Retailers blame IRS for slumping sales as income tax refunds get delayed
Add Walmart, Foot Locker, Burlington Coat Factory and Best Buy to the list of delusional retailers. According to this CNBC, report, the above companies are blaming the IRS for their slipping sales. They don’t have a clue…
Uncle Sam is taking a lot of heat from retailers.
The credits, which benefit low- to middle-income households with children, are being distributed later by the Internal Revenue Service this year to give the agency adequate time to validate claims.
Yet while traffic and sales trends are picking up as checks are delivered, their delay contributed to $57 billion less in refunds being doled out through most of February, according to Morgan Stanley.
They also contributed to muted expectations from several major retailers. Though not every company blamed late refunds for soft first-quarter trends, negative outlooks outnumbered the positive by nearly a 5-to-1 margin, according to Retail Metrics.
“We have seen, in our businesses and as reported by a third-party service, a substantial reduction in mall traffic in February,” L Brands‘ CFO Stuart Burgdoerfer told investors on the company’s latest earnings call. “Is it tax refunds? Who knows what it is. But it was a substantial falloff.”