newsobserver.com projects - Amazon cuts off commissions - Comments

Re: Amazon cuts off commissions

ishley — Mon, 29 Jun 2009 10:15:42 -0400

So let me get this straight: currently each person who orders something off of Amazon (or other online retailer) is supposed to keep accurate records of their purchases and then pay sales tax to NC at the end of the year. However, individual purchasers don't generally keep the records or pay the taxes. So the NCGA comes up with a way to require the more sophisticated party, who can most easily and efficiently keep the records and pay the taxes, to bear that administrative burden. I see this as entirely appropriate and good public policy.

To the extent that the South Dakota case establishes precedent that prevents this burden-shifting, the holding needs to be re-evauated by SCOTUS. I haven't read (and am not going to read) the opinion, but I think it or a related decision may address the more vexing question of apportionment of sales tax between seller's state and buyer's state.

It seems to me the affiliates are getting screwed by Amazon, which is in effect taking the position of abetting tax fraud by individuals who don't keep records of their tax free purchases. When you place an order you put in your shipping and billing address, so it wouldn't take that much more computing power for the retailer to calculate your sales tax based on where you live.

Re: Amazon cuts off commissions

slimjim — Sat, 27 Jun 2009 00:46:53 -0400

Oh Yea... I also own the island of manhattan. If people from North Carolina are not producing local websites then out of state doamin name farmers will pick off our state and North carolina will become a generic landing page instead of thought provoking websites produced by local people.

I admit I am a little extreme but I set out to design a large network of websites to compete with the Barry Dillers of the world. I had to do something because my cash flow is quickly turning to no flow so I am putting in the extra time, energy and thought which will produce results and perhaps revenue.

This is a real kick in the gut so I am a little bitter and more than willing to move on.

Re: Amazon cuts off commissions

slimjim — Sat, 27 Jun 2009 00:28:05 -0400

Dear It's hurting my brain,

it hurt my brain to develop my formula. I have been collecting my own content for years. I own a large collection of Rt. 66 photos which I took. I also own one of the the largest collection of photographs of the American flag. I own video and first hand experiences I can write about. I have years of content for several websites.

I have spent the past few weeks producing hours of raw video of me gardening for UglyGarden and NCGardener. I have written reviews for USBrewedBeer and I have early stage video and photography for DirtyKitchenCook. I am also in the procecess of filming the RaleighGreenway and I am producing several early stage local blogs.

I admit I am in the very eary stage of production but losing Amazon changes almost everything.

Yes .. I have other sites which will be based on free content on the internet. I own the entire east coast from JersyBeachStorm to KeywestStorm and every major beach in between. I focused on North Carolina. They will be my rainy day at the beach websites and they will promote "On Demand Movies and TV shows" from Amazon.

If you don't get it or do not like my concept then go to another web site. I am not the only person holding North Carolina domain names and this Tax law will stop people from devloping new websites since the promise of a revenue stream has ended. With that said.... I can not be expected to hold domain names out of loyalty to North Carolina if I do not live in North Carolina... Yes. I buy names to protect them just a Hugh Morton developed a mountain and charged you to look at bears and other mountain animals.

Re: Amazon cuts off commissions

scharrison — Fri, 26 Jun 2009 23:48:13 -0400

Okay, let me get this straight: you grab up hundreds of domain names, then set up makeshift websites with very little intellectual content, whose main purpose is to entice people to click through here and there so you can make commissions. But you're also trying to tell us you are somehow protecting domain names, and if you are forced to leave North Carolina, they will be in jeopardy?

That's just...I gotta quit thinking about this. It's hurting my brain.

Re: Amazon cuts off commissions

slimjim — Fri, 26 Jun 2009 22:25:17 -0400

I am in the process of moving out of state. I plan to have a new residence by the end of July. I am planning to sell UNCReunion, CarolinaReunion, NCStateReunion, UNCHomecoming, OBXLandmarks, BiltmoreAve, CapitalBlvd, NCBlackHistory.com plus more than two hundred other North Carolina domain names which I had been busy setting up as blogs. Don't blame me in five years when most of the Good North Carolina domain names are owned out of state and do not represent any local interest.

