As Passed by the Senate

127th General Assembly Regular Session 2007-2008

Sub. S. B. No. 160

Senator Amstutz 

Cosponsors: Senators Schuring, Spada, Sawyer, Miller, D., Mumper, Fedor, Schuler, Stivers, Wilson, Harris 

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A BILL

To amend sections 5739.033, 5739.035, 5739.123,

1

5741.03, and 5741.05 and to enact section 5740.10

2

of the Revised Code to authorize retail vendors

3

with annual delivery sales in Ohio of less than

4

$500,000 to continue to use origin-based situsing

5

rules for determining the appropriate sales tax

6

jurisdiction in which a sale is taxable, to

7

authorize all retail vendors currently using

8

origin-based situsing to continue to do so if the

9

Tax Commissioner determines that the Streamlined

10

Sales and Use Tax Agreement does not allow

11

origin-based situsing by vendors with delivery

12

sales of less than $500,000, to authorize

13

out-of-state sellers with annual delivery sales in

14

Ohio of less than $500,000 to collect Ohio use

15

taxes at a single uniform rate if the Commissioner

16

makes that determination, and to provide for the

17

distribution of use tax collected at a single

18

uniform rate to counties and transit authorities.

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BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO:

Section 1. That sections 5739.033, 5739.035, 5739.123,	20
5741.03, and 5741.05 be amended and section 5740.10 of the Revised	21
Code be enacted to read as follows:	22

Sec. 5739.033.  (A) Except as provided in division (B) of	23
this section, divisions (C) to (I) of this section apply to sales	24
made on and after May 1, 2006. Sales made before May 1, 2006, are	25
subject to section 5739.035 of the Revised Code. On and after	26
January 1, 2005, anyJanuary 1, 2008. Any vendor maypreviously	27
required to comply with divsions (C) to (I) of this section and	28
any vendor that irrevocably electelects to comply with divisions	29
(C) to (I) of this section for all of the vendor's sales and	30
places of business in this state shall continue to source its	31
sales under those divisions.	32

The amount of tax due pursuant to sections 5739.02, 5739.021,	33
5739.023, and 5739.026 of the Revised Code is the sum of the taxes	34
imposed pursuant to those sections at the sourcing location of the	35
sale as determined under this section or, if applicable, under	36
division (C) of section 5739.031 or section 5739.034 of the	37
Revised Code, or at the situs of the sale as determined under	38
section 5739.035 of the Revised Code. This section applies only to	39
a vendor's or seller's obligation to collect and remit sales taxes	40
under section 5739.02, 5739.021, 5739.023, or 5739.026 of the	41
Revised Code or use taxes under section 5741.02, 5741.021,	42
5741.022, or 5741.023 of the Revised Code. Division (A) of this	43
section does not apply in determining the jurisdiction for which	44
sellers are required to collect the use tax under section 5741.05	45
of the Revised Code. This section does not affect the obligation	46
of a consumer to remit use taxes on the storage, use, or other	47
consumption of tangible personal property or on the benefit	48
realized of any service provided, to the jurisdiction of that	49
storage, use, or consumption, or benefit realized.	50

(B)(1) As used in this division:

51

(a) "Delivery sale" means the taxable sale of tangible	52
personal property or a service that is received by a consumer, or	53
a donee designated by the consumer, in a taxing jurisdiction that	54
is not the taxing jurisdiction in which the vendor has a fixed	55
place of business.	56

(b) "Agreement" has the same meaning as in section 5740.01 of	57
the Revised Code.	58

(c) "Governing board" has the same meaning as in section	59
5740.02 of the Revised Code.	60

(2)(a) AIf the tax commissioner does not make the	61
certification under section 5740.10 of the Revised Code, a vendor	62
that is not required by division (A) of this section to situs	63
sales under divisions (C) to (I) of this section on the date of	64
the commissioner's certification may continue after that date to	65
situs its sales under section 5739.035 of the Revised Code unless	66
it is required, under division (B)(5) of this section, to situs	67
its sales under divisions (C) to (I) of this section.	68

