Setting Up Shopify Sales Tax

CrushSuite handles alcohol-specific compliance fees, but standard sales tax collection is managed through Shopify's built-in tax system. You need to configure Shopify to collect sales tax in every sta

You are here: Phase 2 of 3 — Configure

You'll need about 10 minutes for this step. You'll configure Shopify to collect sales tax in each state you ship to, and enable tax on shipping.

Why This Matters

If sales tax isn't configured correctly, you may be under-collecting tax from customers — which creates a liability for your winery. This step applies to both Vinoshipper users and self-compliance users.

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Quick Tax Primer (Read This If You're New to DTC)

Before you dive in, there are two things worth understanding. These catch a lot of wineries off guard when they first move to DTC.

Sales tax is based on where you're shipping the order to, not where your winery is located. This is called destination-based sourcing. If your winery is in California and a customer in Maryland orders three bottles, you need to collect Maryland's tax, not California's. Every state where you ship wine is a state where you need to be configured to collect tax.

Wine often has its own tax treatment, separate from standard sales tax. Some states have no standard sales tax but do tax wine specifically. Some states add an alcohol excise tax on top of standard sales tax. Some states have different rates for wine vs. other goods. Standard sales tax (what you configure in Shopify below) is one piece. State alcohol fees (configured separately in CrushSuite) are the other. Together they make up what your customer pays in tax and fees at checkout.

If you're unsure about the specifics for your situation, talk to a tax professional who understands alcohol DTC. The configuration below gets the mechanics working. The right amounts depend on your specific setup.

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Before You Start

Have this ready before you begin:

• The list of states where you ship wine. This should match the states you enabled in Configuring State Shipping Rules.

• Shopify admin access with permission to modify settings. You need to be an admin or have tax settings permission.

That's it. The actual configuration is quick.

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Step 1: Add Tax Collection for Your Selling States

1. Log in to your Shopify Admin.

2. Click Settings at the bottom left of the screen.

3. Click Taxes and duties from the settings menu.

4. Under Regional Settings, find or search for United States.

5. Click on United States to open the regional tax configuration.

6. Under "Regions you're collecting in," click + Collect in new region.

7. Add every state where you sell wine. Select each state from the list and confirm.

Which states you collect in depends on your licensing model, not just which states you ship to.

• States where you hold your own DTC licence — you are the seller of record. Configure Shopify to collect sales tax there, and you remit it.

• States where you ship under Vinoshipper's licence — Vinoshipper is generally the seller of record and handles the state-level obligation. Collecting there in Shopify as well may mean double-collecting.

If you have a mixed footprint — your own licenses in some states, Vinoshipper's in others — get the split confirmed for your specific licenses before configuring this. Ask us and we'll walk through your state list with you. This is the single most consequential setting on this page to get wrong.

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Step 2: Enable Tax on Shipping

Many states require sales tax on shipping charges. If you use Vinoshipper, enabling this setting ensures your Shopify tax calculations match Vinoshipper's — avoiding discrepancies between the two systems. Self-compliance users should also enable this to stay compliant with state tax requirements.

1. In Shopify Admin, go to Settings → Taxes and duties.

2. Scroll to Global Settings.

3. Find the option "Charge sales tax on shipping".

4. Check the box to enable it.

5. Click Save at the top of the page.

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After Configuration

Shopify will now automatically calculate and collect the appropriate sales tax on wine orders and shipping charges based on the customer's destination state. This works alongside CrushSuite's state alcohol fees — they are separate charges:

• Sales tax — standard state/local sales tax, collected by Shopify

• State alcohol fee — wine-specific compliance fee, calculated by CrushSuite

Both appear in the customer's checkout, and both are necessary for full compliance.

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Common Mistakes

Only collecting tax in your home state. This is the biggest and most expensive mistake. Destination-based sourcing means you need to collect tax for every state you ship to, not just the state where your winery is located.

Enabling tax collection but forgetting "Charge sales tax on shipping." If you skip Step 2, your tax calculations won't match Vinoshipper's, which creates reconciliation headaches later. Always enable this setting.

Forgetting to update when you add a new shipping state. When you enable a new state in CrushSuite (or Vinoshipper), remember to also add that state to your Shopify tax collection. The two configurations are separate and need to stay in sync.

Assuming Shopify handles alcohol excise taxes. Shopify's tax engine calculates standard state and local sales tax. It does not calculate alcohol-specific excise taxes or state compliance fees. Those are handled by CrushSuite's state alcohol fee configuration, which is a separate step.