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cornellbirds avatar image
cornellbirds asked

Are in-app purchases subject to US state sales tax?

Are in-app purchases generally subject to US state sales taxes? I'm a developer in NY state and generally have to charge US state sales tax to residents of New York, California, and a few other states. Are in-app purchases subject to sales tax? How does one configure that? There are a few references in Amazon documentation about VAT, and the fact that VAT is automatically added on top of the list price of the in-app purchases. It seems like the same would apply to US state sales taxes, but some initial test purchases indicate that this isn't automagically happening.
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2 Answers

Sujoy@Amazon avatar image
Sujoy@Amazon answered
Hi Cornellbirds, Any Amazon Party selling Apps is responsible for collecting and remitting any taxes imposed on its sales of those Apps to end users. You are responsible for any income or other taxes due and payable resulting from any Amazon Party’s payments to you. For more information on Taxes, please see section 5.c. of the Distribution Schedule in the App Distribution and Services Agreement listed in your Developer Portal. Thanks.
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Tere avatar image
Tere answered

So if Amazon collects "state sales tax" pertaining to each state when required, not sure how we claim that on our sales tax when filed? So we don't need to pay that "state's sales tax"? Just planning ahead for the records.

I sent the question through the contact form but received an email response that they are not allowed to offer tax guidance and referred me back to the tax guide.

Normally we would supply our state "resale tax ID#" to our merchants for tax exemption on purchases. Then pay the ''State Sales Tax" when due.

I don't see this information on the Tax Interview Guide. Did I overlook it?

Thank you!

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