(3) Except as otherwise provided in divisions (B)(4) and (5)	69
of this section, a vendor with total delivery sales within this	70
state in prior calendar year 2005 that areyears, beginning with	71
calendar year 2007, of less than thirty millionfive hundred	72
thousand dollars may continue to situs its sales under section	73
5739.035 of the Revised Code from May 1, 2006, through April 30,	74
2007, except that, if the tax commissioner does not enter a	75
determination in the commissioner's journal under division	76
(B)(2)(b) of this section, those dates shall be May 1, 2006,	77
through December 31, 2007.	78

(b) On or before February 1, 2007, the tax commissioner shall	79
determine whether certified service provider services are being	80
provided by the governing board of the streamlined sales and use	81
tax agreement for all delivery sales. If the commissioner	82
determines that such services are being so provided, the	83
commissioner shall enter the determination in the commissioner's	84
journal and shall provide notice of the determination on the	85
department of taxation's official internet web site. If the	86
commissioner makes such an entry in the journal, then a vendor	87
with total delivery sales in calendar year 2006 that are less than	88
five million dollars may continue to situs its sales under section	89
5739.035 of the Revised Code from May 1, 2007, through December	90
31, 2007.	91

(3) Beginning January 1, 2008, all vendors shall source their	92
sales under divisions (C) to (I) of this section.	93

(4) Once a vendor has total delivery sales that exceed the	94
dollar amount in division (B)(2)(a) or (b) of this sectionin this	95
state of five hundred thousand dollars or more for a prior	96
calendar year, the vendor shall source its sales under divisions	97
(C) to (I) of this section and shall continue to source its sales	98
under those divisions, regardless of the amount of the vendor's	99
total delivery sales in future years.	100

(5) A vendor permitted under division (B)(3) of this section	101
to situs its sales under section 5739.035 of the Revised Code that	102
fails to provide, absent a clerical error, the notices required	103
under division (I)(1) of section 5739.035 of the Revised Code	104
shall situs all subsequent sales as required under divisions (C)	105
to (I) of this section.	106

(C) Except for sales, other than leases, of titled motor	107
vehicles, titled watercraft, or titled outboard motors as provided	108
in section 5741.05 of the Revised Code, or as otherwise provided	109
in this section and section 5739.034 of the Revised Code, all	110
sales shall be sourced as follows:	111

(1) If the consumer or a donee designated by the consumer	112
receives tangible personal property or a service at a vendor's	113
place of business, the sale shall be sourced to that place of	114
business.	115

(2) When the tangible personal property or service is not	116
received at a vendor's place of business, the sale shall be	117
sourced to the location known to the vendor where the consumer or	118
the donee designated by the consumer receives the tangible	119
personal property or service, including the location indicated by	120
instructions for delivery to the consumer or the consumer's donee.	121

(3) If divisions (C)(1) and (2) of this section do not apply,	122
the sale shall be sourced to the location indicated by an address	123
for the consumer that is available from the vendor's business	124
records that are maintained in the ordinary course of the	125
vendor's business, when use of that address does not constitute	126
bad faith.	127

(4) If divisions (C)(1), (2), and (3) of this section do not	128
apply, the sale shall be sourced to the location indicated by an	129
address for the consumer obtained during the consummation of the	130
sale, including the address associated with the consumer's payment	131
instrument, if no other address is available, when use of that	132
address does not constitute bad faith.	133

(5) If divisions (C)(1), (2), (3), and (4) of this section do	134
not apply, including in the circumstance where the vendor is	135
without sufficient information to apply any of those divisions,	136
the sale shall be sourced to the address from which tangible	137
personal property was shipped, or from which the service was	138
provided, disregarding any location that merely provided the	139
electronic transfer of the property sold or service provided.	140

(6) As used in division (C) of this section, "receive" means	141
taking possession of tangible personal property or making first	142
use of a service. "Receive" does not include possession by a	143
shipping company on behalf of a consumer.	144

(D)(1)(a) Notwithstanding divisions (C)(1) to (5) of this	145
section, a business consumer that is not a holder of a direct	146
payment permit granted under section 5739.031 of the Revised Code,	147
that purchases a digital good, computer software, except computer	148
software received in person by a business consumer at a vendor's	149
place of business, or a service, and that knows at the time of	150
purchase that such digital good, software, or service will be	151
concurrently available for use in more than one taxing	152
jurisdiction shall deliver to the vendor in conjunction with its	153
purchase an exemption certificate claiming multiple points of use,	154
or shall meet the requirements of division (D)(2) of this section.	155
On receipt of the exemption certificate claiming multiple points	156
of use, the vendor is relieved of its obligation to collect, pay,	157
or remit the tax due, and the business consumer must pay the tax	158
directly to the state.	159

