(1) Any vendor that collects and remits sales tax to the department of revenue as provided by law may use an electronic database of state addresses that is certified by the department pursuant to subsection (3) of this section to determine the jurisdictions to which tax is owed.
Any vendor that uses the data contained in an electronic database certified by thedepartment of revenue pursuant to subsection (3) of this section to determine the jurisdictions to which tax is owed shall be held harmless for any tax, charge, or fee liability to any taxing jurisdiction that otherwise would be due solely as a result of an error or omission in the database.
Any electronic database provider may apply to the department of revenue to be certified for use by Colorado vendors pursuant to this section. Such certification shall be valid for three years. In order to be certified, an electronic database provider shall have a database that satisfies the following criteria:
The database shall designate each address in the state, including, to the extent practicable, any multiple postal address applicable to one location and the taxing jurisdictions that have the authority to impose a tax on purchases made by purchasers at each address in the state.
The information contained in the electronic database shall be updated as necessaryand maintained in an accurate condition. In order to keep the database accurate, the database provider shall provide a convenient method for taxing jurisdictions that may be affected by the use of the database to inform the provider of apparent errors in the database. The provider shall have a process in place to promptly correct any errors brought to the provider's attention.
The database shall be at least ninety-five percent accurate based on a statisticallyvalid sample of addresses from the database tested for accuracy by the department of revenue.
The database shall satisfy any additional criteria that the executive director of thedepartment of revenue establishes pursuant to subsection (7) of this section.
The department of revenue shall have the authority to designate an entity to examineelectronic databases and report to the department as to the accuracy and suitability of the databases for use by vendors. The entity may impose a fee on each electronic database provider applying for certification in an amount necessary to cover the reasonable and documented costs of examining the database.
The department of revenue shall have the authority to waive the certification processspecified in subsection (4) of this section and certify an electronic database as suitable for use by vendors if the database has been previously certified by a public or private entity and the certification criteria of the certifying entity are the same or more stringent than the criteria specified in subsection (3) of this section. The department shall have the discretion to accept or reject a previously certified database, and under no circumstance shall the department be required to waive the certification process pursuant to this subsection (5).
The department of revenue shall have the right to deny or revoke the certification ofany electronic database for just cause.
The executive director of the department of revenue shall promulgate rules for theadministration of this section. Such rules shall be promulgated in accordance with article 4 of title 24, C.R.S.
This section is repealed, effective ninety days after the date that the revisor of statutes is notified by the department of revenue that a geographic information system that meets the defined scope of work set forth in the request for solicitation, provided by the state, is online, tested, and verified by the department of revenue to be operational, supported, and available for a retailer to use to determine the taxing jurisdiction in which an address resides. The department of revenue shall notify the revisor of statutes in writing, by email to [email protected], no later than fifteen days after such a system is online, tested, and verified by the department of revenue to be operational, supported, and available for use.
Source: L. 2004: Entire section added, p. 767, § 2, effective May 17. L. 2020: (8) added, (HB 20-1023), ch. 22, p. 81, § 2, effective March 11.
Cross references: For the legislative declaration contained in the 2004 act enacting this section, see section 1 of chapter 231, Session Laws of Colorado 2004.