Amazon.com sent out a mass e-mail threatening to drop all “Associates” located in North Carolina rather than risk paying a new tax making its way through the state’s legislature.
Amazon Associates are web site owners who put links to Amazon products on their site, and are paid a small commission when a customer follows the link and purchases an item on Amazon’s site. North Carolina has proposed a tax on these “click” transactions to be paid in conjunction with sales tax. Rather than pay that tax, Amazon has decided to just drop the affiliates.
And here I thought paying higher taxes was patriotic. Apparently, not to Amazon.
I never understood why Microsoft got the reputation for being a big bully in their space and Wal-Mart got the reputation for causing the destruction of community businesses when, in reality, Amazon is by far the greatest offender in both categories. They are notorious for bullying their third-party Marketplace sellers – all of whom pay a hefty commission and additional fees to sell on their site – and seem to be directing that propensity to bite the hand that feeds them at their Associates now. They would rather send their Associates in NC, and any other state that proposes holding them to their tax responsibilities, out into the wilderness rather than uphold their civic responsibilities.
But, as a whole, the Associates seem to be taking it out on the state rather than on Amazon, buying Amazon’s take and saying that North Carolina is going to “kill” the associates program. I’m perplexed by that one. Amazon could follow the law, collect and remit the tax that they owe, and be on their way. Instead, they’re just going to lop off the Associates from the state if the law goes through.
I don’t think anyone can read this site and doubt that I’m for the lowest possible taxes. That’s not what this is about, though. Hell, I’d find a way to abolish as many taxes as I could if I was in charge. But when there is a tax law, I’m for that tax law applying equally to everyone. Especially when it comes to business, where unequal application of taxation leads to unfair competitive advantage for one business over another and the Government choosing winners and losers.
Why shouldn’t Amazon have to collect and remit Sales Tax in states that require it? Did you know that, in Pennsylvania, if you are not charged Sales Tax during an internet transaction that you are responsible for remitting the tax as “Use Tax” on your PA-40 form? So either way, PA is supposed to get their 6%.
Amazon is fighting this so hard because their advantage over local businesses is that you don’t see that 6% on the total of your Amazon cart, but you do see it on your receipt from your local merchant. Even though you’re responsible for the 6% either way, it’s an unfair competitive advantage for Amazon to not be the one taking it from you.
Wal-Mart has to charge Sales Tax just like a local business do. Their advantage is they’ve run their business in a way that allowed them to grow and dominate. That’s entirely fair. That’s the way it’s supposed to be in America.
Amazon’s advantage over local businesses is that they’ve found a loophole in the law which allows them to skirt tax laws and local businesses have no access to the loophole.
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