In the digital marketplace, businesses can offer services our great-grandparents never dreamed of.
Today’s consumers can:
- download a digital copy of On the Road to Kindle (or get Abbey Road straight from iTunes);
- store family photos in the cloud with services like Dropbox; or
- update customer records from a mobile phone with apps like Salesforce 1.
Yet for as much convenience and access as the new digital universe offers us, it also creates complexity and risk–especially when it comes to tax. States want to tap into tax revenue from growing digital economies, but their pre-internet tax codes simply aren’t built for it. As a result, digital tax policy varies widely from one state to the next (and some states have yet to fully define their policies).
It’s no surprise then, that many online businesses struggle to understand their tax obligations. To help you keep up, this post contains the latest state and federal news related to tax on digital goods and services.