Sales Tax Discount for Vendors in Rhode Island
Issue Overview: Twenty-six states and the District of Columbia allow vendor discounts as compensation for the time and effort expended in collecting, reporting and remitting sales tax i.e., a collection of taxes for the state without commission. But, the state gives its lottery retailers a commission for lottery sales. The cost of this legislation has been a stumbling block.
NFIB Position: Compensation should be allowed for the work involved and for the expense and the liability expense in the event of error or failure of timely reporting. Small business owners have told NFIB/Rhode Island that the requirement of payment of the tax on credit sales is an additional burden, sometimes forcing them to borrow to pay the tax before they received payment from the customer. Then there is a problem of obtaining a tax refund on sales refunds, unpaid bills and bad debt write-offs.
Issue Status: NFIB again had legislation be introduced to address this issue; but the serious state fiscal woes will preclude passage.
