I Got Fired!
In the midst of all the craziness, I received this email:
Yep, I was fired.
Along with other affiliates who happen to live in the State of Georgia.
I talked about this whole Nexus Amazon Tax thing before here, but now it's really happening.
Thankfully, that merchant is far from a big producer for me (well, one season a year I might miss them), but what OTHER merchants are going to do this?
I've been doing deep research into all this and let me tell you, it's crazy. A good friend of ours just happens to also be our County Commissioner. I am having to explain it all to him.
And guess what? He never even thought, or KNEW to think, about the affiliates involved in the dead center of this battle.
Thing that drives me nuts is not so much the whole use tax thing... I kinda get that. Even if we don't get charged sales tax online, we are still SUPPOSED to report the tax we would have been charged on our tax returns.
It's always been that way - but no one really does it.
So instead of finding a way to get our state residents to actually do it, the State is going after all online merchants and trying to force THEM to do it for them.
Not sure how legal or constitutional all that is, but it will take a high court to make that decision. I imagine the Amazon vs New York case that is still hanging in limbo will create the first precedent...and then it will go from there.
Bottom line is this - NO ONE wins in all this...and there is only one loser - the affiliates.
If Amazon jumps on board and fires the 6,000 - 7,000 affiliates here in this state (who earned a combined $600 MILLION in 2011 and paid over $36 MILLION in state income tax) - well, that will be a mess.
State loses.... they won't get that money they are thinking they'll get.
The "Big Businesses" who started all this mess won't win. Wal-Mart, Home Depot, etc think it's unfair that they have to charge sales tax online (because they have physical retail presence in this state) and Amazon does not.
Amazon will just fire their Georgia affiliates and wash their hands of all this - and STILL not have to charge sales tax!
And here's what will happen... and it's what NO ONE is talking about...
Amazon WILL still make the same, if not MORE, money as before all this.
Thing is, our affiliate advertising links that we Amazon Associates (affiliates) put on our websites and web pages will no longer CREDIT us (the affiliate) for the sale but the link will still work and go to Amazon...but now Amazon will get 100% of the revenue from that sale which was generated by a former GA affiliate.
- Amazon makes more.
- Amazon STILL sells to Georgia residents.
- Amazon STILL does NOT charge tax to Georgia customers.
- Georgia customers STILL don't pay/report use tax on tax returns.
- Georgia STILL doesn't get that money from out-of-state internet sales.
- Georgia will make LESS due to 6,000 -7,000 or more GA-based Amazon Associates (affiliate) being fired and no longer making that income, paying tax on that income, or spending that income in-state.
Now, if ALL affiliate links created by a Georgia affiliate became "dead" non-working links, well, I'd probably be less aggravated by all this.
But they'll still work... and all those folks like me that have worked so hard for YEARS to get those links OUT there, will either have to go find them, replace or delete them.... or just go one knowing those links are out there and we're getting screwed.
I've been reading everything I can get my eyeballs on hoping for that ONE thing someone says that makes me - as an affiliate AND as a resident of this state - to say, "Oh, ok - now I see why this is, or could be, a good thing" - and I'll just suck it up and move on.
But there is nothing.
It's pretty pathetic, to be honest.
I know Amazon "bought' their way out of this same situation in California and in Texas by offering to build distribution centers in those states and create thousands of new jobs as a deal to NOT have to charge customers that are residents of those states sales tax (use tax).
So c'mon Amazon - build a distribution center here in Georgia. Help this state create thousands of NEW jobs. Don't be the reason thousands LOSE their job.
Ok, that's my rant and my story of my first "Nexus Firing".
Anyone have any insight or advice or suggestions.... or a shoulder to cry on? lol!
Recent Comments
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Las Vegas, baby! hahahahahaha! If a state doesn't CHARGE sales tax at all... well, think about it ;)
Well, we actually do have a sales tax here in Vegas, but no state tax.
Of course, we also just had a murder-suicide on a casino floor on Friday night, so it's definitely not all peaches and cream here.
Yeah I heard about that. I wonder what happened. I heard that yesterday someone fired off 50 rounds in a shopping mall parking lot close to where I live.
