Revenue Secretary says ‘there shouldn’t be a difference’ between in-state and out-of-state sellers

Kansas Secretary of Revenue Mark Burghart said Thursday that the intent of a policy memo from his agency regarding the collection of use tax on internet sales is an issue of fairness.

“The statutory scheme in place recognizes that there shouldn’t be a difference,” said Burghart. “The use tax exists to basically prevent folks from avoiding in-state retailers and going to out-of-state businesses, because of the price differential.”

In theory, in some parts of Kansas, buyers could be almost 10 percent more for the same product by buying it from a Kansas-based business. That is significant.

“The out-of-state companies have had a competitive advantage for 52 years,” said Burghart. “In 1967, the National Bellas Hess case came down and that’s the case that basically said a state could not enforce its tax collection duties against these out-of-state companies, if they didn’t have that physical presence.”

That’s what the Wayfair decision at the U.S. Supreme Court overturned.

“They may be notified to collect and remit, but if they can show facts that their connection with Kansas does not warrant the state imposing that responsibility, then we’ll look at those facts,” said Burghart.

The state plans to work on getting out-of-state businesses to register with the Streamlined Sales Tax project, where Kansas is one of 24 states that provide software and services for free to those registered
to help them collect the money.