I know this is 1-year-old news, but I'm considering moving to NY and am just curious if any of you NY affiliate marketers have been affected by the NY "Amazon" Tax in any capacity?
NY State "Amazon" Tax - Has It Affected Your Business?
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I recently applied to become an affiliate for a physical product. I was not declined out of hand, but was required to sign a document stating that the only promotion I would do would be to place banners on my existing website. They specifically prohibited me, as a NY affiliate, from promoting them actively in editorial content on the site, or in email messages, and no PPC either.
It seemed to me that their lawyers decided that if the company reduced the affiliate's role to nothing but a media placement paid on a CPA basis, then they avoided the state's claim that they had a business nexus in NY, and therefore avoided having to collect tax from NY buyers.
If I wasn't going to actively promote them, it didn't make sense to even bother. Based on their payout, and typical banner clickthrough rates, I'd likely make less that AdSense was paying.
I don't know how common this is among programs. But it definately sucks. And of course, some other companies refuse to allow NY state affiliates, which sucks only slightly more.
It seemed to me that their lawyers decided that if the company reduced the affiliate's role to nothing but a media placement paid on a CPA basis, then they avoided the state's claim that they had a business nexus in NY, and therefore avoided having to collect tax from NY buyers.
If I wasn't going to actively promote them, it didn't make sense to even bother. Based on their payout, and typical banner clickthrough rates, I'd likely make less that AdSense was paying.
I don't know how common this is among programs. But it definately sucks. And of course, some other companies refuse to allow NY state affiliates, which sucks only slightly more.
I think it's gonna be an extremely big blow to the industry if CA take it on too. There won't be any stopping other states from there.
http://blog.affiliatetip.com/archives/advertising-tax-two-minute-drill/ is a good video
http://blog.affiliatetip.com/archives/advertising-tax-two-minute-drill/ is a good video
I'm more surprised I haven't seen bigger, more vocal movements against this sort of extreme over-regulation. I can't find updates past last Summer on Amazon and Overstock's lawsuits to overturn it in NY... I'm assuming both lawsuits went no where.
my (completely uninformed) guess is that those w/ the most risk are as Narsticle points out CJ/Linkshare/Shareasale merchants especially brand names and those selling products whereby the internet is one of the smaller, if not the smallest distribution channel.
The performance guys on the other hand- namely those companies in the leadgen/continuity/single product where internet is either 100% of the traffic or the majority will likely find ways to deal with it and it will just be one more inconvenience for them possibly requiring a price drop to offset the tax collection and more annoying (real) bookkeeping.
The performance guys on the other hand- namely those companies in the leadgen/continuity/single product where internet is either 100% of the traffic or the majority will likely find ways to deal with it and it will just be one more inconvenience for them possibly requiring a price drop to offset the tax collection and more annoying (real) bookkeeping.
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