Gov. Jerry Brown signs Amazon sales-tax bill

heat_miser · on Sept 24, 2011

All this will do is to hurt the smaller web retailers who will inevitably have to track and pay sales tax. Some of whom are already on the brink and will have to trim their payrolls, or fall to amazon.

So much for a "level playing field"

Lost_BiomedE · on Sept 24, 2011

I hope whatever eventually happens does not require me to fill out 49 tax forms up to 4 times a year.

Woost · on Sept 24, 2011

I can't seem to find a non-fluff writeup of this story, though I've found a bunch of similar versions.

From my understanding of the issue, California passed a law redefining "presence" in a state so as to include companies which have affiliates in that state. Businesses which have no affiliates (or advertising?) in California still would not have to collect sales tax. Amazon was not too happy with this situation, so they cut all of their affiliates in Cali, and proceeded to get into politics. They agreed to reinstate/not proceed with cutting their affiliates (I'm not sure if they actually cut or just threatened) in exchange for a year long delay in collecting sales tax.

mhartl · on Sept 24, 2011

I'm not sure if they actually cut or just threatened

They cut the program. Before the California State Government (CSG) passed the Amazon Tax, I was making over $1000/month in Amazon affiliate commissions, which blew up on two days' notice. My account currently says "This account is closed and will not generate referrals. Access to this site is for historical purposes only." I've not yet seen any sign of the account being reinstated, and I don't anticipate ever being compensated for the income lost while the situation was in limbo.

Will the affiliate program for California residents eventually be restored? Perhaps, but I wouldn't count on it, and God only knows what CSG will do next. I'm currently in the process of moving my legal residence to Nevada, just in case.

Woost · on Sept 24, 2011

So it's worse than I thought.

How does California justify collecting sales tax from Amazon if Amazon has no affiliate network there, no advertising there, and no real presence?

mhartl · on Sept 24, 2011

According to the LA Times, they're going to restore the affiliate program. But I already have one foot in Nevada, so I think it's too late.

How does California justify collecting sales tax from Amazon if Amazon has no affiliate network there, no advertising there, and no real presence?

It doesn't. Amazon avoids an expensive legal battle in exchange for collecting sales tax. It's your garden-variety extortion, writ large.

rshm · on Sept 24, 2011

Please help me understand this. Is it only valid for Amazon or CA based E-Commerce Sites or all sites selling to CA based customers.

InclinedPlane · on Sept 24, 2011

This article is mostly fluff, if someone has a link to a better explanation somewhere else that would be greatly appreciated.

As far as I can tell this is California overstepping its bounds and attempting to tax out of state entities.

minouye · on Sept 24, 2011

From an affiliate perspective, this potentially means that Amazon and other merchants will reinstate California affiliates. Some smaller merchants have already sent out reinstatement notices.

droithomme · on Sept 24, 2011

Wow that article sure is unbiased!</sarcasm>

But seriously, every state has a different rate, every county, every city. The article mentions a federal solution is up next. So what, a federal database by address of the rates each person is in, and 52 filings per year for the 50 states plus DC plus Puerto Rico, and a requirement to register each purchase with this system? Gee, that should help small business a lot.