When you first heard the term 'Destination Based Sales Tax', you may have scratched your head and wondered how it relates to your e-commerce site. After that you probably reached for the aspirin when you realized just how big of a headache it could be. Fortunately, you found your way to destinationtax.com, where we can propose and provide custom solutions for your destination-based sales tax problems!
Currently, our free calculator provides rates for Washington and Nevada, and we are in the processing of adding other states. We are also looking at adding state address databases as they become available in order to provide street address standardization and zip+4 lookups to determine the most accurate sales tax rates.
Here is a better explanation, from dor.wa.gov:
What is the Streamlined Sales and Use Tax Agreement (SSUTA)?
The SSUTA is a cooperative effort of 44 states, the District of Columbia, local governments and the business community
to simplify and make more uniform sales and use tax collection and administration by retailers and states. It is intended
to reduce the cost and administrative burdens on retailers that collect the sales tax, particularly retailers operating in
multiple states. It would encourage "remote sellers" selling over the Internet and by mail order to collect tax on sales to
Washington customers. It seeks to make local "brick-and-mortar" stores and remote sellers all operate by the same rules and
in the same competitive environment.
What are "remote sellers"?
Remote sellers are businesses that sell products to customers in a state, using the Internet, mail order, or telephone, without
having a physical presence in that state. These sellers currently cannot be required to collect and remit sales tax as brick-and-mortar
stores must do. The U.S. Supreme Court ruled in 1992 (Quill vs. North Dakota) that the burden of collection was too high given the
number of taxing districts in the country and variations among states as to what was taxable and at what rate.
Why is this agreement needed?
Local brick-and-mortar stores are operating at a competitive disadvantage to remote sellers who aren't collecting or paying taxes.
Sometimes local stores find themselves serving as showrooms for Internet sellers. Prospective customers check out the merchandise
locally but buy the product online to avoid paying sales tax.
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