Amazon Dropping Affiliates Over Taxes

By Christopher Nickson
July 01, 2009

Amazon has severed ties with affiliates in Hawaii, Rhode Island, and North Carolina over the thorny issue of collecting sales tax from online sales.

Internet sales giant Amazon has long made use of affiliates round the country, who make money whenever someone clicks on a link from their site to make a purchase at Amazon. 

However, that’s changing in several areas, and in the last week Amazon has severed links with affiliates in North Carolina, Rhode Island, and Hawaii after those states passed legislation that approves collecting sales tax on online transactions. 

But the story really began in New York, when a judge ruled that affiliates were essentially the same as having a physical presence in the state, and that the state could collect taxes. Amazon is fighting that ruling in court, although it is collecting the tax. 

For the other states, though, Amazon has decided ...

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