States predicted minimal harm to direct/online retailers from this decision but the survey results claim a different story:
- More than half (56%) of the respondents said their business experienced decreased sales as a direct result of the Wayfair Supreme Court decision.
- Remote merchants have had to pay up to $275,000 as an initial investment for sales tax collection software, including consulting services to implement the software.
- Companies have paid up to $500,000 for recurring expenses of sales-tax collection.
- After a delay in getting software implemented, one company owed some $500,000 in past-due taxes it had been unable to collect.
- Customers are confused by the added cost, and some vendors are under a disadvantage against smaller competitors that don’t trip the threshold for economic nexus.
Vendors have to track a lot of information in the wake of Wayfair to obey the tax laws of far-flung states. Costs are turning out to be high in customer relations as well as on the bottom line. But this doesn't have to be your reality.
Not all companies will need a software solution, not everyone will be audited for back taxes, and you may not be taxable everywhere you have nexus. The best route is to stay ahead of the changes and gain a strong understanding of all the laws and where they impact you. If you need help navigating all the updates and making sure your company stays compliant - Contact us!