(b) A business consumer that delivers the exemption	160
certificate claiming multiple points of use to a vendor may use	161
any reasonable, consistent, and uniform method of apportioning the	162
tax due on the digital good, computer software, or service that is	163
supported by the consumer's business records as they existed at	164
the time of the sale. The business consumer shall report and pay	165
the appropriate tax to each jurisdiction where concurrent use	166
occurs. The tax due shall be calculated as if the apportioned	167
amount of the digital good, computer software, or service had been	168
delivered to each jurisdiction to which the sale is apportioned	169
under this division.	170

(c) The exemption certificate claiming multiple points of use	171
shall remain in effect for all future sales by the vendor to the	172
business consumer until it is revoked in writing by the business	173
consumer, except as to the business consumer's specific	174
apportionment of a subsequent sale under division (D)(1)(b) of	175
this section and the facts existing at the time of the sale.	176

(2) When the vendor knows that a digital good, computer	177
software, or service sold will be concurrently available for use	178
by the business consumer in more than one jurisdiction, but the	179
business consumer does not provide an exemption certificate	180
claiming multiple points of use as required by division (D)(1) of	181
this section, the vendor may work with the business consumer to	182
produce the correct apportionment. Governed by the principles of	183
division (D)(1)(b) of this section, the vendor and business	184
consumer may use any reasonable, but consistent and uniform,	185
method of apportionment that is supported by the vendor's and	186
business consumer's books and records as they exist at the time	187
the sale is reported for purposes of the taxes levied under this	188
chapter. If the business consumer certifies to the accuracy of the	189
apportionment and the vendor accepts the certification, the vendor	190
shall collect and remit the tax accordingly. In the absence of bad	191
faith, the vendor is relieved of any further obligation to collect	192
tax on any transaction where the vendor has collected tax pursuant	193
to the information certified by the business consumer.	194

(3) When the vendor knows that the digital good, computer	195
software, or service will be concurrently available for use in	196
more than one jurisdiction, and the business consumer does not	197
have a direct pay permit and does not provide to the vendor an	198
exemption certificate claiming multiple points of use as required	199
in division (D)(1) of this section, or certification pursuant to	200
division (D)(2) of this section, the vendor shall collect and	201
remit the tax based on division (C) of this section.	202

(4) Nothing in this section shall limit a person's obligation	203
for sales or use tax to any state in which a digital good,	204
computer software, or service is concurrently available for use,	205
nor limit a person's ability under local, state, or federal law,	206
to claim a credit for sales or use taxes legally due and paid to	207
other jurisdictions.	208

(E) A person who holds a direct payment permit issued under	209
section 5739.031 of the Revised Code is not required to deliver an	210
exemption certificate claiming multiple points of use to a vendor.	211
But such permit holder shall comply with division (D)(2) of this	212
section in apportioning the tax due on a digital good, computer	213
software, or a service for use in business that will be	214
concurrently available for use in more than one taxing	215
jurisdiction.	216

(F)(1) Notwithstanding divisions (C)(1) to (5) of this	217
section, the consumer of direct mail that is not a holder of a	218
direct payment permit shall provide to the vendor in conjunction	219
with the sale either an exemption certificate claiming direct mail	220
prescribed by the tax commissioner, or information to show the	221
jurisdictions to which the direct mail is delivered to recipients.	222

(2) Upon receipt of such exemption certificate, the vendor is	223
relieved of all obligations to collect, pay, or remit the	224
applicable tax and the consumer is obligated to pay that tax on a	225
direct pay basis. An exemption certificate claiming direct mail	226
shall remain in effect for all future sales of direct mail by the	227
vendor to the consumer until it is revoked in writing.	228

(3) Upon receipt of information from the consumer showing the	229
jurisdictions to which the direct mail is delivered to recipients,	230
the vendor shall collect the tax according to the delivery	231
information provided by the consumer. In the absence of bad faith,	232
the vendor is relieved of any further obligation to collect tax on	233
any transaction where the vendor has collected tax pursuant to the	234
delivery information provided by the consumer.	235

