Does DigitalChalk charge sales tax on course purchases?
The training DigitalChalk sells and delivers online on behalf of its customers is a professional service, not an item that is subject to sales tax. The delivery of online education services are not subject to sales tax in North Carolina per the NC Department of Revenue at: http://www.dornc.com/faq/sales.html. Additionally, the US Supreme Court ruled in Quill Corp. v. North Dakota (91-0194), 504 U.S. 298 (1992) that a business is not responsible to collect sales taxes for transactions that originate in a state from which it does not currently have a physical office. This is the foundational case that is the basis for why you don’t pay taxes for most things you buy online. The law actually doesn’t absolve the buyer from owing the tax but it removes the responsibility of the retailer from collecting those taxes on behalf of the state. Because the customer who purchases a course online through DigitalChalk is actually doing business with DigitalChalk, not the course provider, this protection is conveyed to DigitalChalk’s course providers. DigitalChalk’s course providers are receiving a royalty payment for the use of their intellectual property in the delivery of the service to the consumer. DigitalChalk has no current plans to begin collecting sales tax from customers unless the laws of the state of NC change or Quill v. North Dakota is overturned.