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The Complexity of Marketplace Facilitator Laws

SWIPEBY helps businesses by using our technology platform to sell their products to their customers (food, coffee, Snickers bars, and the like). That makes us, by definition, a marketplace facilitator. Other marketplace facilitator examples are Amazon, Etsy, and even Walmart.

Traditionally, the sellers were responsible for collecting and remitting the sales tax. Platforms, like SWIPEBY and Amazon, were only considered to be facilitating the sale, so they weren’t responsible for the tax obligation.

That all changed around 2017 when states realized they were missing out on significant tax revenue and began to roll out laws switching the tax obligation from the seller to the marketplace facilitator. So, state-by-state and sometimes municipality or some other defined region, the laws differ. This has made compliance very complex.

As these laws were being implemented, SWIPEBY quickly pivoted to build the required capability. We are using Avalara, a leading tax compliance company, to help manage the process, so our operators can have full confidence we are meeting the tax obligations as required. We are honored to be featured in an Avalara case study.

We’ve had some questions about this from our operators in the past. Avalara provides a great state-by-state breakdown of the Marketplace Facilitator Laws which may help you understand the complexity.

These laws are one way online commerce has changed the way we all do business, but at least there are some outstanding solutions like Avalara that help meet the ever-changing needs. Learn more about working with SWIPEBY.

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