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Victory for affiliates, as Illinois Supreme Court strikes down "Amazon tax"

by Curtis2011
17 replies
Full story here.

tl;dr: Illinois passed a law in 2011 that taxed every online sale to an Illinois buyer, even if they are buying from a company that has no physical presence in the state.

Their state's supreme court just ruled this unconstitutional, as it violates a federal law that prevents states from doing this.

+1 for Amazon affiliates. Hopefully, this will set some precedent for other states as well.
#affiliates #amazon tax #court #illinois #strikes #supreme #victory
  • Profile picture of the author Marketing Fool
    That's awesome!
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  • Profile picture of the author HeadStartSEO
    Whoa.. Great news! Thanks for sharing.

    /dance
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    • Profile picture of the author agmccall
      The precedent has been set, now other states have something to refer to

      al
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  • Profile picture of the author kfount
    Amazon was definitely overstepping their bounds here.

    When companies make laws like that, I have trouble promoting their affiliate products.

    I don't like that if I relocate to another state I have to give up my source of income. It's made even worse that my husband's business is so on-the-go.
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    • Profile picture of the author Marketing Fool
      Originally Posted by kfount View Post

      Amazon was definitely overstepping their bounds here.

      When companies make laws like that, I have trouble promoting their affiliate products.

      I don't like that if I relocate to another state I have to give up my source of income. It's made even worse that my husband's business is so on-the-go.
      Again, I think you miss the point...Amazon did not make that law...the state of Illinois did...the state of Illinois essentially kicked amazon out...and now the supreme court has overturned that law...allowing Amazon back in.

      This is a win for us affiliates, and a win for Amazon...it's a lose for over-reaching tax hungry socialist governments.
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  • Profile picture of the author Rbtmarshall
    Nothing is certain except death and taxes - Benjamin Franklin
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    • Profile picture of the author lerxtjr
      Only a matter of time Illinois. I nixed 40 websites that were promoting amazon product a few years ago when they killed Colorado associates. We went through a year of battles and thought we won. Start finding your alternate income generators now because once Amazon has your state on its radar, it's goin' down. Amazon has absolutely no reason to continue its associate program (their belief not mine). Like any software product, they started the associate program to get others to make Amazon a known name. Now everyone goes to Amazon to buy pretty much anything other than specialty items. And, they know it. So, why not save the bucks and take the orders direct? That's how the big software companies do it too. Fire their reseller channel after 10 years or so and take all the orders direct. (me still bitter!)
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      • Profile picture of the author Marketing Fool
        Originally Posted by lerxtjr View Post

        Only a matter of time Illinois. I nixed 40 websites that were promoting amazon product a few years ago when they killed Colorado associates. We went through a year of battles and thought we won. Start finding your alternate income generators now because once Amazon has your state on its radar, it's goin' down. Amazon has absolutely no reason to continue its associate program (their belief not mine). Like any software product, they started the associate program to get others to make Amazon a known name. Now everyone goes to Amazon to buy pretty much anything other than specialty items. And, they know it. So, why not save the bucks and take the orders direct? That's how the big software companies do it too. Fire their reseller channel after 10 years or so and take all the orders direct. (me still bitter!)
        I think you miss the point...it's not amazon that does this, its the STATE. The State passed a law to force Amazon out... and now the state supreme court has overturned that law...allowing Amazon to come back in.
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  • Profile picture of the author Rbtmarshall
    they didnt kick anyone out, all they were saying is that any commerce transaction that takes place in illinois will be taxed. I think they went about it the wrong way.


    When I lived in Florida there was no sales tax when buying crap on amazon, saved tons of money the years I lived there. Now that I'm in California, a nexus state, I get taxed for every transaction on amazon. It sucks, but its taxes and the law.


    this bill may have failed, but like mentioned above already, it wasn't amazon who did any of this. And I doubt the state is going to give up on the potential tax revenue online shopping is taking away from the state. The ;laws are going to change with the times


    the state made the law and the state vetoed it. Now it looks like this issue is going on to the US supreme court.


    To call it an amazon tax is just a media stunt.

    The days are numbered for businesses conducting tax free transactions in states without a physical presence. Amazon is only following state and federal laws, not creating them.
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  • Profile picture of the author Marketing Fool
    Of course they kicked them out. They proposed this law and Amazon told them that if they passed it, Amazon would immediately close their affiliate operations in the state.

    The state passed the law, and Amazon immediately left.

    That's being kicked out...plain and simple.

    It wasn't a media stunt. This law was written FOR amazon...lawmakers referred to it as the Amazon tax law...
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  • Profile picture of the author Rbtmarshall
    Amazon would have still made sales in Illinois. All this shows is how little affiliates rank in the amazon pecking order.


