In February, emails circulating among Wal-Mart Stores executives leaked to the press.
The emails described February sales figures as a “total disaster,” and the executives placed the blame on the payroll tax cut expiry that went into effect on January 1.
Everyone was worried about how increased taxes and rising gas prices were hitting the consumer, so the emails came at just the right time to stoke fears over a consumer slowdown even more.
Bloomberg reports that during a presentation at an industry conference today, Wal-Mart CFO Charles Holley said that the slowdown in sales they observed in late January was actually “not disastrous,” and that sales normalized by the end of February.
Holley went on to say that the slowdown was primarily due to delayed tax returns, an explanation flagged by analysts as soon as the leaked emails hit the tape that was later backed up by Wal-Mart itself in its quarterly earnings filing.
Furthermore, according to Holley, Wal-Mart has not seen a slowdown in U.S. sales based on the expiry of the payroll tax cut.
This is welcome news for those worried about a big slowdown in consumer spending for tax reasons.
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