Amazon Challenges NY State Sales Tax Law
NY State is basing its law on the fact that Amazon has many "affiliates" with addresses in New York. Amazon pays affiliates a small commission on sales that originate from a link on the affiliate web site. Does this payment make the affiliate an "agent" of Amazon or is the affiliate being paid for what is, in effect, an ad that worked?
cNet reports that a 1992 US Supreme Court decision (Quill v NC) suggests Amazon has a good case. (And with the current make-up of the Supreme Court, I'd put my money on Amazon should the case get that far):
currently limits states' ability to collect sales taxes from out-of-state retailers. It says retailers aren't required to collect sales taxes from customers who live in states where the businesses don't have a physical presence, or "nexus." New York's new statute represents one attempt at getting around those limitations.
States want to get their paws on sales taxes related to online commerce. Bricks-and-mortar chain stores (Wal-Mart, Target, Safeway, etc.) will probably stay mum, since they do have a physical presence and must already collect taxes; online sales are simply an add-on. Expect more challenges like this one, unless Congress intervenes or the US adopts another system for funding most state and local government.
See Issue Overview : Taxes -- A Look at Taxation Principles and Methods
Comments
Figures. NY born and raised. I have no doubt that NYS wants their greedy paws on this.
By affiliates, does that mean the resellers of used items? Amazon must be sweating that one. Their price on new books is always high, but I am a huge fan of their used item setup.
Amy
I had to deal (indirectly) with NY and NJ authorities in my previous job. I have never seen anything like these guys. They are dealing like the mob… it looks like they are running some kind of racket.
New York…Hillary Clinton. Taxes through the Internet…that’s Hillary for you.
Acts like the mob…I’m sure there’s a good reason for that. And someone said NY was Hillary’s state. Well, that’s what Hillary would like to hear…..”her” state. Not the state of the people, but “her” state.
However, it has been proven that those with less of an education do support Hillary.
We need intelligent people representing the intelligent folks of America. The intelligent folks know how to get things done. The less intelligent? They become puppets to people like Hillary.
Hello, Sharon — HRC had nothing to do with this action. She’s a senator, not the governor nor someone in the state legislature.
I say, BOYCOTT NEW YORK!
Take a bite OUT OF the Big Apple!