I was asked today, How do taxes for online shopping in the USA work? The questioner from the UK was asking how much and when we pay taxes for goods we buy in the USA. Honestly, I couldn’t give him a straight answer. Why do we pay taxes on some stuff we buy online in the USA, but not on others?
Physical Location Matters
“If your customer is in the same state as the physical location of your business, they owe sales tax on items they purchase from you. If you have more than one location, then customers in those states would also owe taxes. If you are shipping merchandise to a state where your business (or your merchant account provider) does not have a location, you will not need to collect sales tax,” according to allbusiness.
Why Not Buy Everything Online?
I’ve asked myself that question. With the ability to get free shipping, no taxes, doesn’t shopping online just make sense? Using PriceGrabber.com and Ebay I’ve never even had to look at the weekly Sunday ads, the best deals… Are Online!
Will this system last forever?
States are pushing for a national internet sales tax. It only makes sense considering all the money lost on non taxed goods being sold online. It seems to only make sense to buy everything online to avoid not only the taxes, but the use on your car as well…