Monday, September 10, 2018

Breaking Down the Online Sales Tax and its Effect on Free Shipping

Chain Store Age
Competition continues to heat up within the retail industry as online-only retailers will now be required to collect state and local sales tax. Many details still need to be worked out and there’s no set date when this will take effect – but this is no small piece of news. To that end, this soon to be eliminated benefit for retailers (previously not having to collect these taxes), along with free shipping, helped propel the rise of e-commerce to the point that it now represents about 10% of total retail.

But “free shipping,” of course, is not really free – someone has to pay for it – and now that online retailers have to pay sales tax, will they be able to afford free shipping as well?. . . more