Taxing Shipping charges?

Is there a ruling on taxing S&H charges?

[Girl_Racer]

Hi

I was wondering whether anybody could tell me whether there are hard and fast rules about charging sales tax on S&H?

Victoria Secrets.com DOES charge on S&H, but another website I looked at today didn't (the S&H was applied after the taxed sub total had been derived)

Any ideas?

Thanks!

[walkman]

I don't think you need to. Maybe handling since it's a service provided by YOU. I am guessing though

[Sunshyn]

Connecticut has made it clear that we need to charge sales tax on shipping charges in our state. PayPal really made a mess of our books for that because their sales tax is set up so that it won't do that.

[Girl_Racer]

Thank you!

PayPal was the checkout process I used that did NOT include it in sales tax! (As opposed to VicSecrets which did)

That would explain it

thanks again!

[craftedev]

It may also vary by location. Indiana changed their tax laws last year in order to collect tax on shipping charges.

[Big_Balou]

From my experience charging tax on shipping is dependant on the state you are based in. For instance I'm in NC now and for any instate purchases tax is charged on shipping.

[sun818]

California - sales tax on shipping is not allowed, but handling ("your profit") is taxable. Now, how one goes about separating out shipping and handling for accounting purposes is the dilemna. You can either undercollect or overcollect which has its own set of issues...

[danieljean]

I signed a client in large part because that was one of her pet peeves.

Note to fellow shopping cart programmers: let customers choose how they want the tax applied, perhaps even letting them apply it only in certain zones. :)

[digitalv]

I'm curious as to why any state would force you to charge sales tax on shipping? The shipping price that YOU pay to your shipper already INCLUDES sales tax. If a state is forcing you to charge sales tax on top of that, that's double taxation.

[Conard]

NY State requires sales tax be charged on shipping for in state orders, for the why....
More income for the state or as the state would say....Why Not?

[danieljean]

digalv: it's even less efficient than that in Canada. Businesses are reimbursed for those taxes they pay, remitting only the difference between taxes they paid and taxes they charged customers. It's an accounting nightmare for a lot of small businesses.

[craftedev]

Indiana adopted the change to comply with the Streamlined Sales and Use Tax Agreement. Which I believe is several states and businesses working to create similar tax laws among the states. Paving the way for internet tax by eliminating the argument it's too dificult to collect taxes from so many states.