Internet Tax Laws Impacting Affiliates

lisa · #1 (**permalink**) 07-14-2009, 12:40 PM

Don't know if you've been following this story (it's not new) but more states are getting affected and could eventually affect more and more affiliates in a negative way....

http://www.clicknewz.com/1955/internet-sales-tax-laws/

thdrknight · #2 (**permalink**) 07-16-2009, 11:37 AM

Quote:

Originally Posted by lisa

Don't know if you've been following this story (it's not new) but more states are getting affected and could eventually affect more and more affiliates in a negative way....

http://www.clicknewz.com/1955/internet-sales-tax-laws/

Thank you my lady, filed in ND2NO

Ditto · #3 (**permalink**) 07-16-2009, 11:41 AM

I was excited about the Amazon affiliate program and then I read this news a few days ago. Oh well.

McKnight · #4 (**permalink**) 07-18-2009, 02:30 AM

Let me just ask a question here to make sure I understand.

If I'm from France and I want to join the Amazon.com affiliate program... then they will not get taxed because there is no affiliate tax law in France? Or is it the other way around, they will get taxed because there is an affiliate tax law in the country where Amazone has it's HQ.

Rammuny · #5 (**permalink**) 07-18-2009, 10:04 AM

Jeez.. They never leave us Internet people alone do they..

lisa · #6 (**permalink**) 07-18-2009, 11:48 AM

Quote:

Originally Posted by McKnight

Let me just ask a question here to make sure I understand.

If I'm from France and I want to join the Amazon.com affiliate program... then they will not get taxed because there is no affiliate tax law in France? Or is it the other way around, they will get taxed because there is an affiliate tax law in the country where Amazone has it's HQ.

I believe as long as the affiliate tax law does not apply to France residents you should be OK.

McKnight · #7 (**permalink**) 07-18-2009, 12:33 PM

Thank you for your reply Lisa, now I understand. Let's hope France stays tax free .... I'm from Croatia btw ... France was just hypothetical

missme · #8 (**permalink**) 07-19-2009, 05:37 AM

This internet tax law has already messed up my Amazon account. Since I'm from NC they just canceled our accounts before the law passed. Luckily I just started using Amazon and wasn't making any money. I see people on the Amazon discussion board ready to leave NC and go to a internet tax free state because they were making a living off of Amazon. I feel sorry for them. Now they are unemployed. Stupid move NC.

Geekdout · #9 (**permalink**) 07-19-2009, 07:52 AM

I have a few choice words for this but unfortunately it wouldn't be anywhere near professional so I'll just leave it at that. I've been saying for quite sometime that it would only be a matter of years before the feds wanted to put their paws into the potential of the internet for another stream of taxes. They took and let it build up until the majority of people were using it as a way of life and now that it's approaching a critical mass there going to tax it more than whats been done.

cliffman · #10 (**permalink**) 07-19-2009, 11:43 AM

I guess if you was making really good money with it, you could just move to a state that didnt have it... well thats not entirely possible in all situations. We could all start a riot?

Amazone · #11 (**permalink**) 07-20-2009, 03:53 AM

I hate to burst your internet bubble, Katie, but they are within their rights to audit your business and demand payment of sales tax on items purchased on the Web.
Internet sales taxation has been a topic of contention even before Amazon sold its first book and Priceline booked its first flight.
One of the more controversial points is that no one, including our own government, seems to have a clue how to implement a fair and logical Internet taxation process.
That moratorium ended last year and opened the door for municipalities to begin collecting sales tax on their own.

Here in Alabama the sales tax collection department is airing radio spots asking Alabamians to step up to - and toss dollars into - the proverbial collection plate. The commercial kindly suggests that if I have purchased anything from an online retailer, I am honor-bound to proclaim such purchases and submit the appropriate sales tax to the collection department right away. They thank me in advance for my cooperation.

ssmorgan · #12 (**permalink**) 07-27-2009, 02:37 AM

This is a pretty complex topic...

Actually, based on info in the link that Lisa mentioned, what NY is trying to do is to enforce an existing tax that no one really pays (i.e. when people purchase things from the web, they are supposed to pay state taxes on those products when they are filing their state incomes taxes. However, no one really does this). Therefore, the state is trying to enforce this tax by going after the websites.

This will generate a huge revenue for the state, assuming, of course, that companies (like Amazon) do not drop affiliate in those states (which Amazon has obviously done). The problem when Amazon drops affiliates is at least two-fold: a) the state does not generate the income it anticipates, b) affiliate marketers who made a lot of money from affiliate marketing may lose all their income overnight -- Pretty scary stuff, but also that's a loss for the state, since these affiliate marketers will not be paying as much taxes (since their income has vanished) as they did in previous years.

There are many lessons we can learn from this, but I guess the biggest lesson (which is actually a reminder, not a new lesson) is to diversify income... not all income is dependent on one company/channel. Another lesson is to start immediately making good friends with people in the state's legislature!

Sherif

P.S. by the way, thanks for the link, Lisa, I think Lynn Terry is on top of this topic!

lisa · #13 (**permalink**) 07-27-2009, 11:39 AM

Great post, Sherif. It will be interesting to see how this unfolds.

WB Sponsors