Online retailers need to collect sales tax in ND starting October 1

Jul 12, 2018

Starting October 1st, remote sellers will be required to register with the state of North Dakota and collect and remit sales taxes.

Tax Commissioner Ryan Rauschenberger says this is the result of a Supreme Court ruling last month that remote sellers can now be required to collect sales taxes in states where they have no physical presence. He says this applies mainly to online retailers. A previous ruling on the issue in 1992 said it shouldn't have to be required, but Rauschenberger says times have changed.

"Online retailers basically had a loophole, or were treated favorably over our brick and mortar businesses here in North Dakota. Brick and mortar businesses, regardless of the amount of sales they made, had to collect and remit sales tax, and comply with our tax laws. But a large company selling millions of dollars of retail sales in North Dakota did not have to collect and remit the tax. So this creates a level playing field. And basically, throughout the years, you had your online retailers fighting with your brick and mortar retailers - but now we have that level playing field that we've been fighting for."

Rauschenberger says online retailers now have to do what any other retailer in North Dakota does - they have to register with the state. He says they can register with the state specifically or they can register to Streamline Sales Tax to register automatically with all 23 states who now require the collection of sales tax. He says as a result of that you're going to see more sites charging state sales taxes after October 1st.