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STATE OF OKLAHOMA
2nd Session of the 60th Legislature (2026)
HOUSE BILL 4345 By: Moore
AS INTRODUCED
An Act relating to revenue and taxation; amending 68
O.S. 2021, Section 1354.27, which relates to sourcing
of retail sale or lease or rental for purposes of
sale tax; modifying where the sale is sourced to
reflect the receipt is the final delivery location
designated by the purchaser; modifying definition to
state that an intermediate store or warehouse shall
satisfy what constitutes the receipt; and providing
an effective date.
BE IT ENACTED BY THE PEOPLE OF THE STATE OF OKLAHOMA:
SECTION 1. AMENDATORY 68 O.S. 2021, Section 1354.27, is
amended to read as follows:
Section 1354.27. Sourcing of retail sale or lease or rental.
A. The retail sale, excluding lease or rental, of a product
shall be sourced as follows:
1. When the product is received by the purchaser at a business
location of the seller, the sale is sourced to that business
location;
2. When the product is not received by the purchaser at a
business location of the seller, the sale is sourced to the location
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where receipt by the purchaser, or the purchaser's donee, designated
as such by the purchaser, occurs, including the location indicated
by instructions for delivery to the purchaser or donee, known to the
seller. For purposes of this paragraph, the location of receipt
shall be the final delivery location designated by the purchaser or
the purchaser's donee and shall not be satisfied by any intermediate
transfer, possession or delivery to a business location, warehouse,
fulfillment center, or other facility of the seller or of a related
party prior to delivery to the purchaser or donee. Provided, this
subsection shall not apply to florists. All sales by florists shall
be sourced to its business location;
3. When the provisions of paragraphs 1 and 2 of this subsection
do not apply, the sale is sourced to the location indicated by an
address for the purchaser that is available from the business
records of the seller that are maintained in the ordinary course of
the seller's business when use of this address does not constitute
bad faith;
4. When the provisions of paragraphs 1, 2 and 3 of this
subsection do not apply, the sale is sourced to the location
indicated by an address for the purchaser obtained during the
consummation of the sale, including the address of a purchaser's
payment instrument, if no other address is available, when use of
this address does not constitute bad faith; and
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5. When none of the previous rules of paragraphs 1, 2, 3 and 4
of this subsection apply, including the circumstance in which the
seller is without sufficient information to apply the previous
rules, then the location will be determined by the address from
which tangible personal property was shipped, from which the digital
good or the computer software delivered electronically was first
available for transmission by the seller, or from which the service
was provided, disregarding for these purposes any location that
merely provided the digital transfer of the product sold. In the
case of a sale of mobile telecommunications service that is a
prepaid telecommunications service, the location will be that which
is associated with the mobile telephone number.
B. The lease or rental of tangible personal property, other
than property identified in subsection C or D of this section, shall
be sourced as follows:
1. For a lease or rental that requires recurring periodic
payments, the first periodic payment is sourced the same as a retail
sale in accordance with the provisions of subsection A of this
section. Periodic payments made subsequent to the first payment are
sourced to the primary property location for each period covered by
the payment. The primary property location shall be as indicated by
an address for the property provided by the lessee that is available
to the lessor from its records maintained in the ordinary course of
business, when use of this address does not constitute bad faith.
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The property location shall not be altered by intermittent use at
different locations, such as use of business property that
accompanies employees on business trips and service calls; and
2. For a lease or rental that does not require recurring
periodic payments, the payment is sourced the same as a retail sale
in accordance with the provisions of subsection A of this section.
This subsection does not affect the imposition or computation of
sales or use tax on leases or rentals based on a lump sum or
accelerated basis, or on the acquisition of property for lease.
C. The lease or rental of motor vehicles, trailers,
semitrailers, or aircraft that do not qualify as transportation
equipment, as defined in subsection D of this section, shall be
sourced as follows:
1. For a lease or rental that requires recurring periodic
payments, each periodic payment is sourced to the primary property
location. The primary property location shall be as indicated by an
address for the property provided by the lessee that is available to
the lessor from its records maintained in the ordinary course of
business, when use of this address does not constitute bad faith.
This location shall not be altered by intermittent use at different
locations; and
2. For a lease or rental that does not require recurring
periodic payments, the payment is sourced the same as a retail sale
in accordance with the provisions of subsection A of this section.
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This subsection does not affect the imposition or computation of
sales or use tax on leases or rentals based on a lump sum or
accelerated basis, or on the acquisition of property for lease.
D. The retail sale, including lease or rental, of
transportation equipment shall be sourced the same as a retail sale
in accordance with the provisions of subsection A of this section,
notwithstanding the exclusion of lease or rental in subsection A of
this section. "Transportation equipment" means any of the
following:
1. Locomotives and railcars that are utilized for the carriage
of persons or property in interstate commerce;
2. Trucks and truck-tractors with a Gross Vehicle Weight Rating
(GVWR) of ten thousand one (10,001) pounds or greater, trailers,
semitrailers, or passenger buses that are:
a. registered through the International Registration
Plan, and
b. operated under authority of a carrier authorized and
certificated by the United States Department of
Transportation or another federal authority to engage
in the carriage of persons or property in interstate
commerce;
3. Aircraft that are operated by air carriers authorized and
certificated by the United States Department of Transportation or
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another federal or a foreign authority to engage in the carriage of
persons or property in interstate or foreign commerce; and
4. Containers designed for use on and component parts attached
or secured on the items set forth in paragraphs 1, 2 and 3 of this
subsection.
E. For the purposes of this section, the terms "receive" and
"receipt" mean:
1. Taking possession of tangible personal property;
2. Making first use of services; or
3. Taking possession or making first use of digital goods,
whichever comes first.
The terms "receive" and "receipt" do not include possession by a
shipping company on behalf of the purchaser. The terms shall also
not include possession, custody, or control of tangible personal
property at a business location, warehouse, fulfillment center or
other facility of the seller, or of an affiliate or other related
party of the seller, prior to delivery to the purchaser or the
purchaser's donee at the location designated by the purchaser.
SECTION 2. This act shall become effective November 1, 2026.
60-2-14735 AO 01/05/26