(4) If the consumer of direct mail does not have a direct	236
payment permit and does not provide the vendor with either an	237
exemption certificate claiming direct mail or delivery information	238
as required by division (F)(1) of this section, the vendor shall	239
collect the tax according to division (C)(5) of this section.	240
Nothing in division (F)(4) of this section shall limit a	241
consumer's obligation to pay sales or use tax to any state to	242
which the direct mail is delivered.	243

(5) If a consumer of direct mail provides the vendor with	244
documentation of direct payment authority, the consumer shall not	245
be required to provide an exemption certificate claiming direct	246
mail or delivery information to the vendor.	247

(G) If the vendor provides lodging to transient guests as	248
specified in division (B)(2) of section 5739.01 of the Revised	249
Code, the sale shall be sourced to the location where the lodging	250
is located.	251

(H)(1) As used in this division and division (I) of this	252
section, "transportation equipment" means any of the following:	253

(a) Locomotives and railcars that are utilized for the	254
carriage of persons or property in interstate commerce.	255

(b) Trucks and truck-tractors with a gross vehicle weight	256
rating of greater than ten thousand pounds, trailers,	257
semi-trailers, or passenger buses that are registered through the	258
international registration plan and are operated under authority	259
of a carrier authorized and certificated by the United States	260
department of transportation or another federal authority to	261
engage in the carriage of persons or property in interstate	262
commerce.	263

(c) Aircraft that are operated by air carriers authorized and	264
certificated by the United States department of transportation or	265
another federal authority to engage in the carriage of persons or	266
property in interstate or foreign commerce.	267

(d) Containers designed for use on and component parts	268
attached to or secured on the items set forth in division	269
(H)(1)(a), (b), or (c) of this section.	270

(2) A sale, lease, or rental of transportation equipment	271
shall be sourced pursuant to division (C) of this section.	272

(I)(1) A lease or rental of tangible personal property that	273
does not require recurring periodic payments shall be sourced	274
pursuant to division (C) of this section.	275

(2) A lease or rental of tangible personal property that	276
requires recurring periodic payments shall be sourced as follows:	277

(a) In the case of a motor vehicle, other than a motor	278
vehicle that is transportation equipment, or an aircraft, other	279
than an aircraft that is transportation equipment, such lease or	280
rental shall be sourced as follows:	281

(i) An accelerated tax payment on a lease or rental taxed	282
pursuant to division (A)(2) of section 5739.02 of the Revised Code	283
shall be sourced to the primary property location at the time the	284
lease or rental is consummated. Any subsequent taxable charges on	285
the lease or rental shall be sourced to the primary property	286
location for the period in which the charges are incurred.	287

(ii) For a lease or rental taxed pursuant to division (A)(3)	288
of section 5739.02 of the Revised Code, each lease or rental	289
installment shall be sourced to the primary property location for	290
the period covered by the installment.	291

(b) In the case of a lease or rental of all other tangible	292
personal property, other than transportation equipment, such lease	293
or rental shall be sourced as follows:	294

(i) An accelerated tax payment on a lease or rental that is	295
taxed pursuant to division (A)(2) of section 5739.02 of the	296
Revised Code shall be sourced pursuant to division (C) of this	297
section at the time the lease or rental is consummated. Any	298
subsequent taxable charges on the lease or rental shall be sourced	299
to the primary property location for the period in which the	300
charges are incurred.	301

(ii) For a lease or rental that is taxed pursuant to division	302
(A)(3) of section 5739.02 of the Revised Code, the initial lease	303
or rental installment shall be sourced pursuant to division (C) of	304
this section. Each subsequent installment shall be sourced to the	305
primary property location for the period covered by the	306
installment.	307

(3) As used in division (I) of this section, "primary	308
property location" means an address for tangible personal property	309
provided by the lessee or renter that is available to the lessor	310
or owner from its records maintained in the ordinary course of	311
business, when use of that address does not constitute bad faith.	312

Sec. 5739.035. This section only applies to sales that are	313
required tomay be sitused under this section pursuant to division	314
(A) or (B) of section 5739.033 of the Revised Code.	315

