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Etsy Sellers Worry How the Supreme Court’s Decision on Online Taxes Will Impact Their Small Businesses

June 22, 2018, 11:10 PM UTC

Online retailers’ stocks are down following the Supreme Court’s 5-4 decision in South Dakota vs. Wayfair earlier this week. The ruling, announced on Thursday, allows states to collect sales taxes from retailers that are not physically based in the state. And now, some small e-commerce business owners wonder if they’ll feel the similar sluggish returns in the near future.

The decision impacts giants such as Amazon and Overstock, but the impact trickles all the way down to individual sellers on marketplace websites such as Etsy, which specializes in supporting small businesspeople who want to sell their creations to customers across the country and around the globe.

Some Etsy sellers are worried about how the regulations will impact their ability to keep doing business as usual. It’s not the profit loss as much as the compliance headache, according to a CNNMoney report. Some sellers fear they’ll have to do sales tax returns for every state or risk an IRS audit of their side gigs and small businesses.

Etsy CEO Josh SIlverman responded to the Supreme Court ruling in a blog post on Thursday. “More than three quarters of Etsy sellers are businesses of one,” he wrote. “They have very different needs and challenges than larger online retailers.” He added that Etsy is encouraging sellers to sign a petition encouraging policymakers to take so-called micro-businesses like Etsy storefronts into account as they iron out the details.

The online marketplace for handmade goods has been trying to stay ahead of industry regulation changes while supporting its core seller business. Last year, in an effort to cut costs, Etsy laid off 20% of its nearly 1,000 employee workforce.