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Amazon Cuts Off North Carolina Affiliates

Amazon.com has reportedly cut off all affiliates in North Carolina as a preemptive response to the sales tax change being pushed through the state legislature. The Seattle-based online retailer warned affiliates last week that such a move might be necessary, but the early shutoff seems to be a move in hopes of swaying opinion on the proposed legislation. "Local affiliates say they were 'blind-sided' by the company's action. 'I got this e-mail at 4:30 this morning,' said James Barrett, a technology consultant from Winston-Salem. 'It wasn't saying your account will be shut down. It said it is shut down. That just blew me up right there.' Barrett said that he is frustrated at lawmakers for considering the tax, but equally aggravated with Amazon. 'They're trying to tick off all their associates and get them to call down to Raleigh,' Barrett said. 'I think that is pretty tacky. That's not the way to use people who are referring business to your business.'"

20 of 411 comments (clear)

  1. That's the real meaning of "voting with your feet" by vivaoporto · · Score: 5, Insightful

    That's the real meaning of "voting with your feet". There is an unjust law, or even a just one that Amazon doesn't agree, and they don't want to be subjected to it, so they move out of the state.

  2. Actually, I think it's a great tactic by infinite9 · · Score: 5, Insightful

    ... even if it is a bit assholeish. It sends a loud and clear message to the NC government that the legislation will hurt local businesses.

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    1. Re:Actually, I think it's a great tactic by lewp · · Score: 4, Insightful

      I agree. Amazon is losing sales on this too, so it's not like they're just screwing the little guy. They're putting their money where their mouth is.

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      Game... blouses.
    2. Re:Actually, I think it's a great tactic by roc97007 · · Score: 3, Insightful

      > What is the state to do?

      Well, one thing they could do is create rainy-day funds during times of prosperity instead of growing the government a corresponding amount. Some states do this, but I think most don't bother, because a big lump of cash sitting there is too much of a temptation to spend. And investing the rainy day funds raises the risk of being wiped out in the same downturn that the funds were for.

      Regarding maintaining roads, at least in my state that's the first thing they cut out of the budget in a downturn. Speaking as someone who recently had a $3,000 insurance claim for damage done to my vehicle by a really deep pothole downtown.

      But back to the question above, "what is the state to do?", it is a conundrum, because increased taxes in a downturn invariably stalls recovery, putting the government in an unwelcome position -- charity now, or prosperity later? The additional cost of the taxes to pay John Q. Unemployed's extended unemployment benefits may have been the money the company needed to hire him. Or worse, it may be the impetus for the company to move to a more business-friendly state, causing the jobs to disappear forever.

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  3. It's not tacky by rpillala · · Score: 4, Insightful

    That's not the way to use people who are referring business to your business.

    That's exactly the way to use people who are referring business to your business. The only thing that motivates a business "relationship" is the exchange of value. If the proposed law was going to cause this change anyway, making it early as an example is the way to get people to "call down to Raleigh."

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  4. not tacky by v1 · · Score: 5, Insightful

    They're trying to tick off all their associates and get them to call down to Raleigh,' Barrett said. 'I think that is pretty tacky.

    Sounds like an excellent way to motivate your local associates to get their arses over to the capital and ride their representatives. There's not a great deal Amazon can do directly to fix this, they have to rely on their local affiliates to keep the local conditions amicable to their business. If the locals aren't moving, then it's time to light a fire under them.

    Got their attention too didn't it? Sounds like it's working as intended to me...

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    I work for the Department of Redundancy Department.
  5. Bravo North Carolina. by maillemaker · · Score: 3, Insightful

    >Bravo to North Carolina for calling these online retailers to be responsible.

    Hope they enjoy no Amazon-related resellers operating in their state.

    Taxes are how states compete for business. Raise taxes on a business that can operate anywhere else and avoid the tax, guess what? They are leaving town.

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  6. Re:Are Online Retailers Going to Contribute or Not by Duradin · · Score: 3, Insightful

    The Balkanization of commerce isn't a good thing.

    Amazon pays its taxes. Get Amazon to head quarter in your community and then you'll get its tax money.

    The overhead of tracking tax codes down to the city level (and keeping up to date) would be overwhelming. The only winning move in this case really is not to play and that's what Amazon did.

