US Sales Tax Basics for AU Operators Selling to America

11 min · video · Beginner

An AU dropshipper sells A$32,000 of product to US customers in 2025. In 2026, an email arrives from the California Department of Tax and Fee Administration. The email demands back sales tax, claims California economic nexus has been triggered, and threatens to refer the matter to the IRS. Most AU operators panic. The actual answer is usually: you owe nothing. But you need to know the rules to be sure. Today: US sales tax for AU operators, the marketplace facilitator shield, and when you actually need to register.

How US sales tax differs from AU GST

Three structural differences make US sales tax confusing for AU operators:

There is no federal sales tax. Each US state sets its own rate (0-10%). 45 states have sales tax; 5 do not (Alaska, Delaware, Montana, New Hampshire, Oregon).
Nexus, not residency, triggers obligation. You owe sales tax in a state if you have "nexus" — economic, physical, or marketplace. The thresholds vary by state.
You collect from buyers and remit to states. Like GST, sales tax is collected at point of sale and remitted to the state revenue agency.

The AU dropshipper's safe harbour: marketplace facilitator laws

This is the part most AU operators get wrong. Since 2019-2021, every US state with sales tax has passed "marketplace facilitator" laws. These laws shift sales tax responsibility to the marketplace platform (Shopify, Amazon, eBay, Etsy) when the platform meets certain thresholds.

For AU dropshippers selling via Shopify direct-to-consumer (not Amazon, not Etsy, not other marketplaces): you are the seller, not Shopify. Shopify is a software provider, not a marketplace facilitator. The marketplace shield does NOT apply. You may owe US sales tax.

For AU dropshippers selling via TikTok Shop, Amazon, eBay: the platform is the marketplace facilitator. They handle sales tax collection and remittance. You owe nothing on those sales.

This is the single most important distinction. Shopify-based AU dropshippers selling to US customers must understand US economic nexus rules. Marketplace-based AU sellers can largely ignore them.

Economic nexus thresholds (Shopify direct sales)

Each US state sets a threshold for economic nexus. Cross it and you owe sales tax in that state. The two most common thresholds:

Annual revenue threshold: typically US 00,000 in a calendar year or 12-month rolling period.
Transaction count threshold: typically 200 transactions in a calendar year (some states use OR; some use AND).

So most AU dropshippers crossing US 00,000 in US sales OR 200 US transactions in any state trigger nexus.

Quick rule of thumb: at A 50k+ AUD per year selling to US customers via Shopify, you start triggering nexus in major US states. California, Texas, New York, Florida, Pennsylvania reach the threshold first because of population.

!US sales tax map showing state-by-state economic nexus threshold rates US sales tax is a state-by-state patchwork. Most AU dropshippers under A 50k/year US revenue do not need to register. Photo: Unsplash / NeONBRAND.

When you do NOT need to register

For 90%+ of AU dropshippers selling to US customers:

Your annual US sales are under US 00,000 (≈A 50k).
You do not have physical presence (warehouse, employee) in any US state.
You sell exclusively via Shopify direct (not Amazon, not Walmart, not eBay).

In this profile, you owe zero US sales tax. The "DTC dropshipper from Australia" scenario is below US economic-nexus thresholds in 100% of US states.

When you DO need to register

You probably need to register for US sales tax if any of these are true:

You sell over US 00,000 to US customers in a year.
You hold inventory in a US warehouse (3PL with US presence triggers physical nexus).
You have a US-based employee or contractor handling fulfilment.
You sell on Amazon FBA in the US (FBA inventory triggers physical nexus in fulfilment-centre states; though marketplace facilitator rules cover the actual sales tax remittance, you may still need to register in those states).

If any of these apply, the work is real: register in each state where nexus is triggered (typically takes 4-6 weeks), set up sales-tax automation (TaxJar or Avalara handle 90% of the workflow for A