Online retailer Overstock.com has followed Amazon.com's decision to cut off a commission program to North Carolina-based Web sites.
The move would allow the companies to avoid having to collect sales tax on sales to customers in the state. Under the commission programs, the .coms pay a percentage to Web sites that steer buyers to the online product.
The proposal would use the commission arrangement to justify levying sales tax on Internet purchases. Current state law already requires North Carolinians to pay such a tax, but taxpayers have to report themselves. Few do.
The tax proposal would treat online retailers as if they operated a brick-and-mortar store in the state.
Overstock has also cancelled its affiliate programs in Hawaii and Rhode Island, which are considering similar programs. It reinstated the program in California after Gov. Arnold Schwarzenegger vetoed a similar proposal.
"It's painful to have to terminate these relationships with affiliates, simply because they live in states where counterproductive (and likely unconstitutional) laws are being passed," said Patrick Byrne, Chairman and Chief Executive Officer of Overstock.com in a news release. "However, politicians have to remember that a tax is a price that government charges for a service, and when they raise their prices, we're going to buy less of their services."
The commissions can prove lucrative for Web site owners, some of whom live off the money.
Lawmakers who support the proposal say it's only fair to require online retailers who makes sales in the state to collect sales tax.
Hat tip: Dzone
Comments
Re: Overstock follows Amazon's tax move
July 3, 2009 - 8:45am — bniolet (author)Comment deleted for inappropriate content. Thanks, for the heads up, cdtew. --BN
Attn: Moderator
July 3, 2009 - 8:49am — cdtewGosh, that post wis absolutely uncalled for. That link doesn't even have a warning what its linking to. You are a disgusting human being, and how you're still commenting here I don't know.
Re: Overstock follows Amazon's tax move
July 3, 2009 - 8:06am — starcoconstI am having a hard time understanding why I have to pay sales tax on the computer download of Quickbooks tax tables. Every year I have to pay 199 for each computer so I can have the proper tax table updated. I pay this so I can collect the tax money for the State and FEd. I never get reimbursed the $5000 accounting fees it costs me to keep records for the state and fed and now to add insult I have to pay sales tax on this download. It is not a problem now though. I no longer have employees due to recession and after Obama tries to force me to pay Employee health care I doubt I will ever have employees again, just subcontractors.
Re: Overstock follows Amazon's tax move
July 2, 2009 - 7:58pm — PaulTerrellI will say it again. The Democratically controlled NC General Assembly does not care about the effects of it's tax increases has on workers and small businesses.