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phil
April 22nd, 2014 at 7:50 pm
Study: Sales taxes cause Amazon sales to fall 10%
12:04 PM ET · AMZN
• An Ohio State University study found households in states that have begun collecting sales taxes on Amazon (AMZN +0.8%) purchases cut their Amazon spending by 10% relative to households in states lacking collection. A 24% drop was seen for $300+ purchases.
• The study tracked the spending of 245K households that spent at least $100 on Amazon in 1H 2012, and followed their activity through the end of 2013. Amazon currently collects sales tax in 20 states, including California, Texas, and New York. Other states will soon be joining the list.
• While Congress continues to mull a national online sales tax bill, plenty of smaller online retailers are able to avoid collecting on sales to states where they have no presence. Many of Amazon’s 3rd-party sellers, collectively responsible for 39% of the company’s Q4 unit sales, fall within this group.
• Amazon’s Q1 report arrives on Thursday.
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