    If a law changes that affects affiliates operating in a state where there is no physical presence they will react quickly. good business practice it seems.

    Affiliates would be an inconvenience that are not worth the investment for Amzon
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  • Profile picture of the author Marketing Fool
    Any business decision is backed up by math. It's the numbers, always. If the numbers don't pan out, you don't do the deal. To say affiliates are merely an "Inconvenience" for amazon is naive and incorrect. It's the math. Period.

    This tax changed the calculus for Amazon, making it no longer profitable within their metrics. They were very upfront with the state, and the state in effect said "Screw you Amazon". I'm not sure why you continue to argue about it...
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    • Profile picture of the author Rbtmarshall
      Originally Posted by Marketing Fool View Post

      Any business decision is backed up by math. It's the numbers, always. If the numbers don't pan out, you don't do the deal. To say affiliates are merely an "Inconvenience" for amazon is naive and incorrect. It's the math. Period.

      This tax changed the calculus for Amazon, making it no longer profitable within their metrics. They were very upfront with the state, and the state in effect said "Screw you Amazon". I'm not sure why you continue to argue about it...
      Since you live in Illinois, are you going to be putting all your amazon purchases into your taxes at the end of the year and paying your Illinois state sales tax on those purchases?? I didn't think so. The state, not amazon is missing out on tons of revenue here, there not going to stop with a badly worded bill. they are going to re-word it until it passes and the state collects its share of revenue from its residents.




      http://www.reuters.com/article/2013/...99K0T620131021

      (Reuters) - Diverging high court rulings in New York and Illinois over 'Amazon taxes' point to a possible U.S. Supreme Court case to settle questions about the legality of states taxing online retail sales, lawyers said on Monday.
      ...
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      • Profile picture of the author jumpman21
        Originally Posted by Rbtmarshall View Post

        Since you live in Illinois, are you going to be putting all your amazon purchases into your taxes at the end of the year and paying your Illinois state sales tax on those purchases?? I didn't think so. The state, not amazon is missing out on tons of revenue here, there not going to stop with a badly worded bill. they are going to re-word it until it passes and the state collects its share of revenue from its residents.
        Rob, While you make valid points. You keep forgetting a few things. Illinois is a "HIGHLY TAXED" State! Everything from Property Taxes, Retail Taxes, Cig./Liquor Taxes, etc. Highest crime in the nation, and No Jobs! Plus, A failing everything!! Schools, 100 million debt, Jobs, Housing, etc. Then, Open up the papers?! Some Gov. official is going to jail for 3-5 yrs. for stealing "millions" in tax payer money! Why? Because of the same re-writes you speak of. Now, enter your average joe. Works 30 hrs. a week and can't even cover his mortgage, bills, etc. Figures out a way to make a few bucks online to feed his family. And the Gov. passes the law and totally wipes that out! You really back this type of Law re-writes as you call it? Seriously? It seems to me that you make enough money now and seemed to forget how hard it is to truly make it. 90% of the time? People who try to make a "little" money online, end up paying alot of money for ways to do it. Is there a refund law? Is their an entrepreneur law? No! Why? Cause there's no help for entrepreneurs! Instead of being so negative?! Try helping or encouraging people like me and all the other warriors here! A little love towards the little guys is "ALWAYS GOOD!"
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  • Profile picture of the author Rbtmarshall
    What? im not talking about any individuals emotional response or anything, I'm just saying what my opinion on the facts I've seen are.

    Here in California amazon did not have a presence a few years ago. then the state saw all the revenue it was missing and took action. and amazon proposed to build two data centers in california. guess what now its a nexus state.

    My opinion is the same will happen in every state that has problems taxing internet commerce for transactions conducted in a state that has no physical presence of that company. they will either make it law to collect state sales tax on transactions conducted by residents or give amazon incentives to open up a data or distribution center in Illinois allowing the tax with no additional law.
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  • Profile picture of the author Ghoster
    Hopefully North Carolina will now do the same. I haven't been able to use Amazon in years.
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  • Profile picture of the author DubDubDubDot
    I have little doubt that the law was orchestrated by offline companies that donated campaign cash to Governor Quinn. He was re-elected and immediately signed it into law. Sears was threatening to leave the state around that time. My intuition is that Sears was the driving force behind the law.

    I can't find the link now, but there was a story I think earlier this year about how Illinois expected the law to generate $X when in reality it ended up costing the state. The sales taxes brought in were less than the lost income taxes from eliminated affiliate income. Several large affiliate operations left the state.

    But I guess none of that matters when you just need campaign cash.
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