California just passed a law saying companies like Amazon.com and Overstock.com have to collect and pay sales taxes to the state for items sold online to CA residents. Part of the law defines what sort of companies must do this, and it has something to do with whether an out-of-state online retailer with any kind of “nexus” in the state – a physical or corporate presence, not just a brick-and-mortar retail outlet – is liable.
Read more: http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2011/06/30/BUI31K4P1U.DTL#ixzz1Qp4myMbk
Such businesses within the state must already pay the tax. Amazon, with their headquarters in Washington and warehouses in Nevada, think they shouldn’t have to. The law now says they must. To avoid it, they’ve thrown their California “Associates” who make affiliate fees for referring customers, under the bus. They would constitute the “nexus” presumably. Amazon A9 and A2Z Development are in the state, but they could move those, perhaps.
I think this is supremely douchy of them.
The California budget that passed guarantees that “…poor people will receive less medical care and welfare, disabled people will see fewer services, state parks will close and public university students will pay more in California under the budget that takes effect Friday.” Amazon benefits from the market, and simply would have to do what California-based retailers routinely do: charge their customers tax, and send that collected tax to the state.
They can argue that it’s unconstitutional, but they can’t argue that it’s wrong. The lack of such tax gives them a competitive advantage against home-grown businesses on the total price of goods sold. So it hurts California business that they don’t have the same obligations. I know there are lots of people who think corporations shouldn’t have to participate in the communities that they earn their billions from, but I disagree.
I buy a couple hundred bucks in goods from Amazon per year. But July 15th I was planning on setting up an Amazon EC2 and S3 server and experiment with Cloudfront. That’s a minimum of $1k per year I was going to spend with Amazon. But I’m not going to do that, now. I’ve decided to boycott them. Maybe no one else will join me, but I don’t really care. Just my little drop removed from their billion-dollar bucket in defense of California, California affiliates, and California online competitors.
I’m using the hashtag #AmazonBoycott. Join me if you like.