Support sales tax calculation via the API

[jkwade]

Per Sachin's comments on twitter, I'm opening up an issue suggesting Balanced provide sales tax calculation for sellers via its API.

Vertex may be a possible integration partner.

[sachinag-zz]

Even if the online sales tax thing dies in the Senate, capturing the correct sales tax is exactly the sort of thing where sellers are like "oh, I didn't think of that, but I guess I do need it" (even if they don't).

If it does pass, all hell will break loose, because $1MM (the law's threshold for compliance) isn't that much money.

Happy to talk more about this. Having been the founder of a failed marketplace and spending a lot of time on the tax issue for another startup with an app store makes me a nerd about this.

[Skud]

Just some thoughts on Australia's GST system, which you may want to take into account for this.

As an Australian business owner, I need to charge 10% GST of Australian customers (but not international ones) once my annual revenue exceeds a certain limit. Very small traders don't need to charge GST in other words, but any business supporting at least one full time staffer probably will.

GST is a flat 10%, however it is sometimes included in the price of an item and sometimes excluded. For instance, when I go to buy a tshirt in an Australian bricks-and-mortar shop and see it costs $30, that includes GST. When I get to the counter and pay for it, my receipt says that the cost is broken down as $27.28 for the shirt and $2.72 GST, equalling $30.

However, occasionally things are priced as $X + GST. This happens more for b2b transactions. For instance, my accountant tells me it will cost $500 to prepare my taxes, and when I finally get an invoice it is for $550: $500 + 10% GST.

So as a business, what I would want from balanced is the ability to:

1. set a tax rate (10%)
2. specify whether the prices are inc- or ex-tax, eg. when I send you a purchase for $30.00 do you take the tax out of it or add it on top?
3. apply that tax only to buyers in Australia

When I get reports from you, I would want a column showing the country of the buyer, the total amount charged, then that amount broken down into the item price and tax. Eg:

item: fancy tshirt
qty: 2
price: $30.00
buyer country: AU
tax: included (other options: excluded, n/a (for foreign countries))
total: $60.00
item price: $54.56
GST: $5.44

Hope that helps you understand the requirements for an Australian business that charges GST.