New York Screws Affiliate Businesses
As a lot of people know, selling products and earning affiliate commissions is one of the leading ways to generate an income online. I, myself, have made quite a bit of money by selling products as an affiliate.
We also know that government typically has a reverse midas touch - everything they touch turns to shit. And now New York state is taking that shit and smearing it in the face of affiliate business in the state of New York.
According to Domain Name Wire, New York has decided that any business which runs an affiliate program and has affiliates in New York then has a business presence in the state of New York. Of course that means they’re trying to collect sales taxes on the sale. So, for example, if I run an affiliate program and I have affiliates in New York, I then have to pay state sales taxes in New York for any shipments I send to New York - even though I am based in Florida.
As a result, we are sure to see a host of affilliate programs out there kick out all of the New York affiliates. Internet Retailer is reporting that Amazon.com and Overstock.com is filing a lawsuit against the state of New York. As the story says:
But Amazon, charging New York’s new tax law is “invalid, illegal, and unconstitutional,” filed a lawsuit against New York in early May seeking to have the law thrown out. Overstock followed by telling its more than 3,400 New York-based affiliates that, as of the law’s June 1 effective date, Overstock would no longer place ads on their sites for customer leads unless New York changes the law or the courts declare it unenforceable.
One thing is super clear: government doesn’t understand business. These people in Albany want to raise more taxes to pay for all their pet projects. As a result of this act, they’re just going to kill the income of any good affiliate marketers in New York and this is going to result in LESS taxes.
Idiots. But, this is the kind of crap you get when you elect tax-and-spend politicians to government.
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Comments
Don’t get discouraged. There are many affiliate programs that may just eat this cost as a cost of doing business. From a business sense, pulling out of New York may not make a lot of sense. So, you can still do it, Frank.
But yeah, the state sure isn’t making it easy.
While I think that the rationale put forward by NYS is pretty lame, and that affiliate status really shouldn’t make a difference, I do think that it is only fair that online businesses and brick-and-mortar stores be treated similarly with regards to taxes. Since I really doubt that units of government are going to stop requiring businesses to collect sales tax anytime soon, that means that online stores should collect sales tax revenue just like their competitors down the (physical) street. Maybe not now, but as soon as a viable method can be worked out for doing so.
Well it looks like I get kicked again. I just barely get my web site up, and here is another reason to forget the whole idea.
A pissed off NYC resident.