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Red: States relying on general tax laws to govern digital goods. Blue: States that have enacted laws specifically addressing digital goods taxation. Green: States that expressly do not tax digital goods. Source: Wikimedia Commons, Wapcaplet.

State to Implement Online Sales Tax

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The Indiana Department of Revenue is implementing an online sales tax, starting this Fall.

Products purchased from out-of-state sellers online will soon be charged the state’s seven percent sales tax. The Indiana Department of Revenue plans to begin enforcing the 2017 online sales tax law on October 1, according to the Northwest Indiana Times.

Passed last year, the law will require retailers who sell over $100,000 worth of goods in the state, or do business with more than 200 Indiana customers, to collect state sales taxes. Previously, only businesses with a physical presence in the state, so-called brick and mortar retailers, had to collect state sales tax.

The state’s move to implement an online sales tax was bolstered by a U.S. Supreme Court decision to uphold South Dakota’s decision to implement a similar tax on June 21.

The Indiana Department of Revenue encourages retailers to join the Streamlined Sales Tax Registration System to learn how to comply with multiple state sales tax laws.

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