Thanks a Lot, Jerry Brown: Amazon Cancels California Contracts

The California budget passed by the legislature and favored by Gov. Jerry is already changing the Golden State's troubled economy. For the worse, but still, changing it.

Just arrived in my inbox: 

Hello,

For well over a decade, the Amazon Associates Program has worked with thousands of California residents. Unfortunately, a potential new law that may be signed by Governor Brown compels us to terminate this program for California-based participants. It specifically imposes the collection of taxes from consumers on sales by online retailers - including but not limited to those referred by California-based marketing affiliates like you - even if those retailers have no physical presence in the state.

We oppose this bill because it is unconstitutional and counterproductive. It is supported by big-box retailers, most of which are based outside California, that seek to harm the affiliate advertising programs of their competitors. Similar legislation in other states has led to job and income losses, and little, if any, new tax revenue. We deeply regret that we must take this action.

As a result, we will terminate contracts with all California residents that are participants in the Amazon Associates Program as of the date (if any) that the California law becomes effective. We will send a follow-up notice to you confirming the termination date if the California law is enacted. In the event that the California law does not become effective before September 30, 2011, we withdraw this notice. As of the termination date, California residents will no longer receive advertising fees for sales referred to Amazon.comEndless.comMYHABIT.COM or SmallParts.com. Please be assured that all qualifying advertising fees earned on or before the termination date will be processed and paid in full in accordance with the regular payment schedule.

You are receiving this email because our records indicate that you are a resident of California. If you are not currently a resident of California, or if you are relocating to another state in the near future, you can manage the details of your Associates account here. And if you relocate to another state in the near future please contact us for reinstatement into the Amazon Associates Program.

To avoid confusion, we would like to clarify that this development will only impact our ability to offer the Associates Program to California residents and will not affect their ability to purchase from Amazon.comEndless.comMYHABIT.COM or SmallParts.com.

We have enjoyed working with you and other California-based participants in the Amazon Associates Program and, if this situation is rectified, would very much welcome the opportunity to re-open our Associates Program to California residents. We are also working on alternative ways to help California residents monetize their websites and we will be sure to contact you when these become available.

Regards,

The Amazon Associates Team

Editor's Note: We invite comments and request that they be civil and on-topic. We do not moderate or assume any responsibility for comments, which are owned by the readers who post them. Comments do not represent the views of Reason.com or Reason Foundation. We reserve the right to delete any comment for any reason at any time. Report abuses.

  • The Gobbler||

    Sweet!

  • President||

    You're the Duke. You're a number one!!!!!

  • Resto Druid FTW||

    Good movie.

  • ||

    Clearly the answer is for the hoarders at Amazon be forced to do business in California. Lets get the leftist mob right on this.

  • Hormonal Lisa||

    They're busy in Madison, WI at the moment.

  • NLRB||

    Set phasers to "litigate"!

  • AlmightyJB||

  • ||

    It is not over until they win.

  • Chupacabra||

    It's all in the Commerce Clause.

  • ||

    The California legislature is gripped by the paralysing fear that, despite their best efforts, somebody, somewhere is making a profit.

  • ||

    Yeah the legislature hates profit. Classic numbnutedness. Do you ever use your brain for logic?

  • Pham Nuwen||

    Sarcasm, douche. Settle down.

  • cynical||

    Profit is money that they don't get to spend, so, yeah, they hate it.

  • B D||

    Amazon is the biggest bunch of tax cheats! I thought you libertarians were all about having only a sales tax?! Well, Amazon's entire business model is dependent of cheating that sales tax! It's a tax loophole for the upper middle class!

  • ||

    Yeah because no one who is not upper middle class ever ordered from Amazon. Mail order has never been taxed nor should it. There should be at least one area of commerce the state keeps their greedy paws off.

  • ||

    Amazon charged me sales tax when i ordered my copy of Matt's and Nick's new book.

  • mad libertarian guy||

    Me too, and every other purchase I make, but that's because Amazon has a major distribution warehouse in KY, making it an in-state purchase.

  • ||

    Donate more money to Reason, they sent me a copy for free. ;p

    Although I didn't know they were sending it and had already pre-ordered for the Kindle... guess I'll just have to find a liberaltard friend to give it to.

