As the growth in state-by-state sales tax collection marches on, Amazon notified sellers Tuesday that it will begin collecting sales tax in Minnesota in just under two weeks, starting on October 1. Per eCommerceBytes:
Amazon began collecting and remitting Washington sales tax on January 1, 2018. In April, it added Pennsylvania, and in July, it added Oklahoma.
Here’s the message Amazon provided to sellers on Tuesday:
Tax collection for orders shipped to Minnesota State – Effective October 1, 2018
Based on changes to Minnesota State tax law, Amazon will begin calculating, collecting, and remitting sales tax for all orders shipped to customers in Minnesota on October 1, 2018.
Your existing tax calculation settings, order details, and payments reporting will update automatically to reflect this change. No action to your tax settings or seller account is required.
Local sales tax collection is becoming an increasingly complex problem for marketplace sellers, as tax rates vary from state to state (and even city to city). Several startups have cropped up to help sellers charge, report, and remit the correct amounts.
In the case of Minnesota, the state has created an FAQ for “marketplace providers” specifically (i.e. putting a mandate on the platforms). It notes, “Marketplace Providers must register and begin collecting Minnesota sales tax on behalf of remote sellers using their marketplace no later than October 1, 2018.”
Minnesota also has an Update for Remote Sellers that states, “Remote sellers that sell goods or services into Minnesota from other states must register and begin collecting sales tax in Minnesota no later than October 1, 2018. Minnesota businesses that remotely sell into other states may also need to start collecting sales tax in those states.”