Skip to comments.Amazon.com drops Illinois affiliates in the wake of internet tax
Posted on 03/14/2011 6:57:24 AM PDT by SeekAndFind
Going Galt is in fashion nowadays..............
Bookmarked for later.
Let’s just keep finding ways to kill business. That’ll show ‘em.
In short, the transaction was an inter-state transaction.
I can't wait for this one to go to the US courts.
That should bring in a lot of revenue...
Im getting notices that my state (OK) is now charging tax on all internet sales. Will have to pay.
This has already gone all the way to the Supreme Court. Unless a business has a physical presence in the state, you cannot make them charge sales tax. States like Illinois and California are trying to argue that the in-state affiliates provide that nexus that allows them to tax companies like Amazon. So when these laws pass, Amazon simply ends the affiliate program for that state. It doesn't hurt Amazon, doesn't help the state, but is devastating to those affiliates that need the revenue from the advertising...
Amazon is not in Illinois, though, it is in Washington. So if you go to a website that sits in Illinois and click on an Amazon link, you are now in Washington. That is where all sales are conducted. And why these States are cutting their own throats by trying to get a Washington based retailer to collect taxes for them.
Gov. Pat Quinn says “Let them eat cake” while businesses flee confiscatory taxes. Let Boeing or Cat announce a headquarter move and watch the panic set in. You can’t tax yourself to prosperity. It’s been tried and failed every time.
Thanks for the explanation!
Thanks for the info.
RE: Amazon and Texas are having a similar battle
Texas too? I would have expected the Lone Star State to have more sense than that.
RE: Unless a business has a physical presence in the state, you cannot make them charge sales tax.
Well, this is where Obama and his Democratic friends come in to support their Democratic buddies in blue states like Illinois and elsewhere (Illinois will be the pioneer as this is where Chicago and Rahm Emanuel are ).
And if it ever goes to Court anywhere in the US, you can be sure Obama and his justice department will invoke the time-honored “Commerce Clause”.
it will certainly slow my shopping ..we also require permits for Garage sales and limit them to one every six months
It doesnt matter if you cant tax yourself into prosperity. your gov wants it all..from your small 2 bit town to the feds..nothing you work for is yours. it belongs to them .
This has got to be a very stupid move by Illinois.
It would be very easy for Amazon to relocate their warehouse activities to a state that is not going to tax sales.
As far as I know Florida is open for internet based businesses.
RE: As far as I know Florida is open for internet based businesses.
Yep, and so will the states neighboring Illinois. I wouldn’t be surprised if Wisconsin poaches them.
Just hear an interview w/ Fat Wallet (internet performance advertising site) who is in my community.They will now be leaving Illinois. They have already received cancellations from the likes of Amazon. They would lose 40% of their business if they stayed. They (and all the others like them) warned the lawmakers. Apparantly, these idiot lawmakers thought they were bluffing.
Its the everything clause. There is nothing they can’t justify using that clause.
Here’s something I only found out recently, and I cannot vouch for the accuracy of the information. It was stated by the host of a local talk show.
In Alabama, say you are on vacation in Florida and buy something. You are supposed to remit to the state of Alabama the Alabama sales tax on that item.
So Amazon won’t do business in Illinois or Texas over taxing. At this rate, they’ll be down to a handful of states by 2015.
With Gov. Rick Scott here in Florida we are going to be a very business friendly state, so any businesses who are fed up in other states will be flocking to this state.
I suspect Texas, being a mostly conservative state, will drop the tax. Other liberal states will institute this tax.
Amazon will deal with the smarter states.
Here in Wisconsin we have what is called a "sales and use tax". What this basically means is that If you buy an item for your own use it's subject to sales tax. If you didn't pay the (sales) tax when you bought it you are supposed to pay the (use) tax to the state.
I would suspect that the compliance is really low, but this is and has been for quite some time, the law of the land.
Not exactly. Amazon will still do business in Illinois, Texas, Colorado, and other states that do this. They will just sever ties to any affiliates in those states. What this will ultimately do is lower the taxes paid to those states, as their in-state businesses lose income and jobs...
Don't be so sure about that. The legislature's constituents include a lot of small businesses that have never liked the concept of collecting state taxes when internet companies don't, creating an unfair competition. The small businesses are made up of voters who live in the districts and vote in local elections. The out-of-state internet companies do not.
So who's side do you think the legislators will take?
My point is that if Amazon decides they won't do business in states that tax them or their affiliates they will eventually find themselves with no American business. If they won't do business in Illinois, Texas, New York and California, what are their hopes of long-term profitability?
Who said they aren't "doing business" in Illinois?
You can still go to Amazon.com and they will take your order.
Do you understand what Amazon has done and what the law passed by Illinois does?
Yes I do. Amazon is fleeing from places that want to levy sales taxes against their business, even if it means hanging some of their affiliates out to dry or abandoning their own distribution centers. Eventually, they will run out of states that won't try to tax them. Then, where will they go?
Have you ever seen a thing called a "globe"?
You obviously do not understand then. They aren’t “fleeing” anywhere.
They are in Washington State. They will stay in Washington State. People will continue to shop at their website in Washington State even from Illinois.
What they are doing is ending their Affiliate Program with people who reside in Illinois.
Let’s create an Amazon Affiliate and see what is happening.
Let’s say Illinois resident Linda (signed up for the Affiliate program) ran a small blog about making curtains by hand, and she had a link on her site that would take a visitor to a book on curtain making on Amazon.com
Let’s say Mary, reading about curtain making, was interested in the book that Linda talked about, so she clicked on the link and bought the book from Amazon.
Amazon, noting the session started from Linda’s blog, sends Linda some money for linking to their site. If the book was, let’s say $15, the money Linda would get would be between $.60 and $1.27 depending on how far up the “ladder” Linda was.
So, the current law in Illinois says that Amazon has to collect sales tax on that sale, since it originated in Illinois with Linda’s website.
Amazon can still be open for business in Illinois, but they have decided that it is too much trouble to keep Linda, and thousands others like her, on as affiliates.
Illinois didn’t hurt Amazon at all. But they just ended a nice way for Illinois residence to make a little money on the side.
So instead of increasing tax revenue, this will be a revenue remover.
what they are trying is to charge each person who shops on the internet.
the tax is unfair as is most tax.
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