1. For purposes of this section:
a. "Advertising and promotional direct mail" means:
(1)Printed material that meets the definition of direct mail, in appendix C, part I
of the agreement; and
(2)The primary purpose of which is to attract public attention to a product,
person, business, or organization, or to attempt to sell, popularize, or secure
financial support for a product, person, business, or organization. As used in
this subsection, the word "product" means tangible personal property, a
product transferred electronically, or a service.
b. "Other direct mail" means any direct mail that is not advertising and promotional
direct mail regardless of whether advertising and promotional direct mail is
included in the same mailing. The term includes:
(1)Transactional direct mail that con
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1. For purposes of this section:
a. "Advertising and promotional direct mail" means:
(1) Printed material that meets the definition of direct mail, in appendix C, part I
of the agreement; and
(2) The primary purpose of which is to attract public attention to a product,
person, business, or organization, or to attempt to sell, popularize, or secure
financial support for a product, person, business, or organization. As used in
this subsection, the word "product" means tangible personal property, a
product transferred electronically, or a service.
b. "Other direct mail" means any direct mail that is not advertising and promotional
direct mail regardless of whether advertising and promotional direct mail is
included in the same mailing. The term includes:
(1) Transactional direct mail that contains personal information specific to the
addressee, including invoices, bills, statements of account, and payroll
advices;
(2) Any legally required mailings, including privacy notices, tax reports, and
stockholder reports; and
(3) Other nonpromotional direct mail delivered to existing or former
shareholders, customers, employees, or agents, including newsletters and
informational pieces.
Other direct mail does not include the development of billing information or the
provision of any data processing service that is more than incidental.
2. Notwithstanding sections 57-39.4-11 and 57-39.4-11.1, the following provisions apply
to sales of advertising and promotional direct mail:
a. A purchaser of advertising and promotional direct mail may provide the seller with
either:
(1) A direct pay permit;
(2) A streamlined sales and use tax agreement certificate of exemption claiming
direct mail or other written statement approved, authorized, or accepted by
the state; or
(3) Information showing the jurisdictions to which the advertising and
promotional direct mail is to be delivered to recipients.
b. If the purchaser provides the permit, certificate, or statement referred to in this
subsection, the seller, in the absence of bad faith, is relieved of all obligations to
collect, pay, or remit any tax on any transaction involving advertising and
promotional direct mail to which the permit, certificate, or statement applies. The
purchaser shall source the sale to the jurisdictions to which the advertising and
promotional direct mail is to be delivered to the recipients and shall report and
pay any applicable tax due.
c. If the purchaser provides the seller information showing the jurisdictions to which
the advertising and promotional direct mail is to be delivered to recipients, the
seller shall source the sale to the jurisdictions to which the advertising and
promotional direct mail is to be delivered and shall collect and remit the
applicable tax. In the absence of bad faith, the seller is relieved of any further
obligation to collect any additional tax on the sale of advertising and promotional
direct mail where the seller has sourced the sale according to the delivery
information provided by the purchaser.
d. If the purchaser does not provide the seller with any of the items listed in this
subsection, the sale shall be sourced according to subdivision e of subsection 1
of section 57-39.4-11. The state to which the advertising and promotional direct
mail is delivered may disallow credit for tax paid on sales sourced under this
subdivision.
3. Notwithstanding sections 57-39.4-11 and 57-39.4-11.1, the following provisions apply
to sales of other direct mail:
a. Except as otherwise provided in this subsection, sales of other direct mail are
sourced in accordance with subdivision c of subsection 1 of section 57-39.4-11.
b. A purchaser of other direct mail may provide the seller with either:
(1) A direct pay permit; or
(2) A streamlined sales and use tax agreement certificate of exemption claiming
direct mail or other written statement approved, authorized, or accepted by
the state.
c. If the purchaser provides the permit, certificate, or statement referred to in this
subsection, the seller, in the absence of bad faith, is relieved of all obligations to
collect, pay, or remit any tax on any transaction involving other direct mail to
which the permit, certificate, or statement applies. Notwithstanding subdivision a,
the sale shall be sourced to the jurisdictions to which the other direct mail is to be
delivered to the recipients and the purchaser shall report and pay any applicable
tax due.
4. a. This section applies to a transaction characterized under state law as the sale of
services only if the service is an integral part of the production and distribution of
printed material that meets the definition of direct mail.
b. This section does not apply to any transaction that includes the development of
billing information or the provision of any data processing service that is more
than incidental regardless of whether advertising and promotional direct mail is
included in the same mailing.
c. If a transaction is a "bundled transaction" that includes advertising and
promotional direct mail, this section shall apply only if the primary purpose of the
transaction is the sale of products or services that meet the definition of
advertising and promotional direct mail.
d. Nothing in this section shall limit any purchaser's:
(1) Obligation for sales or use tax to any state to which the direct mail is
delivered;
(2) Right under local, state, federal, or constitutional law, to a credit for sales or
use taxes legally due and paid to other jurisdictions; or
(3) Right to a refund of sales or use taxes overpaid to any jurisdiction.
e. This section applies for purposes of uniformly sourcing direct mail transactions
and does not impose requirements on states regarding the taxation of products
that meet the definition of direct mail or to the application of sales for resale or
other exemptions.