The Montana Legislature has introduced Senate Bill 558, a significant piece of legislation aimed at addressing the complexities of sales tax collection for online marketplace providers and sellers. Introduced on March 31, 2025, the bill seeks to clarify the responsibilities of marketplace providers in collecting and remitting sales tax on transactions facilitated through their platforms.

One of the key provisions of SB 558 is the establishment of a relief mechanism for marketplace providers that fail to collect or remit sales tax due to incorrect or insufficient information from marketplace sellers. This relief is capped at 5% of the total sales tax due for all sales facilitated by the provider in a calendar year. However, this provision does not apply to sales where the marketplace provider is affiliated with the seller, defined as having ownership of more than 5% in either entity.

Additionally, the bill introduces definitions for terms related to the sale of property, services, and electronically transferred products. Notably, it defines "de minimis online auction websites" and "de minimis retailers" as those with gross sales in Montana of less than $100,000 in the previous year, which are expected to remain below that threshold in the current year. This classification aims to exempt smaller retailers from the burdens of sales tax collection, thereby encouraging small business participation in the online marketplace.

The introduction of SB 558 has sparked discussions among lawmakers and stakeholders regarding its implications for both local businesses and the state’s tax revenue. Proponents argue that the bill provides necessary clarity and support for small online retailers, while critics express concerns about potential revenue losses for the state and the fairness of tax obligations among larger marketplace providers.

As the legislative process unfolds, the bill's future remains uncertain. Experts suggest that if passed, SB 558 could significantly impact how online sales are conducted in Montana, potentially influencing the broader landscape of e-commerce regulation in the state. The next steps will involve committee reviews and potential amendments as lawmakers weigh the benefits and drawbacks of the proposed legislation.