Is it legal for a merchant to charge sales tax for shipping?

Question

I was about to make an online purchase when I noticed that the sales tax (for Texas) was being calculated after the merchant added the shipping cost. I was being taxed on the shipping and not just the goods. Is this legal in the state of Texas? If no one can answer, what state agency do I contact to find out.

Answer 1

Some states require that shipping is added to the taxable base for charging sales tax.  It is an easy way to increase tax revenue without increasing the tax rate.

Answer 2

It depends on your state. You can search "your state" and "taxation" and have to read a ton to find out for sure though.  In Indiana they do charge for shipping (and also sales tax on clothes and diapers!).

Answer 3

I think the State Tax Commissioner of Texas would be able to answer your question.  Perhaps your state's Tax Commissioner and give an answer.  The problem I see is that governmental offices are so inefficient that you could spend an inordinate amount of time on the problem.  Government employees really are about as lazy as their reputation presents them as being.  They are civil service and are not subject to any real measurement of service.  I would call the merchant in question to underscore my concern with inclusion of a sales tax for shipping.  I respect you for trying to "right a wrong."   I cannot imagine a Texas law that adds a tax on to tax, i.e., the price of the on-line purchase.  In fact, I thought most states did not have a tax on e-purchases in order to encourage the growth of e-commerce. Strange to me.  Good luck.

Answer 4

NO.

They are not supposed to charge sales tax on shipping.  There is no product!!