Patrick Semansky/AP

President Trump has taken another swipe at Amazon, tweeting that it is damaging "towns, cities and states throughout the U.S.," paying no taxes, and killing jobs.

  • His tweet: "Amazon is doing great damage to tax paying retailers. Towns, cities and states throughout the U.S. are being hurt - many jobs being lost!"
  • Why Trump is wrong: As of April, Amazon does collect taxes on goods sold from its own inventory for every state in the union that has a sales levy.
  • Why Trump is right: Amazon has been a buzzsaw through big swaths of traditional retail, including brick-and-mortar bookstores, department stores and apparel shops. Tens of thousands of jobs have been lost, along with sales taxes that fund local services. And Amazon doesn't collect sales taxes on goods sold by third-party affiliates, unless it is contracted to do so by those sellers. Amazon declined to comment, but has said previously that close to half the items sold on its site are from third-party affiliates.

A legal grey area: In the case of product sales across state lines, sales taxes are collected only if that business has a significant presence, like a factory or warehouse, in that state. Otherwise, the customer still technically owes that tax, but only very rarely is the state able to collect.

The economic impact: As e-commerce has grown, so has revenue generated by selling goods across state lines. For years, this enabled many retailers, including Amazon, to offer lower prices by not collecting sales taxes. According to Richard Cram of the Multistate Tax Commission, third-party sellers on Amazon are avoiding more than $1 billion annually in sales taxes across the country, giving those dealers an unfair advantage on brick-and-mortar competition, and robbing local governments of revenue.

Amazon itself, however, now pays sales taxes in all sales-tax states, and has publicly supported the Marketplace Fairness Act, which would allow states to require out-of-state retailers to collect sales taxes.

  • The latest iteration of the act would exempt companies with less than $1 million in annual revenue, so even if this legislation passes, a significant number of third-party sellers could avoid collecting sales duties.

Our thought bubble: If Trump were truly concerned about this sales-tax loophole, he could get behind the bipartisan bill, reintroduced in the Senate in April. More likely, however, he is only taking the opportunity to tweak Amazon and its founder, Jeff Bezos, who owns the Washington Post, which the president has accused of being unfair to him.

Go deeper

38 mins ago - Technology

Congress' next moves to rein in Big Tech

Illustration: Eniola Odetunde/Axios

After grilling the CEOs of Amazon, Facebook, Google and Apple last week, members of Congress are grappling with whether to accuse any of the firms of illegal anticompetitive behavior, to propose updating federal antitrust laws — or both.

The big picture: Congress is just one arm of government making the case against these companies. Google is expected to be the first of the firms to face possible antitrust litigation from the Justice Department before summer's end, but all four face a full-court press of investigations by DOJ, the Federal Trade Commission and state attorneys general.

Fauci: Coronavirus task force to examine aerosolized spread


A sneeze. Photo: Maartje van Caspel/Getty Images

The White House coronavirus task force will examine more closely just how much SARS-CoV-2 might be transmitted via aerosols, and not just from droplets, NIAID director Anthony Fauci said Wednesday at an online forum sponsored by Harvard T.H. Chan School of Public Health.

Why it matters: The longer the coronavirus can remain infectious in the air, the more likely it can infect people, particularly indoors — leading to the possible need to alter air filtration and circulation within buildings.

The next wave to hit Main Street

Illustration: Eniola Odetunde/Axios

Call it the great retail wash. A wave of defaults, bankruptcies and evictions expected in cities across the U.S. is poised to remake the retail landscape across the country, but there may be some upside for consumers and small businesses.

Why it matters: Rather than an overnight descent into a collection of urban wastelands full of Starbucks, Amazon fulfillment centers, Chase bank branches and nothing else, the coronavirus pandemic and resulting retail apocalypse may just mean that, in major U.S. cities, less is more.