Ecwid Ecommerce Glossary

Tax

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What is tax?

A tax is a compulsory charge usually of money imposed on a taxpayer by a governmental organization for public purposes.

As an online seller, you may need to collect taxes and then periodically forward the collected tax amounts to appropriate tax authorities. These taxes are known as sales taxes in the US, VAT in Europe and Japan, GST in Canada, etc.

Taxation rules depend on the country where the online business is based. Tax rates differ depending on types of products, a business location, as well as consumers’ location, and other things. 

Before you start selling online, check with your local tax experts whether you sell taxable goods and what are the tax rates associated with them.

Various accounting tools for e-commerce businesses help to create sales tax reports and file sales taxes. 

Learn how to set up taxes in your Ecwid store.

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