Historically, in North Carolina, services were not subject to sales taxes. That all started to change a couple of years ago. As first written and interpreted, the new laws only applied to businesses that also sold products. Businesses that were strictly service businesses still did not need to charge or collect sales taxes. However, the most recent directives from the North Carolina Department of Revenue, mandate that almost all services are now subject to sales taxes.
This mandate has a couple of peculiar exceptions. In my business, all my services are now taxable except for custom programming. In the automotive repair industry, all repair services are now taxable except for work on an automatic transmission. As Spoc from Star Trek would say, “That is highly illogical.” But illogical or not, it is what it is.
Beginning in July of this year, I will be collecting and paying Sales Taxes to the state of North Carolina. This will impact the amount you have to pay for my services. It also increases the amount of paperwork and overhead required of my business.