Q: I run an e-commerce site connecting local buyers and sellers of baked goods. Am I required to collect sales tax?
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- California
- (916) 704-3009
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- Answered
A:
Under California law, sales tax is generally applicable to retail sales of tangible personal property, which includes baked goods. As the operator of an e-commerce platform connecting buyers and sellers, your responsibility to collect sales tax depends on whether your business is considered a retailer or a facilitator in these transactions.
If your platform actively sells goods and processes payments, you may be considered a retailer and thus responsible for collecting and remitting sales tax.
However, if your role is limited to connecting buyers and sellers without handling transactions, you might not be directly responsible for sales tax collection. The specific structure of your business and the nature of your involvement in transactions will determine your obligations. It is advisable to review the California Department of Tax and Fee Administration's guidelines regarding e-commerce and marketplace facilitators.
Consulting with a tax professional or attorney can provide clarity on your specific situation. Keeping accurate records of all transactions is crucial for compliance with tax regulations.
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