Sales Tax by State

California's partial exemption for R&D and manufacturing — the 3.9375% rate

California offers a partial sales and use tax exemption for equipment and machinery used primarily in qualifying manufacturing or R&D operations. The partial exemption reduces the state tax rate by approximately 3.9375%, leaving only the local and district tax portions as taxable. This applies to tangible personal property used in production and R&D under California R&TC §6377.1.

Colorado home rule cities — what they are and how they affect filing

Colorado has over 70 'home rule' municipalities that administer their own sales tax independently of the state, with their own rates, forms, filing deadlines, and audit authority. Sellers with Colorado sales must file separately with each home rule city where they have nexus, in addition to filing the state return. This is why Colorado is considered the most complex sales tax state for remote sellers.

Louisiana parish-level sales tax filing — what every ecommerce seller needs to know

Louisiana has 64 parishes (counties), most of which independently administer their own sales taxes. Remote sellers use the Louisiana Remote Sellers Commission (LARC) portal to file a single consolidated return covering all parish sales. LARC does not cover Orleans Parish (New Orleans), which requires a separate filing. Louisiana's combined rates vary significantly by parish.

Texas resale exemption and the cost-of-goods deduction for manufacturers

Texas allows resellers to purchase goods exempt from sales tax by providing a Texas resale certificate (Form 01-339). Texas also allows manufacturers to take a cost-of-goods-sold deduction on the Texas Franchise Tax: a separate incentive. For sales tax purposes, Texas's data processing services tax has a 20% exemption, meaning only 80% of the charge is taxable.

What is Washington's B&O tax and how is it different from sales tax?

Washington's Business and Occupation (B&O) tax is a gross receipts tax on the privilege of doing business in Washington, separate from sales tax. Unlike sales tax, B&O is paid by the business on its gross revenue, not collected from customers. Remote sellers with economic nexus in Washington may owe both sales tax and B&O tax.

Why does Colorado charge a 7% credit card fee on sales tax payments?

Colorado charges a service fee on credit card payments for sales tax, currently set by the state's payment processor and typically around 2-3%. The 7% figure sellers sometimes encounter is a combination of the credit card service fee and Colorado's vendor fee (an allowance for sellers who file on time). Understanding the offset is essential for accurate net remittance.