So, it finally happened. The South Dakota state government can now charge eCommerce sales tax for online businesses.
This morning the US Supreme Court announced the 5-4 ruling, overturning a 1992 decision (Quill Corp v. North Dakota) that barred states from collecting sales tax from businesses with “no physical presence” in their state. The high court ruled against Wayfair, Overstock.com, and Newegg, sending their stock price into a fall (along with that of Amazon, Etsy, Ebay and more). As a result of the ruling, many fear the gates have been opened for all 45 states that collect sales tax to use the Wayfair decision to charge Internet sales tax. When this happens, online shops will likely begin charging customers at the checkout, driving up eCommerce prices for customers.
However… Consumers are already required to report their online purchases and pay the applicable taxes. According to CNN, “Last year, states could have collected as much as $13.4 billion in additional online sales taxes, according to the General Accountability Office. Although buyers are technically supposed to add up their purchases and pay all the applicable taxes along with their regular filing, few do.” As a result, some argue this decision is fair, especially when one considers eCommerce’s massive impact on the U.S. economy.
In the majority opinion, Justice Anthony Kennedy wrote, “The Internet’s prevalence and power have changed the dynamics of the national economy.” He also mentioned the need for states to collect the tax as digital retail continues to explode, saying, “The expansion of e-commerce has also increased the revenue shortfall faced by States seeking to collect their sales and use taxes.” With eCommerce poised to make up 17% of US retail sales by 2022, the ruling makes sense now more than ever.
The likely winners in this scenario will be states who can now collect the online sales tax (many more to come), and Amazon, who has been paying state sales taxes for years. While the decision will hurt smaller, non-monolithic eCommerce businesses, Amazon’s competition will now likely face the same tax requirements, keeping Amazon even still again, ahead of the curve.
For now, in South Dakota, the law will only apply to eCommerce sites with more than $100,000.00 in sales revenue from commerce within the state. The state now stands to gain an additional 50 million dollars in revenue annually from the tax. Lastly, as CNBC reports, “[the] states that are likely to see the biggest percentage increase in revenue are Louisiana, Tennessee, South Dakota, Oklahoma and Alabama, according to the Barclays research.”
This week, Eric Dye of the Entrepreneur Podcast Network interviewed Redstage CEO Adam Morris on the coming B2B eCommerce revolution. In this episode, the pair discuss the latest trends, market news, and strategies for companies who “NEED” to adapt to the new standards of digital commerce. Click play above to listen now or follow the link at the bottom to download the podcast. Happy listening!
Insights included in this entrepreneur interview:
1. “What does the B2B eCommerce market look like and why is B2B super hot right now?”
2.“How is B2B eCommerce different from traditional online retail?”
3.“What are the main roadblocks for companies going digital?”
As a digital entrepreneur, Adam Morris has been working alongside Anthony Latona (Redstage’s CMO) since their university days. The duo co-founded several businesses together over the years, most recently Redstage, which started in 2008. As Morris recalls, “All of our businesses revolved around online commerce, and we’ve had a knack for being ahead of the Internet business curve. Redstage is an eCommerce agency that specializes in web design, development, strategy and support for B2B and B2C clients all over the world. As part of the Fulcrum Family of companies, we have over 700 employees on 5 continents. For the past 10 years we’ve been transforming companies through eCommerce, now focusing primarily on Magento and Shopify. With B2B eCommerce set to explode before the end of the decade, we’re ready to take on the biggest challenges facing the world’s largest companies – especially when it comes to tackling the transition to digital, something we’re quite good at.”
If you enjoyed this podcast, check out this post on MagePlaza about our developers’ biggest “B2B Pet Peeves” (the top 4 signs that a B2B site needs to upgrade).
Hasan Elkomey Takes Helm of Redstage’s Partner Channel
Redstage is pleased to announce the latest addition to our team and new SVP of Strategic Partnerships, Hasan Elkomey. As the former VP of Digital Transformation and Strategy at Damco, Hasan will drive Redstage’s partnership initiatives, leveraging his 15 years of insight to drive growth. Hasan’s experience working with complex organizations will help maximize value for clients as well as industry partners. Furthermore, the new SVP aims to accelerate company revenue by enhancing organizational efficiency and shepherding in the next wave of customer experiences.
