Received a letter from California out of state to register to pay taxes because our FBA inventory is in their state. How do we handle this, being a small business ? We can register with California, however how do we collect prior sales taxes for last three years from Amazon customers. What is the best solution for filing sales tax for all the states? Any suggestions would be appreciated.. cdtfa.ca.gov/industry/wayfair....45278426079#online-marketplace Yes. If you meet either of the sales thresholds pursuant to the Wayfair decision on your sales for delivery into California, you are required to register with the CDTFA to collect the use tax from your customers. However, the online marketplace may collect and pay the tax on your behalf. You should contact your marketplace for more information.
See IMPORTANT NOTE above (just under the FAQ's heading) regarding the use tax collection requirements prior to the Wayfair decision.
@NYjacob If any marketplace chooses to place seller inventory in California, how is it seller responsibility to pay taxes which seller was never informed about. If big stores like Walmart, sells the stuff and choose to bring distributors inventory from their nexus state to California, who is responsible to collect taxes. We never shipped any products to California for storage, as seller we only shipped our products in our nexus center. We have no control or awareness how any marketplace chooses to distribute our products for faster shipping purposes. It is not our decision.
Since now new rule changed for the state of California, where the online retailers have more than 200 transactions in California, seller can enroll for sales tax collection and remittance from that point, however sellers don't owe any past taxes, when they had no intention to keep thier nexus in California. For past storage issues, states should go after marketplace who stored the products in California and should have set those accounts for collecting sales tax and remit to those state where they held the inventory. As seller, we have no control on it.
Why it is hard for state of California to go after big retailer who are also marketplace facilitator for other states and collect and remit taxes for other states. This way, California state will also get taxes paid by foreign sellers who have flooded online retail and get away from any taxes. Going after small business in USA where cost of living itself is so high, is plan to kill leftover small businesses. It is not issue about collecting sales taxe for one state, it is about for all the other states and then hiring an accountant and finally shutdown the business and become a liability on the state and live on food stamps.