§ 105-164.42E. Agreement requirements. - North Carolina Statutes

§ 105‑164.42E. Agreement requirements.

The Secretary may not enterinto the Agreement unless the Agreement requires each state to abide by thefollowing requirements:

(1)        Uniform state rate.– The Agreement must set restrictions to achieve more uniform state ratesthrough the following:

a.         Limiting the numberof state rates.

b.         Limiting maximums onthe amount of state tax that is due on a transaction.

c.         Limiting thresholdson the application of a state tax.

(2)        Uniform standards. –The Agreement must establish uniform standards for all of the following:

a.         The sourcing oftransactions to taxing jurisdictions.

b.         The administrationof exempt sales.

c.         The allowances aseller can take for bad debts.

d.         Sales and use taxreturns and remittances.

(3)        Uniform definitions.– The Agreement must require states to develop and adopt uniform definitions ofsales and use tax terms. The definitions must enable a state to preserve itsability to make policy choices not inconsistent with the uniform definitions.

(4)        Centralregistration. – The Agreement must provide a central, electronic registrationsystem that allows a seller to register to collect and remit sales and usetaxes for all signatory states.

(5)        No nexusattribution. – The Agreement must provide that registration with the centralregistration system and the collection of sales and use taxes in the signatorystates will not be used as a factor in determining whether the seller has nexuswith a state for any tax.

(6)        Local sales and usetaxes. – The Agreement must provide for reduction of the burdens of complyingwith local sales and use taxes through one or more of the following:

a.         Restrictingvariances between the state and local tax bases.

b.         Requiring states toadminister any sales and use taxes levied by local jurisdictions within thestate so that sellers collecting and remitting these taxes will not have toregister or file returns with, remit funds to, or be subject to independentaudits from local taxing jurisdictions.

c.         Restricting thefrequency of changes in the local sales and use tax rates and setting effectivedates for the application of local jurisdictional boundary changes to localsales and use taxes.

d.         Providing notice ofchanges in local sales and use tax rates and of changes in the boundaries oflocal taxing jurisdictions.

(7)        Monetary allowances.– The Agreement must outline any monetary allowances that are to be provided bythe states to sellers or certified service providers.

(8)        State compliance. –The Agreement must require each state to certify compliance with the terms ofthe Agreement before becoming a member and to maintain compliance, under thelaws of the member state, with all provisions of the Agreement while a member.

(9)        Consumer privacy. –The Agreement must require each state to adopt a uniform policy for certifiedservice providers that protects the privacy of consumers and maintains theconfidentiality of tax information. (2001‑347, s. 1.3; 2005‑276, s. 33.31.)