Navigating Sales Tax Changes with Vertex and Creatuity
The recent U.S. Supreme Court ruling in South Dakota v. Wayfair (which overturned the long-maintained Quill decision) will dramatically change the landscape when it comes to sales tax. States may now require online sellers to collect sales tax on out-of-state transactions.
In light of these changes to the ecommerce ecosystem, we’ve paired with the tax experts at Vertex to provide you with several assets that can aid your company in navigating these increasingly complex policy transformations, including an interactive online quiz for merchants to rate their tax complexity.
The concept of sales tax nexus originates with the 1992 Quill vs. North Dakota Supreme Court ruling stating that retailers had to maintain a physical presence in a state before requiring that merchant to collect sales tax for that state. Living up to its canonical definition, nexus is a complex series of connections between local state definitions, nationwide interpretations of nexus, and regional obligations of a retailer in situational contexts. Different states have varying definitions of what constitutes economic nexus and “significant presence,” but is generally understood to include several factors such as owning or operating an office, warehouse, or commercial space, number of employees, and relying on third-party partner for shipping, inventory, or distribution.
Wayfair vs. South Dakota was a federal case heard by the Supreme Court of the United States in which SCOTUS ruled that it is within states’ constitutional rights to collect sales tax on out-of-state transactions carried out by online retailers. The 5-4 ruling dictated on June 21st, 2018 directly challenged and overturned the 1992 Quill vs. North Dakota case while simultaneously shifting the understanding of commerce clauses.
Until the June 21st SCOTUS ruling, nexus was historically determined by physical presence–but the age of ecommerce with its burst in online sales and technological advances outdated the 1992 decision ill-equipped to deal with the huge influx of internet sales. Courtesy of the 2018 Wayfair decision, states newly-unburdened by previous federal restrictions will now be responsible for making the choice to collect taxes on ecommerce sales and their subsequent policy formations regarding collection policies.
Below you can find a list of assets that we’ve published to help you guide your business through ongoing and upcoming changes in sales tax policy:
1. Read a synopsis of what the ruling means from Vertex’s Chief Tax Officer, Michael Bernard, by clicking here.
2. Refer to the Vertex website for the most up-to-date content communications such as state updates, podcasts, blogs posts, webinars, etc.
3. Watch the Vertex sales tax webcast here.
4. Browse our FAQs – Learn what the case was about, how this will affect sellers, verticals it will affect, what businesses should be doing to prepare, and how Vertex and Creatuity are here to help!
5. Review our infographic and take our interactive, online quiz to determine your sales tax complexity.
Vertex is tax technology company that offers a plethora of knowledge in all things tax-related as established subject matter experts. Specializing in sales & use tax, value-added tax, exemption certification management, compliance, and tax data management, the tax solution teams at Vertex are a leader in tax technology, integrations, and offer a wide variety of products and services.
Alongside an unwavering commitment to integrity, a community of Vertex tax specialists provide access to innovative, cutting edge software and unrivaled corporate tax expertise, while remaining loyal to their customers, clients, and partners. You can connect with Vertex on Facebook, Twitter, LinkedIn, and YouTube, or visit their website.
About Creatuity, a Magento Enterprise Solution Partner
At Creatuity, it’s our mission to build the most efficient ecommerce sites possible to foster your business’ access to technological advances and economic success while pairing you with the best tax strategies and expert resources out there. If your business is already operating on a best-in-class ecommerce site through Magento, there are leading-edge, integrative sales tax compliance solutions available to you. As an esteemed Enterprise Solution Partner, we’re able to match you with the most effective, personalized tax solution for your needs to create a smooth period of implementation and integration.
Founded by Magento Master Joshua Warren in 2008, Creatuity is a Magento Enterprise Solution Partner headquartered in Richardson, Texas. As an international agency with offices in the U.S. and Europe, Creatuity has earned some of the most prestigious honors in the eCommerce technology industry, including six Horizon Interactive Awards, a Distinguished Agency Award, Spirit of Excellence Award (Americas) and Best in Class Implementation in 2018 (RuralKing.com), and two Academy of Interactive and Visual Arts W³ awards. With almost thirty M2 Certified team members, Creatuity currently holds the most certifications of any Magento Enterprise partner in the world. As a global ecommerce agency, we specialize in Magento Commerce Cloud implementation, Magento Order Management integration and Magento 1 to Magento 2 migrations. As an agency, we’ve been the driving force behind several award-winning innovations like our omnichannel-aware, AI powered Chatbot and our contributions to the core code of Magento’s Instant Purchase functionality. For inquiries, contact one of our team members at (214) 810-5005 or firstname.lastname@example.org.