WHY DO I PAY SALES TAX?Updated 2 years ago
You may notice that many businesses are now collecting sales tax on your purchases, even if they did not before. Recent tax law changes across the country have changed tax requirements for online retailers. Many businesses are now required to collect sales tax in all states where they conduct business.
As a result, Wig Studio 1 collects retail sales tax as required by law in specific states. The requirements vary by state and are determined by the number of transactions (orders) placed in a state and/or a monetary threshold (dollar amount of sales). This process is referred to as establishing nexus.
Once a retailer establishes nexus in a state, they are required by law to collect sales tax from the consumer and remit those funds to the respective states that taxes are collected. If you have purchased from a retailer before and not paid sales tax and now are required to pay sales tax, it means that the retailer has reached nexus in that state and is now required to collect sales tax by law.
From a retailer standpoint, collecting sales tax and remitting the funds to respective states is an expensive venture, creating excessive costs monthly and quarterly to facilitate this process; however, it is always our goal at Wig Studio 1 to remain compliant, so this is something that we are not able to change.
You may find that other online retailers are not currently collecting sales tax. The reason is that they may not have met the threshold for collection requirements in certain states, or they are currently working toward this process to eventually be in compliance. The retailer has no sales tax obligation if it has not established nexus in a state.
If you are concerned with or have questions regarding paying sales tax, we recommend that you reach out to your State Senator or Representative for additional information on how your state’s sales tax percentage is determined.
We appreciate your continued support and are happy to assist in any way we can.
Sincerely,
The Wig Studio 1 Team
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