What Is Product Tax Code On Amazon? Read Complete Answer

Many sellers have been asking what is product tax code on Amazon? Frankly speaking, majority of the sellers do not know what this means and how to set up product tax codes on Amazon FBA.

As a serious seller having products that are fulfilled by Amazon FBA, you are required to set up your sales tax collection. You are required to decide who gets charged sales tax, whether it’s you or your customers.

Any seller that must make use of the Amazon’s sales tax collection services must set up a product tax code for each product that are sold and fulfilled by Amazon FBA.

Product tax codes are very important especially on items that require special sales tax considerations. So, what is product tax code on Amazon? This post covers every aspect and you will have a better understanding of what a product tax code means and how to set it up.

What Is Product Tax Code On Amazon?

A Product Tax Code is a special code a seller must assign to a product that is to be fulfilled by Amazon FBA to enable the seller make use of the sales tax collection service offered by Amazon.

If a seller wants Amazon to handle tax collection for them while fulfilling their orders, a product tax code has to be assigned to each product. Not all products are covered by product tax code, it is only meant for products that are taxed differently in differed jurisdictions and states.

Any product that requires special tax consideration must be assigned a product tax code, this will help Amazon to take the right step with regards to tax collection while selling the product.

In summary, a product tax code is the specific code you give to a particular product you are selling on Amazon FBA. With this code, Amazon will know how much and who to tax when your items are being sold. Also read Does Amazon Hire With Misdemeanors?

Where Do I Find My Amazon Product Tax Code?

Every seller can access the product tax code on the Seller Central Tax Settings page, once you have logged into your Amazon Seller Central account, simply navigate to “Settings” and select “Tax”.

Once you have selected “Tax, you will find all the product tax codes for products that require special tax consideration. All that is required is to choose the product tax code that closely fit the product you want to sell and use.

A seller is required to set up their sales tax collection on Amazon FBA, some sellers don’t like collecting sales tax from their customers, they prefer paying tax from their profit.

However, any seller that wants to collect sales tax from their Amazon FBA customers must use the Amazon’s sales tax collection service which collects sales tax on behalf of sellers.

Before trying to locate your Amazon product tax code, you need to first navigate to the Tax settings page in your Seller Central and set up your sales tax collections. Learn about Amazon FBA Calculator Widget

How To Set Up Sales Tax Collection On Amazon FBA

Each seller is obliged to set up their sales tax collection on Amazon, this is after they must have registered for a sales tax permit in each of the states they are selling.

For example, if you are selling taxable items in New York, you need to register to collect sales tax in New York, collecting tax without registering is considered illegal.

Below are the steps on how to set up sales tax collection on Amazon FBA.

  • Register for sales tax permit.
  • Visit the Seller Central.
  • Navigate to “Settings” and click.
  • Click on the “Tax Settings” option.
  • Select the “View/Edit your Tax Collection and Shipping & Handling and Giftwrap Tax Obligations Settings” option.
  • Select all the states you are collecting sales tax.
  • Select if you are collecting sales tax on each county or local level.
  • Enter a custom sales tax rate if necessary (not recommended).
  • Also select if you want to collect sales tax on gift wrapped items and on shipping.

Now that we are through with setting up sales tax collection, let’s show you how to set up product tax codes. Also read Amazon Package Running Late No Tracking

What Is Product Tax Code On Amazon

How To Set Up Product Tax Codes On Amazon

If you have products that require special tax consideration, you need to select a product tax code that is closely fit to the product, this will help Amazon to know how to collect sales tax for that product.
Follow the steps below on how to set up product tax codes on Amazon.

  • Open the Amazon Seller Central.
  • Ensure you have logged in to your account.
  • Click on the “Settings” option.
  • Select the “Tax” option.
  • Select “View Master Product Tax Codes and Rules”.
  • Select the product tax code that closely fit your product, use the tax code to label your product.

I Can’t Find My Amazon Product Tax Code

Product tax codes are not for every products on Amazon FBA, if you can’t find your product tax code it means that the product is taxed generally.

A product that does not require special tax consideration will not have a product tax code, this is because the general tax code is applicable to it irrespective of where it is shipped from and shipped to. Don’t miss the Amazon FBA Hashtags For Amazon Sellers – Best 60

What Should I Do If I Can’t Find My Amazon Product Tax Code?

If you can’t find a product tax code for your Amazon FBA product, it means that the product is always generally taxed, simply label the product with “A_GEN_TAX”, Amazon will now collect the sales tax wherever the items is being sold.

I Don’t Want To Charge Sales Tax On My Item At Amazon FBA

If you don’t want to charge sales tax on your item at Amazon FBA, simply label the item with the code “A_GEN_NOTAX”, the customer will not be charged sales tax when buying the item, you will be charged instead.

Items That Require Product Tax Code On Amazon

Not all items require product tax codes on Amazon FBA, you should only use product tax codes on items that may be taxed differently at different times and states.

Below are the items that may require you labelling them with a different product tax code.

  • Infant and Baby Supplies
  • Food
  • Clothing
  • Books and Periodicals
  • Sporting Goods
  • Health and Beauty Products
  • Computers
  • School Supplies

Do You Need A Tax Number To Sell On Amazon?

Yes, you need a tax number before you can sell on Amazon, all sellers are required to submit their tax identification numbers before selling on the platform.

This allows Amazon to easily identify each seller and also useful while making sales report to the IRS. You can use your Social Security Number (SSN) if you are a sole proprietor based in the United States and have no employee.

Do Amazon Products Have Sales Tax?

Yes, Amazon products have sales tax and this sales tax is collected based on the local and state rates of the destination where the item is delivered, as well as the location where the item is fulfilled from.

If a product is to be shipped to a state that does not impose tax, a sales tax may still be collected if the the item is shipped from a state that imposes tax and vice versa.

How Much Are Amazon Taxes?

Amazon charges 2.9% of each transaction so as to collect sales tax for each seller, Amazon doesn’t have a specific amount for sales tax, it depends on the rate charged by states where the items are ship to and fulfilled from.

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