As a shop owner, it’s important to understand the types of taxes we calculate, collect, and remit for every purchase made on the site. The Supreme Court of the United States has sided with states to allow them to collect Sales Tax from online merchants like Creative Market. This means US-based buyers will now see this tax reflected at the time of purchase. Throughout this article, we’ll take a look at some common questions around Sales Tax so you can learn more about how we’re staying compliant.
What is a Sales Tax?
It’s a type of tax imposed by states on the sale of goods and services. Rates may vary by county.
How does Creative Market collect US Sales Tax?
Buyers will see the applicable Sales Tax next to product prices in the purchase flow, before they confirm their orders. This Sales Tax is calculated based on the billing information they’ve entered in their account’s payment settings. Creative Market determines, collects, and remits Sales Tax for all purchases.
Creative Market is currently collecting Sales Tax from US buyers in the following states:
- Alabama
- Arizona
- Connecticut
- Hawaii
- Idaho
- Kentucky
- Louisiana
- Maine
- North Carolina
- New Mexico
- Pennsylvania
- South Dakota
- Utah
- Texas
- Vermont
- Washington
- Wisconsin
- Wyoming
Does this affect my earnings and tax forms?
Sales Tax is not collected from your earnings. Because this is not an income tax, amounts collected will not appear on US tax forms. For more information on withholdings and tax forms, visit our Shop Guide to Tax & Payouts found here.
Can buyers opt-out?
At this time, we have no means to provide exemption, but we welcome feedback as we consider if this is possible in the future.
How much US Sales Tax is collected when my products are sold?
The amount of Sales Tax charged to US-based buyers depends on the state and zip code where they are located. They must check with their state’s local tax authorities to learn more about the rate they can expect in all online purchases. If you want to get a rough idea of the average rates in different states, check out this map created by The Tax Foundation. In all cases, Sales Tax will be calculated and charged based on current state laws.
Creative Market does not charge Sales Tax when buyers purchase a credits package. However, when they use their credits to purchase products, Sales Tax will be charged on those purchases.
How about international sales taxes?
Creative Market collects VAT/ GST for buyers from the European Union and select countries like Australia and Singapore. We will expand to other jurisdictions in the future as we comply with local laws. The Sales Tax, VAT, or GST rate your customers will be charged depends on their billing location (including country, state, and ZIP code).
Reach out if you have any questions
Our Support Team is happy to answer any other questions you might have around Sales Tax and other elements of the purchase process. Feel free to reach out to us here.
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