Saturday, October 15, 2011

Amazon Prepares For Showdown In California After Budget Includes Amazon Tax

During the last two years, a variety of states have tried to apply "Amazon Tax", which change the definition of what counts as "presence" in a state that include whether a company has subsidiaries. Frankly, it's ridiculous. A subsidiary is really nothing more than a poster, and that defies common sense to say that the advertiser is considered a direct employee of the company. Amazon has struggled these efforts in a variety of states, but it takes a great fight. Apparently, the new California budget includes a tax version of the Amazon and the company wasted no time in sending an email to all partners Amazon CA (like us) to let us know that it would "end" of the contract of California, unless changed his mind.


For over a decade, the Amazon Associates program has worked with thousands of California residents. Unfortunately, new opportunities legislation can be signed by Governor Brown forces us to end this program for participants, based in California. In particular, the collection of taxes imposed on the consumer sales for online retailers - including but not limited to those mentioned by marketing affiliates based in California like you - even if retailers do not have a physical presence in the state.

We oppose this bill because it is unconstitutional and against-productive. It is supported by big box retailers, most of which are outside California who seek to harm the affiliate advertising programs of its competitors. Similar laws in other states has led to job losses and income, and few, if any, new tax revenue. We deeply regret that we must take this action.



Therefore, we will cancel the contracts with all California residents who participate in Amazon Associates, from the date (if any) that the law of California enters into force.
As we have said before, it's a very short-sighted by the state. They think they will bring in tax revenue when all it really is to kill members and units of that money elsewhere, to other states. For a state to be respectful of the Internet, taking into account all the "Silicon Valley" thing, you would think that local politicians who know better
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