Q: Does changing the classification of those products to Digital - Customization of Software will change the Tax liability?
A: Yes, There are two things we need to know to apply a specific tax rate anywhere in the US.
An address (specifically the Ship to Address)
The product categorization (LINK)
When we categorize something like Clothing for example our tool goes and looks at every map we have and finds out what rate that thing is taxed at in all the different places.
For example it would look to see if the transaction was clothing in New Jersey because the people of New Jersey have voted to NOT tax clothing in New Jersey, but the people of California have voted to tax clothing in California.
Digital - Customization of Software is just another type of thing that is sold, and it depends on what the people of that state have voted that determines if it is taxed at 5% or 50%.