According to the Atlanta TV station, WXIA, Georgia will now require residents to pay an 8% online sales tax. Georgia will become the 10th state to require an online sales tax, and shopping at sites that don’t collect will result in a “use tax” paid to the Georgia Dept. of Revenue.
So how does this affect your small business? Allow me to offer some advice
Users are used to paying tax online
First, you shouldn’t panic – this isn’t the end of the world or your online sales. Shoppers routinely buy online at sites that collect sales tax, mainly because those businesses are located or have an office inside of that state, so users are somewhat conditioned to seeing a tax line on the checkout.
Collect the right taxes
Secondly, you need to be sure that your site is collecting sales tax properly. Prior to this law, when purchasing online you would often have to select your county when checking out – this will reverse that option and allow for a flat 8% sales tax, so if your site needs to collect the new tax, it should be straightforward.
Be proactive in keeping customers happy
Third, it’s no secret that this means that buying online will now cost more for Georgia residents. Business owners should consider taking a hard look at free shipping to keep buyers interested, or some sort of incentive or price break to stay competitive online.
Obviously this day was coming – as many local and state governments deal with smaller budgets and larger demands, a tax of some sort on the glorious e-commerce bucket was coming. Now that it’s here – be proactive to ensure your customers don’t price-shop elsewhere.