(A) Except as otherwise provided in this section, the situs	316
of all sales is the vendor's place of business.	317

(1) If the consumer or the consumer's agent takes possession	318
of the tangible personal property at a place of business of the	319
vendor where the purchase contract or agreement was made, the	320
situs of the sale is that place of business.	321

(2) If the consumer or the consumer's agent takes possession	322
of the tangible personal property other than at a place of	323
business of the vendor, or takes possession at a warehouse or	324
similar facility of the vendor, the situs of the sale is the	325
vendor's place of business where the purchase contract or	326
agreement was made or the purchase order was received.	327

(3) If the vendor provides a service specified in division	328
(B)(3)(a), (b), (c), (d), (n), (o), (q), (r), or (s) of section	329
5739.01 or makes a sale specified in division (B)(8) of section	330
5739.01 of the Revised Code, the situs of the sale is the vendor's	331
place of business where the service is performed or the contract	332
or agreement for the service was made or the purchase order was	333
received.	334

(B) If the vendor is a transient vendor as specified in	335
division (B) of section 5739.17 of the Revised Code, the situs of	336
the sale is the vendor's temporary place of business or, if the	337
transient vendor is the lessor of titled motor vehicles, titled	338
watercraft, or titled outboard motors, at the location where the	339
lessee keeps the leased property.	340

(C) If the vendor makes sales of tangible personal property	341
from a stock of goods carried in a motor vehicle, from which the	342
purchaser makes selection and takes possession, or from which the	343
vendor sells tangible personal property the quantity of which has	344
not been determined prior to the time the purchaser takes	345
possession, the situs of the sale is the location of the motor	346
vehicle when the sale is made.	347

(D) If the vendor is a delivery vendor as specified in	348
division (D) of section 5739.17 of the Revised Code, the situs of	349
the sale is the place where the tangible personal property is	350
delivered, where the leased property is used, or where the service	351
is performed or received.	352

(E) If the vendor provides a service specified in division	353
(B)(3)(e), (g), (h), (j), (k), (l), (m), (p), or (t) of section	354
5739.01 of the Revised Code, the situs of the sale is the location	355
of the consumer where the service is performed or received.	356

(F) If the vendor provides lodging to transient guests as	357
specified in division (B)(2) of section 5739.01 of the Revised	358
Code, the situs of the sale is the location where the lodging is	359
located.	360

(G) If the vendor sells a warranty, maintenance or service	361
contract, or similar agreement as specified in division (B)(7) of	362
section 5739.01 of the Revised Code and the vendor is a delivery	363
vendor, the situs of the sale is the location of the consumer. If	364
the vendor is not a delivery vendor, the situs of the sale is the	365
vendor's place of business where the contract or agreement was	366
made, unless the warranty or contract is a component of the sale	367
of a titled motor vehicle, titled watercraft, or titled outboard	368
motor, in which case the situs of the sale is the county of	369
titling.	370

(H) Except as otherwise provided in this division, if the	371
vendor sells a prepaid authorization number or a prepaid telephone	372
calling card, the situs of the sale is the vendor's place of	373
business and shall be taxed at the time of sale. If the vendor	374
sells a prepaid authorization number or prepaid telephone calling	375
card through a telephone call, electronic commerce, or any other	376
form of remote commerce, the situs of the sale is the consumer's	377
shipping address, or, if there is no item shipped, at the	378
consumer's billing address.	379

(I) Division (I) of this section applies only if the tax	380
commissioner makes the certification provided under section	381
5740.10 of the Revised Code.	382

(1) In each delivery sale by a vendor permitted to situs its	383
sales under this section, the vendor shall clearly indicate on	384
the invoice or other similar document provided to the purchaser	385
at the time of the sale that the vendor is a vendor permitted to	386
situs its sales under this section.	387

(2) A purchaser that receives tangible personal property or	388
services in a delivery sale from a vendor permitted to situs its	389
sales under this section may claim a refund of the tax the vendor	390
collected and remitted on the sale in an amount equal to the	391
excess of the tax collected and remitted over the tax that would	392
have been due if the sale had been sitused to the tax jurisdiction	393
in which the purchaser received the property or service.	394

A refund is authorized under this division only if the	395
invoice or other similar document provided to the purchaser at the	396
time of the sale includes the notice required under division	397
(I)(1) of this section.	398

