So you know how you don’t have to pay sales tax on stuff you buy online unless you’re buying it from a company that has a physical presence in your home state? Yeah, that could all be over soon.
New York Governor Elliot Spitzer has pledged not to raise taxes. But he’s got a budget deficit to deal with, so he’s trying to find new ways to collect taxes. And his administration believes they’ve found a loophole in that whole bricks and mortar thing.
Here’s how it works. Sure, Amazon doesn’t have a warehouse in New York. But lots of New York-based web sites have Amazon affiliate links. And Spitzer argues that effectively makes the New Yorkers who run those websites into Amazon salespeople, thus allowing the state to collect taxes from Amazon.
If Spitzer’s plan holds up in court, it could open the floodgates and other states would likely be quick to follow. Either that or Amazon and other online retailers would stop offering affiliate programs. The plan is set to take effect in New York in December.
Photo by Amazon.
John W. Furst on November 19th, 2007 at 3:48 pm
As far as European consumers are concerned, the European Union forces all companies world-wide to collect VAT (value-added sales tax). This is 15% to 25% !! Large companies like Clickbank.com or GoDaddy.com have already started to comply with European laws.
However, VAT is a tax for the end-user, the consumer. A registered business doesn’t have to pay it.
More info:
http://blog.fcon21.biz/2007-10/83-Transatlantic-Connection-CoSBI
Bill on December 8th, 2007 at 6:09 pm
I have an idea. Instead of looking for more ways to get taxes from people, why not instead try lowering your damn budget.