Although the Trump Organization is headquartered in New York, the store does not claim to collect sales taxes in the state.
There are 45 states that levy sales taxes. Tax experts speculate that the Trump Organization could be employing a tactic commonly known as “entity isolation” to avoid levying sales taxes in most of those states. Such a strategy would class the organization’s website as a separate entity from the physical locations around the country — including Trump’s golf courses, resorts and the headquarters itself.
But this exemption may not apply to New York. The online store’s explicit connections to the brick-and-mortar storefront in Trump Tower potentially classify it as a sales tax vendor in the state.
“The Trump Organization should be paying sales taxes on any goods that they’re selling in New York state,” said Ron Deutsch, executive director of the New York-based Fiscal Policy Institute.
According to the New York Department of Taxation and Finance, online retailers are considered sales tax vendors if they “maintain a place of business in the state, such as a store, office, or warehouse, and sell taxable, tangible personal property or services to persons within the state.”
The Trump Store website defines itself as the “official retail website of The Trump Organization” and encourages visitors to “visit our brand new Trump Tower flagship retail store” located in Trump Tower’s “garden level.”
Trumptowerny.com, the official website of Trump Tower New York, further insinuates itself with Trumpstore.com by linking to the online shop and telling potential customers to “shop now.”
“You have Trump Tower New York and the Trump Store in Trump Tower pointing people to the site, essentially being salespeople,” Carl Davis, research director of the nonpartisan Institute on Taxation and Economic Policy, told Giftofaservant.
A spokesman for the New York Department of Taxation and Finance said secrecy laws prevent it from commenting on specific taxpayers.
While President Donald Trump continues to slam retail giant Amazon’s tax practices, the tax-collection practices of his own organization’s online store raise questions of their own.
“It seems like they’re using a similar strategy as Amazon, but they’re taking it further,” Davis said when told of Virginia’s addition to the Trump Store’s list.