Amazon Dumps California Affiliates

The largest online retail website Amazon.com dropped thousands of California affiliates on Wednesday. Amazon affiliates in California are the latest victim of an ongoing campaign by states to collect sales tax from online retailers.

The catch is, however, that the retailer must have a physical presence in the state to collect the sales tax. State laws have been written to include affiliates as being a “physical presence” in the state.

Earlier this year I felt the pain of such laws when Illinois passed a similar internet tax law, and was promptly terminated as an Amazon affiliate. The income I earned from hocking Amazon products wasn’t much, but every penny helps these days. There was at least one company in Illinois that had to relocate to Wisconsin because a good chunk of their revenue came from Amazon.

Brick-and-mortar retailers have been lobbying for such internet taxes for a while, saying that websites like Amazon have an unfair advantage because they are tax-free.

My personal opinion is that the internet should remain tax-free. What do you think? Should states be enacting these internet tax laws, knowing it will hurt thousands of Amazon affiliates?

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