  7. Re:Are Online Retailers Going to Contribute or Not by Todd+Knarr · · Score: 4, Insightful

    OK then, riddle me this: what is the sales tax rate for any address in the US? Note that you can't stop at the city plus ZIP code level, in San Diego County there are ZIP codes that're partly in a city (where city sales tax applies) and partly outside the city (where city sales tax does not apply). Where can a company go to find out authoritatively what the sales tax rate is for a customer address? I don't know of any, and it's just not reasonable to require a company to pay sales tax without giving them a way to find out how much sales tax they're supposed to collect.

  8. good for amazon! by superwiz · · Score: 4, Insightful

    Finally some business demonstrating some balls. If the tax is being considered, then the locality has an environment hostile to Amazon's business. It doesn't matter if it goes through. The fact that they see nothing wrong with their hostile attitude is enough of a reason for Amazon to declare that they will have nothing to do without them. No business with bullies -- not even with those who associate with bullies by living in their tax base. Good for them!

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    Any guest worker system is indistinguishable from indentured servitude.
  9. Unfair? by sjames · · Score: 5, Insightful

    The legislator claims it's not fair that brick and mortar stores collect sales tax and Amazon doesn't. I say the brick and mortar collects taxes according to ONE tax structure in ONE place. What's fair about an out of state retailer having to understand potentially thousands of sales tax structures in many different combinations? Not to mention then needing to keep books on thousands of accounts to make sure the various state and local tax collectors get said taxes.

    Unless and until the various legislatures are willing to get together on a simple clearing house to make it easy for retailers to figure out how much to collect and where to send it, they have little choice but to not do business in places that insist on it.

    NC is already proving that such questions could be hard to answer. Whose taxes do we collect, the billing address? the ship to address? The address where the affiliate's server is located? NO! We must collect for the physical address of the person who owns the affiliate site. At least this week. No doubt the eventual answer (at least the one legislators will want) is ALL OF THE ABOVE AND MORE! In all different amounts with a whole table full of thresholds, percentages, and exceptions. OH, and different addresses to send the checks to with different required documentation and forms to fill out. Each and every one of them will claim that their tax is very simple and effortless to collect. None will recognize that the sheer volume and lack of standardization makes the matter impossible.

  10. Re:blindsided? by cayenne8 · · Score: 3, Insightful
    "Honestly, I'd rather pay 7% for my TV knowing that people who can't afford TVs didn't have to shell out more to feed their kids so that my TV could be cheaper."

    Trouble is...most of those people will still buy TV's first, and then complain they can't feel their kids.

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  11. Re:While your at it...... by JesseMcDonald · · Score: 3, Insightful

    It doesn't matter whether the person in question is a customer, employee, or visiting dignitary. The only criteria that matters is that they entered the property willingly, knowing the conditions. That is as true for employees as it is for customers.

    That fact that the business in your anecdote settled doesn't mean they would have been found liable in court--or that they were actually liable, which isn't always the same thing. The customer was liable, if anyone, for breaking the glass and thus creating the situation. However, it doesn't look good for employees to sue customers even when doing so would be justified, so I'm not particularly surprised that the employer settled the matter itself as an act of goodwill.

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    "The state is that great fiction by which everyone tries to live at the expense of everyone else." - Bastiat
  12. Re:That's the real meaning of "voting with your fe by erroneus · · Score: 5, Insightful

    Yes, it is unfortunate that N.C. sellers had to suffer for it, but I have to agree with Amazon's action on this. At every turn, government at all levels seek more and more money rather than taking a hard look at where they are spending it. Ultimately, I believe, they simply want more money to vote themselves higher pay and to return favors of their campaign donors. I wish there were a better way to run government. I vaguely recall one or more SciFi movies in the past where a city became a business or something to that end... the prospect was frightening, but I have to wonder if such a project were applied properly, if it wouldn't be run more efficiently. One problem with current styles of government is that there is little to no incentive to save money or to use it wisely. They have no profit motive and clearly no personal integrity or desire to serve motives. So I have to wonder, what motives would cause governments at local, state and even federal levels to deliver "good service" to the people at the lowest cost possible?

