Throughout the years, there have been numerous unconventional sales tax proposals. After all, Florida generates a majority of their revenue from sales tax, as the state has no income tax.
The latest proposals, outlined in Senate Bill 352 and House Bill 369, look to implement a sales tax holiday, having potential implications for ecommerce sellers mid-year.
In this article, we’ll outline the basics of these new proposals, consider the potential benefits, explore exemptions, and determine the impact on ecommerce sellers.
What is the Latest Sales Tax Proposal?
Senate Bill 352 and House Bill 369 look to establish a sales tax holiday from June 1, 2025 and July 31, 2025 on the sale of certain tangible personal property or services. However, the transaction is only exempt from sales tax if the payment is made in virtual currency and at a qualified establishment.
The list of qualified establishments includes bars, nightclubs, barbershops, spas, restaurants, convenience stores, grocery stores, and motor fuel suppliers. If your business is in any of these sectors, you may need to adjust your Shopify accounting or Amazon FBA accounting to avoid overpaying sales tax during this two-month period.
What are the Benefits of Offering a Virtual Currency Sales Tax Holiday?
State sales tax holidays aren’t a new concept. In fact, Florida already has a back-to-school sales tax holiday in August and a disaster preparedness tax-free weekend to prepare for natural disasters. Countless other states, like Alabama and Texas, have similar disaster preparedness tax-free weekends.
The first benefit of a virtual currency sales tax holiday is that it promotes purchases. Consumers are more likely to purchase goods and services when they can save money on sales tax. This can help businesses in certain industries generate additional revenue.
In addition, sales tax holidays promote support for certain industries. For example, Tennessee’s tax-free restaurant food and drink supports the restaurant industry while Louisiana’s and Mississippi’s Second Amendment sales tax holiday supports the firearm industry.
Florida’s virtual currency sales tax holiday shows the state’s support for the virtual currency industry. Florida’s Governor, Ron DeSantis, has already discussed his vision to make Florida a destination for crypto investment, while the Miami Mayor, Francis Suarez, wants Miami to be the capital of crypto. As crypto continues to gain popularity, you might need to bring on an ecommerce CPA to help you manage these new transactions.
Which Businesses are Exempt and Why?
Traditionally, sales tax holidays are only applied to specific products or services. For example, during Texas’s back-to-school sales tax holiday, consumers could receive a tax-exempt shirt regardless of whether it was purchased online, at a local retailer, or at a gas station. However, the virtual currency sales tax holiday seems to apply to any type of purchase as long as it’s made through a qualifying business.
Since the virtual currency sales tax holiday proposal is relatively new, there isn’t much data to back the rationale behind qualifying retailers. Are both food and drinks sold at a bar tax-exempt? How about everything sold at a gas station or grocery store? These are a few of the questions that have yet to be answered.
What Does This Mean for Ecommerce Sellers?
There is still a lot of uncertainty surrounding the impact on ecommerce sellers. Do the sellers of spa items or food items qualify if they sell online? If Florida does pass these two new laws and ecommerce sellers do qualify, sellers will need to be sure that their storefronts are set up to accept virtual currency payments. This can be done by working with a CPA for Amazon sellers or a Shopify CPA.
In addition, the transactions will need to be flagged as tax-exempt so consumers aren’t incorrectly charged sales tax. Complying with the tax-exempt holiday relies on understanding which goods or services you sell are tax-exempt. Through your work with an Amazon FBA CPA, you might find that only half of your products qualify. Properly differentiating between taxable and tax-exempt goods will be essential.
Summary
Although there’s no guarantee that Senate Bill 352 and House Bill 369 will be passed, Florida does seem to be motivated to offer virtual currency incentives. Taking a proactive approach to offering virtual currency payment options can be done by working with the right Shopify accountant or Amazon FBA CPA. Reach out to one of our team members today to learn more about how we can help.
