A worrying news has come through today: following New Mexico the state of Virginia — which is facing a $3.6 billion budget deficit this year [more here] — is now considering an affiliate tax as well. I’ve read about it in Scott Jangro’s AffBook blog [link to post], Googled the topic and found this post on LinkShare’s blog about it too. Both are referring to an earlier alert by the Performance Marketing Alliance which refers to PMA’s “lobbying contacts in Virginia” who have notified the Alliance “that a state senator will be proposing an advertising tax bill” soon [original post here].
A few days earlier, Virginia’s Governor, Bob McDonnell (also on Twitter: @BobMcDonnell) has “ruled out tax increases as a solution for Virginia’s $4 billion budget shortfall, promising to target them for vetoes” [source]. We certainly hope to see this particular bill vetoed, Mr. McDonnell. Your fellow-Republican Governors of California and Hawaii have done so in their states on 07/01/2009, thereby saving thousands of small businesses [more here].
The specifics of the above-reported bill are yet unknown, but it is always best to be pro-active than reactive. Be prepared to contact your legislators [find yours here] in the event of the bill’s proposal. I will follow the topic, and post more about it in the comments area below as soon as there are more news to report.
3 thoughts on “Affiliate Tax Prospect Now Clouds Virginia Sky”
The above-referred-to bill is VA Senate Bill No. 660, and it is referring to exactly the same notions we’ve come across in the past (in other states): sales “by an independent contractor” – who works “for a commission or other consideration” – to residents of the state, threshold of $10,000 a year, etc. Read more about it (including the text of the bill itself) in today’s post by Scott Jangro: Virginia Affiliate Tax Looks Real.
Don`t they realise they are just going to put some people out of work, then they`ll have to pay unemployment benefits out? So short-sighted!
Good points, Geoff, and many legislators in fact do not realize what the consequences may be (due to a lack of understanding of the industry).