A sales tax can be either origin or destination based. In the origin-based model, the tax is the tax rate and rules in the seller’s location, and in the destination-based model, the tax rate and rules are those in the buyer’s location. This report compares the two models.

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Gunners from the Armed Forces of Ukraine fire at Russian position with a 155 mm self-propelled howitzer 2C22 in the Kharkiv region on April 21, 2024. (Anatolii Stepanov/AFP via Getty Images)