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  • Daniel Gray CPA US Tax Services Toronto Canada

Online sellers, including Canadian sellers, impacted by new sales tax law

There is US sale tax ‘nexus’ law change via the recent U.S. Supreme Court ruling; specifically online sales will much more easily be subjected to US sales tax. Also Canadian (and other non-US sellers) with no USA physical presence who previously did not have nexus in a state, may now find they have nexus for sales tax purposes.

Quill, which set a standard requiring substantial physical presence before a state could enforce the sales tax collection responsibilities on a seller, was overturned.

Companies will now need to consider:

  • whether they have physical presence nexus in a given state

  • whether their sales activity in a state exceeds economic nexus thresholds

While South Dakota v. Wayfair, Inc. related to online retailers, the ruling is not limited only to online retailers.

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