Tax Practice Group Co-Chair David Blum and tax partners Lauren Ferrante in Chicago and Stefi George in New York co-authored an article in Tax Notes State arguing that the Illinois Department of Revenue's recent expansion of marketplace facilitator rules to peer-to-peer car sharing platforms is yet another example of a state tax agency stealthily applying the Wayfair doctrine without legislative consent.

"Almost five years out, we know that the U.S. Supreme Court’s ruling in Wayfair prompted almost every state to not only enact legislation requiring out-of-state sellers to collect sales or use tax on sales for delivery into the state," the authors wrote, "but likewise require the same of out-of-state marketplace facilitators regarding their own sales and those sales they facilitate on behalf of third-party sellers…".

"This fall, however, the Illinois Department of Revenue (DOR) went a step further, stealthily expanding the marketplace facilitator approach to the Automobile Renting Occupation and Use Tax Act (ART). Under this new guidance, set forth in a DOR publication, peer-to-peer car sharing platforms must collect and remit ART on car sharing transactions facilitated through their platforms…".

"The Wayfair creep is troubling. In this instance, it occurred without any action by the legislature (and in the face of a veto of legislation on this very issue), raising significant concerns regarding sound tax administration and sufficient taxpayer notice."