  • ||

    Actually it is usually taxed, it's just up to the buyer to report mail order purchases to their state's tax agency. Which they never do of course.

  • Fred G. Sanford||

    And "B D" stands for Big Dummy, big dummy.

    *raucous laugh track)

  • Warty||

    IKEA's entire business structure is designed to avoid taxes. We heart IKEA.

  • ||

    I thought you libertarians were all about having only a sales tax?!

    ?????

    Just which 'libertarians' are you referring to? The ones under your bed that will come out at night to eat you?

  • Old Salt||

    When my semi-libertarian girlfriend gets drunk every 28 days and passes out on the living room floor, she often crawls into the bedroom and then underneath our bed because Jagermeister makes her think she's a cat!

    So in a sense, I do sometimes lie awake at night and wonder if the libertarian under my bed will get randy and decide to "eat" me!

    Now my cousin, he has the top bunk in his prison cell and he tells me that he's worried that his cellmate (who was arrested for threatening to blow up a federal courthouse for "freedom") might be a cannibal!

    Maybe that's the kind of "libertarian" your playmate is worried about?

  • ||

    Loophole = valid use of law which the speaker doesn't like.

    Your tears are so yummy and sweet.

  • ##||

    Heaven forbid that you should actually know what you're talking about before hurling insults. Amazon, just like every other online and paper mail order catalog service, is not required to collect sales tax in a state where it doesn't have a sales presence. That does NOT absolve the purchaser from paying sales tax, it just makes it their responsibility rather than Amazon's. I wasn't aware that only the upper middle class buy from Amazon or is it that only the poor submit sales tax from their purchases? Either way, that makes them the tax cheats, not Amazon.

  • Troll Meter 2000||

    6/10 - Moderate success.

  • ||

    Refusing to do something that will cause you to incur a huge administrative burden and tax liability isn't cheating. It's actually playing by the rules.

  • Mainer||

    somewhat off topic but this has the flavor of the assault weapons ban. I suspect alot of folks here know they tried to define an assault weapon by features: IIRC forward grip, bayonet lug, flash suppressor...

    When the manufacturers then produced guns that avoided the type and number of these features, the anti-gunners cried foul, that they were using loopholes in the law.

    So...they make rules to get a certain result, people play by those very rules to a different result, and they get all butt hurt. But it's YOUR RULES.

  • ||

    You have to understand that "the rules" are, basically, the same as for Calvinball.

  • Old Mexican||

    Re: B D,

    Amazon is the biggest bunch of proud tax cheats!


    There, so you don't defame us. We're a proud bunch.

    I thought you libertarians were all about having only a sales tax?!


    You thought wrongly.

    Next question?

  • Skid Marx||

    Welcome back, OM. We missed you much.

  • Quetzalcoatl||

    There, so you don't defame us. We're a proud bunch.

    Us? You are an Amazon, OM? I always thought that you were male...

  • Appalachian Australian||

    Like cancer, we often debate which type of tax is the least bad. I'd rather have prostate cancer, which is quite treatable and has low mortality, than fingernail cancer, with a 60% mortality rate.

    But given a choice, I'd avoid having any cancer at all.

  • Trident||

    The libertarians telling you they want a sales tax are way too eager to befriend you dumb liberals.

    Either that or they are stupid enough to believe liberals would fall for it as a compromise of some sort. They completely underestimate liberals' goal in life to get as much money out of other people's pockets as possible.

  • Pham Nuwen||

    I'm all for a sales tax? Fuck you all! I'm keeping the decoder ring.

  • cynical||

    "I thought you libertarians were all about having only a sales tax?!"

    Why that's one of the fundamental planks of libertar... wait, what? Do you think Grover Norquist and Neil Boortz are typical libertarians? Do you actually ever read this site?

  • Warty||

  • Zuo||

    FUCK I JUST SPILLED LIQUA ALL ON MY LAPTOP HANG IN THERE LENOVO

  • Zuo||

    Oh, and COMMERCE CLAUSE NGGAS... JUST WAIT FOR IT :(

  • ||

    It is supported by big-box retailers, most of which are based outside California, that seek to harm the affiliate advertising programs of their competitors.

    I'm sure the Kochs are behind this.

