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.
The Amazon.com e-mail encourages its former associates to contact lawmakers about the tax. If the provision does not survive the budget bill, the message states that Amazon would consider reinstating the program.
House Democrats included the so-called "click-through" provision in a $780 million tax package that was meant to mitigate cuts to state spending. The state is facing an unprecedented drop in revenue and lawmakers have proposed various combinations of cuts and taxes to balance the budget.
The click-through provision is intended to give the state justification to levy sales tax on sites such as Amazon.com, which has no physical presence in the state. The company says the plan violates the Commerce clause of the U.S. Constitution.
It has challenged a similar provision in New York state.