Marketplace Facilitators

Obligations of Marketplace Facilitators

Starting June 1, 2019, a marketplace facilitator is required to collect and remit sales tax when a seller uses its marketplace to conduct a retail sale. A marketplace facilitator must inform the seller on its marketplace that it will collect and remit tax on taxable items sold on its marketplace that are sourced to Vermont. Once notified, a marketplace seller will not need to collect and remit sales tax as the marketplace facilitator will fulfill that requirement for the seller making sales in Vermont.

Definition of “Marketplace Facilitator”

A “marketplace facilitator” is a person who (1) contracts with a marketplace seller to facilitate the sale of products (2) through a physical or electronic marketplace (3) that it operates and (4) receives consideration.

Additionally, to qualify, a person must engage in one or more of the activities from each of the lists below. 

Affiliate Activities

  1. Directly or indirectly through one or more affiliated persons communicate offer and acceptance between buyer and seller.
  2. Directly or indirectly through one or more affiliated persons own or operate the infrastructure or technology that brings purchasers and marketplace sellers together.
  3. Directly or indirectly through one or more affiliated persons provide a virtual currency to purchase items from marketplace sellers.
  4. Directly or indirectly through one or more affiliated persons develop software or research related to activities taking place on a marketplace that it or an affiliate operates.

Services Provided to Sellers

  1. Provide payment processing services.
  2. Provide fulfillment or storage services.
  3. List products for sale.
  4. Set prices.
  5. Brand sales as those of the marketplace facilitator.
  6. Take orders.
  7. Advertise or promote.
  8. Provide customer service or return and exchange service.

This is only a summary of the requirements. Please contact the Department if you need assistance or have further questions.