- President Donald Trump praised a Supreme Court ruling that could soon lead to online retailers having to collect state sales taxes in 45 states.
- But it could also have an affect on his own online retailer.
- TrumpStore.com currently collects sales taxes in just four states.
President Donald Trump praised a Thursday Supreme Court ruling that could soon lead to online retailers having to collect state sales taxes in 45 states.
“Big Supreme Court win on internet sales tax – about time!”Trump tweeted. “Big victory for fairness and for our country. Great victory for consumers and retailers.”
Among those online retailers that could soon be affected, however, includes Trump’s own online retailer.
As of Friday, the Trump Organisation’s online retailer, TrumpStore.com, collects sales tax in Florida, Louisiana, New York, and Virginia, according to its website. Last month, Trump’s business quietly updated the list of states to include New York, while Virginia was added not long before that.
A Trump Organisation representative did not respond to a request for comment from Business Insider on how the Supreme Court decision could affect TrumpStore.com. When New York was added to the list of states, a Trump Store spokesperson told Business Insider the online retailer has “always, and will continue to collect, report, and remit sales taxes in jurisdictions where we have an obligation to do so.”
Carl Davis, research director for the Institute on Taxation and Economic Policy, a non-partisan think tank, told Business Insider the Trump Store’s sales tax collection policy is “a textbook example of the problem that this ruling is meant to address.”
“Trump Store could have been collecting sales taxes on its bathrobes and slippers and golf balls all along, but it made a business decision not to do so and, until now, states had limited options for requiring tax collection,” he said. “Most states still need to pass laws or issue regulations that will allow them to use the expanded tax collection authority the court just granted. But once that happens, Trump Store and other internet retailers are going to have to start collecting sales taxes in states where they do a meaningful amount of business.”
The 5-4 Thursday decision in South Dakota v. Wayfair overturned a 1992 ruling that said retailers could only be required to collect sales taxes in states where the sellers had a physical presence. The decision was seen as a victory for brick-and-mortar stores, which felt they were at a disadvantage to online outlets that did not need to collect the taxes. States also argued that the previous interpretation prevented them from maximizing potential tax revenues.
“The Trump Store has been a clear winner under what the court just labelled ‘a judicially created tax shelter,'” Davis said. “But that tax shelter isn’t going to last much longer.”
Five states – Delaware, Montana, Oregon, New Hampshire, and Alaska – do not have a state sales tax.
Trump focused on the sales tax litigation as he blasted Amazon, the e-commerce giant, in recent months. In criticising Amazon and its founder, Jeff Bezos, who also owns The Washington Post, Trump said Amazon did not collect sales taxes.
Though the company earlier collected sales taxes in just five states, it more recently moved to start collecting the taxes in each of the 45 states with such a tax, as well as Washington, DC, prior to the Supreme Court ruling.
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