Making Home Rules Make Sense

Home rule refers to states where local counties and cities administer sales tax. Home rule jurisdictions march to their own drum with their own requirements, forms, and due dates.

Home Rule Impact on Companies

An issue for companies filing sales tax in these states can be cost when their sales tax provider is charging a per-filing fee for every jurisdiction.

And those fees can add up quickly. For example, along with the state-administered return, Colorado has 63 home rule jurisdictions. 63 x 12, assuming a monthly filing schedule, would equal 756 returns per year. A serious cost multiplier! The sales tax liability amounts being filed are sometimes less than the actual cost that your sales tax provider charges you for the per-filing fee. Make that make sense. 

Home Rule States Sales Tax

States such as Alabama and Texas have alleviated the burden of home rules filing for remote sellers by allowing them to collect and remit a simplified/single local tax rate to the state only. If you’re registered in these states with the correct sales tax license for remote sellers (e.g., AL SSUT and TX SLTR), it can reduce a lot of complexity and cost.  

Colorado and Alaska took a different path, setting up systems providing centralized registration and filing options for home rule jurisdictions. This makes it easy to file across all state jurisdictions using one login and a single file format.

Home Rule: The Solution

At Zamp, one of our core values is providing simple, predictable pricing to our customers. By building accurate reporting with the state of Colorado for its SUTS system and with Alaska for its ARSSTC portal, we’re able to provide full home rules support for these states at no additional cost to our customers. One form to cover them all!  

When states take action to improve or simplify processes, sales tax providers should pass on those benefits to their customers. Eliminating the multiplier impact of per-filing fees for home rules jurisdictions can have a major impact on a customer’s overall compliance cost.

Looking to simplify your sales tax compliance process? Get in touch with our team of experts to learn more.

About the author

Matt Grattan

Matthew Grattan heads up partnerships and sales for Zamp. He’s worked in the sales tax industry for over 12 years. Matthew currently resides on Bainbridge Island, WA with his wife, 3 kids and dog, Ruthie.