This is ground breaking tax law and is designed to go straight to court where the attorney's hired by the state make a fortune.

As for the book store owner supporting this law. I often buy books from her store because I always try to buy local. Please read my first sentence where I say I am moving away from North Carolina so I will not be here to buy books in North Carolina.

I just got RedneckStunts.com on line and even though it is an early phase, it will soon be produced out of state. This is breaking my heart.

Re: Amazon cuts off commissions

BitterEXdemocrat — Fri, 26 Jun 2009 18:24:42 -0400

...and they want you to keep on thinking that too, while you still vote for them as the clueless imbeciles in NC seem to do time after time...damn a bunch of NC democrackkks!

Re: Amazon cuts off commissions

scharrison — Fri, 26 Jun 2009 17:15:41 -0400

"Nobody made anybody start a brick/mortar book store in NC and nobody is stopping a brick/mortar from closing up shop and going entirely online from some other state to make sales."

Actually, that would also apply to other businesses, like textile mills.

Oh, that's right, they already left.

Re: Amazon cuts off commissions

melted — Fri, 26 Jun 2009 16:26:40 -0400

The NC general assembly is desperate for more money they can waste. Our general assembly and governor are about as dumb as they get.

Re: Amazon cuts off commissions

bnartist — Fri, 26 Jun 2009 16:12:39 -0400

For the record, Quail Ridge Books is located in Ridgewood Shopping Center in West Raleigh just off the Beltline and, online. You can call or order online. You can pick a book up or have it delivered. You might even meet the author and you will pay sales tax.

Re: Amazon.com, the GOP and tax evasion

ewchaisson — Fri, 26 Jun 2009 16:10:41 -0400

Glad you brought Streamlined Sales Tax into it. That's a great alternative. Why isn't NC pushing harder to get more retailers involved in this initiative rather than causing detriment to an entire industry within it's borders.

Not only are they hurting that industry, but since affiliates are some of the most tech savvy and tech supporting members of the state, this is putting some seriously negative appearances on a state that wants RTP and the state as a whole to be the "Silicon Valley of the East." What tech companies are going to want to come into a state that slaughters an entire tech industry? Oh yeah...the ones that we can somehow afford MASSIVE tax breaks for.

I agree with Jason. Get the spending under control, then ask me for more money.

Re: Amazon cuts off commissions

jasonpedley — Fri, 26 Jun 2009 16:04:21 -0400

With 11% unemployment (some counties are higher), I find it hard to comprehend why the state wants to levy even more taxes on us before they get their spending under control. Do they not get the same numbers we get?

This state needs to balance its OWN budget before it takes ANY more of mine. I'm fiscally responsible - why can't the people we send to Raleigh be the same? If they can't do the job, send them home.

I'm sorry North Carolina, there is ZERO room in my budget for any tax increases. Try again next year.

Also, there IS a level playing field here. Any business can do exactly what Amazon is doing. Nobody made anybody start a brick/mortar book store in NC and nobody is stopping a brick/mortar from closing up shop and going entirely online from some other state to make sales. It's called competition and in general, not everybody is a winner.

My #ncaffiliatetax video:

Re: Amazon.com, the GOP and tax evasion

ncrma601 — Fri, 26 Jun 2009 16:02:39 -0400

Since you are looking for the Fire Department, I imagine if you ask your local county or city they will tell you that in addition to property tax the large amount of their budget comes from the local sales tax - i.e. the local sales tax not being collected by Amazon. As the former mayor of Dallas told Amazon in a public hearing, "’When you are sitting at home in your virtual world and ... a fire breaks out, do you want us to send a virtual fire truck or a real big red fire truck?’

