Sales Tax Issue

mad · 2019-10-30 04:13:07

Currently, in Backlight you can set up Sales Tax for your current State in the US you cannot have multiple Sales Tax by State. However, in the US; States are now requiring that local Sales Tax be collected. Also, many vendors are now requiring that the Tax is collected as a new policy change such as Bay Photo/FotoMoto.

Is there going to be an update to Backlight to allow for multi-State collection of Sales Taxes? This is becoming very important since the U.S. Supreme Court ruling allowing States to collect Sales Tax on Internet purchases from Out-Of-State. For example, I live in Arkansas and they have a 9% sales tax which I need to collect and send onto the Dept of Revenue on a quartley basis. If the person orders from out-of-State, I am required to collect this and the opposite is true if I purchased something from out-of-State on the internet such as from another vendor. Companies are starting to change their policies now as each State passes their law on this.

Therefore, it would help if backlight can support this on an individual State by State since each state charges a different Sales Tax amount.

Hopefully, Ben or Matt can answer this.

Thx,
Michael

Ben · 2019-10-31 05:39:01

Hi Michael, it’s not something that’s on our radar. Is there only one sales tax to be paid for any given transaction, or would you sometimes need to collect sales tax both for your own state and the buyer’s state? Are there any minimum thresholds on the sales amount before taxes kick in?

Daniel Leu · 2019-10-31 07:16:44

Michael, did you look into the limits regarding collecting sales tax for remote sellers? For California, you only need to collect sales tax

if, during the preceding or current calendar year, the total combined sales of tangible personal property for delivery in California by the retailer and all persons related to the retailer exceed $500,000

For Arkansas, the limits are $100k or 200 transactions (Since you are in Arkansas, this obviously doesn't apply to you). Depending on your sales volume, you might not need to collect sales tax for out-of-state sales.

mad · 2020-02-06 00:11:44

According to the new rules based on the Supreme Court decision, all online sales must be taxed & collected for each state. For example, if someone buys an item from me online from California its sales tax is 7.5% then that is what is collected they would not be charged sales tax for Arkansas. Then what is collected is eventually sent to California/Each State each quarter. Since each State has a different sales tax amount this would require a drop-down of each State including for example Puerto Rico and Washington D.C. both of which are non-States but do collect Sales Taxes. I recently converted my main site over to another method not using Backlight in order to be able to enter each state's sales tax; but I have lost some capability of using backlight. I prefer to use backlight and hope this can be included. Let me know!!!! By the way some states like Arkansas also tax Shipping as well. I also know the limits. There are four states without Sales Tax.

BTW, each state are now adding laws to enforce this collection of Sales Tax based on the Supreme Court Decision for online sales. If you follow sites such as Amazon, Bay Photo, and others they are now collecting Sales Taxes for Each State that has them. I think this is something that needs to be addressed.

Last edited by mad (2020-02-06 00:16:10)

Daniel Leu · 2020-02-06 01:14:05

Michael, are you referring to the South Dakota v. Wayfair decision from June 21, 2018?

rod barbee · 2020-02-06 01:27:47

Just doing a quick search, it looks like the thresholds are pretty high in most states
check out this chart: https://www.salestaxinstitute.com/resou … exus-chart
Specifically, the Marketplace Nexus column on the right. There are links to nearly all states.

In my own state of Washington, you need to be selling at least $100,000 in goods/services before you need to register and and collect sales tax.
(this is as of Jan. 1, 2020)

Unless you're meeting these high thresholds in various states, it doesn't look like you need to worry about it.

Daniel Leu · 2020-02-06 04:52:49

That's a good reference, Rod! Thanks! Did you read the notice to the buyer requirements in Washington?

rod barbee · 2020-02-06 05:36:10

About notifying the buyer who’s buying from WA state that’s they need to pay use tax? I saw that.

I’m thinking that a blanket notification might do, one stating that the seller only collects sales tax from purchasers in the seller’s state and it’s the responsibility of the buyer to report use tax to their own state’s department of revenue.

Community @ The Turning Gate

#1 2019-10-30 04:13:07

Sales Tax Issue

#2 2019-10-31 05:39:01

Re: Sales Tax Issue

#3 2019-10-31 07:16:44

Re: Sales Tax Issue

#4 2020-02-06 00:11:44

Re: Sales Tax Issue

#5 2020-02-06 01:14:05

Re: Sales Tax Issue

#6 2020-02-06 01:27:47

Re: Sales Tax Issue

#7 2020-02-06 04:52:49

Re: Sales Tax Issue

#8 2020-02-06 05:36:10

Re: Sales Tax Issue

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