This post contains affiliate links.
Illinois recently passed a law requiring affiliates to collect sales tax from purchases made to consumers in the same state. Amazon affiliates of course have now way to implement these required sales taxes and are therefore dependent on Amazon to collect the taxes on the sales on their behalf to meet compliance.
Instead Amazon.com sent notice that they no longer affiliates in Illinois will no longer be able to sell products through Amazon and will not be eligible as Amazon affiliates, they would get 0 commission for their sales. Amazon does not tax items sold in Illinois and instead of writing a system in place to allow for adding taxes to items sold through affiliates who ran businesses in the same state, they instead opted to just separate from their affiliates.
The odd thing is Amazon.com already complies with some sales tax laws and charges sales tax for shipping certain products from certain merchants to certain states. According to the Amazon.com Sales Help page, this is the list of merchants and states where taxes are applied to an order:
The following is a partial list of merchants selling items at Amazon.com which may be included in your order, and the states in which they charge sales tax.
- Amazon.com LLC: KS, KY, ND, NY and WA
- Amazon Digital Services, Inc.: KY, ND, NY and WA (Kindle content, MP3s, and digital videos are only taxable in KY and WA)
- Electronic Arts, Inc.: All States except for AK, ID, ME, MS, ND, NM, SD, VT, WV, and WY*
- Magazine Express, Inc.: AL and WA
- New York Times, Inc.: AL, DC, KY, and NY*
- Synapse Services, Inc.: WA only
- Target.com: All states other than VT
- Hachette Digital, Inc.: AL, AZ, CO, CT, DC, HI, ID, IN, KY, LA, ME, MS, NC, NE, NJ, NM, SD, TN, TX, UT, VT, WA, WI and WY*
- Harper Collins Publishers, LLC: All States*
- Penguin Group (USA) Inc: All States*
- Simon & Schuster Digital Sales, Inc.: All states other than AK, DE, MT, NH, and OR*
- Macmillan: AZ, CO, CT, DC, HI, IN, KY, ME, MS, NC, NE, NJ, NM, SD, TN, TX, UT, VT, WA, WI and WY*
- Dow Jones & Company, Inc: AZ, CT, DC, HI, ID, KY, NC, SD, and TX*
- Zondervan Corporation LLC: CA, CO, FL, GA, IA, IL, IN, LA, MA, MD, MI, MO, NC, NV, OH, PA, SC, TX and WA*
So I guess wouldn’t it have been better if Amazon just update their system to be able to apply taxes to affiliates who had sites registered in that state? This way they could keep getting the sales, and just automatically collect and submit the taxes on behalf of the affiliate? Or, at the very least collect the taxes and distribute them to the affiliate to submit to the government?
Not sure what the easiest way to accomplish this was, but this is now spreading and there are several states that left bloggers scrambling to find other ways to make affiliate income since they can no longer be Amazon associates.
Here’s to hoping Arizona doesn’t pass an absurdly stupid law that taxes an Affiliates sales, after all the state is already collecting taxes on our Affiliate income as an income tax, it would be a double tax to collect from us both ways.
-Justin Germino
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