Trump vs Amazon tax war
The tax war continues between Amazon sellers and state governments who want to threaten the businesses of sellers who haven’t been cooperating with sales taxes.
A recent development suggests that United States President Donald Trump himself is getting involved in the battle. The fight between Amazon CEO Jeff Bezos and Trump has some history behind it, but Amazon and its sellers will hope that nothing will come of it in the future.
Here Come The Big Guns
According to a recent Axios report, Trump is “obsessed with Amazon” and is reportedly looking for ways to take Amazon down. Axios reports that the company is hurting the businesses of Trump’s friends, which include many brick-and-mortar stores whose sales have plummeted with the rise of online retail. Trump is taking the personal battle to the professional landscape in what could have an impact on many businesses.
One quote from the Axios article is particularly eye opening:
Trump’s deep-seated antipathy toward Amazon surfaces when discussing tax policy and antitrust cases. The president would love to clip CEO Jeff Bezos’ wings. But he doesn’t have a plan to make that happen.
Trump also reportedly believes that Amazon is harming the postal system despite multiple aids informing him that Amazon is actually making a lot of money for the post offices.
Regardless, it seems Amazon is the latest of Trump’s obsessions when it comes to companies. Trump and Amazon CEO Jeff Bezos have a long-standing rivalry with one another, with Bezos being a noted opponent to Trump’s campaign when the President was running for election in 2016.
Bezos attempted to repair relations with Trump after the President won the election, congratulating him for his accomplishments publicly. Bezos has softened on his stance against Trump since the President took office. However, it seems that Trump didn’t forget about the feud they had before Trump won the election, according to USA Today.
In a May interview with Sean Hannity, Trump said Bezos used his purchase of The Washington Post in 2013 “for power so that the politicians in Washington don’t tax Amazon like they should be taxed.” Trump also claimed Bezos “has a huge anti-trust problem.”
Trump has spoken harshly about Amazon and Bezos since Trump became a candidate for the presidency in 2015. Trump has tweeted his disapproval of Amazon’s business strategies in the past, so it’s no surprise that the feud between the two has continued into Trump’s first term.
What Effect Will This Have On Amazon?
Well, it already has had a minor effect on Amazon in just the first hours since the Axios report. On Wednesday, when the article was released, Amazon lost 5.4 percent of its value (around $40 billion) in stock. The sizable drop was a shock to many in the business and showed the power that Trump’s words have on the American people – or at least on the stock brokers.
Amazon recently became the world’s second-most valuable company on the planet, and a recent estimate suggested the company could be worth as much as $1 trillion within the next few years.
This sharp drop in stock is concerning for many Amazon shoppers and sellers as Amazon isn’t the first company to take a hit following negative remarks from the President.
However, Bezos’ attempts at smoothening relations between himself and Trump suggest that Bezos is willing to make adjustments for the betterment of the company. It’s unclear how much more of Amazon’s value will fall because of this report, or if there will be any more significant drops in the future.
Trump vs Amazon tax war: White House Backtracks Comments
After the stocks for Amazon fell on Wednesday, the White House released a statement on the same day saying that there are no plans for any direct action against Amazon nor any policy changes in the works that will directly affect the business, according to Reuters.
“The president has said many times before he’s always looking to create a level playing field for all businesses and this is no different,” said White House spokeswoman Sarah Sanders, when asked about the Axios report. “He’s always going to look at different ways, but there aren’t any specific policies on the table at this time.”
The New York Times even reported that Amazon’s stocks bumped up a tiny bit after the White House statement calmed down the masses. That means that perhaps things aren’t as bad for Amazon and its sellers as people initially thought they’d be after the report dropped. Original estimates had the stocks falling by a full 7 percent on Wednesday rather than the 5.4 percent that was noted earlier.
Whether President Trump will actually make true on his word to come after Amazon and Bezos remains to be seen.
A war between the White House and Amazon would not be good for anyone who is doing business with Amazon.
However, for now it appears that the waters have calmed and there’s nothing imminent to suggest that there will be problems for Amazon sellers.
Trump’s statements so far have simply been thoughts expressed out loud. Whether he acts on them could determine what will happen for Amazon in the future. Bezos would be smart to try to repair relations with the President in order to avoid potential damage to the company, although it’s not entirely clear how much Trump could do to change the way Amazon does business without the help of other politicians.
Trump has failed to change the way that businesses operate more often than not, such as in the case of the NFL when Trump demanded that owners release any player who refused to stand for the playing of the National Anthem before games. Stocks have risen and fallen in response to Trump’s comments and tweets in the past though, so the movement that Amazon is seeing now is hardly unprecedented. What would be unprecedented is if Trump is successful in changing Amazon in a meaningful way.
Trump vs Amazon tax war – The fight between Trump and Bezos has been going for a while, and there’s no signs that it will stop any time soon. For now, stay tuned.
Anders Jorstad is a content creator for Rosenbaum Famularo, P.C., the law firm behind AmazonSellersLawyer.com. Anders will be earning his degree in journalism from Hofstra and has five years of professional journalism experience. He has written for numerous online and print publications including SB Nation and The Hofstra Chronicle.