The Affiliate State Tax is Not Our Friend

The power of social media demonstrates how information flows rapidly around a very new and troubling issue. There is a rising tide that the affiliate marketing community needs to pay close attention to. The New York State affiliate program tax has been quietly gaining a head of steam.

The buzz started yesterday when Overstock.com pulled its New York State affiliate marketing program. The Twitter marketing community lit up as the news traveled across the social web. I was Twittering with @affiliateTips Shaun Collins (who first picked up the story) that this was the beginning of a problematic trend. States wanting tax dollars act like herds of animals looking for food - even if it means putting small business owners out of business in these already trying economic times. Bravo Elliot Spitzer and Governor Patterson! Immediately @5StarAffiliate shot us and @techcrunch a Tweet that California is now looking to follow New York. Kiplinger has the coverage of the CA tax warning.

Overstock’s affiliate program manager Ryan Sorensen shared a link to Overstock’s response letter with more details and that he felt other large retailers were soon to follow. Amazon filed a complaint in State Supreme Court in Manhattan objecting to the new law. The problem is that the new tax kicks in on June 1st which means that online retailers can’t hold out for resolution of the Amazon complaint.

All this being said, we cannot sit around and wait to see where this goes. The very large and fragmented affiliate marketing community needs to come together and get involved to address this issue before it exceeds our grasp. We need to stand up as solutions & service providers and act on behalf of, and protect, our community and affiliates. We at MediaTrust have reached out to the IAB to see what actions are suggested. If you would like to work together as a collective on this issue, please contact MediaTrust thru the following email: affiliatepetition@gmail.com

This is an important issue that affects the livelihood of our industry. Lets join together to advance our cause.