§ 44-59-9 - Seller and third party liability. - Rhode Island Statutes

SECTION 44-59-9

   § 44-59-9  Seller and third partyliability. – (a) A certified service provider shall be the agent of a seller, with whom thecertified service provider has contracted, for the collection and remittance ofsales and use taxes. As the seller's agent, the certified service providershall be liable for sales and use tax due each member state on all salestransactions it processes for the seller except as set out in this section. Aseller that contracts with a certified service provider shall not be liable tothe state for sales or use tax due on transactions processed by the certifiedservice provider unless the seller misrepresented the type of items it sells orcommitted fraud. In the absence of probable cause to believe that the sellerhas committed fraud or made a material misrepresentation, the seller shall notbe subject to audit on the transactions processed by the certified serviceprovider. A seller shall be subject to audit for transactions not processed bythe certified service provider. The member states acting jointly may perform asystem check of the seller and review the seller's procedures to determine ifthe certified service provider's system is functioning properly and the extentto which the seller's transactions are being processed by the certified serviceprovider.

   (b) A person that provides a certified automated system shallbe responsible for the proper functioning of that system and shall be liable tothe state for underpayments of tax attributable to errors in the functioning ofthe certified automated system. A seller that uses a certified automated systemshall remain responsible and shall be liable to the state for reporting andremitting tax.

   (c) A seller that has a proprietary system for determiningthe amount of tax due on transactions and has signed an agreement establishinga performance standard for that system shall be liable for the failure of thesystem to meet the performance standard.