Would every small business suddenly become a tax-collection agency? Would the kid who cuts my lawn be forced to be a tax collector?
HR25 calls for substantial accounting of business-to-business (B2B) sales (ie wholesale sales exempt from sales tax). These B2B sales must be tracked closely to forestall attempts at retail sales tax evasion. If a small business (or any business) makes tax-free B2B purchases, that business better make appropriate sales (B2B or retail) that shows the B2B purchases were legitimate For B2B sales, the accounting will track the money trail For retail sales, the business owes sales tax to the federal government, probably via a state-administered sales tax collection entity The tax collection entity wont care if the sales tax was actually paid explicitly by the consumer or not If a small business (or any business) doesnt wish to collect sales taxes itself, it better not try to make any tax-free B2B purchases for supplies, etc. I think there is some room here for evading sales tax on services (ie landscaping, painting, etc) but if the supplies, etc were already taxed as RETAIL purchases then t
