Friday - July 01, 2011

California Ignores The Law, Suffers

California tells online retailers to start collecting sales taxes

Beginning Friday, Amazon.com and other large out-of-state retailers will be required to collect sales taxes on purchases that their California customers make online.

Beginning Friday, a new state law will require large out-of-state retailers to collect sales taxes on purchases that their California customers make on the Internet — a prospect eased only slightly by a 1-percentage-point drop in the tax that also takes effect at the same time.

Getting the taxes, which consumers typically don’t pay to the state if online merchants don’t charge them, is “a common-sense idea,” said Gov. Jerry Brown, who signed the legislation into law Wednesday

But those taxes may come with a price. Amazon and online retailer Overstock.com Inc. told thousands of California Internet marketing affiliates that they will stop paying commissions for referrals of so-called click-through customers.

That’s because the new requirement applies only to online sellers based out of state that have some connection to California, such as workers, warehouses or offices here.

Both Amazon in Seattle and Overstock in Salt Lake City have told affiliates that they would have to move to another state if they wanted to continue earning commissions for referring customers.

“We oppose this bill because it is unconstitutional and counterproductive,” Amazon wrote its California business partners Wednesday. Amazon has not indicated what further actions it might take to challenge the California law.

Amazon ends deal with 25,000 California websites

Gov. Jerry Brown has signed into law California’s tax on Internet sales through affiliate advertising which will immediately cut small-business website revenue 20% to 30%, experts say.

The bill, AB 28X, takes effect immediately. The state Board of Equalization says the tax will raise $200 million a year, but critics claim it will raise nothing because online retailers will end their affiliate programs rather than collect the tax.

Amazon has already emailed its termination of its affiliate advertising program with 25,000 websites.

Click a link on some blog that takes you to an online retailer - say one that sells crossbows perhaps? - and the blogger in California “owns” or “roots” the sale in that state, so the retailer then owes sales tax to that state? As in: you live in New Mexico, you click on a link at a blog run by some guy in New Jersey that takes you to a crossbow selling online retailer in Indiana, and now New Jersey has the power to collect sales tax from a transaction between Indiana and New Mexico? Is there a diplomatic way to say “Blow it out your ass, fuckface!”??

This is a Use Tax, plain and simple. And use taxes are the biggest loser idea that ever was. While the laws may require citizens to add up the things that they buy out of state and then pay the proper amount of sales tax to their home state, other than my mother nobody in the entire country does this. Nobody. Because deep down we all know that what we buy somewhere else is no business of the state we live in, so they can sod off.

Amazon was quick to turn the tables. Calling the new law unconstitutional, Amazon sent an email Wednesday to California affiliates immediately severing ties with them—and putting those businesses in the crosshairs.

“Unfortunately, Governor Brown has signed into law the bill that we emailed you about earlier today. As a result of this, contracts with all California residents participating in the Amazon Associates Program are terminated effective today, June 29, 2011,” the company wrote in an email to affiliates obtained by FoxNews.com.

By ending these local affiliate programs, Amazon and Overstock should largely exempt themselves from the law—meaning California shoppers probably won’t see taxes on books and other goods from them.

The States are just as out of control and out of their minds as the federal government when it comes to taxes. Neither group has been able to spend responsibly for the past 80 years or more, and both are now mired in debt. But neither will face the music and put their budgets under the chopper. The post I didn’t run: Obama wants to raise taxes hugely to attempt to balance the budget. Which will once again KILL any slight bit of growth the economy may have been showing. It’s like he’s doing this shit on purpose. Nobody could be that stupid by accident. Guess I was wrong: Jerry Brown is that stupid. And so is California, for re-electing this wasted old hippie 20 years past his sell-by date.

The internet is a duty free port. Just make sure that whatever you buy online comes from some other state. If it comes from your state, just go buy it locally instead. Personally, if I ran a web business I’d set it up off shore if I could. Failing that I’d set it up in Delaware, or another state that has no sales tax. Failing that, I’d make it abundantly clear that no sales would be made to the state the business resided in. And thus the taxman can go to hell. Because that’s what America is all about.

Posted by Drew458     on 07/01/2011 at 10:24 AM   
Filed Under: • Government • Stoopid-People • Taxes •  
• Comments (3) • Trackbacks(0)  Permalink •  

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