Web retailers, states tussle over tax rules
- Page:
- < Previous
- 1
- 2
The amount of money at stake overall for state governments is somewhat murky. According to a recent University of Tennessee study, uncollected state and local taxes from online sales could total $7 billion this year. However, only a small part of this would stem from consumer purchases, because transactions between businesses make up the bulk of e-commerce sales. Consumers are generally supposed to pay a "use tax" themselves on online purchases, but few do.
Because any extra revenue is precious, several states, such as New York, have passed laws seeking to cash in on Web retailers' affiliate relationships, while others are considering doing so.
Amazon cut off affiliates in North Carolina in late June, anticipating legislation requiring it to collect sales tax will soon pass there. The company has also stopped working with affiliates in Rhode Island and Hawaii because of similar laws that already have passed. Discount retailer Overstock.com Inc. and jewelry marketer Blue Nile Inc. also closed down affiliate programs in Hawaii, Rhode Island and North Carolina, and Overstock stopped working with affiliates in New York last year.
Hawaii's Republican governor, Linda Lingle, vetoed the bill Wednesday, so Amazon, Blue Nile and Overstock.com said Thursday they plan to reinstate affiliates there if the state's Democratic majority does not override Lingle's decision.
Rebecca Madigan, founder of Performance Marketing Alliance — based in Camarillo, Calif. — which represents affiliate marketers, called the new state rules "pretty devastating." Echoing opinions of several online retailers and associates, Madigan argues that the nation's estimated 200,000 affiliate marketers are advertisers, not salespeople.
"They don't deliver product, they don't take any money from a consumer, and most of the time they don't even know who the consumer is," she said. Because the tax crackdown could curtail the business generated by affiliates, "the states are sort of shooting themselves in the feet," she said.
- Page:
- < Previous
- 1
- 2
Recent comments
It appears that it is hard for a state to charge a tax when there...
Rick | July 3, 2009 at 9:06 p.m.
- UVU beats SUU; USU wins big 12:57 a.m.
- BYU spikers end season with a loss 12:55 a.m.
- Cougars beat Utes in overtime 12:50 a.m.
- Iverson may be headed to 76ers 12:34 a.m.
- Credit Coug defense for win 12:33 a.m.
- Aggies blow away T-birds 12:32 a.m.
- Mo steals show in Cavaliers' victory 12:31 a.m.
- Editorial: Facilitate Big Brother? 12:22 a.m.
- Mom befriends wife of PTSD vet 12:21 a.m.
- Political clash over U.S. debt 12:21 a.m.
- Cave to be sealed with body inside
- Predicting the unpredictable: BYU wins
- Vegas, Poinsettia bowls or bust
- Glover gives Utes last-second upset
- BYU football: 5 keys to victory
- Cougars turn back Wildcats'
- Hall mouths off about hate of Utah
- Man trapped in Nutty Putty cave dies
- Running game key to BYU offense
- Woods, wife unavailable for interview
- Cougars beat Utes in overtime
394 - Thunder rolls by Jazz
136 - Hall mouths off about hate of Utah
130 - Cave to be sealed with body inside
115 - Man trapped in Nutty Putty cave dies
115 - Editorial: Poor welcome for Palin
113 - Rivalry Week is highly profane
88 - Hall's legacy measured today
75 - Y. focused on 10-win season
73 - Letters: C02 causes warming
70
If you're shopping online for gifts, take care. While there are some...
It's BEER, not acid people! Some people love having it sprayed on themselves....
I believe Max Hall cemented his legacy tonight with his lack of...
I find it interesting that these comment come after a so-so performance in a...
If you really think BYU is more arrogant than USC or UCLA or so many other...
cougars baby!!!!!
I have one word for the BYU AND UTAH fans: TCU!!!! hahahaha
Two great examples of lack of class surfaced tonight: Pete Carroll, USC's...
Don't forget my favorite Max stat. 2 out of 3. Yeah, I bet that...
Thanks for the comment Max! I hope you keep on playing just like you have...
Neat article! (Yes, I'm a little biased :) It's been an exciting time to be...

