity noted on line 4 of page 1 of the reimbursement
application;
- copies of invoice(s) or other documentation
reflecting the expenses incurred to switch to origin-based
sourcing;
- copies of canceled checks or other proof that the
invoices or expenses were paid in full.
Questions?
If you have any questions regarding this information release,
please contact Taxpayer Services at 1-888-405-4039, or e-mail
us through our Web site: tax.ohio.gov.
OHIO RELAY SERVICES FOR
THE HEARING OR SPEECH IMPAIRED
Phone: 1-800-750-0750