July 02, 2009

Important update on the affiliate taxation fight

Affiliate taxation issue heats up Things have really came to a head with respect to the ongoing efforts by several states to pass affiliate tax legislation. Join us for a special broadcast of Affiliate Marketing Insider this week, where we’ll discuss all the latest affiliate tax news with a panel of industry leaders who are actively working to keep these measures from becoming law. Tune in at noon Pacific (3 p.m. Eastern) Thursday on WebmasterRadio.fm to hear the discussion.

We just received word that Overstock.com is dropping its affiliates in California, North Carolina and Rhode Island. As we’ve reported previously, Rhode Island has passed a nexus law already, which is already in effect, but the measures in California and North Carolina have not yet passed. North Carolina’s legislature has until July 15 to come to an agreement on the budget. If the North Carolina measure passes, it would go into effect immediately. Hawaii’s advertising tax bill is expected to be decided on the same date – July 15. Gov. Lingle is expected to veto the bill – House Bill 1405.

Amazon.com decided not to wait for the final verdict in Hawaii and notified its Hawaii affiliates Monday night it would discontinue their commission payments effective yesterday. Amazon has stated, however, that it will reopen its programs to Hawaii affliates if the bill is in fact vetoed. In fact, Amazon has pre-emptively terminated its program for affiliates in North Carolina, Rhode Island and Hawaii but NOT, interestingly, in California. If California’s affiliate tax law passes, it would go into effect 90 days from passage. No one has any idea when the California budget will pass.

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