Refunds shall be filed directly with the tax commissioner and	399
claimed in the manner prescribed by section 5739.07 of the	400
Revised Code.	401

(3) A purchaser of tangible personal property from a vendor	402
permitted to situs its sales under this section that removes the	403
property from the tax jurisdiction in which the resident received	404
the property is liable for additional tax in an amount equal to	405
the excess of the tax that would have been due on the sale if the	406
sale had been sitused to the tax jurisdiction to which the	407
purchaser removed the property over the tax that the vendor	408
collected and remitted on the sale.	409

(4) Nothing in this section relieves a person claiming to be	410
authorized to situs sales under this section, but not so	411
authorized, from liability for tax, penalty, interest, or	412
additional charges imposed under this chapter for failure to	413
collect the amount of tax lawfully due applying the situsing	414
provisions of divisions (C) to (I) of section 5739.033 of the	415
Revised Code.	416

(5) For the purposes of division (I) of this section,	417
"delivery sale" has the same meaning as in section 5739.033 of the	418
Revised Code, and "tax jurisdiction" has the same meaning as in	419
section 5739.24 of the Revised Code.	420

Sec. 5739.123.  (A) As used in this section,	421
"destination-based sourcing requirements" means the manner in	422
which sales are required to be sourced under divisions (C) to (I)	423
of section 5739.033 of the Revised Code.	424

(B) A vendor who holds a license issued prior to May 1, 2006,	425
under division (A) of section 5739.17 of the Revised Code may	426
apply for temporary compensation to assist the vendor in complying	427
with the destination-based sourcing requirements for the first six	428
months those sourcing requirements become applicable to the vendor	429
under section 5739.033 of the Revised Code. The vendor shall file	430
the application in accordance with division (C) of this section.	431
The compensation shall be the actual amount of tax collected per	432
county for each month of the six-month period, not to exceed	433
twenty-five dollars per county per month, for sales of tangible	434
personal property delivered to each county in which the vendor	435
does not have a fixed place of business and does not, or is not	436
required to, hold a license issued under division (A) of section	437
5739.17 of the Revised Code for that business. Only amounts paid	438
by the vendor for which the vendor is eligible for a discount	439
under division (B) of section 5739.12 of the Revised Code and that	440
are shown on returns filed during that six-month period shall be	441
considered in calculating the compensation. In no event shall a	442
vendor receive compensation that exceeds its total cost of	443
complying with the destination-based sourcing requirements. For	444
purposes of the six-month compensation period, a partial month	445
shall be considered a month.	446

(C) A vendor that applies for compensation under this section	447
shall file an application with the tax commissioner on a form	448
prescribed by the commissioner. The application shall be filed	449
within sixty days after the end of the reporting period that	450
includes the last day of the last month of the six-month period	451
for which the vendor is requesting compensation. The commissioner	452
shall determine the amount of compensation to which the vendor is	453
entitled, and if that amount is equal to or greater than the	454
amount claimed on the application, the commissioner shall certify	455
that amount to the director of budget and management and the	456
treasurer of state for payment from the general revenue fund. If	457
the commissioner determines that the amount of compensation to	458
which the vendor is entitled is less than the amount claimed on	459
the vendor's application, the commissioner shall proceed in	460
accordance with section 5703.70 of the Revised Code.	461

(D) The compensation provided under this section shall not	462
reduce the amount required to be returned to counties and transit	463
authorities under section 5739.21 of the Revised Code.	464

Sec. 5740.10.  (A) As used in this section, "delivery sale"	465
has the same meaning as in section 5739.033 of the Revised Code.	466

(B) It is the intent of the General Assembly for this state	467
to become a full member in the streamlined sales and use tax	468
agreement to enhance collection of the taxes imposed under	469
Chapters 5739. and 5741. of the Revised Code by remote multi-state	470
sellers. This state's participation has been jeopardized, however,	471
because the agreement does not resolve issues relating to the	472
situsing of certain sales and because of the impact the agreement	473
has on businesses located within and outside this state that have	474
annual delivery sales in this state of less than five hundred	475
thousand dollars.	476

