[§255D-9]  Seller and third party liability. [See note below.]  (a)  A certified service provider is the agent of aseller, with whom the certified service provider has contracted for thecollection and remittance of sales and use taxes.  As the seller's agent, thecertified service provider is liable for the sales and use taxes due eachmember state on all sales transactions it processes for the seller except asprovided in this section.

(b)  A seller that contracts with a certifiedservice provider is not liable to the State for sales or use taxes due ontransactions processed by the certified service provider unless the sellermisrepresented the type of items it sells or committed fraud.  In the absenceof probable cause to believe that the seller has committed fraud or made amaterial misrepresentation, the seller is not subject to audit on thetransactions processed by the certified service provider.  A seller is subjectto audit for transactions not processed by the certified service provider.  Themember states acting jointly may perform a system check of the seller andreview the seller's procedures to determine if the certified service provider'ssystem is functioning properly and the extent to which the seller'stransactions are being processed by the certified service provider.

(c)  A person that provides a certifiedautomated system is responsible for the proper functioning of that system andis liable to the State for underpayments of tax attributable to errors in thefunctioning of the certified automated system.  A seller that uses a certifiedautomated system remains responsible and is liable to the State for reportingand remitting tax.

(d)  A seller that has a proprietary system fordetermining the amount of tax due on transactions and has signed an agreementestablishing a performance standard for that system is liable for the failureof the system to meet the performance standard. [L 2003, c 173, pt of §2]

 

Note

 

  Section effective when State becomes a member of thestreamlined sales and use tax agreement.  L 2003, c 173, §4.