CLICK HERE for an updated version of this article (10/2021)
Our Exclusive BigCommerce App Helps You Sell Regulated Products
If you sell tobacco, alcohol, or other regulated products, you know it can be tough to stay compliant with tax laws. And, in the ecommerce realm, it’s even more difficult. Customers can come from anywhere, meaning you don’t just have to follow the laws of the specific place where you have your brick-and-mortar.
At IntuitSolutions, we develop BigCommerce apps that solve industry-specific needs. So, when our clients who sell regulated products approached us about their difficulties dealing with excise tax, the challenge was clear. We built Taxman, an app that automatically calculates and charges excise tax with pinpoint accuracy, everytime.
What Is Excise Tax?
Regulated products like tobacco and alcohol are subject to special taxes called excise taxes, which are charged in addition to sales tax. Excise taxes are not calculated at a universal flat rate and vary widely by geographic region. For example, some states charge a single, state-wide excise tax while other states have different excise tax rates based on city, county, or municipality. How the tax is calculated varies as well: some areas charge a flat rate while others take a percentage of the product’s price.
Excise Tax and Ecommerce
As you might imagine, charging the right amount of excise tax in an ecommerce situation is a daunting challenge. Not only will customers from different states need to pay different rates but customers in different parts of the same state might need to pay a different rate, too. In some places, the rules are so granularly specific that two areas within the same city or township could actually have different rates.
Charging excise tax has long been a problem for ecommerce stores that sell regulated products but has recently come to the forefront of the industry with the explosion of the vape market. Many vape shops are simply not compliant with tax laws, putting them at risk of incurring serious penalties.
A BigCommerce App To Give You The Control You Need
Taxman, IntuitSolutions exclusive app, solves that problem. Taxman gives you total control over how the tax is calculated, with a granularity and flexibility that isn’t possible with existing tax management apps like Avalara.
Here’s how it works:
Configure Tax Zones By Zip Code
Setting excise tax rates by state isn’t specific enough. You need more granular control to stay compliant. Our app lets you configure ranges of zip codes instead of relying on automatic settings like city or state. You’re not limited: charge by county or even neighborhood. You group the zip codes with the same excise tax laws together, ensuring that customers are charged the right amount, no matter where they’re coming from.
Set Tax Rate For Each Product
Not all Products you sell are subject to the same level of excise tax. Our customization lets you set every Product’s tax rate in each zone that you configure. No matter what someone orders, they’ll be charged the correct amount for where they live. Choose the method of calculating tax that’s right for each product, in each region. Taxman lets you charge based on:
- Flat rate
- Percentage of Product price
- Percentage of taxable portion (taxable portion of each Product is editable)
Automatically Add Excise Tax To Cart At Checkout
On the customer end, Taxman is clean and simple. When a customer fills out their billing/shipping information, excise tax is calculated and applied to their order total as a separate line item. It’s clearly labeled and included in the grand total, so customers understand what they’re paying for.
Check out our Taxman demo! Add an item to your cart and proceed to checkout to see how it works on the customer end.
Sell Vapes Online? You Need This App Today
Do you have a solution for charging excise tax? Don’t pay more down the line when you get hit with penalties. Our developers build apps specially designed for merchants like you who sell regulated products. Invest in your business’ future – contact us today to schedule a demo and see what Taxman can do!