Walmart blamed the state of the economy and the January payroll tax increase in particular for weak sales on Thursday as it reported lower-than-expected earnings and cut its profit forecast.

“The 2 percent payroll tax increase continues to impact our customer,” Walmart U.S. president and CEO Bill Simon said in a statement accompanying the company’s second-quarter earnings release. The retailer, the largest in the U.S., saw same-store sales fall 0.3 percent in the quarter.