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Amazon Tax Day In California

June 30, 2011

Today in California Governor Brown passed the state budget for the first time on time in many years which is quite an accomplishment for the state of California. I must give him credit for that. However part of the savings, 370 million dollars worth actually is what they thought they could bring in annually with this tax, in California’s massive budget shortfall was to be paid by online companies such as http://www.Amazon.com collecting taxes on the sales of their online associates of which I am one. But, as expected that money will never appear in California’s coffers because myself and every other Amazon Associate today received the following email

 

 

Hello,For well over a decade, the Amazon Associates Program has worked with thousands of California residents. Unfortunately, a potential new law that may be signed by Governor Brown compels us to terminate this program for California-based participants. It specifically imposes the collection of taxes from consumers on sales by online retailers – including but not limited to those referred by California-based marketing affiliates like you – even if those retailers have no physical presence in the state.We oppose this bill because it is unconstitutional and counterproductive. It is supported by big-box retailers, most of which are based outside California, that seek to harm the affiliate advertising programs of their competitors. Similar legislation in other states has led to job and income losses, and little, if any, new tax revenue. We deeply regret that we must take this action.

As a result, we will terminate contracts with all California residents that are participants in the Amazon Associates Program as of the date (if any) that the California law becomes effective. We will send a follow-up notice to you confirming the termination date if the California law is enacted. In the event that the California law does not become effective before September 30, 2011, we withdraw this notice. As of the termination date, California residents will no longer receive advertising fees for sales referred to Amazon.com , Endless.com, MYHABIT.COM or SmallParts.com . Please be assured that all qualifying advertising fees earned on or before the termination date will be processed and paid in full in accordance with the regular payment schedule.

You are receiving this email because our records indicate that you are a resident of California. If you are not currently a resident of California, or if you are relocating to another state in the near future, you can manage the details of your Associates account here . And if you relocate to another state in the near future please contact us for reinstatement into the Amazon Associates Program.

To avoid confusion, we would like to clarify that this development will only impact our ability to offer the Associates Program to California residents and will not affect their ability to purchase from Amazon.com , Endless.com ,MYHABIT.COM or SmallParts.com .

We have enjoyed working with you and other California-based participants in the Amazon Associates Program and, if this situation is rectified, would very much welcome the opportunity to re-open our Associates Program to California residents. We are also working on alternative ways to help California residents monetize their websites and we will be sure to contact you when these become available.

Regards,

The Amazon Associates Team

So, as you can see Amazon has no intention of paying these taxes or paying California the 370 million dollars they are expecting each year in their budget so the money will need to come from other places such as education or law enforcement or elsewhere in the budget. It’s not as if this was an unknown outcome this has happened in every state where this Amazon tax has been proposed. So instead of gaining the 370 million dollars they are losing all the taxes that myself and all the other affiliates earn every year. As I mentioned here. If it was just me it would be one thing but there are something like 10,000 affiliates in California how much do they make and spend off of this program?

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