While North Carolina retailers scramble to understand how to comply with new sales tax collection burdens from multiple states and localities, the state Department of Revenue (NCDOR) joined the sales tax rush with an August 7 directive. The Tax Foundation says North Carolina is one of thirteen states that should pass enabling legislation that sets minimal standards for tax collection and ensures collection standards do not apply retroactively. Instead of waiting for legislation, NCDOR decided it would apply South Dakota’s standards to enforce the “perhaps unconstitutionally broad” statute, which has been on the books in some form since 1987.

  • North Carolina Department of Revenue has issued a directive to require sales tax collection by internet sellers with sales of at least $100,000 or more than 200 transactions in the previous or current calendar year, effective November 1, 2018, or 60 days after the seller meets the threshold, whichever is later. The Department cited the state’s very broad (and perhaps unconstitutionally broad) nexus statute. Consequently, the regulation’s enforcement could face legal challenge, which can be avoided through enactment of an enabling statute similar to South Dakota’s.