ARSD § 64:06:01:68 — Sourcing rules for direct mailing

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MicrosoftInternetExplorer4
64:06:01:68. Sourcing
rules for direct mailing. Notwithstanding § 64:06:01:63, a purchaser
of direct mail that is not a holder of a direct pay permit may provide to the
seller in conjunction with the purchase an exemption certificate claiming
direct mail.
Upon receipt of an exemption
certificate claiming direct mail, the seller is relieved of all obligations to
collect, pay, or remit the applicable tax and the purchaser is obligated to pay
or remit the applicable tax on a direct pay basis. An exemption certificate
claiming direct mail shall remain in effect for all future sales of direct mail
by the seller to the purchaser until it is revoked in writing. A purchaser of
direct mail that provides the seller with documentation of direct pay permit is
not required to provide an exemption certificate claiming direct mail.
If the purchaser of direct mail does
not provide the seller with documentation of a direct pay permit or an
exemption certificate claiming direct mail, the transaction shall be sourced as
either:
(1) Advertising and
promotional direct mail. The purchaser may provide information to show each
jurisdiction to which the advertising and promotional direct mail shall be
delivered to the recipients. Upon receipt of the delivery information, the seller
shall collect the tax according to the delivery information provided by the
purchaser. In the absence of the intent to evade tax, the seller is relieved of
any further obligation to collect tax on any transaction where the seller has
collected tax pursuant to the delivery information provided by the purchaser.
If the purchaser of advertising and promotional direct mail does not provide
the seller with delivery information, the seller shall collect the tax
according to subdivision 64:06:01:63(5); or
(2) Other direct mail. The
seller shall collect the tax according to subdivision 64:06:01:63(3) which is
sourced to the address for the purchaser in the business records of the seller.
Nothing in this rule limits a
purchaser's obligation for sales or use tax to any state to which the direct
mail is delivered. The purchaser shall source the sale to the jurisdictions to
which the direct mail is delivered to the recipients and must report any sales
or use tax due.