Business

Asos slides 5.3% following US decision on sales taxes

Fellow UK online fashion retailer Boohoo also down 2.5 per cent

An employee organises photographs of models at the Asos headquarters in London. Its shares fell after US sales tax decision. Photograph: Reuters

Fri Jun 22 2018 - 11:14

Asos shares fell on Friday, mirroring a slide in online retail peers on the other side of the Atlantic after the US supreme court overturned a ruling allowing ecommerce companies to avoid collecting sales tax from customers.

The London-listed online fashion retailer slipped as much as 5.3 per cent in morning trading on Friday after the court ruled states have the right to impose sales tax on online sales even if the retailer does not have a physical presence in their territory.

Shielded

US retailers Wayfair, Overstock. com and Ebay shed 3.8 per cent, 2.5 per cent and almost 2 per cent respectively on Thursday. Amazon shares fell 1 per cent, shielded in part thanks to the retailer's decision in 2012 to collect tax on its own sales in 45 states.

Asos reported its US revenue grew to £152.8 million (€173.8 million) in the six months to February, accounting for 35 per cent of its total revenue.

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Fellow UK online fashion retailer Boohoo was also down 2.5 per cent on Friday. The company reported revenue from the US market at £92.7 million (€105.4 million) in the 12 months to the end of February, or 16 per cent of total group revenue.

– Copyright The Financial Times Limited 2018

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