The 2018 Wayfair decision from the Supreme Court allows states to collect sales tax, including remote sellers sales tax, from remote sellers with no physical presence in the state. Most states have already jumped on the bandwagon. Only two of the states that charge sales tax have not yet imposed sales tax collection on remote sellers: Florida and Missouri.
Florida may add online sales tax requirements, including remote sellers sales tax, as early as next week.
At the moment, Floridians can buy online and send their sales tax payments in with their income taxes. That would require them to keep track of all their online shopping, multiply their expenditures by 6%, and write a check to the states. Like most Americans, Florida’s shoppers generally choose not to pay those taxes.
And so far, the Sunshine State’s government hasn’t taken the opportunity to get sellers to collect those taxes.
$2.7 billion shortfall
Florida is facing a major shortfall in revenue this year. The state, which relies on tourism and hospitality for much of its revenue, has not held up well financially during the pandemic. Nationwide, the pandemic has encouraged consumers to stay home and order goods online instead of taking a chance with retail shopping. Florida is seeing the same pattern.
Experts anticipate similar shortfalls in the next two years as well. Without an increase in revenue, Florida will be looking at deep cuts in services like education and health care.
Like many other states, Florida is hoping that expanding sales tax collection might help. Florida law will require all remote sellers with $100,000 of sales or 200 transactions in Florida to collect and remit sales tax.
The current law specifies “mail order” in many cases, but the new law will update that to “remote sales.” This will include phone or internet sales delivered from out-of-state companies to Florida. The new law will also include marketplace sellers like eBay and Amazon marketplace vendors. It specified that marketplaces can collect the tax from individual vendors.
The Florida Department of Revenue currently encourages remote sellers to register voluntarily to collect and remit sales tax, but it could soon be a requirement.
How Sales Tax DataLINK can help
If you have sales to individuals in Florida, whether you’re a retailer or a manufacturer, you might hear this news and feel frustrated. Now you’ll have another state to cope with. You’ll have to sort out their laws and regulations and figure out (or maybe guess) whether you’ll meet their thresholds this year.
You’ll have to determine whether your goods and services are taxable in Florida, identify exemptions, calculate your sale tax commitments correctly, and file returns on time. There will be unavoidable costs, and it can be hard to predict how that will change your business.
For some small business owners, each state that adds these requirements feels like another straw on the camel’s back. Each addition makes you wonder if this will be the straw that breaks the camel’s back — or sends you out of business.
You don’t actually have to go state by state, though. Sales Tax DataLINK provides predictably priced sales tax solutions that calculate, file, and report for all 50 states. Our sales tax engine keeps up to date on all rates and regulations.
You can even let us take on the whole sales tax compliance issue for you, leaving you free to work on mission-critical jobs instead.
Our software is affordable and accurate, and we have American CPAs on hand who will help you any time you need support. Call 479-715-4275 and let us impress you.