How can I set up state-specific tax for digital products in Shopify?

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I was told by my accountant I need to charge tax only on purchases from my site. All my products are digital downloads. How do I set this up in Shopify to charge tax only on one state?

Thank you,



Reply 1 (1)

Shopify Staff
2509 229 532

Hi @KelliB,


Thank you for getting in touch. Once you have registered with your state's tax authorities, you should be provided with a sales tax ID that you can then input into your tax settings within the Shopify admin. Shopify has an automated registration-based tax system that will set the tax rates in the regions you're registered for and charge customers sales tax based on the information you have provided.


If you do not provide any sales tax IDs for other states, and have no physical locations in other states added to your Shopify admin, then customers outside of your home state should not be charged sales taxes when they complete an order on your store. While this process is automated, it's always best to keep an eye on your incoming orders and make sure that taxes are being applied correctly. If our automated system believes that you may be required to register for sales tax in another state, you should receive a notification indicating this to you.


I hope this information helps but please let me know if you have any further questions.

Victor | Social Care @ Shopify 
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