How to create a robust US sales tax strategy for online trade

Why is US sales tax so complex?

There is no standardised tax system in the US as each state sets its own tax rules and often take widely varying approaches. As a result, every state has a different tax framework, with varying regulations covering everything from tax liability and tax rates through to exemption rates and reporting requirements. In addition, local area tax jurisdictions also have authority over some aspects of taxation which adds an additional layer of complexity. So, what does this mean for day-to-day tax management?

The root cause of US sales tax liability is the principle of nexus – in other words, the requirement that a qualifying connection exists between the state exercising its tax power and the taxable subject.

Source International Tax Review

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