It’s official: Texas governor Perry just vetoed the ridiculous etax (which 99% of the time results in Amazon and other online merchants firing the affiliates in the state, meaning that the state doesn’t grab MORE income, but loses income as their own citizens lose a source of income)…but California legislators approved it. Now it goes to the senate in California – but there’s still hope, governor Jerry Brown could veto it still…
And I, for one, won’t hold my breath for that. Snow has a better chance in a volcanic eruption than this bill has of not getting passed in Cali-all-for-taxes-ornia. Why does it matter?
Well, it’s something to think about for my Cali readers. It takes some time for Amazon to counter-sue and go through all the legal proceedings – all the while the writing’s on the wall.
If I lived in California, I’d immediately look into some way of getting my business on solid ground. Meaning:
Solutions for Affiliates Under the Etax
1) Use web 2.0 sites like Squidoo to make affiliate sales…
2) Incorporate in Wyoming, Nevada or Delaware (or Oregon or some state where they don’t collect state sales tax, there’s only 5 to choose from, Wyoming being the reigning champ for incorporating in). This requires some cost, but depending on your business success online – it might be worth looking into.
3) Using affiliates like Sears or Wal-Mart, Barnes & Noble or the like – those who collect state sales tax on online purchases already, usually those with a physical presence in the state in the form of brick and mortar stores. I don’t affiliate with them since they’re all behind this etax, and also because their terms all SUCK ROTTEN EGGS.
4) Find another source of income – like AdSense, Chitika or a CPA program…or selling to your own list.
5) Focus on digital downloads – these are exempt from legislators’ attempts to tax everything. Digital downloads are entirely exempt from taxes (with maybe a few exceptions I don’t know about, but I’m pretty sure they are protected under Federal law at this point).
It also matters to me because I want to move back there, and this leaves me in a lurch of sorts (to add to my present lurches, bwahahaha) – my plan is simply to go with a Wyoming-based corporation with a virtual office. The thing is I don’t know how much that costs, so right now it’s all theory.
Here’s the original story:
Texas governor vetoes the etax bill (thus the affiliates in the Lonestar state are still safe, thankfully).
California doing what Cali does: tax people and businesses to death (while thinking this will answer a deficit which is ludicrous – it’s just going to drive more and more businesses away, including ripping the income out of the hands of its own citizens that do affiliate marketing in the state: epic fail, Cali, epic fail).
Here’s where I’m coming from: California and other states currently stink at balancing their state budget. It’s not an income problem – it’s a spending problem. They aren’t “losing” money from Amazon et al not being taxed – they never had that money. So any argument that this is a source of lost revenue totally ignores all the pork spending going on…
And yeah. This isn’t a political blog, so I’ll leave it at that – I just want to warn you guys in Cali that you’ll need to think about how this affects your business in the near future (i.e. be ready to get the email from Amazon, Commission Junction, Hayneedle and whoever you affiliate with that you are no longer an affiliate because of the decision of the state legislators…stay tuned, since it could theoretically get vetoed…just don’t hold your breath).
Alright. Back to the trenches for me. If you’re wondering how my rankings are going for the site that just tanked, don’t worry – it’s just one site. I make money with others – but that one’s gone for now, no improvement – nothing good to report other than I’ve learned a bit about making better choices. I think.
Stripes are hard to change, you know. ;)
Thanks for reading. Hopefully I can get back on and have some good news to report on making money online, etax or no.
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