In 2018, the United States Supreme Court made a decision to declare a previous decision unconstitutional, altering 1988 Sales Tax Law too no longer be based on a business’s address, but instead the address where an item is shipped/used; one of 11,000 tax jurisdictions in the United States, with each State having their own unique Sales Tax Law. To collect Sales Tax from a customer, a permit is required to be secured first from each State that tax the particular item category, then the collected tax must be reported and remitted to each State at periodic times. Some States offer exemptions with thresholds. See USSC South Dakota v. Wayfair, Inc. 2018 for the change of Commerce Code Guidance of the Supreme Court. Some States offer API’s to get sales tax rates based on address; however, now it’s necessary to be aware of all United States different Sales Tax Laws, as some tax shipping, others do not, some tax handling, some do not. Most importantly, do not collect taxes for a State without a permit for that State. Good luck. Oh, one other thing, be aware, some of the 11,000 different tax jurisdictions share the same zip code with other tax jurisdictions, with different tax rates within the same zip code. All this makes automatic Sales Tax Calculations much more complex than it was when Sales Tax was based on business address. Sales Tax is now based on where the item sold is delivered and used, and this is why you’ll now see it referred to as “Use Tax”, or VAT (Value Added Tax); applied to Interstate commerce; e.g., telephone sales, catalog sales and Internet sales. There’s a significant amount of incorrect information respecting Sales Tax, so rely on each State’s government sites for reliable information.
