PayPal state tax problem - Post ID...

User 2022416 Photo


Registered User
25 posts

We are big fans of your software. That being said, we are experiencing a problem when a customer checks out using the coffecup shopping cart and is forwarded to paypal.

Since we are based in VA, we charge 5% tax on every item shipped from VA to VA. Coffee cup allows us to select the state from the shipping drop-down menu and tax is recorded appropriately. The break occurs when the order is forwarded to paypal. In a perfect situation, the tax will be reflected correctly, however not in all cases. Please see the following example:

1. Virginia customer orders $10 item. He accidentally puts in Utah as shipping destination in coffeecup.

2. Coffeecup passes thru the order to paypal with no tax.

3. Customer enters correct info on paypal with VA address, however Paypal does not charge the 5% tax because the info was passed incorrectly via Coffeecup. (keep in mind that paypal account is set up correctly to charge VA customers 5% but is overridden by the coffeecup passthru info)

4. Customer is charged $10 rather than $10.50.

5. We are liable.

If we decide to make our shipping default VA, then we run the opposite risk of charging all out of state customers tax on orders where the customers neglect to choose their correct shipping location in the coffecup shopping cart..

kindly advise with a solution and what our liability may be as an online merchant - Craig

User 364143 Photo


Guest
5,410 posts

Not a perfect solution but what you can do is make your state the default tax in the cart and have a statement on the checkout page that if people in that state must select that state to prevent delays in shipment, then send them a PayPal request for the difference.
CoffeeCup... Yeah, they are the best!
User 38401 Photo


Senior Advisor
10,951 posts

I know the Pro version will address this 'default' issue, not sure on the basic version, I'll install it today and see. I won't say anymore than that, but I don't want anyone to think that this issue hasn't been worked on :)

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