Does Indiana state tax apply to international digital download sales?

Accounting & Taxes

Topic summary

Main issue: An Indiana-based seller of digital downloads asks whether Shopify will automatically apply Indiana state sales tax to all purchases (including international buyers) when the market is set to United States + International, with tax collection enabled and no shipping zones (since it’s a digital product).

Key details from the original post:

  • Indiana requires sales tax on the seller’s digital downloads.
  • Concern: Will state tax be charged to every transaction regardless of buyer location?
  • Setup: Tax box checked; markets include US and International; no shipping configured.

Response/update:

  • No direct confirmation on how Shopify taxes are applied across international orders for digital goods.
  • Guidance given to consult local tax authorities/tax professional for correctness and compliance.
  • Directed to Shopify’s US Tax Registration Guide and to contact live support via the Help Center for account-specific assistance.

Status/outcome:

  • Unresolved. The core question about automatic application of Indiana tax to international purchases remains unanswered; next steps are reviewing the guide and contacting Shopify support.
Summarized with AI on January 3. AI used: gpt-5.
1

I live in Indiana in the US and have digital downloads I am selling. My state requires I collect tax on them which I have set up and the box to charge tax on the product checked. Will this automatically charge every purchase of the digital download with my state tax percentage including anyone who purchases internationally? I currently have the market set for the digital downloads as International and United States, will this setting charge my state tax for every purchase no matter where the destination or do I need to add more settings somewhere else. I did not set up shipping areas because it is not a physical product.

2

Hi @njwellness !

Thanks for your question!

I understand that you are in the process of setting up your taxes. It sounds like you have already reviewed your tax eligibility but we can always suggest consulting with your local tax authorities or a tax professional to verify that you charge your customers the correct tax rates, and to ensure you file and remit your taxes correctly. With that being said, you can use our US Tax Registration Guide to help with your tax settings. Once reviewed, we would be more than happy to continue assisting you through our Help Center. To access our live support, you can ask the Virtual Shopify Assistant to “contact support.” It will guide you on the next steps to connect with a team member who can provide further assistance tailored to your account.