Internet Does Not Equal No Tax

An online subscription services provider requested the South Carolina Department of Revenue to rule on the taxability of internet-based platforms on which their customers stream videos, listen to music, and play online games. The taxpayer offers subscription services at a standard monthly fee depending on usage amounts and type of package. South Carolina rules that because the subscriptions or services were online activities they are still subject to tax under the communication business class.

Sales tax rules for online transactions and internet-based companies can be confusing. Contact our state and local tax team to make sure you remain in compliance.