  • Achtung Coma Baby||

    That term "big-box retailers" is near exclusively said by liberals. It would seem to me to have some negative connotation, but I can't determine it if there is one.

    Anybody wanna help me out, here?

  • I think it means||

    Wal-Mart

  • Capt. Obvious||

    It's a store that sells boxes that are larger than normal to the general public and not to other businesses. Doesn't seem negative to me.

  • Achtung Coma Baby||

    So, the big boxes that these stores sell are what?...bad for the environment?

  • Auntie Semitic||

    Hey! I'm gonna need some of those big boxes to live in once the taxman is done with me!

  • Capt. Obvious||

    That must be it. I think I understand why they're so upset now. (shakes fist) Damn you Big Box Retailers... Damn you to Hell.

  • Old Salt||

    Am I a complete fucking perv for instinctively thinking that the term "Big Box Retailers" is something that involves plus sized escort services?

  • Skid Marx||

    "box"

  • Tim Cavanaugh||

    Yeah, but maybe the Kochs are using phrases said exclusively by liberals just to throw everybody off the scent. They're full of tricks, those Kochs. Didn't you see the Reason interview with Ed Koch?

  • Almanian||

    The Kochtopus knows no limits. But you know this, don't you Tim?

  • Ska||

    It's covered on the first day of minion orientation.

  • Koch Minion #7895-2||

    Wasn't that a huge pain? They really needed to update their PowerPoint slides. And don't get me started on the bagel selection.

  • STEVE SMITH||

    KM #7895-S! WHAT FIRST RULE KOCH CLUB?

    STEVE SMITH NEED RAPE KM #7895-S AGAIN TO HELP YOU REMEMBER FIRST RULE KOCH CLUB??!!

  • SIV||

    Bastard Koch brother cornered the market on Billy the Kid photographs !

    Nobody owns one but him. Isn't that some kind of monopoly?

  • Zeb||

    I don't know who uses the term the most, but it seems like a reasonable name for a certain set of retailers who insist on building a new, big, box-shaped building for every store they open. It appears to be a viable business model.

    My favorites are the people who think that Walmart is icky and evil, but Target is A-OK.

  • Meiczyslaw||

    Yeah. Walmart managed to break the superstore ban in San Diego, and now every Target in town is remodeling.

  • Appalachian Australian||

    San Diego ended up forced to spend millions of dollars for a special election. It's probably the only government spending I can actually support.

    What was really insidious about the bill was that it amounted to a bill of attainder at Wal-Mart that was expressly promoted by Wal-Mart's competitors for the purpose of restricting the number of places people can buy fresh groceries.

  • Achtung Coma Baby||

    Wait, so Wikipedia lists Barnes & Noble as a big-box store, or as I like to call it, a "supercenter". In the rural area I'm from, Barnes & Noble isn't thought of in the same way Wal-Mart is. Barnes & Noble is just a "book store".

  • Zuo||

    "Big Box" refers to stores that operate based on a model of spamming massive quantities of merchandise, using economies of scale to under cut local/mainstreet competition. Some specialize in a certain field, like electronics or books, others are generalists. Consumers love em, for good region. MomNPop stores, long used to gauging the shit out of their local captive markets, naturally, hate them. Liberals hate consumers and "the corporations", hence the lip-service to "small business". (Even though their policies harm small retailers far more than they do juggernaut corporations.)

  • Ted S.||

    Sounds like the way Big Government uses its purchasing power to pay artificially low rates for medical procedures.

    When the private sector does this, it's evil. When the government sector does the same thing, it suddenly, magically becomes virtuous.

  • ||

    They are stores that are big and shaped like boxes.

    Unless you were raised by wolves you should know that being big and shaped like a box is bad.

  • Spiny Norman||

    And Amazon's already pulled their associates program from several states for just this reason, so it's not like Sacramento didn't see it coming.

  • ||

    Oh, they saw it coming. They want to shut down the Amazon affiliate program. That's the whole point. Like previous poster stated, they cannot tolerate the thought that someone somewhere in California is making money.

  • ||

    Is there free super saver shipping on that strawman?

  • ||

    Yay, good for Amazon hanging tough on this issue. I support them. By the way I'm a California resident. The reason Jerry Brown won the election is because the GOP ran the hapless self-financed millionaire Meg Whitman. No need to rehash her inept and disastrous campaign, except to say that, unlike Arnold, at least Meg didn't have sex with her Mexican maid.

