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by tallanvor 2915 days ago
Here's the problem with that $100k/200 transaction law. Small businesses have to do one of three things:

1) Assume that they will hit one of those limits and collect tax from the start. Once they've told the customer that they've been charged tax, they will have to file anyway. I don't see anything that says the first $100k/200 transactions are exempt from the requirement. And if you hit the limits this year, you'll have to collect taxes no matter what from my reading of the bill.

2) Keep track of how much has been sold to South Dakota residents and stop selling if they hit the limits.

3) Give up and tell South Dakota residents that they're out of luck and that a state with less than 900k residents isn't worth putting up with the filing hassles.

If I'm not sure if my business will take off, I'm probably not interesting in paying taxjar or someone else $5000/year just in their filing fees (to make sure I'm covered), so I'm most likely to go with option 3 and start by limiting sales to my home state, those with no sales tax, and those that aren't going to try and make me collect the sales tax for them.

1 comments

This ultimately comes down to the fact that each state in the US behaves like an individual country in many ways, especially when we talk about taxation. It doesn’t jive well with the current lay of the Internet, and it will be interesting to see the reaction here. In Australia a single GST was introduced (long ago, July 1 2000) and it’s a big simplification for online transactions. The catch: everyone would need to agree to a number.
"jibe well"
Thanks, too long back to correct it now :(