Apart from Redstage, Hasan serves on Rutgers University’s board for the Center of Innovation — Design Thinking as the program’s Chairman. Over the years, Hasan has become known as an industry thought leader for his work fostering relationships with some of the world’s most recognized brands. He regularly speaks at digital industry events around the United States.
Increases service offerings for clients through the Shopify Plus Partner Program
Hoboken, NJ – June 15, 2016 – Redstage Worldwide LLC, a boutique agency providing enterprise class ecommerce services to clients, today announced an enhancement to the their service offerings. They will be among the first group of digital marketing and design experts to partner with Shopify Plus for the launch of the Shopify Plus Partner Program; further advancing the future of ecommerce and how businesses succeed.
The new Shopify Plus Partner program will broaden Redstage’s reach in the e-commerce industry and allow them to help thousands of online merchants grow and expand through a partner ecosystem that connects brands with accomplished ecommerce agencies like Redstage. Shopify Plus is a cloud-based, multichannel commerce platform for high growth, high volume merchants. Shopify Plus’ platform benefits for Redstage clients include overall lower infrastructural costs, handling of high order volume, multiple payment options for customers, mobility support, and integration of existing IT platforms.
Expressing his enthusiasm about the launch of the Shopify Plus Partner Program, Redstage CEO Adam Morris said, “We’re very happy to add Shopify Plus to our platform offerings. Shopify Plus gives us a powerful enterprise level toolbox. The platform allows top brands and retailers to reach customers on their preferred shopping channels at an unprecedented speed of implementation.”
“We’re excited to welcome Redstage to the new Shopify Plus Partner Program,” says Loren Padelford, VP and GM, Shopify Plus. “Their experience developing innovative ecommerce properties for their clients was a key factor in having the agency as a launch partner.”
Redstage’s partnership with Shopify Plus will create new opportunities for their clients to benefit from innovative, social and conversational commerce strategies that will improve long term brand awareness. To learn more please visit: https://redstage.com/shopify-plus/or Redstage’s website www.redstage.com. To learn more about the Shopify Plus Partner Program, please visit www.shopify.com/plus/partners.
Redstage is a global leader in ecommerce solutions and consulting for online merchants around the world. Built by marketing experts and backed by a brilliant development team, Redstage has worked with over 600 online stores over the past 8 years. Redstage can design, build, launch and support your store by truly becoming your partner in ecommerce. Redstage is currently supporting the ecommerce needs of companies like SpaceX, Red Dress Boutique, Jura/Capresso, Pixi, Pat LaFrieda and many more.
A couple of weeks ago, we did a webinar with eBridge Connections on Responsive design and why it is so important today. We hope that you were able to take the time out of your schedule to attend. It was a very informative session and we’re proud to have been given the opportunity to share our knowledge and expertise.
With that said, we know that not everyone out there was able to attend and we want to make sure that everyone can see how important responsive design is today and take advantage of this as a way to enhance their overall customer experience and increase revenue.
eBridge Connections was kind of enough to record the entire webinar and post it on their YouTube channel. To see what you missed, or to watch it again, you can follow the link to the video here: Responsive Design Webinar
We’re excited to announce that Adam Morris, Redstage Co-Founder and CEO, will be co-hosting a webinar in conjunction with Redstage partner eBridge Connections on the benefits of Responsive Design and its importance in today’s Ecommerce landscape.
Responsive design allows store owners to create a shopping experience that is consistent for all customers regardless of what device they are viewing the site on (desktop, tablet or mobile). This method results in a website that adjusts automatically based on the users device.
The webinar will explain:
The current state of mobile and tablet shopping
What responsive design is and how it works
The benefits of using responsive design
The webinar will take place on Thursday, June 26, 2014 at 2:00PM – 3:00PM EDT. You can register here to join in and see why responsive design is so important so you can stay competitive in your industry.