There has been a lot of talk about the advertising tax, which is being considered by many states, but a lot of folks aren’t clear about the threat and implications.
So, I’ve put together a a short video on the advertising tax. Given me two minutes of your time t find out why you need to start playing a role in the fight against the advertising tax in your state.
Basically, if you’re an affiliate working with companies who don’t have a physical presence in your state, and an advertising tax bill passes in your state, you’re at risk of being kicked out of those affiliate programs.
This tax is also known as the affiliate tax or Amazon tax.
The gist of it is that these states are trying to require companies to collect sales tax even when they don’t have a physical presence in the state.
Currently, if a company doesn’t have a physical presence, they don’t have to charge sales tax. There is legal precedent for this from the Quill Corp. v. North Dakota decision by the U.S. Supreme Court.
So yes, the advertising tax is unconstitutional for anybody who cares about the U.S. Constitution.
The contention by the states is that affiliates are a physical presence for these companies. You know that’s not true, and I know that’s not true, but does your state senator know that we’re just running advertising?
Anyhow, this sort of bad legislation became law in New York last year, and the result was a large number of affiliate programs removing their New York affiliates to avoid charing sales tax.
It’s a lose/lose/lose situation.
The state still isn’t getting sales tax from all of these transactions when merchants boot their affiliates, affiliates are losing their “jobs”, and the state naturally has less income tax to collect.
If you’re an affiliate, merchant, or network, it’s imperative that you take action.
One place to find information about fighting current or future legislation in your state is the Fight Against the #AdvertisingTax group on Facebook.
Lastly, when the vote does come down in your state, be sure to note how your representative(s) vote. And then put them out of a job at the next election if they voted against your livelihood.