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by CalmQuiet
5941 days ago
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There's an amazing amount of heat, but little light on this, particularly regarding exactly what impact the legislation threatened to have on costs, labor, etc. for Amz, affiliates (exactly what is that? someone selling via Amz Marketplace?), and customers. Huffington offers: "The bill, which was part of a package of tax measures aimed at increasing revenue, originally sought to create a nexus between the state and on-line retailers based on their ties to local affiliate websites, which link to products. The bill was ultimately altered due largely to fears that retailers like Amazon would simply cut ties to Colorado companies that make money by referring buyers." "The final bill, which was signed into law in February, instead required large online retailers to start collecting sales taxes or provide a summary of people's web purchases in the state, leaving affiliates out of the equation. This created an economic nexus without making local affiliates a scapegoat for paying local sales taxes." --http://www.huffingtonpost.com/2010/03/08/amazon-reacts-to-co... ...but Huff doesn't cite sources. Anyone find a better analysis by a dispassionate legal/financial source? |
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"Online retailer Amazon has ended all Colorado-based affiliate accounts after a new law passed by the state's legislature would have forced them to collect and pay state sales taxes. The law, HB 10-1193, states that any affiliate marketer making more than $10,000 for a retailer is declared a legal agent, and a state presence, of that company. Rather than be forced to pay the state taxes, Amazon has instead side-stepped the law by closing its doors to all affiliates based in Colorado."
...though I think they're sloppy, too, speaking of Amazon being "forced to pay the state taxes" - when they seemingly would have to begin to collect sales taxes from customers, which could mean: • Figuring out the tax rate (which varies by city, county, etc) for each customer. • Charge a differential price to customers depending on the state/co/city of residence. • Either increase the charge to customer's CC or cut Amazon (or it's affiliate's) net on a sale. • Send on the $ to state gov.
Sounds to me like they just don't want hassle and cost of programming, processing etc.
Note another effect: When I buy a $2500 laptop from Apple online, I have consider the cost of where I want it shipped. If it goes to my office in town, I pay ~3% more sales tax than if I they ship to my out-in-county home.
If Apple can handle all that, so can Amazon, but if this is what the CO law will impose on national online retailers it will mean lots more issues for both customer and seller to weigh and start handling immediately.
Maybe it's equitable, but I sure wouldn't like to have to have all my business's billing software rewritten overnight.