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unknown pleasures

Discogs Charging US Sales Tax, Beginning July 1st

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Posted (edited)

I’m sure if you use Discogs you already saw the notices but the site is going to start automatically collecting sales tax for about 20 US states starting in July:

 

https://support.discogs.com/hc/en-us/articles/360024123194

 

Starting July 1, 2019, Discogs will be taking on full responsibility for the calculation, collection, and remittance of sales taxes in all states where we qualify as a Marketplace Facilitator (MPF). A list of these states is available in the help article linked below. 

In states where Discogs does not qualify as an MPF, it is important for sellers to determine their own sales tax responsibilities. We urge sellers to use a professional tax advisor to help determine these responsibilities. 

Discogs will be launching a new feature where sellers can view MPF states as well as toggle on / off states that they've determined it is necessary to collect sales tax. Beginning July 1, this tool will be available on the seller settings page. We will also be adding new information to the Marketplace Order export to assist with tracking sales tax that has been collected. 

 

It looks like they’ll add it into the purchase and then pay it on behalf of sellers, so if you live in one of the affected states expect the price of your Discogs purchases to go up.

 

(Seems like a lot of the European sellers on the forums are upset and threatening to block US sales!)

Edited by unknown pleasures

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Posted (edited)

Between this and the chatter of oversea shipping going up – not 100% sure of that impact just yet, personally – it seems like it's becoming increasingly more annoying to keep up with the hobby™.  At least from the perspective of importing.

Edited by Derek™

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4 minutes ago, N8TRU said:

Will this be charged for where we live or charged for where the seller is based out of? I live in Delaware so we don't have sales tax.

As a buyer, you would only pay sales tax if you live in one of the states in the list.

 

As a seller, you’d need to collect sales tax even if you don’t live in the same state (or even the same country) as the person you sold to, assuming they’re in one of the states in the list. However, it looks like Discogs is automating the tax collection process.

 

So basically, if you live in a state that isn’t on the list or obviously one with no sales tax at all, you don’t need to worry about taxes on the buy side, only if you sell stuff on Discogs. 

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Just a quick bump to remind any affected US based buyers that are considering a Discogs purchases to get it in over the weekend/before Monday when the tax hike happens.

 

(Plus who knows how many European sellers are going to start blocking all US sales come Monday morning...)

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48 minutes ago, Shitty Rambo said:

Does Reverb LP pull this shit too? Might have to start using them for my second-hand online shopping.

I personally don't use Reverb for buying or selling but I just read the Sales Tax FAQ on their site and it looks like the setup there is already similar to what Discogs is implementing. Honestly, Discogs was one of the last holdouts; Amazon, eBay, Etsy, etc. have all been doing this for some time.

 

I'm afraid with how easily its become to track digital transactions, unless you're dealing with well-concealed cash in a plain paper envelope or some super-anonymous cryptocurrency the government is going to find a way to take "their fair share."

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8 hours ago, unknown pleasures said:

I personally don't use Reverb for buying or selling but I just read the Sales Tax FAQ on their site and it looks like the setup there is already similar to what Discogs is implementing. Honestly, Discogs was one of the last holdouts; Amazon, eBay, Etsy, etc. have all been doing this for some time.

 

I'm afraid with how easily its become to track digital transactions, unless you're dealing with well-concealed cash in a plain paper envelope or some super-anonymous cryptocurrency the government is going to find a way to take "their fair share."

Looks like the VC S/T/W board is the last off-the-grid "marketplace". 

 

The state would tax your garage sale if they could, that's basically what they're doing with discogs lol. 

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7 hours ago, Shitty Rambo said:

The state would tax your garage sale if they could, that's basically what they're doing with discogs lol. 

I would venture to guess that the vast majority of the business conducted in $ is done by record stores and dealers. They're likely facilitating millions of dollars of transactions per year, of course they're going to comply with the law. If you don't like it, you can always move to Montana.

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5 hours ago, AlexH. said:

I would venture to guess that the vast majority of the business conducted in $ is done by record stores and dealers. They're likely facilitating millions of dollars of transactions per year, of course they're going to comply with the law. If you don't like it, you can always move to Montana.

Chill on the bootlicking, you might have a boner for statism, but my opposition towards it doesn't mean I have to pack my shit and leave :D

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1 hour ago, simple_torture said:

I added an item to my cart this morning, and sales tax was not included in the total displayed before you hit "Place Order and Pay Now." (I am in Rhode Island.) Not sure if doesn't come up until the invoice is sent? Has that been indicated?

I don't think it has been turned on yet.  

 

I went on Ebay this morning to order more shipping boxes.  When I ordered them a few weeks ago I wasn't charged tax, this time I was.  This will be across the board for all online merchants much sooner than later.

 

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So it seems a few weeks in that this was a bit of an overblown concern, assuming you don't have an ideological opposition to sales tax in the first place 😜. It's actually not that complicated.

 

 

 

If you are a buyer, either:

For sellers:

  • Your buyers in MPF states automatically pay sales tax, and Discogs automatically collects it.
  • For non-MPF states, if you don't meet a specific state's economic nexus threshold, which means you do X amount of business in the state (at least $100,000 & 100 transactions for all states that have sales tax), you are not legally required to collect sales tax. This most likely covers everyone on VC. If you're doing that much in Discogs sales to one state, you probably have an accountant who has already explained this to you.
  • The exception is your home state. According to Discogs, there are usually no thresholds for "resident sellers" since you're effectively the same as a brick and mortar business at that point. This is the one annoying one, since Discogs also says you technically have to register your "business" and file tax returns and all that. That seems to be on the honor system for now, since you have to go in and manually check the box for your state in your seller settings, so I'm leaving it be for now. If you really want to stay off the grid, you can always arrange an in-person meetup.

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5 hours ago, frutiger75 said:

yet another instance of where the ideals of framers of the Constitution are thwarted by partisan politics with SCOTUS political appointments by the "executive branch" (lol). 

5-4 decision. guess who wrote the opinion, who joined, and who dissented.

 

bUt MuH rOaDs

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Just had my first sales tax sale. $50 item I sold. Discogs charged $4.40 sales tax to the buyer on top. I have all my records shipped to my parents in Georgia so I haven't had to pay sales tax. Moving to California in a few weeks and seems like it might be cheaper for me to continue having Discogs records sent there and then having them ship a few at a time to me in CA

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