I started testing Multi Vendor Marketplace by webkul and realized that this app don't compute sales tax from US local tax perspective. Webkul answered Taxes are calculated by Shopify and configured on Shopify backend.
I as admin can choose to distribute the tax on the product in three ways :
Admin only :Whole product tax will be given to the admin.
Divide Between Sellers :Whole product tax is divided proportionally between the sellers.
Proportion Between Admin & Seller : Tax distributed proportionally amongst the admin and the seller.
However, In the U.S., generally, US sales tax is based on NOT a product or seller basis, BUT a shipping destination of a buyer and whether the seller has business address and have Nexus in the state. Shopify tax setting is for a single vendor not for marketplace.
for example, X seller is located in the state of California (CA) in the U.S., and sell a product in CA, then X is subject to sales tax. if X sell a product to a buyer other than CA, X is not subject to sales tax when X doesn't have taxable presence in other states from sales tax perspective.
I'm going to launch soon but I am facing this issue. Dear US marketplace owner, please share how you handle sales tax practically.
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