Sales Tax 101

What Does Automation, Calculations and Integrations Have to Do With Sales Tax Holidays?

by Kristen Cooper

Everything. 

Customers love sales tax holidays (for obvious reasons), but they can be challenging for eCommerce businesses to support. Why is that?

  • Sales tax holidays change up from year to year. Some states renew their sales tax holiday(s) year after year, but others decide each year whether they want to allow for a sales tax holiday.
  • Some states allow local taxing districts or even individual businesses to opt-out of sales tax holidays.
  • Some states cap prices. For example, only items of clothing and footwear priced at under $100 per item are non-taxable during Texas’s sales tax holiday.
  • Tax exempt items in sales tax holidays change up from state to state. Example: One state’s “Back to School” Sales Tax Holiday might exempt backpacks and bookbags while another state’s does not.

  With so many variables, how do you make sales tax holidays run as smoothly as possible? With Automation, Calculations and Integrations.

  • Automate as much as you can.

The key to surviving sales tax holidays is to eliminate manual efforts wherever you can. You should look to automate key tasks such as:

  • Sales tax calculations. Move away from having to keep up with changes and rate cards. Automate the calculations and ensure that you’ve got the right rate every time. 
  • Product classification and product tax code assignment.  On the topic of product tax codes, you’ll need to know your solution of choice offers the granularity of product tax codes that you need.
  • Sales tax filings to the states where you’re registered. Eliminate the burden of remembering due dates and manually having to file those state sales taxes.
  • Ensure you’re calculating the right sales tax.

Accuracy is key. You want to make sure that you’re relying on rooftop-level calculations so the exact address corresponds to the right rate. You’ll also want to ensure that the tax rates you are usings are the most current available. 

  • Manage sales tax from end to end.

Make sure you’re integrating with your eCommerce platform, marketplace or cart of choice to streamline sales tax management from calculations to reporting.

Ready to make sales tax holidays easy? Learn more about how TaxJar can handle all of this for you and request a demo today.  

Looking for more information on tax free weekends?

View our Guide to Sales Tax Holidays.

Start your 30 day free trial of TaxJar. No credit card required.
AIRPRESS LOADED

Cached Query Manual Filing?filterByFormula=OR({State} = "") needs refreshing in 51