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Re: VAT, Taxes & TaxCodes for USA

Rob North
- 04/08/2015 14:59:14

Taxes in the US are strange. There is no national tax (yet) and no VAT at all. Taxing of products and services is left up to each state. Each state is allowed to set its own sales tax. Some states like Oregon do not charge sales tax at all, others like my state of California, can have a different tax for each city and county. This leads to thousands of taxing jurisdictions.

That said, there is a concept called nexus. Nexus is where your business is physically located. The concept of Nexus means that you charge the sales tax only to customers physically located in your tax jurisdiction. So a mail order or internet business physically located in New York does not have to charge sales tax to customers physically located in Florida. But if a customer from Florida was physically at a store in New York, that customer would be charged the sales tax for that New York Jurisdiction.

To add to the confusion, each state has products that are taxed and some that are tax exempt. Products that are exempt in one jurisdiction may be taxed in another.

There has been a big fight about forcing internet and mail order retailers to charge the sales tax based on where the customer is located, and that could happen soon. If the Marketplace Fairness Act passes, because there are so many taxing jurisdictions, you will have to integrate with a tax calculation service that can handle both the calculation of the tax and the disbursement of payments to the many taxing jurisdictions. Business with $5 Million in annual US sales will be exempt (They are trying to make this threshold $1 million). It’s going to be a mess! 

If you are planning to fulfill orders from the EU to the US and not planning any physical locations in the US, there may be different laws and treaties on tax. I’m not sure on that.

Rob North
Pair A Dice Games

On Wednesday, April 8, 2015 2:22 AM, Roethlin Daniel <> wrote:

Hi dear Community
I come from Switzerland and our company has running some Odoo installations over Europe.
In the next weeks we are implementing a new Odoo installation in the USA.
Can someone help me to find something like a “USA VAT Module” or a “VAT importfile” of default taxcodes of USA ?
Can you help me in this topic ?
Kind regards
Daniel Röthlin
Project Manager & Application Engineer
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