Dropshipping tax - confused - which country do I charge tax for?

[Lizaveta]

I am based in Australia and my dropship supplier is in the U.S. In my ecommerce plugin for my website, I am given the option to specify how much tax needs to be charged. I'm very confused about this whole tax issue - as I am based in Australia, I'll have to pay taxes to the government out of the revenue I make from my business. So does this mean I should calculate and charge Australian sales tax? OR do I need to be calculating and charging tax in the location of the warehouse?

[peteVA]

I can only tell you the US end.

YOU will be charged the going sales tax rate of the state in which your supplier(s) is located - FOR DELIVERIES INTO THAT STATE ONLY.

That's it. If they are in California and the sale is in New York, there is no sales tax.

Simple enough so far.

You cannot CHARGE sales tax in the US, since you are not registered with the state in which your supplier is located. Therefore the supplier charges you (at your cost, not the selling price) and it's done.

[Lizaveta]

Hey, sorry about the late reply, things have been pretty hectic around here. Thanks for your help!