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What is sales tax?
Sales tax is imposed on all retail sales, leases and rentals of most goods, as well as taxable services. In other words a sales tax is a tax on the end-purchase of a good, so it normally does not apply if a sale is for re-sale or for subsequent processing. Sales tax normally a certain percentage that is added onto the price of a good or service that is purchased.
Your sales tax responsibilities as a new business owner, whether you start a business or buy an existing business, will vary depending on the type of organization or entity you operate. Besides state level, estimation of sales tax is also done on municipal or county levels. Payment of state sales tax depends on your sales and your state’s regulations.
Normally it is the consumers who are burdened with sales tax. The re-sellers on the other hand, are exempted from sales tax, provided they do not use the goods on which sales tax is levied.
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