Legal
Business
Employment Legal Business EmploymentThe United States is one of the most attractive markets for international companies, especially for those that market their products through platforms such as Amazon, eBay, Etsy or Walmart. However, US indirect taxation can be complex because there is no federal VAT, but rather a sales tax system (Sales Tax) regulated by each state.
Furthermore, since the historic ruling in the case South Dakota vs. wayfair In 2018, the tax obligations of companies selling in the United States have changed significantly.
Understand how Sales Tax rules currently work and the role of Marketplace Facilitators It is essential to avoid non-compliance and operate safely.
Until 2018, a company was only required to collect and remit Sales Tax in those states where it had a physical presence, such as offices, warehouses or employees.
However, the ruling of the Supreme Court in the case South Dakota vs. wayfair eliminated that requirement and allowed states to demand the collection of the tax based on the volume of sales made within their territory, even without physical presence.
In this way the concept of Economic Nexus.
As a general reference, many states established a threshold of:
Nevertheless, Each state establishes its own criteria and several have already eliminated the 200 operation requirement, maintaining only the sales volume as a reference.
Therefore, it is essential to analyze each state individually to determine when a tax obligation exists.
A Marketplace Facilitator is a platform that connects sellers with buyers and is responsible for managing the entire transaction.
Among the main marketplace facilitators are:
In practice, if a company sells its products through these platforms, it is normally the marketplace itself that is in charge of calculate, collect and remit the corresponding Sales Tax.
That is, the seller does not usually have to directly manage these taxes for sales made through Amazon or similar platforms.
Nevertheless, These taxes continue to be paid on behalf of the seller and are part of its overall activity, so they must be taken into account for tax compliance and planning purposes.
Following the Wayfair ruling, virtually all states with Sales Tax passed Marketplace Facilitator laws between 2019 and 2021 that They transferred the responsibility of collecting and remitting the tax to the platforms.
In practice:
As a general rule, the seller does not have to collect or remit the Sales Tax corresponding to sales made within the marketplace.
Currently, Sales Tax is applied in 45 states and the District of Columbia.
There are five states that do not have state Sales Tax:
Besides, The tax is normally calculated based on where the buyer is located, so rates may vary by state, county, and destination city.
Although platforms greatly facilitate tax management, There are certain obligations that continue to be the responsibility of the company.
When sales are made through the company’s own website or other external channels, it is up to the seller to monitor whether it exceeds the Economic Nexus thresholds in each state.
In these cases it will be necessary:
The program Fulfillment by Amazon (FBA) can generate what is known as Physical Nexus.
When Amazon stores inventory in its fulfillment centers, that inventory may constitute a physical presence in certain states and generate new tax obligations.
Therefore, it is advisable to analyze where the inventory is stored and the associated tax implications.
Although the marketplace collects the tax, some states still require the seller:
The requirements vary according to each jurisdiction, so it is advisable to carry out a specific analysis for each case.
Obligations related to Sales Tax in the United States can be complex, especially for international companies that combine direct sales with operations through marketplaces such as Amazon.
At UR Global we accompany our clients from the United States throughout the entire process to guarantee correct tax compliance and avoid risks derived from incorrect registrations or declarations.
In addition, we consolidate all the company’s tax information, integrating both sales made through marketplaces such as Amazon, eBay, Etsy or Walmart, as well as direct sales made through other channels. This way, We verify that all activity is correctly reflected and we ensure that the collection, declarations and payment of taxes are carried out in accordance with the regulations applicable in each state.
Our specialized team can help you with:
Have the support of specialists allows companies to focus on their growth, with the peace of mind of adequately complying with tax obligations in one of the most dynamic and demanding markets in the world.
The emergence of Marketplace Facilitators has significantly simplified Sales Tax management for companies that sell on platforms such as Amazon. However, this does not eliminate all tax obligations of the seller.
Direct sales, Amazon FBA warehousing, and registration and filing obligations still require proper planning and ongoing monitoring. Likewise, it is essential Correctly consolidate all information from marketplaces and own sales channels to ensure that tax collection and compliance are correct.
In At UR Global we help companies safely navigate the US tax complexity, offering comprehensive support that allows them to grow in the United States with confidence, optimizing Sales Tax management and ensuring full compliance with current regulations.
Trend
