Friday, June 10, 2011

Amazon Shuts Down Associates Affiliate Program In Connecticut Due to New Law for Online Sales Tax




  • Connecticut is now CLOSED for Business with Amazon and Overstock. Bloggers, small retailers, etc. will no longer be able to participate in the Amazon Affiliate Program due to a recent budget passed by Dan Malloy (D), governor of Connecticut. And to think, I voted for him. Gee, thanks! 


    Connecticut's Amazon Affiliates received notices early this morning terminating their contracts with Amazon. This is a result of the budget signed by Dan Malloy. The budget allegedly sought to receive $9.4 million in taxes from $148 million in online sales each year. Fine. What proves vexing, beside the taxation of Amazon through bloggers and business owners, is that, on April 21, Kevin Sullivan, Revenue Services Commissioner, wrote a memo to to Ben Barnes (Malloy's budget chief) saying that no state that has adopted the Amazon law has collected any money from the tax. The reason for this is that Amazon just ends the affiliate programs in each state.

    The measure is unlikely to generate much, read: a few dollars, revenue without Amazon. 

    Connecticut could have benefited from the income taxes of these individuals and small enterprises. But, this new sales tax has resulted in complete termination of the program in the State of Connecticut. Small enterprises and bloggers who supplemented their income through the Amazon Affiliate Program, will suffer a big blow. I understand that Connecticut has a big deficit and high unemployment rates but, I do not believe this was the way to get there. All this accomplishes is reduce the income of people. Connecticut will no longer benefit from any supplemental income I might have earned. 


    And what has been Connecticut's response to all of this? Taunting. 

    Kevin B Sullivan, the tax commissioner, issued a statement: "they can run but they cannot hide." Seriously? I think they not only hid, they went ahead and ended all relations. 

    Below is MY pink slip, thanks to the new Connecticut budget:


    Notice of Contract Termination Due to New Connecticut Law‏


Hello,

For well over a decade, the Amazon Associates Program has worked with thousands of Connecticut residents. Unfortunately, the budget signed by Governor Malloy contains a sales tax provision that compels us to terminate this program for Connecticut-based participants effective immediately. It specifically imposes the collection of taxes from consumers on sales by online retailers - including but not limited to those referred by Connecticut-based affiliates like you - even if those retailers have no physical presence in the state.
We opposed this new tax law because it is unconstitutional and counterproductive. It was supported by big-box retailers, most of which are based outside Connecticut, that seek to harm the affiliate advertising programs of their competitors. Similar legislation in other states has led to job and income losses, and little, if any, new tax revenue. We deeply regret that we must take this action.
As a result of the new law, contracts with all Connecticut residents participating in the Amazon Associates Program will be terminated today, June 10, 2011. Those Connecticut residents will no longer receive advertising fees for sales referred to Amazon.comEndless.com,MYHABIT.COM or SmallParts.com. Please be assured that all qualifying advertising fees earned on or before today, June 10, 2011, will be processed and paid in full in accordance with the regular payment schedule.
You are receiving this email because our records indicate that you are a resident of Connecticut. If you are not currently a resident of Connecticut, or if you are relocating to another state in the near future, you can manage the details of your Associates account here. And if you relocate to another state after June 10, 2011, please contact us for reinstatement into the Amazon Associates Program.
To avoid confusion, we would like to clarify that this development will only impact our ability to offer the Associates Program to Connecticut residents and will not affect their ability to purchase from www.amazon.com.
We have enjoyed working with you and other Connecticut-based participants in the Amazon Associates Program and, if this situation is rectified, would very much welcome the opportunity to re-open our Associates Program to Connecticut residents.
Regards,
The Amazon Associates Team


Gee, thanks Connecticut. 

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