Hello,
My business is service-based (personal coaching), so I do not charge sales tax. However, I used to carry a product I sold online, for which I did charge sales tax.
I would like to bring that product back, and am curious how those of you who sell online are dealing with the destination-based sales tax (DBST) requirements passed by the Washington state legislature on July 1, 2008.
Destination-based sales tax requires you to charge the tax rate based on where the item you shipped is received. If you live in Seattle and ship a book or article of clothing to a purchaser in Spokane, you tax them at the Spokane tax rate. If you ship to someone in Tacoma, you charge them the Tacoma rate.
Especially of note: If you sell an ebook, it is considered software, and is also taxable under the destination-based sales tax requirements. I spoke with two employees at the Department of Revenue, and they both explained the law the same way.
I also called my shopping cart supplier (1shoppingcart.com), and the rep I spoke with didn't know about DBST. Their system has not been revised to accommodate the 21 states with these requirements.
My husband has a small home-based business on the side, leasing a software program. He has clients in small towns across the state, and now allocates much more time every month to do his manual invoicing.
You can learn more on the Department of Revenue's website - http://dor.wa.gov/Content/FindTaxesAndRates/RetailSalesTax/
DestinationBased/MoreSST.aspx
Do you have experience with destination-based sales tax using an online shopping cart?
Thanks.
~ Patricia