Poshmark will launch Posh Remit, a service that calculates, collects and submits state and local sales tax on all eligible orders from shoppers across the country on behalf of its sellers, in April. The software will simplify the process of collecting and submitting state and local sales tax for the social marketplace’s 5 million sellers.
E-Commerce companies have been scrambling to update their tax collection practices since the June 2018 South Dakota v. Wayfair Supreme Court decision, which declared that retailers need to collect sales taxes even in states where they don’t have a physical presence. This has had an outsized impact on smaller retailers, who have fewer resources available to learn about sales tax rules across multiple states and jurisdictions, implement tax compliance software and train themselves to use it.
States already have started adjusting their tax policy to adjust to the new regulations. California is leading the way: the state will require out-of-state retailers to collect taxes if, during the previous or current calendar year, they meet at least one of two criteria:
- Their sales for delivery into California exceed $100,000; or
- The retailer made sales for delivery into California in 200 or more separate transactions.
- Posh Post, which offers sellers pre-paid, preaddressed shipping labels for items that weigh up to five pounds;
- Posh Pay, which handles transaction processing through a variety of payment options;
- Posh Protect, which lets buyers request a refund if an item fails to ship or fails to match the listing description; and
- Posh Authenticate, which offers free item authentication on luxury items priced at $500 or more.
Poshmark Remit will initially collect state and local sales taxes across 46 states and remit them directly to the proper party. The tool joins a suite of services for both sellers and buyers that includes:
- Poshmark Expands Marketplace Into Home Décor
- The Future Of Social Commerce Is Mobile: Instagram, Peer-To-Peer Marketplaces, Chat Lead The Way
- Instagram Debuts Checkout Option, Allowing Shoppers To Buy Within The App
- Are You Liable For Your Customers’ Sales Taxes?
- Exclusive Poshmark CMO Q&A: How Social Commerce Creates A Network Effect On A Personal Level