Arizona Transaction Privilege Tax 2017 Updates
by January 21, 2017
For a long time now Arizona has been promising to simplify their transaction privilege tax (TPT – Arizona’s version of sales tax) system, and we’re happy to say that the day has finally arrived – for better or for worse.
Arizona Transaction Privilege Tax: What has Changed?
Centralized Reporting and Filing
Starting January 1, 2017, the Arizona Department of Revenue is now the single point of administration and collection of Arizona TPT. If you are an Arizona sales tax filer, this means that you will file any sales tax returns due after January 1, 2017 at the Arizona Department of Revenue’s AZTaxes.gov website.
Keep in mind that any TPT collected before January 1, 2017 still needs to be filed in the old manner (with the state and with any cities where you might be registered.)
Example:
You are an experienced Arizona seller and have always filed two Arizona TPT returns – one with the state and one for the city of Phoenix. With this change, you will only need to file one TPT return in Arizona, no matter where our transactions took place.
License Renewal Fees Increasing
While on one hand reporting and filing is getting easier, there’s a catch – you still need to register for a TPT permit in each of Arizona’s non-program cities where you make sales, and the fee for renewing that license is going up, up, up. TaxJar customers have reported paying around $350 to renew their licenses for all Arizona jurisdictions. Ouch. (TPT permit renewals were due January 1, 2017. You can find out more about renewing your TPT licenses here.)
Standardized Business and Deduction Codes
Sellers who have filed in more than one Arizona jurisdiction in the past know that filing itself was a veritable Wild West. Tax forms were not standardized, so you had to read each form carefully to make sure you were complying. Centralized Arizona TPT will change all that. Now business codes and deduction codes will be standardized across all Arizona jurisdictions.
Arizona TPT and Amazon FBA
A couple of months ago we brought you new of two new letter rulings in Arizona that seemed to say that 3rd party sellers who only store inventory in Arizona are not responsible for TPT. Though Amazon FBA was not mentioned by name, the circumstances detailed in both letter rulings fit the FBA business model. You can read more about the Arizona letter rulings, including their entire text, here.
As an FBA seller, it is up to you whether or not you continue to collect and remit sales tax in Arizona. As for right now, Amazon has not made a statement as to whether they will now collect sales tax on behalf of FBA sellers. We highly recommend contacting a good sales tax accountant if you’re wavering on what to do here.
Please note: This blog is for informational purposes only. Be advised that sales tax rules and laws are subject to change at any time. For specific sales tax advice regarding your business, contact a tax advisor.
