Fewer consumers say they are deterred from making an online purchase if the retailer charges sales tax than said so a few years ago, according to a new survey by Bizrate Insights, a division of digital marketing technology firm Connexity Inc.
Only 29% of shoppers surveyed Aug. 1-4 called sales tax an important factor in their purchase decision, versus 37% when Bizrate Insights asked the same question in 2013 and 2011.
Behind the shift may be the reality that more online retailers are charging sales tax as they build more warehouses around the country and thus become required by more states to collect and remit sales tax. That’s especially true for Amazon.com Inc., No. 1 in the Internet Retailer 2016 Top 500, which now collects sales tax in 28 states compared with six states four years ago.
“As the largest online retailers, such as Amazon, expand their distribution networks such that more and more online purchases become eligible for sales tax—in addition to evolving sales tax laws—most consumers are accepting the reality and considering additional factors as they choose where to shop,” says Hayley Silver, vice president of Bizrate Insights. “This slow move away from the race to the bottom price for the majority of online buyers should be welcome news for retailers who invest in the customer experience and exclusive products.”
Nonetheless, the Bizrate Insights data shows a significant number of online shoppers still avoid e-retailers that pay sales tax. Among the consumers who did not pay sales tax on their most recent purchase, 48% said sales tax was an important consideration, versus only 24% of those who paid sales tax. Bizrate Insights surveyed 6,216 online buyers immediately after they had made a purchase this month on the websites of some 4,500 online retailers in the United States and Canada.