Amazon.com is in a tax tiff with North Carolina and as a result any North Carolinian based person or business is apparently no longer welcome in the company’s Associates Program. Not that it means a whole lot to me because in the however many years I’ve been a member I think I’ve earned a grand total of $6 which is less than the minimum they require to actually go to the trouble of sending me money, and now that I’ve been tossed I’ll never attain my goal of becoming an Amazon gazillionaire. Despite the fact that this means literally nothing to me I still feel like I’ve gotten a “Dear John” letter…oh wait, I guess I kind of have. Anyway, here’s the text of the email they sent to gid rid of me:
Subject: Important Notice from the Amazon Associates Program
We are writing from the Amazon Associates Program to notify you that your Associates account has been closed as of June 26, 2009. This is a direct result of the unconstitutional tax collection scheme expected to be passed any day now by the North Carolina state legislature (the General Assembly) and signed by the governor. As a result, we will no longer pay any referral fees for customers referred to Amazon.com or Endless.com after June 26. We were forced to take this unfortunate action in anticipation of actual enactment because of uncertainties surrounding the legislation s effective date.
Please be assured that all qualifying referral fees earned prior to June 26, 2009 will be processed and paid in full in accordance with our regular referral fee schedule. Based on your account closure date of June 26, 2009, any final payments will be paid by September 1, 2009.
In the event that North Carolina repeals this tax collection scheme, we would certainly be happy to re-open our Associates program to North Carolina residents.
The North Carolina General Assembly s website is http://www.ncleg.net/ [ http://www.ncleg.net/ ], and additional information may be obtained from the Performance Marketing Alliance at http://www.performancemarketingalliance.com/ [ http://www.performancemarketingalliance.com/ ].
We have enjoyed working with you and other North Carolina-based participants in the Amazon Associates Program, and wish you all the best in your future.
Best Regards,
The Amazon Associates Team
Sent from my Verizon Wireless BlackBerry
Befuddled 
This is the issue with this (I got the same email). All affiliates sign a contract with that makes them an independent “marketer” of Amazon. In all states, you have to have a local presence to actually pay sales tax as a retailer. WIth this law, they were trying to tell Amazon that the affiliates posed as representation and thus Amazon had local presence. But this is no more so than when contractors are consulting on a business or company A resells a distributed product from company B. You don’t go to Walmart and ask them about your Sony warranty on your PS3. You go to Sony for it. In the same fashion, state legislation is basically trying to manhandle Amazon (and other online retailers) with this sort of logic. Obviously, it doesn’t hold water since anyone that has done contract work knows that you don’t represent the company you hold a contract with at all unless it’s like subcontracting.
In any case, in the end the affiliates are the ones that are hurt by this and small business gets thrown out the door which essentially puts them in unemployment…. which then is more burden on the state. Yeah… brilliant move by people that don’t understand how internet business works or the laws behind it.
This looks to me like a case of the state getting greedy and not considering the consequences.
The NC legislature decided they want to collect sales taxes on all those millions of referral sales from associates (people like you). Amazon has decided that they are in fact located in Seattle and not in North Carolina, so no, they won’t collect sales tax on purchases from people in Texas that bought from Amazon after clicking a link on your site. And just to be clear, they are dropping the associate program for North Carolina.
So now the government will get a sales tax on no Amazon sales (the prize they were seeking) and a reduced income tax due to the associates losing that source of income (there are some people that earn most of their income through this type of marketing). SO the state govt will have a net loss and some citizens will have a net loss.
When I lost my job, I had to cut my spending. I have started back to work, but I am still spending very cautiously. Shouldn’t our government be doing the same thing. Continuing to grasp for this straw will cost the state in the long run.
I never joined this program, though if I mention a book, I do tend to link to it on Amazon. I just have never made money off doing so.
That said, YOU don’t do this, Jon, but I have seen numerous bloggers join the Affiliates program and suddenly begin hawking wares daily like it’s their primary source of income, all under the guise of “personal recommendation”.
Since I primarily read NC blogs, I’m tickled this will no longer be the case.
Side effect, but silver lining nonetheless.
Personally I think pimping books and other stuff kind of kills the
purpose of a blog or personal site. If people link to things that come
up as a natural part of their daily routine, ie “I just read this book
and it’s totally killer” then I have no problem. But as you said if
all they’re doing is hawking stuff then I won’t be back
I agree that it’s a shortsighted move by the state that was destined
to backfire, at least in the short term. If EVERY state adopted the
program then Amazon would probably play along, but as things stand it
ain’t gonna happen.
BTW, I think we have a better opportunity to have a real discussion
about the role of government today than we’ve had in my lifetime. We
need to ask, “What should the goverment be doing and how will we pay
for it?”. I’m all for a more efficient gov but the devil is in the
details. Every thing we cut will affect someone and it’s hard to
follow through with cuts when you hear those peoples’ stories. Still,
we are living with a system that is unsustainable and our current
economic situation has shown us that the emperor has no clothes.
Hopefully we’ll begin to do somerthing responsible and sane to fix the
situation.