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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.'"
1. If any of these affiliates were blindsided, it is because they didn't read the notice they were given last week. Of course, a single week's notice is too short anyway...
2. Time for the referral businesses in NC to relocate. Or close up shop. We'd be happy to have them (and their income & property tax revenues) here in NJ.
Of course, now it's only a matter of time before most states have similar laws. Then it'll be time for these businesses to relocate to the Cayman Islands.
"Trolls they were, but filled with the evil will of their master: a fell race..." -- J.R.R. Tolkien on Olog-hai
I agree. This is admirable response by Amazon. Even legal thievery has its limits. NC is laying claims beyond their jurisdiction in my opinion.
Right, because it's not bad enough that the affiliates in North Carolina are already taxed on their earnings, but now they have to be taxed on the sales they refer to Amazon? You're talking taxing the same people three times on every sale (Local, State, and Affiliate). Let's not mention the bigger affiliates that are taxed 5 times (2x corporate earnings taxes, IRS personal, State personal, Affiliate)
Oh, and yes, the IRS and states tax the shit out of individuals in business. I don't know where people get the idea of mystical business tax relief, because if you're in business and playing by the law, you don't get a refund check, you send in a damn check every fiscal quarter.
Without any kind of business expenses, I would be taxed 89% on every dollar I made. eighty. nine. fucking. percent. And I'm just barely hovering around the poverty line doing this shit. Then you and your backwards populist shitheads yell at me for not spending money to better myself on college, or buying a car, or some other bullshit.
If your community is in such a dire condition that they absolutely need to tax a person a third time on the same dollar, then your community is completely fucked, needs to be dissolved, have its assets liquidated, and a new structure put in place.
In short: go fuck yourself.
Can a company move to a US territory and still get all the perks ?
i.e. Puerto Rico ?
OK then, riddle me this: what is the sales tax rate for any address in the US?
I've had to deal with sales tax in both Virginia and North Carolina. The truth of the mater is they don't want you to know what the current tax rate is because they make more money when they audit your small business and apply fines a couple years later.
In Virginia my business was fined for not anticipating our GROSS income correctly. We GROSSED more money one year and because of that we had to pay the tax difference plus a couple thousand in fines. I'm just happy we had a CPA because the tax people where screaming murder until I said they would need to talk with our CPA then they where much nicer...
Small business owner's really can't win by playing by the rules...
"The fact is, online retailers have been leeching off communities for far too long. They make use of the infrastructure these communities provide but use tax evasion to make sure they don't contribute to its upkeep."
What infrastructure is Washington based Amazon using in North Carolina?
That's the rub. They aren't.
That is the whole point behind "No Nexus = no tax"
Go for it Amazon! Put the finger in the dike now before we all get flooded out by greedy state governments whose legal justifications aren't even substantial enough to call flimsy. This is like Wal*Mart closing stores that go union because the problems of dealing with the issue overall far outweighs the losses from leaving a given market. I wish that the automobile makers had stood up to the State of California when they went completely nuts on the emissions regulations and instead of saddling us with thousands in additional new car costs, had simply said: "No new cars for you." Who do you think would have blinked first? The automakers? The state? Or the voters?
Yes I'm sorry that people are getting hurt along the way with this, but go out there and get your state back in order once more and this won't be happening.
Disclaimer 1: I sell on Amazon and I'm still all for this.
Disclaimer 2: I lived in California and breathed that air every day.
"It's the height of ridiculousness to say for those 9 lines you get hundreds of millions."
The article indicates that they sued in NY for a similar law and lost, but are continuing legal challenges there. It doesn't sound like they cut off referrals though.
What's ridiculous is that this law doesn't seem to tax based on the location of the seller or the buyer, but instead on the location of the referrer. Sales tax is supposed to be a tax on the buyer, and it just happens to be the responsibility of the seller to collect it. So NC is trying to charge a sales tax of a buyer that isn't a resident.
It might sound sensible to take a cut of that referral money (since that's the party that's in state), but they're already taxing that by charging income tax to the referrer.
Without any kind of business expenses, I would be taxed 89% on every dollar I made. eighty. nine. fucking. percent.
I call bullshit. Seriously. I've worked for a number of small companies, and I've never seen any loading or tax liability anywhere near that. What the hell are you doing wrong to get to 89% (my guess? He's calculating it horribly wrong).
Really, I would really like to know, because I would love to rally against it like nobody's business, but I just can't even come close to conjuring up a scenario where 89% is the actual tax liability.
"Threatening" government with pulling out is often weak and empty and used far too often. Eventually, with all the posturing that goes on, someone has to make a move that is exact and meaningful. Amazon made a move rather than attempt to actually "play" politics through threats and posturing. So I have to disagree. Amazon is not playing politics. Surely they have taken into account that they would alienate some people in N.C. but they have to prove they are serious.
Amazon isn't sending lobbyists with bags of cash. Amazon isn't asking sellers to plea to the government. Doing so would, in fact, be playing politics. By making a decisive and definitive action, they are make their statement in the only clean and honest way possible. Begging and threatening politicians is only playing their game. To withdraw is the only way... unless you can think of another?
Undoing a law after it has passed is a good deal harder than preventing it from passing. The DMCA seems to be sticking around regardless of how frequently it is abused and how much it harms the people. It's a bad and unpopular law that could only have been passed in the way it was (subversively) and it's not going away. Amazon is speaking not only to N.C., but to every state of the union. Taxing the internet is a very bad idea just as a state seizing a domain name because the operators who do not operate in the same state is violating that state's law is a bad idea. States should never exceed their borders and yet attempt to do so at every opportunity.