  • Colin||

    No need to rehash her inept and disastrous campaign, except to say that, unlike Arnold, at least Meg didn't have sex with her Mexican maid.

    Do you know this for certain?

  • ||

    Does he know that she didn't have sex with the Mexican maid for certain, or does he know for certain that having sex with the Mexican maid wouldn't have helped her campaign?

  • Mainer||

    I'm guessing the Mexican maid would be topping Whitman. (glazed look comes over eyes, staring into the middle distance, unconsciously licks lips)

  • squishua||

    Ewwww! Have you ever seen Meg Whitman??? I wouldn't fuck her with Hillary Clinton's dick!

  • Trident||

    Arnold cheated on a Kennedy.
    He's a hero even when he cheats.

  • ||

    "Hanging tough" on this issue is making Amazon boatloads of money because of the sales tax loophole. It's not exactly disinterested advocacy on their part.

  • Colin||

    Just got my email, too. Hope it doesn't affect selling things there, too, or I'm pretty well fucked.

    Hopefully, Brown will continue vetoing this piece of shit.

    I imagine some legislators are getting an earful right now. I'd contact mine if they weren't all Marxists.

  • Appalachian Australian||

    As an out of state resident, you'll be safe to sell things to us godless Californians.

    It's great to see California putting even more people out of work and scaring business away.

  • Slab Bulkhead||

    I guess they'll have to put an end to the practice of self-taxing me.

  • Jerry Brown||

    Bitch! You betta gimme my money!

  • Left Monocle||

    This zoundz like ze job for ze National Labor Relationz Board!

    What do you mean they have no Jurizdictionz?

  • Bill Burns||

    Day by day, month by month California becomes a more and more difficult place to live and run a business.

    Politicians seem to live in the fantasy of the past – that California is the destination state of most Americans. That becomes less and less true all the time. The natural benefits of our state can’t overcome the man made difficulties.

    Another rainy winter like the last and it will be time to leave.

    Bill

  • Snowbee||

    Well, I think that we can all take one lesson away from this situation:

    Amazon hate The Children.

  • Snowbee||

    It also hates the children, for those of you non-cavemen out there.

  • STEVE SMITH||

    STEVE SMITH LIKE CHILDREN! SEND CHILDREN STEVE SMITH! STEVE SMITH SHOW CHILDREN HOW RAPE RAPE WORK!

  • Snowbee||

    Note: Do not send children to Steve Smith's Daycare Dungeon.

  • Almanian||

    But who could have predicted this?! Who? This was COMPLETELY unpredictable!

    Man, I can't wait till Cali finally succumbs to the Pacific and slips gently beneath the waves for the last time.

    Also - fuck California.

  • Mainer||

    I know, it's like those businessmen are in a dynamic environment, changing their behavior in response to incentives and shit.

  • Greer||

    Can we just get it over with and pass the anti-dog-eat-dog rule?

  • Mainer||

    The sooner I find myself weeping by a broken down train in the middle of the desert, the sooner this will all be over.

  • ||

    This has been going on since New York started it a few years ago. Basically, these states are attempting to assert nexus over affiliates, which is absurd and possibly unconstitutional. However, with all of the revenue shortfalls and the desire of brick-and-mortar retailers to sock it to the pure-play on-line retailers, it's very much in vogue.

  • Yueltime||

    From what I've been able to tell, Amazon has continued its relationship with the New York affiliates. Why hasn't it cut and run? Maybe it has to do with the fact that their lawsuit is still in the appeals process.

  • Old Mexican||

    Good thing I am no longer in California. I heart Texas.

  • Scooby||

    Texas is going to get the same treatment due to a similar law that is coming out of the special session.

  • T||

    Yup. We about to get screwed.

  • ||

    But it's for the citizens!

  • Scooby||

    Not "we"... I'm not an Amazon affiliate. They're the only ones it directly hurts.

  • Snowbee||

    Wait, whaaaaat? God dammit, I moved to Texas to get away from this shit! Guess it's time to invent a new state to move to.