Jennifer, with your personality, have you thought about pulling together the GA affiliates and lobbying your state assembly? I know you're extremely busy, but you and the other affiliates could hire a lobbyist (make sure they're registered as a lobbyist with the state) and they put together a "platform" for you to present. They then do the legwork throughout the year with the prime movers in the legislature (finance cmtee chair, commerce, rules, budget, house and senate side senior leg and aides, etc), then you and the other affiliates hold a "Day at the Hill" and descend on the legislators with the numbers you stated above and let them know how much it will cost them to lose your, THEIR constituents' business, which can and will turn into votes, ya ya ya. You've probably thought of all of this, but I've seen similar work here in VA. Very short-sighted on GA's part. Helen
Hi Helen =) Thank you, that's a nice compliment. Yes, the thought has crossed my mind because we NEED someone to speak up - but I don't know if I am the person to do it (but if not me, then who?).
Problem is, Georgia tried to get this "amazon tax" thing passed on it's own bill and it failed... so they tagged it on to the end of another bill nice and quiet...and it flew through quickly.
The bill it was added to also had the State bringing BACK Tax Free shopping weekends (usually around back to school time). That, on it's own, is very popular with voters (which is also a silly thing to do - 'nother story tho)
I'd really just like Amazon to offer to build something here and create new jobs to end this madness. THAT seems to be what works.
Jennifer
Jennifer, I have no doubt that you could be the spokesperson, but you'd need the numbers of the GA affiliates behind you. Is there a professional group that you all belong to in GA or nationally that could be the umbrella organization? What I'm thinking is if there are enough numbers of voters, i.e. constituents, to catch the elected officials attention, that's a starting point. I understand the "slipping a law through on the coattails of another" ruse, it happens quite often. If the politicians don't think anyone's paying attention or will make noise, it will come down to numbers. Do you know if Amazon is spending lobbying money in GA and if so, who to? That should be public info and probably online somewhere. It may be proving cheaper for them to spend money in the right places now than to build a warehouse and create jobs, thus investing long term and more expensive. I'm in VA which is extremely friendly to business and have seen deals done that would curl your toes. It's usually all about the money, as you and I know...
So sorry to hear about this. Although this is a very important blog. Thank you for writing it. It certainly makes one think as to the gravity of what can happen, and how careful we should be about putting all our eggs in one basket. I know a lot of times these things happen and it is out of our control, but it is good to think ahead and have a plan B. The hamsters are turning my wheels right now :) If I come up with any suggestions I'll be sure to share! (Although I'm sure you'll do fine, you are a tough cookie!) Good Luck!
Illinois has had this for almost 2 years now. Lost all of my Amazon sites in a flash when I got that email "Notice of Contract Termination Due to New Illinois Law." Though I had been preparing for 6 months for this to happen, I had to regroup, take down every Amazon site I had and replace some of the products with other companies that do business in Illinois and find another online avenue. An Illinois judge recently ruled the Illinois Nexus Law unconstitutional, but of course I'll be dead by the time it goes through the courts. This really stinks for online marketers and you really have to rethink your strategy if you live in a state thinking about this.
I'm so sorry to hear all that! But, THANK YOU for sharing that info. I am about to go research to see if I can find info about how Illinois and Colorado did when they passed all this (and had their resident affiliates fired).
If you happen to have a link to some solid (ie, reliable) info on your states situation, I'd really appreciate it if you shared.
Jennifer
With our current presidential administration, the taxation is only going to get worse. This is unanimous amongst the top financial advisers. The Internet is a relatively-untapped resource for government and it is now seizing upon opportunities to pass this kind of legislation. i.e. impose taxes on passive income. It will get worse because of the national debt and that too many folks are pushing for more entitlement programs. These have to be funded from somewhere, and who do they turn to? ...
I hear ya, Daniel! Thing is, this is not a NEW tax. We've always been required to report sales tax we WOULD have paid when buying online on our tax returns (use tax) - but people don't do it.
This IS the States trying to get the online merchants to do it because they can't get their tax payers to do it.
Just what I was needing to hear and read first thing on Monday morning! Man, that totally sucks! I am glad I am not affliated with Amazon. Was thinking about it but I will wait and see what shakes loose on this one. Sorry to hear that so many will lose their incomes in Georgia. Times are tough and the government is making it worse, not better. I am in West Virginia so God only knows what will fly loose here! Obama hates our state so I am sure his agencies will think of things to flatten what is left of our economy out. We just pack our Bibles and guns and he just doesn't understand that philosophy. Too bad for him, he might learn something!
Many people are doing very well with Amazon. Mine own sites are not doing very well with it and I know it's my content. Albeit, this is really the time for you to get into Amazon, even though this looms as a black cloud. WV may be spared for some time to come. I wouldn't throw in the towel before it even happens. It's a dirty shame this stuff is happening!