If the tax commissioner determines, on or before October 20,	477
2007, that the agreement has been amended or interpreted by the	478
streamlined sales tax governing board to allow, beginning January	479
1, 2008, a vendor with total annual delivery sales within this	480
state of less than five hundred thousand dollars in a prior	481
calendar year, beginning with calendar year 2007, to situs its	482
sales under section 5739.035 of the Revised Code, the	483
commissioner shall certify that determination by journal entry on	484
or before that date, shall provide notice of the determination on	485
the department of taxation's web site, and shall notify vendors	486
and sellers the commissioner reasonably believes to be affected by	487
the certification.	488

Sec. 5741.03.  (A) Four and two-tenthsOne hundred per cent	489
of all money deposited into the state treasury under sections	490
5741.01 to 5741.22 of the Revised Code that is not required to be	491
distributed as provided in division (B) or (C) of this section	492
shall be credited to the local government fund for distribution in	493
accordance with section 5747.50 of the Revised Code, six-tenths of	494
one per cent shall be credited to the local government revenue	495
assistance fund for distribution in accordance with section	496
5747.61 of the Revised Code, and ninety-five and two-tenths per	497
cent shall be credited to the general revenue fund.	498

(B) In any case where any county or transit authority has	499
levied a tax or taxes pursuant to section 5741.021, 5741.022, or	500
5741.023 of the Revised Code, the tax commissioner shall, within	501
forty-five days after the end of each month, determine and certify	502
to the director of budget and management the amount of the	503
proceeds of such tax or taxes from billings and assessments	504
received during that month, or shown on tax returns or reports	505
filed during that month, to be returned to the county or transit	506
authority levying the tax or taxes, which amounts shall be	507
determined in the manner provided in section 5739.21 of the	508
Revised Code. The director of budget and management shall	509
transfer, from the same funds and in the same proportions	510
specified in division (A) of this sectiongeneral revenue fund, to	511
the permissive tax distribution fund created by division (B)(1) of	512
section 4301.423 of the Revised Code and to the local sales tax	513
administrative fund created by division (B)(C) of section 5739.21	514
of the Revised Code, the amounts certified by the tax	515
commissioner. The tax commissioner shall then, on or before the	516
twentieth day of the month in which such certification is made,	517
provide for payment of such respective amounts to the county	518
treasurer or to the fiscal officer of the transit authority	519
levying the tax or taxes. The amount transferred to the local	520
sales tax administrative fund is for use by the tax commissioner	521
in defraying costs the commissioner incurs in administering such	522
taxes levied by a county or transit authority.	523

(C) Of the revenue deposited into the state treasury from	524
taxes paid under division (B) of section 5741.05 of the Revised	525
Code, a percentage shall be distributed each fiscal year to all	526
counties and transit authorities that levy a tax under section	527
5739.021, 5739.023, or 5739.026 of the Revised Code. The	528
percentage to be distributed each fiscal year shall be computed by	529
dividing the amount described in division (C)(1) by the amount	530
described in division (C)(2) of this section:	531

(1) The total sales and use tax revenue distributed to	532
counties and transit authorities in the calendar year that ended	533
in the preceding fiscal year;	534

(2) The sum of the total sales and use tax revenue	535
distributed to such counties and transit authorities in that	536
calendar year plus the total revenue collected in that calendar	537
year from the taxes levied under sections 5739.02 and 5741.02 of	538
the Revised Code.	539

(D) Each county and transit authority shall receive a	540
quarterly distribution each fiscal year from the revenue to be	541
distributed as provided in division (C) of this section. The	542
amount of the distribution for each such county and transit	543
authority shall equal one-fourth of a percentage of the revenue	544
to be distributed in the fiscal year under that division. The	545
percentage shall be computed by dividing the amount described in	546
division (D)(1) by the amount described in division (D)(2) of	547
this section:	548

(1) The total sales and use tax revenue distributed to the	549
county or transit authority under division (B) of section 5739.21	550
of the Revised Code in the calendar year that ended in the	551
preceding fiscal year;	552

(2) The total sales and use tax revenue distributed to all	553
counties and transit authorities under division (B) of section	554
5739.21 of the Revised Code in that calendar year.	555