  • cmoney||

    It's the citizens, though. A bunch of egg-headed Californians flee California to escape the burdensome living expenses, but they don't let go of their "progressive" ideals! They want all the nanny state benefits still, and to stand up for the underclass, and all that bs. So they vote in dickweeds. It happened in Oregon, Washington, and it will happen in Arizona, Texas, and Nevada too.

    Same crap goes on in the north east. It won't be long before Mass and NY residents completely poison NH.

  • Curious||

    Can Amazon Canada set up an affiliate program US residents can use?

  • ||

    That term "big-box retailers" is near exclusively said by liberals. It would seem to me to have some negative connotation, but I can't determine it if there is one.

    Progressives detest efficiency.

  • ||

    Also - fuck California.

    I wouldn't fuck California with Janet Napolitano's dick.

  • Max||

    So trying to get businesses to pay taxes like everyone else is wrong. gotcha.

    fucking morons.

  • Appalachian Australian||

    Businesses don't pay taxes; people do. In the case of sales/use tax, it's pretty obvious how much you pay or are supposed to pay.

  • The Big Brown One||

    Trying to get businesses to collect taxes they aren't required to collect is not only wrong, it's stupid. But just because something's wrong and stupid doesn't mean The Big Brown One (Jerry B, that's me!) won't try to do it.

    Perhaps _you_ like fucking morons; I'll pass.

  • cls||

    Let us be clear. Amazon is NOT standing up to the man, as some uninformed people think. Amazon says that all sales taxes on the products sold have to be paid. They tell the poor vendors that they must pay those sales taxes, even if Amazon refuses to collect the taxes. Remember the vendor is really selling to Amazon, not to the end customer. Amazon is the one who gets paid by the customer, not the vendor.

    Nor does the vendor get the whole amount of the sale price. Amazon buys the books from the vendor at a wholesale price below the list price of what the vendor sells it for. Amazon then pays the vendor to ship on their behalf. The customer is buying from Amazon, not the vendor, and Amazon buys from the vendor and pushes the sales taxes onto the vendor. But the end seller, which is Amazon, is the one who is really liable for that. Pushing it on to the small vendors, forcing them to pay, while pretending they are opposing the system, is dishonest.

  • Appalachian Australian||

    What on earth are you talking about?

    Amazon affiliate programmes just involve special links from one's website that are fulfilled by Amazon. The affiliate doesn't really do anything except get paid.

    You may be thinking of a different option where Amazon takes orders but someone else actually ships the product. Amazon takes the payment and the shipper doesn't need to collect nor pay sales tax.

    No vendor would be forced to participate in your harebrained scheme, and vendors/shippers collecting sales/use tax isn't even that unusual anyway.

  • ||

    Amazon does routinely fuck their Marketplace sellers. Amazon doesn't pay you when they get paid, they pay you 60 days later -- and they definitely like to play games with that escrow account if it gets big enough. "We're investigating one of your transactions and have frozen your $7,000 escrow account indefinitely. We apologize for the inconvenience."

  • ||

    This is much ado about a law that isn't even going to get passed. But nice work Amazon for working you up into such a lather.

  • Adamson||

    Gov. Brown already signed it into law. It was a rider on the budget bill.

  • Appalachian Australian||

    Every California resident is required to pay use tax on any applicable purchase where the seller does not collect sales tax. If you take a vacation to Romania and buy a snow globe, you need to pay use tax.

    California's losses from Amazon not collecting sales tax are $0 and the FTB should be focused on locking up the 99% of their citizens who have violated the use tax laws. I believe the CCPOA would help get behind this.

  • GSL||

    In a perfect world, of course, this would mean that John Chiang would be voiding the budget for being out of balance. No way they're collecting $200 million in tax revenues if Amazon bails out.

    Then again, in a perfect world, someone would've remembered that new taxes can't be passed without a two-thirds majority in California, and no one would be taking this seriously.

  • ||

    It is supported by big-box retailers, most of which are based outside California, that seek to harm the affiliate advertising programs of their competitors.

    Propagandist nonsense. They're supporting it because they don't like having to charge sales tax while Amazon doesn't have to.

    Of course, Amazon claims they can't possibly figure out sales tax with all the jurisdictions they ship to...which is odd because walmart.com and barnesandnoble.com have no difficulty doing it.

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