What's Changing?
The excise tax calculation is changing from 15% of the retail gross receipts to 19% of the retail gross receipts.
The excise tax will continue to compound any local taxes and apply to any fees on an order (such as delivery or payment fees).
The excise tax continues to be compounded by sales tax.
You may have three tiers of compounding taxes in your jurisdiction, each with a different calculation for gross receipts. Make sure to check with an accounting or tax professional to confirm any questions you have.
Resources:
Frequently asked questions:
Q: When should I update my taxes?
A: Before opening on July 1st. We recommend completing the following steps when no orders are being processed (either after closing or before opening).
Q: How do I update my excise tax settings?
A: Follow these steps:
In Meadow Admin, navigate to Settings > Taxes for organization-wide settings, and/or Settings > Delivery > Zones for Delivery Zone tax settings.
Click "View" next to your California Excise Tax
Tip: Take a screenshot of your current 15% Excise tax details to ensure you don’t lose any important details when recreating it.
Delete your current 15% CA Excise tax
Create your 19% Excise Tax (It's not currently possible to edit an existing tax rate in Meadow. You will need to delete and recreate your excise tax settings.)
Have questions? Read this article!
Q: Will Meadow automatically update my tax settings?
A: No, a full privilege Admin needs to update your Excise tax settings to 19% before July 1.
Q: How do I exclude product categories from being charged excise tax?
A: When creating your new excise tax, scroll to the Excluded Product Categories section. From there, select the category you want to exclude (e.g., Accessories) from the dropdown and click Add. The exclusion won’t be saved unless you complete both steps—selecting the category and clicking Add.
Make sure to check with an accounting or tax professional to confirm any questions you have.