Technology has rapidly changed our world over the past 20 years and online retail has been a significant and driving factor in that. Sales tax regulations have long been constrained to taxing sales of goods from companies with a physical presence within the taxing state. The resulting dynamic, where consumers are able to avoid sales tax by purchasing goods from out-of-state online vendors, has been a boom for online retailing and a handicap for traditional retail in many areas.
However, on the 21st of June, the Supreme Court overturned the requirement for a physical presence, opening the door for states to require sales tax from online retailers. This is a significant ruling to the world of online commerce and helps to level the playing field for brick-and-mortar businesses.
With how recent this ruling is, it is hard to say how soon business will be impacted or what actions individual states will take, but there is no doubt doing business online is going to change to the benefit of the local dealers who are supplied by NASGW wholesalers. These dealers are on the front lines of the distribution channel, so I am excited about the potential for these businesses. While online sales have a place, getting the retail customer into the retail store provides a level of communication, service and opportunity that does not exist online. Over the past few years, our partners at the National Association of Distributors-Wholesalers have been working on this issue. During this time NASGW has supported their efforts, and it is great to see this come to fruition.
This ruling by the Supreme Court is a huge win for traditional retail across America, but with significant change, comes significant challenge. It is yet to be determined how this decision will be enacted at the state and national level. Tax law is a maze that is sure to take time to navigate, especially when we are talking about fifty different states and fifty different tax laws. There are sure to be more challenges by some of online giants of retail and congress has yet to respond legislatively, but I believe we are headed in the right direction.
Beyond, this pivotal decision, I wanted to remind you all that the 4th of July is right around the corner and I would be remised to not reflect on that important time in the history of our Nation and our industry. American firearms manufacturing can trace its roots to the American Revolution, supplying our Continental Army with firearms to fight the British. So, as you head out to the lake, attend BBQ, or catch your local fireworks show, take in all that patriotism, wave your flag, and thank God and our forefathers for the courage and blessings that have gotten us to this day.
Have a safe a happy Independence Day.
Until next time,
Brad Burney
NASGW Chairman