Even the rich are not getting out of it. They are the ones who provide the commodities and jobs. The government generally rewards them for this. The Obama Administration isn't the first to come along and quell this, but it appears to be the most effective in its drive to do it.
Definitely not here to preach politics, but right now, too many people are burying their heads in the sand and that's not going to help them. Best learn all we can about it so when the hammer does drop, we will be prepared for it.
We've got plenty of "Bibles and guns" down here in the South, too =)
This isn't an Obama thing - he is not doing it. It is our local state government that is doing it. Thankfully, an arena where my vote DOES count (well, kinda sorta...lol!)
Lame Jennifer, sorry to hear about this..
I can rent you my Canadian address..
All you need to do is come up here for a few week to prove you 'live here'.
Umm.. You do babysit right!?
Thanks, Jay! And I just might take you up on all that! Babysit? Yes... But I don't do dishes...lol!
Hi Jennifer,
Here in Europe, every "Member State" has its own rate of VAT (Value Added Tax) It's currently 20% in the UK. Amazon et al seem to manage just fine adding the appropriate amount to each sale depending on where it's going to be delivered.
This is an exercise in tax avoidance (legal) as opposed to tax evasion (illegal). Amazon made sales of c. $5 billion in the UK in 2011 but managed to pay just c. $3 million in corporation tax. Starbucks and Google arrange their affairs in similar ways.
There's been something of a political, media and public backlash about it recently on this side of the pond. You can see an example from the Beeb here: http://www.bbc.co.uk/news/business-20657312
I imagine to get yourself a level playing field, the companies will need to be made to charge your sales tax in the same way as here. It would require them to apply it depending on the actual delivery address. It appears they're just trying to squirm their way around it in the USA at the moment.
Rich. x
Interesting link, thanks Rich.
Our national government has uhhhh "attempted" to make rules about how individual states can go about this (must join SSUTA and come to ONE taxation situation for the entire State). If they didn't do that, charging tax by delivery address would be a nightmare for these online merchants....
first of all..GREAT title! it made me open it up real quick although I have to sleep and be up in a few hours.
second...I don't know the full details of this but I think some of this is also happening in California. So my thinking is that this "problem" is going to spread to a lot of states. Moving probably won't solve this.
third...I'm really starting to think the gov't are are some of the biggest crooks out there. They tax and tax and take and take...and yet all the states are still bankrupt....why? because their spending is out of control! If we ran a business the way the gov't ran this country we would all be bankrupt in months. But, instead the gov't just raises taxes or creates new taxes. In california, I had to pay taxes...ON my tax refund!!! Ridiculous!!
fourth...fortunately, or unfortunately, this makes me really wonder if I want to keep pursuing internet marketing. I'm in the early stages of this and it seems harder than all the other income strategies I'm aware of. And with the google slaps and tax codes.....this is not financial independence. This is more scary than the chances of getting fired from a job...that you were good at. People making $10,000 per month drop to $100 per month on a matter of hours.
If I do continue I will definitely be one of those that does this for reasons other than money.
fifth....seems like things are changing drastically as far as IM goes. My suggestion...consider an additional source of income...and keep positive.
Moving forward the key is to be adaptable to BS like this.
California is a similar situation, but not exactly the same.
Amazon DOES have a physical presence in California. They have a lab where they develop their Kindle/eReader technology. That gave California a bit more leverage.
In Georgia, Amazon does NOT have a physical presence (ie, "nexus") - the state is claiming that we (the affiliates) create that nexus.
In California, Amazon agreed to build a distribution center in the state and create new jobs in exchange for not having to charge sales tax to California residents.
That worked - and California affiliates were let back into the Amazon Associates program.
BUT - the State of California makes Amazon report on each receipt how much sales tax WOULD have been charged...and has to file that info on each customer each year with the California Department of Revenue (so your Gov't can make sure you claim it/pay it each year on your taxes).
Crazy.
I had only heard about it when they first started talking about doing it in California. This is really crazy.
It is really hard to stomach how greedy politicians are. All while billionaires like Warren Buffet "constantly" brag that they pay less in taxes than their secretaries do.
Thanks for the info
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surely a case of penny wise and dollar foolish - in this day and age when businesses are falling by the wayside and the economy is in such dire straights - our government should be looking for ways to promote business - not stifle it - but as long as they have their cush jobs with ridiculous pensions and benefits all they're worried about is re-election
That's a perfect way to say it - "Penny wise, pound foolish".
Sad thing is, most politicians AND "Average" voters have no clue about affiliate marketing. Therefor, fighting for the affiliates as a politician is a bad move....