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Colorado Announces 6-Month Moratorium for Online Sales Tax Changes

Last week, the Colorado Department of Revenue issued the following statement as an outcome to their November 30th rule making hearing. The hearing was about the Emergency Rules announced in September to implement the US Supreme Court's decision in the South Dakota v Wayfair court case. Here is the full statement from Mike Hartman, Executive Director of CDOR:

“As part of our rulemaking process to implement sales tax rules for in-state and out-of-state retailers, we have heard from legislators and the business community, and the Department of Revenue agrees it is important for the state to take the time to get this right.

“As such, the Department is extending the automatic reprieve for Colorado businesses and out-of-state retailers to comply with the emergency rules from the current March 31, 2019 deadline to May 31, 2019. We will evaluate the need for another extension as May 31 nears. This additional time will give the state legislature an opportunity to find innovative solutions to streamline and simplify our sales tax collection laws in accordance with the wishes of the residents of Colorado.  “Despite the automatic reprieve, the Department requests that businesses with the sophistication and capability to collect and remit sales tax on internet sales based on where the good or service is being delivered do so as quickly as possible in advance of the May 31, 2019 enforcement deadline. The Department has upgraded its systems and processes to make compliance as simple as possible. We will continue to engage the business community to address remaining concerns. 

“This is an opportunity to simplify sales tax for all parties: for businesses that collect and remit sales tax, for customers who pay it, and for those of us in state government whose obligation it is to carry out the tax laws passed by the state legislature. No one desires a streamlined and simplified sales tax collection and compliance system more than the Department of Revenue.”

We thank our clients, trade associations and taxpayers who took the time to submit comments about the impractical application of the Emergency Rules, which were originally scheduled to take effect on December 1, 2018. 

We encourage our clients to take the next step by contacting their local legislators in the Colorado House and Senate to seek a streamlined solution to this issue. The next legislative session begins January 4, 2019. To find your local legislative representative, use the following link:

Find Your Local Colorado Representatives


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