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Tax Law

New to the Market: Georgia Enacts Marketplace Facilitator Bill

On January 30, 2020, Governor Kemp signed Georgia’s marketplace facilitator bill, H.B. 276, into law. Effective April 1, 2020, the law will require marketplace facilitators to collect and remit sales and use tax on behalf of marketplace sellers. It will apply to marketplace facilitators with sales in excess of $100,000 in the state.

A marketplace facilitator is defined as a person that contracts with a seller to facilitate a retail sale on behalf of such seller to: (i) provide a service that makes available or facilitates a retail sale including promoting, marketing, taking orders or reservations, providing the physical or electronic infrastructure connecting sellers and purchasers, or otherwise similarly assisting the seller, but excluding merely processing the payment; and (ii) collecting, charging, processing, or otherwise similarly facilitating payment .

The law contains exceptions for franchisors with sales in excess of $500 million nationwide and for facilitated sales of dealers with sales in excess of $500 million in the state. The bill also prohibits class actions against marketplace facilitators arising from the facilitator’s overpayments of sales taxes.

Although Georgia previously enacted bright-line nexus standards under Wayfair, Georgia’s initial marketplace legislation failed to pass in last year’s legislative session.