Findings on Affiliate Status and the Amazon Tax
Excellent meeting this week with Mark Klein from Hodgson Russ as well as some New York affiliates, 4Checks, Growthspurt Media, and Andy Rodriguez Consulting. Thanks to all who came.
I posted a full version, with discussion, of our findings at Abestweb.
Here’s my text from that thread:
To sum up briefly, with much more detail to follow:
1.) The June 30th TSB is the “law of the land” at the moment: NY Affiliates engaging in “safe practices: (including: email campaigns, PPC, et al NOT directly selling merchants, but rather their own sites)” are A-OK, and as such, allow merchants to SUCCESSFULLY REBUT the presumption of nexus providing the merchant takes the steps outlined in that memo, including getting the signed “promise” from affiliates, and terminating those that don’t sign it, or in good faith, follow it.
2.) We will be reaching out to Mark again to compose a companion piece for merchants, outlining their responsibilities should they decide to work with NY affiliates (which, as above, is above board.) We need to work with Hodgson Russ on the price for their time to do so.
3.) Second tier commissions are also OK, supposing that any NY affiliates in any NY Affiliates second tier also adhere to the package we are putting forth (moreso, the June 30th TSB)
4.) At greatest risk, per this reading of the law, are loyalty sites that employ (via commission, cash back, etc) NY residents to encourage other NY residents to shop through their sites. (i.e. A NY Church asking NY parishoners to buy through it’s affiliate links because of the commission that will be gained, etc)
5.) DTM PPC is not rebuttable… PPC to an affiliate site without mentioning the name of the merchant: rebuttable. Ditto for newsletters, email campaigns, etc.
6.) Incorporating in another state, or claiming dual residency, etc, is NOT rebuttable. Merchants pushing that as a solution are doing so at their own peril. Residency, as far as defining that in the case of affiliates, means that you have a place to hang a shingle here, or sleep here, or own any property here. Period. In other words, clever means of disguising your residency is a bad practice.
In the end, this is still an awful piece of legislation, that at it’s core, affects not for profits more than it affects traditional affiliates. Merchants dumping traditional affiliates failed to fully understand the spirit of the law (granted, that spirit was far better spelled out on June 30th… about 45 days too late).
Next steps for your tax fighting dollars is building that companion piece to be sent to merchants that properly defines the law and the TSB’s, as well as organizing an effort to have matching legislation to the June 24th Senate repeal drafted AND sponsored in the NY Assembly.
So I would hope the Affiliate Voice (who was directly involved), The Performance Marketing Association, and ALL interested parties would assist in getting this word out.
We’re developing a package to be hand delivered to every merchant we can find at Affiliate Summit.
Tags: affiliate summit, amazon tax, new york state internet and pay for performance tax
A quick glance over to my sidebar there and you’ll find that I’ve incorporated 
messaging, which we already had available to us in may forms. Since then, it seems to have calmed down.