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Vermont Poised to Implement Click-Through Nexus Law


 Vermont

Like a cat ready to pounce, Vermont is watchful and poised to implement its click-through nexus law. A bigger cat, Amazon pounced first. In early January 2015, the online retailer added Vermont to the list of states in which residency terminates participation in its associates program and sent a Dear John letter to its Vermont associates informing them of that fact. Vermont associates, like blindsided lovers, were dumbstruck.

Amazon’s letter explained that the break was due to Vermont’s click-through nexus law—which has even now not yet taken effect. It was a premature move, one based on the assumption that Vermont will, eventually, establish click-through nexus and subject all of Amazon’s Vermont sales to tax. Currently, Vermonters shop tax-free on Amazon.

Perhaps as a result of Amazon’s treatment of Vermont associates, there is confusion about exactly when the click-through nexus law takes effect. In fact, that is an unknown. To help clarify the implementation timeline, the Vermont Department of Taxes has now released a Statement of Vermont Department of Taxes on Vermont Click Through Nexus Law.

As explained in the statement, the law was enacted in 2011 but will not take effect until “after the Attorney General makes a determination that 15 or more states have similar provisions.” Currently, the Department “understands that the Attorney General’s office considers thirteen states to have click through nexus laws in effect, and that three additional states have measures currently set to take effect this fall (Washington on September 1; Michigan and Nevada on October 1).

A member of the Streamlined Sales Tax Agreement, Vermont “espouses orderly implementation of sales tax changes including fair notice to vendors.” Retailers that sell in Vermont will be required to register with the Department of Taxes and begin collecting tax on the first day of the month that is at least thirty days after the Attorney General’s determination. For example, if the AG makes its determination in October, “the Department will expect remote vendors impacted by the law to register and begin collecting and remitting tax on December 1.”

The more states enact click-through nexus laws, the more businesses should consider automating sales tax compliance. Learn how it works.

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Sales tax rates, rules, and regulations change frequently. Although we hope you'll find this information helpful, this blog is for informational purposes only and does not provide legal or tax advice.
Gail Cole
Avalara Author
Gail Cole
Gail Cole
Avalara Author Gail Cole
Gail began researching and writing about sales tax in 2012 and has been fascinated with it ever since. She has a penchant for uncovering unusual tax facts, and endeavors to make complex sales tax laws more digestible for both experts and laypeople.