Representatives of 18 states, including Michigan, have voted to trigger an Oct. 1, 2005, effective date for the Streamlined Sales and Use Tax Agreement (SSTA), which simplifies the nation's varying sales tax laws. The Streamlined system reduces the number of sales tax rates, brings uniformity to definitions of items in the sales tax base, significantly reduces the paperwork burden on retailers, and incorporates new technology to modernize many administrative procedures.

"This is an important step for Michigan and nearly two dozen other states," said State Treasurer Jay B. Rising. "With so-called e-commerce continuing to grow, it is imperative that we take the steps necessary to stop the erosion of Michigan tax revenues."

While current law does not require Internet and direct mail companies to collect and remit sales taxes on transactions that occur in states where they do not have a physical presence, many companies are expected to begin collecting and remitting taxes under the simplified system. As of October 1st, companies will have access to a Web-based centralized point of sales tax registration for member states, software that will assist in sales tax collection responsibilities, and an amnesty period for sellers that have not been contacted by member states for audit.

The SSTA was initially approved by implementing states in November of 2002. State legislatures then began the work of bringing their Sales and Use Tax statutes into compliance with the Agreement. States whose Sales and Use Tax laws are now in substantial compliance with the SSTA include: Indiana, Iowa, Kansas, Kentucky, Michigan, Minnesota, Nebraska, North Carolina, Oklahoma, South Dakota and West Virginia. Several other states will become full members when conforming legislation takes effect.

"October first will mark the culmination of years of hard work," said State Treasurer Jay B. Rising. "Tax administrators, legislators, and many representatives of the business community, were willing to sacrifice some of their own interests in creating a more rational and efficient sales tax system."

Individuals and companies seeking more information on the Streamlined Sales and Use Tax Agreement and the new simplified system can refer to the Web site at www.streamlinedsalestax.org.