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The Morning Ledger: States Can Force Online Merchants to Collect Sales Tax |
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An employee moves a box at a Wayfair warehouse in Westborough, Mass. in 2016. PHOTO: SCOTT EISEN/BLOOMBERG NEWS
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Good Morning. The Supreme Court ruled that states have the authority to make online retailers collect sales taxes as the digitial transformation of the U.S. economy took a historic step, write the WSJ's Brent Kendall, Jess Bravin and Laura Stevens. The decision opens a new chapter when e-commerce is treated as a mature player in a market place that is no longer defined by trips to the corner store or the shopping mall.
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By a 5-to-4 vote, the court closed a loophole that helped fuel the early growth of internet sales, overruling its own 1992 precedent that forbid states from requiring merchants to collect sales tax unless those sellers maintained a “physical presence” within the state’s borders.
Justice Anthony Kennedy said the “physical presence” rule, always doubtful, had become untenable in the digital age. The court cited studies suggesting that the current rule costs states up to $33.9 billion annually in uncollected sales taxes.
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CarMax Inc. and BlackBerry Ltd. are among the companies slated to report earnings today.
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FedEx Corp. said it plans to increase capital spending in 2020, mostly through investments in its air delivery business amid a strong outlook for the segment.
Air cargo demand rose 9% last year, the strongest growth since 2010, according to the International Air Transport Association. The growth rate jumped from the 3.6% posted in 2016.
FedEx is betting that this trend will continue. The shipper ordered 24 medium and large freighters from Boeing Co., valued at $6.6 billion, the aerospace company announced earlier this week. Deliveries of half the aircraft will begin in fiscal year 2020, while the other half will begin arriving in 2021, FedEx officials said.
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Brian Krzanich violated Intel’s non-fraternization policy. PHOTO: DAVID PAUL MORRIS/BLOOMBERG NEWS
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Intel Corp. Chief Executive Brian Krzanich resigned over violating company policy for having a consensual relationship with a co-worker, a sudden turn for the tech giant as it seeks to extend its dominance in PC chips into new frontiers in computing. CFO Bob Swan was named interim CEO, but said he wasn’t interested in staying on as the permanent chief.
Carlos Ghosn said Friday there was “zero chance” Renault SA would acquire partners Nissan Motor Co. and Mitsubishi Motor Corp., bringing more clarity to the direction of a 19-year-old alliance that is preparing for a future without its chief architect.
AT&T Inc. unveiled a new video service, called WatchTV, that aims to use a “skinny bundle” of channels to recapture some of the millions of cord-cutters who dropped cable and satellite-TV. The package would offer a small number of TV channels to most subscribers for as little as $15 a month while giving free access to subscribers on unlimited data plans.
Deutsche Bank AG’s global corporate-strategy team is being dismantled and the executive who runs it, Ali Almakky, is leaving that role, according to people familiar with the matter.
AmTrust Financial Services Inc. announced Thursday that shareholders have approved its plan to be taken private by two New York families and a private-equity firm.
Puma SE is returning to men’s basketball shoes having signed endorsement contracts with four top draft prospects, including Deandre Ayton and Marvin Bagley III, ahead of the draft in New York Thursday night.
Tensions between Comcast Corp. CEO Brian Roberts and 21st Century Fox Inc. Executive Chairman Rupert Murdoch are complicating Comcast’s pursuit of the biggest media deal in years. Both Comcast and Walt Disney Co., who are vying for Fox’s entertainment assets, are seeking to counter the challenge of cord cutting and new technology rivals.
Global auto stocks were pummeled after DaimlerAG issued a profit warning overnight that the Mercedes-Benz owner blamed on trade tensions between the U.S. and China.
Chanel, the storied French fashion house that has dressed first ladies, royalty and Hollywood stars, published complete financial results for the first time Thursday, revealing itself as one of the luxury industry’s top-selling brands.
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The Securities and Exchange Commission. PHOTO: REUTERS
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The Supreme Court ruled that the government’s practice for appointing administrative-law judges overseeing cases against Wall Street defendants is unconstitutional. The high court’s ruling, written by Justice Elena Kagan, said the judges exercise enough power that they should be accountable directly to the Securities and Exchange Commission, which hears appeals of their judgments and uses the courts for about 20% of all litigated actions brought by the agency.
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The Federal Reserve determined the largest U.S. banks were healthy enough to withstand a severe economic downturn and would continue lending during a crisis, as the industry posts record profits and prepares for a wave of regulatory relief.
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The parent of California’s largest investor-owned utility plans to take a $2.5 billion charge related to a spate of deadly wildfires that swept the northern part of the state last October.
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The Swiss National Bank logo above the entrance to the central bank in Bern, Switzerland. PHOTO: STEFAN WERMUTH/BLOOMBERG NEWS
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Central banks in Europe signaled different outlooks toward rate increases, suggesting the divergent paths of the world’s largest central banks are gripping smaller ones too. The Bank of England held its benchmark interest rate steady at 0.5%, but officials said they expect economic growth in the U.K. to pick up in the months ahead following a soft start to the year, setting the stage for a rise in borrowing costs this summer.
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The number of Americans filing applications for new unemployment benefits fell for the fourth straight week in mid-June, signaling continued strength in the labor market heading into the summer.
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The Bank of Mexico raised interest rates, lifting borrowing costs in line with market expectations as a weaker Mexican peso threatens to derail this year’s slowdown in inflation.
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Frontier Communications Corp., the Norwalk, Conn. telecommunications company, said Chief Financial Officer R. Perley McBride will resign effective Aug. 31.
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Mr. McBride is resigning for personal reasons and will return to Atlanta where his family resides. Frontier has launched a search for his successor.
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Every weekend we select a handful of in-depth articles we think are worth a bit of your time, either because they peel back the layers on a compelling business story, or somehow make us look at business in a different light.
Late last year China closed its doors to contaminated plastic, leaving exporters in a lurch as other customers -- like Vietnam, South Korea and Thailand -- lack the infrastructure to absorb the massive amounts of waste China is rejecting. Between now and 2030, 111 million metric tons of trash like plastic straws, bags and water bottles, will have nowhere to go, reports Wired Magazine.
Amazon.com Inc., whose revenues last year topped $177 billion, has become deeply entwined with the federal government. Mr. Bezos has built one of the largest lobbying operations in Washington, bigger than those of powerhouses such as Exxon Mobil Corp. and Walmart Inc. Its cloud-computing business is a major government contractor, with an estimated $1.5 billion in contracts last year, according to consulting firm GBH Insights. And the company has been pushing hard to change the law to allow government employees to buy more of their own supplies on Amazon.com.
Chief executives used to be able to operate with little scrutiny beyond their quarterly results. That’s no longer the case. The rise of the #MeToo movement has companies hewing closely to their policies on sexual harassment, as well as on consensual relationships, especially for business leaders. Intel Corp. CEO Brian Krzanich resigned Wednesday after the company said it found he had a past, consensual relationship with an Intel employee—what it called a violation of the tech giant’s nonfraternization policy, which applies to all managers.
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