Sales tax is calculated as a percentage of the total taxable purchase. It’s a one-time tax charged at the point of sale to the end customer. The money goes from the consumer, to the vendor, to the government, the end.
Sales tax by state
In the US, sales tax rates are determined at the state and local levels. There is no overarching national sales tax in the US. In fact, some states don’t have sales tax at all, such as Alaska, Delaware, Montana, New Hampshire, and Oregon.
If you’re selling remotely to other US states, you should check the economic nexus laws to see if you are liable for sales tax there.
Local sales tax rates are determined by different jurisdictions, such as the city or county. Sometimes local jurisdictions will add a temporary sales tax to raise funds for a public project, such as transportation or a cultural building.
Though local rates are generally quite low compared to state-level tax, they’re just as important to stay aware of!
At Quaderno we love providing helpful information and best practices about taxes, but we are not certified tax advisors. For further help, or if you are ever in doubt, please consult a professional tax advisor or accountant.
Automate tax compliance worldwide
Let Quaderno automate the sales tax process from end to end so you can stop wasting time on taxes and take back control of your business.