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Online Retailers Slide After High Court Ruling on Sales Tax

Online Retailers Slide After High Court Ruling on Sales Tax
(Dreamstime/Boarding1now)

Thursday, 21 June 2018 11:34 AM

Shares of online retailers took a hit after U.S. Supreme Court allowed states to force these companies to collect sales tax.

The ruling opens the door to a new revenue stream to fill state coffers - up to $13 billion annually, according to a federal report - while imperiling a competitive advantage that e-commerce companies had over brick-and-mortar rivals that already must collect sales tax.

Near midday trading, just after the ruling was announced:

  • Amazon (AMZN) was down 1 percent
  • Wayfair (W) was off 3.6 percent
  • Overstock.com (OSTK) was down 2 percent
  • Etsy (ETSY) fell 4.3 percent
  • eBay (EBAY) slid 2 percent
  • Shopify (SHOP) tumbled 3.4 percent.

Amazon already collects state and local sales taxes. Amazon was among the biggest drags on the benchmark S&P 500 stock index.

The justices, in a 5-4 ruling against Wayfair, Overstock and Newegg Inc., overturned a 1992 Supreme Court precedent that had barred states from requiring businesses with no “physical presence” in that state, like out-of-state online retailers, to collect sales taxes

© 2019 Thomson/Reuters. All rights reserved.

   
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Shares of online retailers took a hit after U.S. Supreme Court allowed states to force these companies to collect sales tax.
online, retailers, court, ruling, sales, tax
168
2018-34-21
Thursday, 21 June 2018 11:34 AM
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