In our state, sales tax is paid only by the end customer. In other words, a retailer does not pay sales tax on merchandise that is purchased for resale. To avoid the sales tax, the retailer furnishes the supplier with a reseller's certificate, which allows the supplier to not charge the sales tax.
If a sales tax is paid by the reseller and the sales tax could have been avoided, the sales tax would have to be expensed immediately. Costs that are not necessary cannot be recorded as assets.
If the sales tax could not have been avoided, then the sales tax would be part of the cost of the merchandise purchased. If the merchandise has not been sold, the entire cost will be reported as inventory, a current asset on the balance sheet. If the merchandise has been sold, then the entire cost will be reported on the income statement as the cost of goods sold.