e-Commerce Sales Tax

The administration for Sales Tax on goods sold by out-of-state e-Commerce sellers will shortly be revisited said the US Treasury.

Currently, sellers with no physical location in another State are not required to charge the Sales Tax of the State when the consumer is resident there. The consumer instead is expected to voluntarily self-declare the tax in a usage report. There is a very limited compliance, in practise, with this obligation. This rule follows a Supreme Court decision in 1992 – but this did not reflect the enormous increase in cross-State e-Commerce.

Many in-State online and bricks-and-mortar retailers claim this leaves them at a significant economic disadvantage to out-of-State retailers who effectively do not have to charge Sales Tax.

The US Congress in order to change the present position, must change the law. The 2013 Marketplace Fairness Act, which was passed by the Senate, positioned the framework for this, but has since been delayed.

With the requirement to raise funding for infrastructure works, the current administration now wishes to re-start this.

The largest US e-Commerce company, Amazon, is now charging Sales Taxes in all States where it is levied.

amavat Europe provides a one-stop-shop solution for VAT obligations within Europe. We assist clients with a single point of contact that speaks their language and handles all VAT related issues with a standard and cost efficient approach.

If you have any queries or questions, please do not hesitate to contact amavat Europe.

To find out more information please visit www.amavat.eu.