Sales Tax Agony Index

New laws across the world mean you owe sales tax on software and digital products wherever your customers are (learn more here). Here are the most painful tax jurisdictions for your team to prioritise (or you can hand it all off to Paddle).

Estimate your tax liability for 2022 - 2023

$100,000
tax liability this year estimated penalties

How is this calculated

Your exact tax liability will vary according to your customer and revenue distribution around the world. Different jurisdictions will have different tax levels from low tax regions like South Dakota (4.5%) to high-tax regions like the Netherlands (21%).

This low/high estimate is based on a 80:20 distribution of your revenue in a 4.5% and 21% tax rate, over 12 months.

Low estimate: MRR * 12 * ((0.045 * 0.8) + (0.21 * 0.2))

High estimate: MRR * 12 * ((0.045 * 0.2) + (0.21 * 0.8))

The penalties estimate tends to come to about 10% of the total. This is based on a midpoint:

Penalties estimate: MRR * 12 * 0.1 * ((0.045 * 0.5) + (0.21 * 0.5))

Agony Alphabetical Tax rate Lowest tax thresholds Hardest to register Has prison sentences
Tax jurisdiction
Sales tax rate
Taxable goods
Admin agony
Worst penalty
Total tax agony rating
🇨🇾 Cyprus
19%
Yes
🇫🇷 France
20%
Yes
🇬🇷 Greece
24%
Yes
🇮🇳 India
18%
Yes
🇺🇸 Iowa
6%
Yes
🇮🇹 Italy
22%
Yes
🇯🇵 Japan
10%
Yes
🇱🇻 Latvia
21%
Yes
🇲🇹 Malta
18%
Yes
🇺🇸 Ohio
5%
Yes
🇵🇱 Poland
23%
Yes
🇪🇸 Spain
21%
Yes
🇸🇪 Sweden
25%
Yes
🇺🇸 Utah
4%
Yes
How do I solve my tax liability?