Sales Tax On Internet Sales For Affiliate Programs

Just in -- Sales tax for Internet sales may be coming to your hometown.  Apparently, a law in New York introduced a new way to impose sales tax on items sold on the Internet.  Because of this new law, companies like CafePress and Amazon are terminating their affiliates account in that state.  However, just in, North Carolina is the next state imposing a similar new law. 

Reports indicate that Amazon has send out an email informing their affiliates that reside in North Carolina that their account will be terminated if the new law passes.  The new "Sales Tax On Internet Sales" is expected to pass within the next two weeks. 

I am under the belief that states with financial problems are the states imposing this new "Sales Tax On Internet Sales" law.  I'm sure they have already begun to use the "sales tax" forecasted amount as a statewide bailout.  If your state has not imposed this "Sales Tax On Internet Sales" law -- just wait.  First New York, now North Carolina -- I'm sure other states will follow.  The point behind the "Sales Tax on Internet Sales" law is physical presence.  Physical presence is applied to the affiliate and not the affiliate program company.  This is why companies like Amazon would rather terminate an affiliate account then impose the sale tax.  Just think, Amazon and other affiliate programs would have to re-code their entire site to accommodate this new law, not to mention sending payment to each individual state. 

There is a movement going on to help fight against the new law.  The movement is called the "Streamlined Sales Tax Project".  The project will not eliminate the new law, but help affiliate programs manage under the new law. 

Affiliate Programs Affected By The New "Sales Tax On Internet Sales" are:

• Amazon.com
• iTunes
• CafePress
• OverStock

and the list will grow ...

Projected States to Imposed the New "Sales Tax on Internet Sales" Law are:

• New York (Approved the Internet Sales Tax)
• North Carolina (Pending Approval of the Internet Sales Tax)
• Florida
• Texas
• Illinois
• Massachusetts
• Connecticut
• California
• Hawaii

The only states that maybe safe from the new "Sales Tax on Internet Sales" law are -- Delaware and Nevada (Tax Free States).