Sec. 5741.05. (A) Beginning January 1, 2005Except as	556
provided in division (B) of this section, a seller that collects	557
the tax levied by sections 5741.02, 5741.021, 5741.022, or	558
5741.023 of the Revised Code on transactions, other than sales of	559
titled motor vehicles, titled watercraft, or titled outboard	560
motors, shall determine under section 5739.033 or 5739.034 of the	561
Revised Code the jurisdiction for which to collect the tax. A	562
vendor or seller of motor vehicles, watercraft, or outboard motors	563
required to be titled in this state shall collect the tax levied	564
by section 5739.02 or 5741.02 of the Revised Code and the	565
additional taxes levied by division (A)(1) of section 5741.021,	566
division (A)(1) of section 5741.022, and division (A)(1) of	567
section 5741.023 of the Revised Code for the consumer's county of	568
residence as provided in section 1548.06 and division (B) of	569
section 4505.06 of the Revised Code.	570

(B)(1) Divisions (B) and (C) of this section apply only if	571
the tax commissioner makes the certification under section 5740.10	572
of the Revised Code.	573

(2) For the purposes of this division and division (C) of	574
this section, "delivery sale" has the same meaning as in section	575
5739.033 of the Revised Code, and "tax jurisdiction" has the same	576
meaning as in section 5739.24 of the Revised Code.	577

(3) Except as otherwise provided in division (B)(4) of this	578
section, and notwithstanding sections 5741.02, 5741.021, 5741.022,	579
and 5741.023 of the Revised Code, beginning January 1, 2008, a	580
seller with total delivery sales in this state in calendar year	581
2007 and each calendar year thereafter of less than five hundred	582
thousand dollars may elect to collect the tax due under this	583
chapter at a rate equal to the sum of the tax levied under	584
section 5741.02 of the Revised Code and the lowest combined rate	585
of tax levied in any tax jurisdiction in this state under	586
sections 5741.021, 5741.022, and 5741.023 of the Revised Code.	587

(4) Once a seller has total delivery sales in this state of	588
five hundred thousand dollars or more for a prior calendar year,	589
the seller shall source its sales pursuant to division (A) of	590
this section regardless of the amount of the seller's total	591
delivery sales in future years.	592

(C)(1) In each sale by a seller permitted to collect use tax	593
under division (B) of this section, the seller shall clearly	594
indicate on each invoice or other similar document provided to the	595
purchaser at the time of the sale that the seller is authorized to	596
collect use tax at the rate prescribed in division (B)(3) of this	597
section.	598

(2) If a purchaser purchases tangible personal property from	599
a seller permitted to collect use tax pursuant to division (B) of	600
this section and pays the tax due under that division to the	601
seller, no assessment may be made against the purchaser for	602
additional tax due under section 5741.021, 5741.022, or 5741.023	603
of the Revised Code unless the purchaser subsequently removes the	604
property from the tax jurisdiction in which the resident received	605
the property to another tax jurisdiction with a higher tax rate.	606

(3) Nothing in this section relieves a person that claims to	607
be authorized to collect the tax as provided in division (B) of	608
this section, but that is not so authorized, from liability for	609
tax, penalties, interest, or additional charges imposed under this	610
chapter for failure to collect the amount of tax lawfully due	611
applying the situsing provisions of division (A) of this section.	612

(D) A vendor or seller is not responsible for collecting or	613
remitting additional tax if a consumer subsequently stores, uses,	614
or consumes the tangible personal property or service in another	615
jurisdiction with a rate of tax imposed by sections 5741.02,	616
5741.021, 5741.022, or 5741.023 of the Revised Code that is higher	617
than the amount collected by the vendor or seller pursuant to	618
Chapter 5739. or 5741. of the Revised Code.	619

Section 2.  That existing sections 5739.033, 5739.035,	620
5739.123, 5741.03, and 5741.05 of the Revised Code are hereby	621
repealed.	622

Section 3. Section 5739.035 of the Revised Code is presented	623
in this act as a composite of the section as amended by both Am.	624
Sub. H.B. 66 and Am. Sub. S.B. 26 of the 126th General Assembly.	625
The General Assembly, applying the principle stated in division	626
(B) of section 1.52 of the Revised Code that amendments are to be	627
harmonized if reasonably capable of simultaneous operation, finds	628
that the composite is the resulting version of the section in	629
effect prior to the effective date of the section as presented in	630
this act.	631