Comments on: ShopSite Tip – Customize Your Tax and Shipping

By: Rob Mangiafico

Rob Mangiafico — Sat, 06 Feb 2010 23:19:51 +0000

Not sure how merchants actually put this into practice. Some might collect the county data after the sale is complete, and with an average sales tax rate in the cart, it works out in terms of not losing too much after you calculate the actual sales tax based on county.

Sort of like charging an average rate for shipping and setting it up so it averages out to not cause a loss on shipping costs.

Maybe another merchant will chime in, or maybe ask on the ShopSite forum.

By: Scott

Scott — Sat, 06 Feb 2010 22:59:12 +0000

Thanks Rob. Another question in search of a solution. You say that some merchants approximate the rate state wide, and sort it out after the fact in terms of complying with state law.

The California state tax return requires sales to be broken down into about 120 different lines by county and then by municipality (see http://www.boe.ca.gov/pdf/boe401a2.pdf) How does or can ShopSite support the needed detail? Thanks

By: Rob Mangiafico

Rob Mangiafico — Sat, 06 Feb 2010 22:42:37 +0000

California and New York make this a more difficult task to manage. You can create as many “sales tax by zip” textboxes as you need in the backoffice, populate each with the zip codes that correspond to a specific tax rate, and ShopSite will apply the correct rate for shoppers when they enter their shipping zip code on the cart page.

However, if counties have overlapping zip codes, then it will not be 100% accurate. Some merchants approximate the rate state wide, and sort it out after the fact in terms of complying with state law.

Two other options would be to have a developer create a Tax API that automates this process, and can read in a downloaded tax file to return accurate sales tax. The file could then be updated when the state makes changes. Or, you could look at the AvaTax API from Avalara, although this is quite expensive.

By: Scott

Scott — Sat, 06 Feb 2010 21:55:03 +0000

California levies a state-wide sales tax as well as counties and cities/municipalities. There are about 4,200 such combinations. These can be boiled down to about 2,600 zip codes.

So your recommendation is a nice idea in theory, but how do I apply it in reality? A 2,600 item drop down menu would be a bit much, don’t you think?

By: Rob Mangiafico

Rob Mangiafico — Wed, 26 Aug 2009 11:09:05 +0000

Brent, thanks for the extra tip. It is amazing that sites continue to use the default settings for such an important step in the buying process.

The problem with New York is they have counties that have overlapping zip code ranges, so they make it difficult for online stores to easily comply with their complex tax code. Other states planned their counties more logically to make it easy to setup zip code ranges and rates.

By: Brent

Brent — Wed, 26 Aug 2009 06:03:02 +0000

Great advice. I cannot tell you how many websites I have seen that use things like this. Plus they continue to do it even after you show them how to make it better.

You can even take it a step further and add more zip code fields in ShopSite that will allow you to use the zip code to automatically calculate County taxes. You just need the zip code breakdowns by County. This is located under Commerce Setup > Tax.