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FastSpring and US state sales taxes economic 'Nexus' tracking


#1

Per my research some US states require foreign/ other US state companies selling digital products/ saas to collect sales tax ( range 5.7 to 9.98 %) if ‘Nexus’ is established.

https://www.quora.com/Does-a-non-US-based-company-providing-online-services-to-US-customers-have-to-pay-sales-tax

TL;DR The nexus is not met if

  • No physical presence
  • No web servers / websites in that state
  • No economic nexus ( revenue from a state economic nexus $100 k -$1 M and/or 200 sales?)

Some of the state have these ballpark rules, and I am assuming if in future more state implement the sales tax on digital goods then they will have something similar.

Per FastSpring website :

https://www.quora.com/Does-a-non-US-based-company-providing-online-services-to-US-customers-have-to-pay-sales-tax

US Sales Tax
Some sales in certain states may be subject to sales tax. Sales of physical products shipped to residents in California, and sales of digital products, subscriptions, and physical products for residents in Alabama, Indiana, Maine, Nebraska, South Dakota, Texas, and Wyoming will incur sales tax. FastSpring complies with the rules and regulations in each state.

So the question :

Does FastSpring track the monthly/annual sales per state ?

If it does tracks it, then I am assuming no sales tax would be owed if the ~ $100k sales threshold is not met .

Would love to hear your thoughts/input on whether I am missing something in my research.
cheers

ps: …and I thought VAT MOSS was a mess :roll_eyes:


#2

FastSpring is a reseller. So they must comply with these tax rules, not you. That’s why you’re paying such a high commission to them.

BTW, digital taxes is not only an European issue. It’s going to be a worldwide trend: https://quaderno.io/blog/digital-taxes-around-world-know-new-tax-rules/


#3

Correct, FastSpring is the actual vendor and the reason you pay them a high commission.