Amazon.com Fires Colorado Affiliates Thanks to Affiliate Tax
Monday, March 8th, 2010
Amazon says “see you later” to Colorado’s affiliate merchants. Thank inept state representatives.
Colorado is the latest state to exacerbate unemployment problems by effectively canning its affiliate marketers.
Colorado has joined a list of states that either proposed or enacted rules that make web companies collect sale tax if they have affiliates operating in the state. In the case of Colorado, HB 10-1193 didn’t necessarily require Amazon.com to collect sales tax. Instead, it upped the compliance burden on Amazon.com, making it just as costly.
As I’ve pointed out before, such “affiliate taxes” actually lower a state’s tax revenue. The e-commerce merchant usually cuts the state’s affiliates rather than deal with the sales tax. So the state doesn’t end up getting the sales tax. Also, it lowers the income of the state’s affiliate marketers, lowering state income tax revenues.
(Hat tip Bruno Falconi)
Related posts:
Illinois has something brewing as well as I see a Alert message in my cj.com panel.
Failed State!
USA is history – seems your gov just keeps wanting to run you all into the ground…very sad…
[...] Domain Name Wire » News » Amazon.com Fires Colorado Affiliates Thanks to Affiliate Tax &… [...]
There is NO leadership in Colorado right now.
They are all currently positioning themselves on either side of Amendment 20(Medical Cannabis).
Senator Chris Romer, son of a former governor, is trying to make “his name” on the issue.
Until medicinal cannabis is out of the news, I’m afraid many more things will get “pushed through the cracks”.
I saw this stat recently that said something like 45 out of 50 states are having budget problems. The solution is always “we need more taxes”. In very few cases does anybody suggest that “the government needs to spend less” (too radical of a concept).
This will only get worse wrt affiliates (and every other source of income) as the states scramble to avoid the obvious (cut spending).
[...] Domain Name Wire » News » Amazon.com Fires Colorado Affiliates Thanks to Affiliate Tax &… [...]
I totally understand the states wanting to get the tax revenue, but that needs to be dealt with on the national level. Seems like a gray area now, like Amazon has to collect the taxes, but they don’t and almost every other online only biz doesn’t either.
Of course companies with brick and mortars in a state DO already collect sales tax on their online biz in those states.
I feel bad for the small affiliates, they have no options. The larger ones can at least setup a corporation or something in another state. A pain for sure, but in the end may be the only way to deal with it. At least until THAT state decides to cut their own throat and enact the same silly policy.
@npcomplete “I saw this stat recently that said something like 45 out of 50 states are having budget problems. The solution is always “we need more taxes”. In very few cases does anybody suggest that “the government needs to spend less” (too radical of a concept).”
here’s another radical concept. why dont people start asking why we need government at all?
http://advisoronline.blogspot.com/2009/12/what-government-really-means.html