The Austin American-Statesman had a nice, balanced article on the advertising tax battle in Texas this weekend.
I had a chance to chat with the author of the piece, Barry Harrell, and share my story.
The article included a statement from Eric Bearse, Texas spokesman for the Alliance for Main Street Fairness, that I have heard repeatedly, but have yet to see substantiated…
“If you have tax fairness, that creates jobs in sales for brick-and-mortar retailers,” Bearse said. “Then they can expand their sales forces, whether it’s virtually or in the store. They can invest more in the state, make more sales and be able to expand their online presence, maybe even through affiliate marketers.”
This is all predicated on the assumption that people shop online strictly to save on sales tax. That is simply “fairness” mythology. How about convenience, better pricing, more selection, etc.?
Read the article: Affiliate marketers may be collateral damage in Amazon’s Texas sales tax fight
{ 6 comments }
Which line is it people are trying to tow?
I know the kool aid is thick and strong on this issue. just for clarification the article states
“Amazon’s business model is built in part on offering products tax-free;”
that’s in part, not in full.so the mythology would only be in part also.
I know most of my friends in the affiliate industry are working very hard to tow this line, but I would call for everyone (between doses of the good stuff) to at least consider whether or not this war can be won.
It looks pretty obvious to me (because the case Amazon filed in New York is full of holes) that they will lose there, and 10,000 affiliates per state does not make a very strong grass roots campaign in a country with 300 million people.
Amazon tactics are one of if you don’t give us are way, we will pull the business out from under your citizens, despite the fact their competitors online don’t have a problem collecting sales tax for their online transactions.
If Texas is able to collect that $237 million from Amazon, you can bet even more states are going to follow suit to get the sales tax they didn’t receive on all of those online purchases.
End game is likely a settlement on the retroactive cases for pennies on the dollar, but all future sales require 100% collection by seller.
There’s another way this game could go. Amazon Associates could stand up and fight back against Amazon for threatening their business and for aiding and abetting sales tax cheats.
10k affiliates per state (and I’m pulling that number out of my butt based on the 9k estimate in IL and the 13k estimate in TX from the article, so lets say 10k on average per state) might not be enough to sway a legislature, but it could very well sway Amazon to quit lobbing business napalm at its own associates and get with the program. Its 2011, the internet is not brand new, online sales tax collection and management is not rocket science.
The article includes this sentence: “Amazon threatened to sever all its affiliate ties in New York if the measure passed but instead chose to challenge the law in court.”
That’s a LIE straight from the booksellers’ lobbyists — Amazon was caught by surprise by the enactment of a retroactive law in New York, and chose to litigate only the nexus issue, not the retroactivity. The booksellers (and now the big-box retailers) want legislators to believe that Amazon won’t follow through on its current threats, by FALSELY claiming that Amazon made a similar threat in New York but didn’t follow through.
Spare a thought for those of us in OZ. We pay some of the highest taxes per capita in the world!
Something to bear in mind is that any state that’s “safe” this year could change in the next legislative session.
I enjoy it here for many reasons beyond the current attractive business atmosphere and lack of state income tax.
It’s a nice place to live, and the economics of it are fringe benefits.
I’m glad you brought this up.
I have been thinking about moving to Texas for most the same reasons you did. I may have to reconsider…
Comments on this entry are closed.