How Broke is the State of California?

by Ryan on June 29, 2011

California is so broke that they want to tax internet sales referred to retailers outside of CA by companies / individuals / websites headquartered inside of CA.

Hello,For well over a decade, the Amazon Associates Program has worked with thousands of California residents. Unfortunately, a potential new law that may be signed by Governor Brown compels us to terminate this program for California-based participants. It specifically imposes the collection of taxes from consumers on sales by online retailers – including but not limited to those referred by California-based marketing affiliates like you – even if those retailers have no physical presence in the state.

We oppose this bill because it is unconstitutional and counterproductive. It is supported by big-box retailers, most of which are based outside California, that seek to harm the affiliate advertising programs of their competitors. Similar legislation in other states has led to job and income losses, and little, if any, new tax revenue. We deeply regret that we must take this action.

As a result, we will terminate contracts with all California residents that are participants in the Amazon Associates Program as of the date (if any) that the California law becomes effective. We will send a follow-up notice to you confirming the termination date if the California law is enacted. In the event that the California law does not become effective before September 30, 2011, we withdraw this notice. As of the termination date, California residents will no longer receive advertising fees for sales referred to Amazon.comEndless.com,MYHABIT.COM or SmallParts.com. Please be assured that all qualifying advertising fees earned on or before the termination date will be processed and paid in full in accordance with the regular payment schedule.

You are receiving this email because our records indicate that you are a resident of California. If you are not currently a resident of California, or if you are relocating to another state in the near future, you can manage the details of your Associates account here. And if you relocate to another state in the near future please contact us for reinstatement into the Amazon Associates Program.

To avoid confusion, we would like to clarify that this development will only impact our ability to offer the Associates Program to California residents and will not affect their ability to purchase from Amazon.comEndless.com,MYHABIT.COM or SmallParts.com.

We have enjoyed working with you and other California-based participants in the Amazon Associates Program and, if this situation is rectified, would very much welcome the opportunity to re-open our Associates Program to California residents. We are also working on alternative ways to help California residents monetize their websites and we will be sure to contact you when these become available.

Regards,

The Amazon Associates Team

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Message Category: Notice of Contract Termination Due to Potential New California Law
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Posted via email from Ryan Born

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  • I got this email earlier today. At first I was upset because I thought, what happens to my commissions earned to date? Looks like they’ll be paying those out.

    Ultimately, it’s a terrible inconvenience. But then, I didn’t make much from Amazon sales as I did from other affiliate product sales.

    I’ll be turning to http://www.skimlinks.com as another potential affiliate program. It comes highly recommended from a friend in another State who was victim to the same thing. 

  • Assuming that’s not an advertorial for skimlinks, please note that skimlinks too will ultimately be subject to the same ruling. They can try and dodge it but if the law passes, it will effect skimlinks in the same manner that it effects Amazon.

  • Heh, sorry Ryan, definitely not an advertisement. I monetize my personal blog through two sources really: affiliate sales for Genesis, and my own personal subscription based newsletter.

    Like I said, I’ve made less than $100 in sales when we run a podcast interviewing an author. I don’t consider that a large commission but it’s a commission I suppose. Anyway, all sorta interesting (and annoying) to see play out… 

  • No worries…thanks for the comments and lively discussion. Let’s hope the bill doesn’t pass and that the state can find better ways to balance the budget. I can think of a few but this of course isn’t meant to be a political blog so I’ll keep them to myself….for now. 🙂 Cheers!