In estimates from a study released this April by Professor William Fox from the University of Tennessee, it is estimated that North Carolina State and Local Governments will lose $130 million in lost sales tax collections due to remote sellers such as Amazon not collecting sales tax. The figure rises to $161 million next year.

http://www.streamlinedsalestax.org/Execitive%20Committee/Previous_meetings/4_13_09/SSTP%20e-commerce%202009%20REV041309.pdf

Re: Amazon cuts off commissions

Gosh — Fri, 26 Jun 2009 15:42:04 -0400

This is seriously a huge issue that resonates with voters.

Get it?

Re: Amazon.com, the GOP and tax evasion

ewchaisson — Fri, 26 Jun 2009 15:39:21 -0400

Ok...for your Best Buy example, all Best Buy stores would have to close, not just change names, and they would have to be solely an online presence. Also, as affiliates, you refer to the merchant's site. You do not collect and process orders on your site, just for them to be filled by the retailer at the end. By your example they would be a sort of private labeled franchise, which by definition would have to operate as an individual business and not as a part of Best Buy.

The problem with this legislation is the ignorance or lack of education to the affiliate industry as a whole. And rather than learn and realize the full impact, legislators are justifying things with distorted numbers and unreal expectations.

Re: Amazon cuts off commissions

ewchaisson — Fri, 26 Jun 2009 15:24:52 -0400

If you ask any of the affiliates who are getting put out of work by this click through provision, they would very likely agree, as I would, that it is fair for NC to want to collect sales tax from these online retailers. However, their method is suspect and unfair. Again, if they were requesting that Amazon collect and pay in NC sales tax on purchases from NC residents, that's one thing (point of sale tax collection). However, they are asking them to collect based on the point of referral. Thus asking consumers from every other state who happen to come through an NC affiliate's link to pay NC sales tax.

An example in practice: As a NC resident, if you go through a NY based affiliates link you would have to pay NY sales tax (which can be well over 8%) due to NY's passage of their own "Amazon Tax". Is that fair? Or would you rather the sales tax generated from your purchase go to support your local government?

If all states pass similar legislation, it will be like playing Russian Roulette with tax rates online because you have no idea what state the referring link is based in until you get to checkout and have the tax applied to your shopping cart. As a consumer this doesn't sound like a good idea.

As an affiliate manager, affiliates being out of work (as they already are after Amazon dropped them) doesn't sound good. Sales tax collection is fine. But killing jobs is not. Yes we need more money to save the jobs of teachers, prison workers, etc. But it should never be a matter of whose livelihood is more important. We should be looking for ways to save jobs across the board, not sacrificing one workforce for the sake of another.

Amazon cuts off commissions

bniolet — Fri, 26 Jun 2009 09:11:03 -0400

Amazon.com cut off state residents today from a commission program that rewards Web sites for linking to the online retailer's products.

The move was surely designed to raise the pressure on lawmakers, who are considering using the commission arrangement to justify levying sales tax on sales Amazon makes to North Carolina residents.

We are writing from the Amazon Associates Program to notify you that your Associates account has been closed as of June 26, 2009. This is a direct result of the unconstitutional tax collection scheme expected to be passed any day now by the North Carolina state legislature (the General Assembly) and signed by the governor.

The commission program provides some Web site owners with a little extra spending money. For Rick Owings and his wife, the program accounted for two-thirds of his income, or more than $70,000 a year.

"There's not enough left to make a mortgage payment," said Owings who runs his Web site, GPSTracklog.com, from Asheville. "Unless the legislature changes this, we're moving out of state. We're taking our business and all the income tax we're paying with us."

Owings' site provides reviews and resources for people interested in buying GPS devices. Like many similar review sites, product descriptions include plenty of links for where to buy online.

It's unclear how many North Carolinians participate in the program because Amazon.com doesn't discuss specifics about its Associates program.

More after the jump.