Podcasters who use Patreon should be aware of Patreon’s new sales tax requirements. The changes were announced on May 6, 2020, and will go into effect on July 1, 2020. To be clear, the sales tax changes affect the patrons of all creators, not just podcasters.
This change does not affect creators directly. Their patrons will be the ones that the new sales tax will be imposed upon.
Some patrons will see an additional line item on their receipt for sales tax starting July 1st. Since tax laws and rates vary from country to country and state to state, the amount will be different for different patrons. The money that Patreon collects as a result of these laws will be paid directly to local governments.
The sales tax changes affect patrons in some parts of the United States, and 17 other countries. Those countries include: Belarus, Iceland, India, Japan, New Zealand, Norway, Russia, Saudi Arabia, Singapore, South Africa, South Korea, Switzerland, Taiwan, Turkey, and UAE.
Patrons in Quebec, Canada, are also on that list (but patrons in the rest of Canada are not). Australian patrons, who support creators in Australia, are exempt from this new sales tax. However, Australian patrons who support creators who are not in Australia will have to pay the new sales tax. In the United States, Patreon will not collect sales tax from patrons in Alaska, Delaware, Florida, Kansas, Louisiana, Mississippi, Missouri, Montana, New Hampshire, Oregon, and Tennessee.
Patreon says it will be sending an email to patrons who are located in regions where Patreon will start charging sales tax, on June 1st. It also suggests that creators “may want to give your patrons a personal heads up before we send them an email on June 1st.” A sample post copy about the new sales tax has been provided.
On the one hand, Patreon might be legally obligated to start charging sales tax. That may not be something they can opt-out of. That said, it feels like Patreon is, once again, expecting creators to be the people who let their patrons know about the sales tax. That’s uncomfortable, especially considering that every time Patreon makes the creators be Patron’s mouthpiece, creators lose patrons.