As “Internet Tax” is Discussed, Oil Rig Count and Auto Sales are Down
July 04, 2017
A Trump tweet has caused the debate over how Internet sales are taxed. After rising for 23 weeks, the number of oil rigs in the U.S. declined slightly. So did automotive sales. Construction spending is flat for the month, but up for the year.
- Trump reawakens debate over internet sales tax. In a tweet about Amazon, the President raised the issue of internet sales taxes, which the company recently began collecting on all purchases by customers in states where a sales tax was applicable. Many, if not most, online companies do not collect sales taxes, however, which as been a sore spot for states and brick-and-mortar competitors for years. Under current laws, online retailers aren’t required to collect the taxes unless they have a physical presence in the state, leaving taxes to be collected by individuals. Virtually no individuals do so, however, and the system is almost impossible to enforce. Legislation originating in the Senate has received bipartisan support and would allow states to collect taxes from online retailers if they simplify their tax codes, but it has stalled in the House. Critics believe it could harm small online businesses by requiring them to keep track of too many tax jurisdictions. Many believe that the issue will end up in the Supreme Court because of statements by Justice Anthony Kennedy and a related lawsuit currently before the South Dakota Supreme Court. [The Hill]
Economic Indicators & News
- U.S. oil rig count falls. After 23 weeks of growth, the number of rigs pumping oil in the United States has fallen. The number fell by 2 and now stands at 756. The fall is minimal, however, and the supply glut is expected to continue. [Business Insider]
- Auto sales fall for fourth month in June. While overall sales are down, shares of auto company stocks are up, as retail sales – those to consumers – were up. The overall drop was largely due to fewer sales to rental companies and other fleets. The seasonally adjusted annualized rate of sales now stands at 16.51 million units, which is the lowest it’s been since February 2015. [Reuters]
- Construction spending virtually unchanged for May. Total spending stood at $1.23 trillion, up 1% from April. The total outlays for January-May are 6.1% higher than the previous year and should contribute to GDP growth. They may be revised heavily in the future. [Market Watch]