In order to advertise your products to US consumers on Google Shopping, you need to collect state tax from consumers in those states. When you choose to set up a Google Shopping campaign we will automatically fill out tax-rates for all US states for you. However, It is your responsibility to understand US state nexus laws and how they affect your business.
On June 21, 2018, the Supreme Court of the United States ruled that states can begin taxing remote sales via their economic nexus laws. Most states (over 40) have since passed economic nexus laws of their own.
Before this ruling: only businesses that had a physical presence in the state had tax collection obligation.
After this ruling: nexus laws were expanded to include a sales tax obligation based on a certain level of economic activity within the state, including sales revenue, transaction volume, or a combination of both.
Like many sales tax laws, economic nexus criteria vary by state and by the type of tax.
Below table is subject to change and you should always check the local state's tax rate for any changes.
*Arizona - AZ: $150,000 (2020), $100,000 (2021 forward)
*Georgia - GA: As of January 1, 2020, the threshold changes to $100,000 or 200 transactions.
*Minnesota - MN: 200 retail sales
*Note that Washington D.C. is not a state.
- If your products are purchased by consumers in Alabama and your sales reach $250.000 you will need to pay the state of Alabama 4.00% tax of those sales.
- If your products are purchased by consumers in Arkansas and your sales reach $100.000 or 200 transactions you will need to pay the state of Arkansas 6.50% tax of those sales.
- If your products are purchased by consumers in Connecticut and your sales reach $250.000 and 200 transactions you will need to pay the state of Connecticut 6.35% tax of those sales.
- If your products are purchased by consumers in Delaware you do not have to pay sales taxes.