US tax move unlikely to affect imports

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A ruling that paves the way for US states to collect sales taxes from online retailers will have little impact on Bermudian spending habits, a local businessman said.

Steve Thomson, owner of Mailboxes Unlimited, said: “I don’t really see it affecting Bermudian shopping.”

The comments come after a 5-4 Supreme Court decision overturned a law that had barred states from requiring businesses without a physical presence in that state to collect sales taxes.

Mr Thomson pointed to two reasons why he didn’t think the decision would have a significant impact on Bermudians.

He explained: “One, Bermudians are affluent — so they are going to shop.

“Two, the prices are so much less anyway, that when you add the six or eight per cent sales tax, its almost irrelevant.”

Mr Thomson said the significant expense relating to online purchases is the cost to get them onto the island.

He added: “The big number in Bermuda was always the shipping — it wasn’t the cost of the item.”

Mr Thomson added that “two-thirds” of online retailers had already been charging sales tax.

He added: “Amazon is probably 50 to 55 per cent of our total volume, and they were basically charging it anyway.”

“I would say 80 to 85 per cent of Amazon was charging the sales tax already. It’s almost a non-issue.”

Mr Thomson said that forcing online retailers to collect sales taxes is fair.

He said: “If you walk into a store in New York City, and pay sales tax to a brick-and-mortar store, how come you can have it delivered to your condo and there’s no sales tax?

“Charging sales tax seems tremendously fair to me.”

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Published Jun 26, 2018 at 10:28 pm (Updated Jun 26, 2018 at 10:30 pm)

US tax move unlikely to affect imports

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