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Welcome back, sales tax squad. 👋
On today’s menu, we have 1) sales tax updates (2) grocery news and (3) a question from you.
SALES TAX NEWS
1️⃣ According to a new rule in Missouri, local sales tax on intrastate sales should be charged at the rate imposed where the merchandise was shipped from.
2️⃣ Even Netflix can’t avoid sales tax. Colorado's tax department told a state court that Netflix’s goods are "corporeal" and by law subject to sales tax.
3️⃣ A new bill introduced in Georgia would exempt sales of diapers, child-rearing products, and adult care items from tax.
4️⃣ A tax reform plan unveiled in Virginia consists of a 0.9% point increase in the sales tax rate and the inclusion of some digital services.
This includes software application services, website hosting and design services, data storage services, digital downloads, streaming, and other computer-related services.
5️⃣ Nebraska’s bill to raise sales tax one cent, to 6.5 cents, is facing opposition. The increase would pay for cuts to the state’s property taxes.
6️⃣ In Mississippi, a tool seller was correctly assessed additional sales tax by the state's Department of Revenue.
Why? Some of its transactions are not considered wholesale, since customers directly used the items.
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ADD TO CART? 🛒
Several states are seeking to do away with sales tax on groceries.
The Governor of Illinois made headlines this week as he called to permanently abolish the state's sales tax on groceries, in order to help families restricted by increasing prices.
A bill in Kansas would eliminate its sales tax on groceries, reduce its bank privilege tax rate, provide a higher standard deduction, and cut property taxes.
In Missouri, a newly introduced bill would exempt retail sales of food from local sales tax.
The states have spoken—time to add those extra last-minute snacks to your cart.
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YOUR QUESTIONS, ANSWERED!
Q (Eliza from UK): We are a foreign company, do we have to pay sales tax?
A: If you have achieved physical or economic nexus within a state, then yes, you are liable to file & remit sales tax in that state.
It is important to note that state tax laws are different than federal income tax laws. Take proactive action by getting a nexus study to mitigate any exposure.
Thank you for reading along.
I’ll be back next month with more sales tax shenanigans.
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Until next time’s 🗑 …
Rohit & the Zamp team