{"id":992193,"date":"2026-10-22T09:39:39","date_gmt":"2026-10-22T09:39:39","guid":{"rendered":"https:\/\/www.taxdesk.com\/?p=992193"},"modified":"2026-10-22T09:39:39","modified_gmt":"2026-10-22T09:39:39","slug":"the-us-is-not-the-risk-for-bangalore-exporters-not-knowing-your-us-sales-tax-position-is","status":"publish","type":"post","link":"https:\/\/www.taxdesk.com\/zh\/the-us-is-not-the-risk-for-bangalore-exporters-not-knowing-your-us-sales-tax-position-is\/","title":{"rendered":"The US is not the risk for Bangalore exporters. Not knowing your US sales tax position is."},"content":{"rendered":"
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Why Bangalore\u2019s product and software exports into America are creating a compliance blind spot most CFOs haven\u2019t priced in<\/p>\n

Most Bangalore exporters are already in the US market. The question now is whether that growth is matched by attention to what it obligates them to do. Two kinds of exposure sit inside every dollar of US revenue and only one of them is within a CFO\u2019s control. For Bangalore there is a third complication most Indian export hubs don\u2019t face: software.<\/p>\n

The scale already committed to the US market<\/h4>\n

US$87.31 billion<\/strong>: India\u2019s exports to the United States, FY2025 to 26<\/p>\n

US$34.39 billion<\/strong>: Karnataka\u2019s merchandise exports, FY26, led by engineering and electronic goods<\/p>\n

US$159 billion<\/strong>: Karnataka\u2019s services exports, FY25, the highest of any Indian state<\/p>\n

Two obligations, moving on two different timelines<\/h4>\n

Tariffs sit at the border and have moved repeatedly through 2026, from an 18% bilateral rate in February to a replacement 10% surcharge weeks later. Separate 50% tariffs on steel and aluminium continue regardless, which weighs heavily on a state where engineering goods are the largest merchandise export. The $800 de minimis exemption was also suspended in August 2025, so every shipment now carries applicable duties.<\/p>\n

US sales tax works on an entirely separate basis. It is owed directly by the exporter, set by each state and unaffected by tariffs or trade agreements. It is also the only one of the two that follows a Bangalore software business with no goods crossing a border at all.<\/p>\n

Sales tax in the US: 45 separate answers to one question<\/h4>\n

$100,000<\/strong>: the typical annual sales threshold that triggers registration in most states<\/p>\n

41<\/strong>: states where that $100,000 figure is the only or primary trigger<\/p>\n

0<\/strong>: single national sales tax system covering all of it<\/p>\n

Since the 2018 Wayfair ruling, every state sets its own threshold for out of state sellers, regardless of physical presence. There is no combined threshold comparable to the EU model, so a Bangalore exporter selling nationally is tracking as many thresholds as states it sells into. Tax Desk\u2019s US Sales Tax service provides registration, filing and ongoing threshold monitoring across every state where nexus is triggered.<\/p>\n

Software is a product in a growing number of states<\/h4>\n

~25<\/strong>: US jurisdictions that tax software as a service (SaaS) in some form<\/p>\n

1 January 2027<\/strong>: California begins taxing SaaS and prewritten software under SB 122<\/p>\n

$500,000<\/strong>: California\u2019s annual sales threshold for out of state sellers<\/p>\n

Around half of US states now tax SaaS, including Texas, New York and Washington, while others exempt it. From 1 January 2027, California joins them, with Colorado moving the same day. Custom developed software stays outside California\u2019s new rules while packaged software and subscriptions fall inside, so a Bangalore firm offering both may have two sales tax answers inside one contract.<\/p>\n

How you sell into the US changes the tax answer<\/h4>\n

Direct shipping from Bangalore:<\/strong> nexus builds gradually, state by state, as revenue accumulates.<\/p>\n

US fulfilment centre (e.g. Fulfilment by Amazon):<\/strong> the marketplace may collect in some states, but registration can still be required in others and inventory location alone can create nexus.<\/p>\n

Software subscription or licence:<\/strong> nexus builds on revenue alone, and whether tax applies depends on how each state classifies the product.<\/p>\n

Marketplace facilitator laws mean Amazon often collects tax on a seller\u2019s behalf, which gets taken as full cover. It isn\u2019t. Several states still require the seller to register and storing inventory in a state can trigger nexus before a single sale is recorded.<\/p>\n

Before the next order ships or the next subscription renews<\/h4>\n

Use the Tax Desk Nexus Checker to plot projected US revenue against each state\u2019s threshold.<\/p>\n

Identify where your fulfilment model already creates nexus through inventory alone.<\/p>\n

Verify what your marketplace\u2019s collection actually covers.<\/p>\n

Classify each software revenue stream as SaaS, prewritten or custom before 1 January 2027.<\/p>\n

Review thresholds and taxability quarterly, not once.<\/p>\n

Speak to the Tax Desk team about automating your US Sales Tax registrations, returns and payments.<\/p>\n

Tax Desk provides US Sales Tax compliance for businesses expanding into the United States, covering registration, filing and ongoing threshold monitoring across the states where economic nexus applies. For Bangalore exporters considering how this applies to their company, please speak to the Tax Desk team.<\/p>\n

This report has been prepared by Tax Desk for general information purposes and does not constitute tax or legal advice. Market data is drawn from publicly available third party research and should be independently verified, tariff figures especially, given how many times the rate has moved through 2026. Software taxability rules are changing quickly and California guidance on SB 122 is still being issued. Tax Desk recommends a specific compliance review before making registration or filing decisions.<\/em><\/p>\n<\/div>\n

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