Today marks what is traditionally the busiest shopping day of the year in the US. The day after Thanksgiving is referred to as Black Friday because the volume of sales switches most stores from the red (in the hole) to the black (profitable).
This year, holiday sales are expected to be the best in a few years. The National Retail Federation is expecting a 2.3% boost this year, compared to a mere 0.4% in 2009 and a 3.9% loss in 2008. Those numbers add up to 138 million people expected in US stores today.
For folks who don’t want to venture out to the stores today (that would be me), retail shops are wooing online shoppers. Nearly nine in ten retailers are planning Cyber Monday specials: Cyber Monday is the Monday after Thanksgiving when shoppers tend to hit the online malls.
Folks shop online for a number of reasons. Some hope to avoid the crowds, others aggressively hunt down the best deals by comparison shopping online. In years past, many shoppers also cited the lack of a sales tax as an incentive.
Of course, not all sales are exempt from sales tax. Many retailers debate whether they must charge sales tax on sales, mostly by claiming that there is no physical presence which would require them to collect tax. Front and center in the debate have been online giants Amazon and Zappos which have taken different approaches – Amazon continues to fight on in states across the country.
For now, the question of whether to charge sales tax for online sales remains controversial in many states. The amount of revenue escaping tax has been a sore spot for many state and local governments. Shoppers don’t seem to mind, do you?
In NY you cannot (legally) escape sales tax. In most cases, if you do not pay the sales tax to the vendoer, you are required to file a ‘use tax’ return and voluntarily remit the sales tax you would have been charged. Needless to say, compliance is low…