  13. Re:While your at it...... by BarryJacobsen · · Score: 5, Insightful

    A better example than a patron would be an employee - the vast majority of bars i've frequented left their employees in situations where the had no choice but to breathe in second hand smoke. I know the free-market extremists will disagree, but i think your employer should be responsible for a safe working environment.

    I certainly know of someone who got a nasty laceration in his foot from broken glass from a customer spill. The bar settled and covered his medical costs.

    That's certainly a different situation than being exposed to second hand smoke, though. If you apply to work at a bar/restaurant where smoking is allowed (which you could easily tell when you were picking up your application), I think you should expect that you'll be around second hand smoke and if that is objectionable - choose not to work there! If you object to working outside in the heat, perhaps you shouldn't apply for a construction job in California - it's not the hiring construction companies job to provide a portable air conditioning unit for you. If you object to working with children - you should probably not try to become a second grade teacher. If you object to working around alcohol - you should not apply to a liquor store. If you object to working around smoke, you should choose not to work at a place WHERE PEOPLE FREQUENTLY SMOKE. You are not entitled to work at whatever job you want with whatever conditions you want, no one owes you the type of job you dream of.

  14. Re:Are Online Retailers Going to Contribute or Not by superwiz · · Score: 3, Insightful

    Amazon does not use any resources provided by the local state government. And yet they would be expected to pay for them? That's called "theft". They use no public roads (delivery companies pay for those through gasoline taxes and vehicle registration payments). They use no police services (they have no physical presence in NC so they have nothing to protect there). They can't take advantage of NC education (since they don't live there, their children can't go to school there). And yet NC thinks they have the right to shake down Amazon? Every honest men hopes this withdrawal of Amazon affiliation takes as heavy toll on NC economy as possible. This type of punishment of thieves would only be just.

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    Any guest worker system is indistinguishable from indentured servitude.
  15. Re:That's the real meaning of "voting with your fe by brainboyz · · Score: 3, Insightful

    That's been tried many times. People always ignore it until it's too late. By actively and immediately halting business, you can bet the affiliates will raise hell in a timely fashion.

  16. Re:That's the real meaning of "voting with your fe by RareButSeriousSideEf · · Score: 5, Insightful

    Unfortunately, Amazon probably needed to demonstrate how serious they were, or NC might well have called their "bluff," leaving the affiliates out in the cold for much longer, if not permanently. Once some government erects a new law / regulation / tax / bureaucracy / program, it's harder to get rid of than mildew.

    In fact, these things really are quite like an aggressive mildew. Do nothing, and they grow, advance, and encroach on your clean space. Work really really diligently and consistently, and you can sometimes beat them back to manageable levels. But get a little lazy once or twice, and boom... they're ba-ack, worse than ever.

    If Amazon had merely warned their affiliates, there would be a big "yeah, right" factor on the affiliates' parts, and a big "yeah, right" factor on the legislators' parts. The tax might well pass, and Amazon's negotiating position would become that much weaker. Amazon *needs* big numbers of pissed off people -- really pissed off right this minute people -- to beat this thing. People who are merely imagining being pissed off in some potential future just don't act. Legislators need to see a thunderstorm, not a possible drizzle advisory; a storm of phone calls, not a flurry of tweets and a new Facebook group called "stop the tax."

    With private economies shrinking but public spending expanding most everywhere, we are going to see more egregious tax grab strategies popping up more and more often over the coming months and years. The ones who don't get their pockets picked clean will be the ones who get brutal, or have someone get brutal on their behalf as Amazon did in this case.

     

  17. Re:While your at it...... by superwiz · · Score: 3, Insightful

    When you walk into a restaurant, you walk into a PRIVATE establishment. Claiming public health concerns to regulate behavior on private property is at the very least disingenuous.

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    Any guest worker system is indistinguishable from indentured servitude.
  18. Re:While your at it...... by realnrh · · Score: 3, Insightful

    Right! Public health inspectors have no place coming into PRIVATE restaurants! Just think of how much money the poor restaurateurs could save if they didn't have to put up with those intrusive inspections, citing them for things like 'chefs not washing hands' or 'seafood kept in unrefrigerated piles on a dirt floor next to the catbox.'

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