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If you are an online business, how are you supposed to charge tax when you give a buyer a % discount?


Do online stores charge tax on full price and then offer a discount or do they charge tax on the discounted sale price? Are there specific laws around this? Thank you!

You do not charge tax for on line sales. Your discount is calculated on the original price. Any product purchased out of state and shipped outof state is not subject to state taxes. If it was taxed you would have to no the tax rate for each state and charge sales tax for your state, their state and then file your sales tax quarterly for each that that you sold an item to. This would put e commerce sites out of business.

Tax should only be charged on the final sale amount, after discount.

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