US Sales Tax Overview
What is Sales Tax?
Businesses in Europe are used to dealing with taxes in the form of VAT, but US sales tax is a different prospect entirely.
There are over 12,000 taxing jurisdictions throughout the US. Add to this 100,000+ rules, rates and boundary changes annually and it’s easy to see why many companies require outside expertise to manage what initially seems like a straightforward process.
VAT vs Sales Tax
Sales tax is collected only at the time of the final sale, whereas VAT is applied every time value is added at each stage during the supply chain.
Depending on the state in which your customer is based, different items may be taxed at different rates.
If you have ‘nexus’ in an American state, you must collect sales tax on all taxable sales.
What is Nexus?
Nexus is a connection or business presence in a state or jurisdiction.
International businesses selling in the US are not required to collect sales tax in a state unless they have ‘nexus.’ If you do, then you need to collect and remit sales tax according to their regulations.
Visit our whitepaper page to learn more about nexus and how to stay compliant when selling into the US. Learn more >
How we help your business
We offer a full suite of professional services including nexus studies that help to identify your obligations and registration services to ensure compliance when you expand in the US. Our cloud-based Avalara AvaTax™ technology integrates with hundreds of ERP, PoS and eCommerce platforms to bring tax automation into your expanding business, both in terms of calculating accurate taxes as well as returns filing and remittance.
Other resources
This guide covers the essential steps ecommerce sellers need to take now that the UK has left the EU Customs Union and VAT regime to keep their cross-border sales going, avoid extra tax costs and frustrated customers.
Read the report to learn about key industry trends, emerging issues, and challenges faced by cross-border sellers and shippers.
Manage international tax with cross-border solutions for VAT, HS code classification, trade restrictions, and more.
