Hello all!

We're starting to work on a way to effectively set taxes in Shopping Cart Creator. (Hooray!) As we all know, there are a lot of different ways to deal with this issue. What we want to do is make sure we address it in the best way possible and try not to overcomplicate things. So what we want to know is, if you already have a Web shop, how are you currently dealing with taxes?

A lot of countries seem to do things differently. What we are looking for is input, feedback, and real-world examples so we can make an accurate assessment of what we should do. We are trying to base our decision as much on factual information as possible. That means now is the time to really share your experience with us so we can make this new feature fit your business needs.

United States / Europe:

We know how taxes work in these areas. Even still, let us know what modifications we can make to help make the program work best for you.

Canada / Australia:

How exactly are PST and GST calculated? If you order something from one province and deliver it to another, which provincial tax applies? Are there any other taxes that either of these countries have to take into account when dealing with online sales?

We know this feature won't be perfect when we first launch it, but we will do our best to make it as powerful as possible. Still, we want to emphasize that we don't want to make it overcomplicated. One of the strengths of Shopping Cart Creator is its ease of use, and we'd like to keep it that way.

With that in mind, I welcome your suggests and comments.

I am the typical American with a business license that requires me to collect tax for sales being shipped to my state of residence only. I want the cart to default to zero tax, but have an option for locals. This could be the same type drop down as the shipping options or a simple check box. Most importantly I do not want a change to where my customers have to login to my site and enter their information before they get to Google Checkout!

The check boxes idea would be the most flexible for people that have multiple state taxes or even setup for package insurance, gift wrapping, etc instead of needing to make "items" for these services. Then users would need to be able to edit the text before the check box and the action it performs. Add $ or % per item or order, etc.

Thank you for listening.

I think a menu of states could be offered in the cart. Before the customer checks out they would need to select the state where they are from so that when my state is selected tax is then shown to the customer. For users needing more than one tax maybe there could be more than one menu.

Scott, there are 3 types of sales tax to consider for Canada.

GST (Goods & Services tax) is applicable to both item price and shipping cost of all sales, save for sales to Nova Scotia, New Brunswick and Newfoundland/Labrador which are charged HST instead of GST (see below). Items sold outside the country are taxed at 0% GST. Currently, sales within Canada are GST taxable at 5%.

HST (Harmonized Sales Tax) currently 13 % (= 5% federal & 8% provincial) which replaces both the federal goods and services tax (GST) and the provincial sales tax and is applied on the same basis as the GST.

PST (provincial sales tax) % varies from province to province. In BC, where we are located it is 7% and is applicable only to sales within BC. There is no PST applicable on sales out of province. The province of Alberta doesn't collect a PST.

- sales taxes are applicable to both item price and shipping cost. '

- invoices on which tax is collected, must bear the GST# of the registered business collecting the tax.

- there are certain types of items which are GST/HST and PST exempt, so some provision should be made to allow specific store items to be exempt from taxation. Other items are considered taxable but are 'zero rated' charged at 0%.

- to work properly, I believe the cart must force the tax choice at some point in the check-out. If the buyer can proceed without selecting the proper tax option, it will create a lot of headaches for sellers. We've sold online for 5 years off ebay.ca, and their system which doesn't force the tax, resulting in more than half of our Canadian sales being completed without the buyer paying tax.

Then, the seller is faced with taking a loss and covering the tax out of the shipping and handling costs (an administrative PIA), or with refunding and reinvoicing (another administrative PIA - and not good PR). So far, we've done the former, but will not again use a system that doesn't force the tax. Hopefully, SCC will do so.


(in a nutshell)
- sales out of country are charged 0% GST on item/s & shipping
- sales within Canada (outside the business home province - but excluding HST provinces) are charged 5% GST on item/s & shipping
- sales within Canada (within the business home province ) charged 5% GST & PST (rate varies by province) on item/s & shipping
- sales to Newfoundland/Labrador, Nova Scotia, and New Brunswick are charged 13% HST

-hope this helps
Steven

I am Canadian... thought I would throw this in.

In some Provinces the PST is calculated then the GST is calculated... in other provinces the GST is calculated then the PST (tax on tax)... and in others it the GST and PST is only calculated on the sale item.

Also, another issue will be, for example, an individual serving of juice is GST applicable but a liter of juice is GST exempt.

Bottom line... the cart creator would need the ability to flag the GST exempt items and how the tax is calculated in the province that the product is shipped to.

We really need more government - LOL!!

Hope that helps.

Australia's rules

The advertised price MUST include GST.

The only time GST is NOT charged is for export purposes, excluding (I believe) New Zealand where the tax still applies. Generally only food is GST exempt.

All invoices for goods valued at over $50 must show:-

The sellers ABN Australian Business Number
The amount of GST charged

This only applies to those registered for GST, for backyarders and hobby sellers it's not an issue.

There are no (at present) State based sales taxes, so selling between states is a doddle.

GST is payable on the freight/postage component as well, so this must be addressed on the final invoice.

I hope this helps

Geoff

Scott,

I'm in Canada so Steven and Cliff above have explained it very well.

It seems that most folks could make it workable if:

They had multiple line items (similar to the shipping section) where they could label the specific type of tax as well as set the percent. We would also need to be able to tell the cart when to apply that info.

I also completly agree with Steven that it cannot be a choice that the customer has. The cart must somehow force the customer to enter an address and then apply the tax appropriately.

rosey

rosey

PopPicker is correct with all he says, but we also need to have the means of selling off-shore that would not have GST included in the sale/freight price.
So we need to be able to address both types of sale within the web shop.

Also the document must say TAX INVOICE as well as showing the Australia Business Number (ABN)

NY, as in many States, requires sales tax to be collected from purchasers within the State. Each selling location has a set tax rate (not all the same - differs by County). The location of the business controls the tax rate so the shop need not differentiate between Counties. It would need to recognize that the shipping address is in NY. I think Google will apply the tax on its own IF there is no tax tab sent. I am unsure of Paypal - but that would be a great ffeature for them to offer (and if you use their buttons - I think Paypal does diferentiate and assess tax to in State sales).

After thinking about this for a while - I believe the best way would be to pass the burden of assessing taxes to Paypal and Google.

You can set Paypal to collect sales tax by state as well. Just like Google.