Regulations cost money
I just do not understand politicians sometimes. They pass a law that says, hey, if you share your profits with people in our state then you have to deal with all of our regulations on sales taxes. Then, they act surprised when companies like Amazon stop sharing their profits.
What is the big deal? Collect the tax. It’s not a big deal. I’m at a loss to understand why Amazon and why Overstock have dug in their heels.
That’s from State Revenue Services Commissioner Kevin Sullivan. Not a big deal? Do they really believe that regulations are free?
I doubt that Amazon’s affiliate program brings Amazon much money. I can’t remember the last time, if ever, that I’ve bought something on Amazon solely because of an affiliate link. At best, I might buy something a little earlier than I otherwise would have.
Weigh that against having to maintain tax expertise in each of the states with these requirements and be open to regular tax audits from those states, and I not only can’t blame Amazon for ending the affiliate programs, I want them to do it. Keeping the program would just mean strengthening the make-work support industries involved in navigating government regulations, and pushing us closer to the bureaucracy event horizon.
If states really want to collect sales taxes in other states, they need to do it right: tax based on the seller’s location, not the buyer’s. Otherwise, you’re building a regulatory maze that will block innovative new companies from starting up and raise prices due to the costs of regulatory compliance.
In response to Punishing low-tax states: An Internet sales tax that looks at the customer’s state instead of the seller’s state punishes states with low sales taxes and inhibits competition.
- Amazon Cancels Connecticut Website Sales Agreements, Citing New State Tax: Dan Haar
- “At issue is a change in the state tax rules that takes effect July 1. Online retailers with operations or a ‘nexus’ in the state must collect the sales tax, which rises next month from 6 percent to 6.35 percent. And under the rules, agreements with locally owned websites are considered to be operations.”
- The Bureaucracy Event Horizon
- Government bureaucracy is the ultimate broken window.
More Amazon
- Notes on publishing ebooks, including scripts
- I have several scripts that make it easier to manage the translate from word processor to ePub or print, and I use them in different ways depending on what kind of a book it is.
- California threatens Amazon, kills affiliate programs
- By this time, California had to know that its new law would not bring in new tax revenue. The tax headaches aren’t worth the trouble of maintaining affiliate programs. The only reason to pass the law was to kill affiliate programs at places like Amazon and Overstock. I don’t understand; what is it about affiliate programs that states don’t like?
- George Orwell’s incinerator
- Amazon shows by doing why digital restriction management on consumer items is a bad idea.
- Why does Amazon get the links?
- Why, when I love independent games, independent music, independent movies, independent comics, and independent books, do I link to Amazon.com for all of those?
More purchase tax
- Consumption vs. Income vs. Sales
- I would love to be convinced that consumption taxes are a better idea than income taxes. But I just don’t see how politicians wouldn’t find it easier to muck up a consumption tax worse than they’ve mucked up income taxes. Is convincing Americans to switch from an income tax to a sales tax an effective use of resources?
- Is it better to tax incomes or purchases?
- Is it better in a democratic republic for the national government to tax incomes, with an income tax, or to tax purchases, with a sales tax?
- Income tax vs. national sales tax
- There is no such thing as a fair tax. All we can do is try for the simplest, most unobstructive tax we can find.
- What’s wrong with a national sales tax?
- When considering a new tax, consider how easily that tax is abused by the state and by the state’s good intentions.
- San Diego’s proposition D: tax first, reform afterward
- San Diego’s proposition D is an attempt to raise taxes and then reform—which is, of course, an attempt to raise taxes and not reform anything at all.
Remember: Trump reassures crowd after assassination attempt fails. (read more…)
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