The recent decision of the Supreme Court of the U.S. may cause certain harms to major online marketplaces, but it surely pleased President Donald Trump, as he welcomed the new online sales tax ruling with superlative praise. However, experts said that this may not be a great concern for President's long-time target: Amazon.
President Trump complimented the decision as a praiseworthy step at his official Twitter account. He regarded the decision as a "Big Supreme Court win on internet sales tax." within hours of the ruling which will streamline a considerably high amount of sales tax from the online retailers and marketplace giants like Amazon. He also addressed that this decision is a fair and huge victory for both the consumers and the retailers as well.
The Supreme Court gave the 5-4 ruling on Thursday which allowed the states to collect sales tax from the online retailers. According to Politico, this ruling will permit the states to collect sales tax from those business entities which run solely on online platforms and don't have any physical existence. Trump claimed that this will have a severe impact on the marketplace giants like Amazon which has been a great revenue extractor from the U.S. economy during last few years.
The price of the stocks of Amazon slashed down to 1.1 percent on Thursday, after the arrival of the decision, as many of the retailers and partners of the company began fearing and reacting on the ruling. However, market experts have had other opinion to convey. They suggested that this decision will cause only a marginal harm to Amazon's business as the e-commerce giant already collects sales tax at all of its various distribution centers, which are situated in the majority of the states of the United States.
Analysts claimed that only the third-party sellers, who use their goods through Amazon's selling platform may face some effects of this decision. According to the claims, the sellers who haven't required to collect sales tax from their customers till this time will now have to collect those as to satisfy the court rule. As a result, they might have to raise the price range of their products. This may, in turn, give rise to a healthy competition between Amazon's very own marketplace and the third-party offerings.
However, it won't cause any loss to the customer base of Amazon, as Colin Sebastian, the Senior Equity Research Analyst for Robert W. Baird & Co., rightly said: "Most consumers use Amazon for convenience, selection, service and Prime, not to find the lowest prices," Now, it is to see, what this Supreme Court ruling brings to Amazon's fate, in reality.
