Bad news has just come from the state of California — the affiliate nexus tax, which I frequently cover in my blog, seems to be on the threshold of materializing.
No, not into cash — the state treasurer is right on the money when saying that the online sales tax revenue is good in theory, but not being sure certain if the dollars would really materialize [source] — but into a law.
Rebecca Madigan, Executive Director of the Performance Marketing Association, reported:
Governor Brown of California has announced he has secured enough votes to pass his budget, including the Affiliate Nexus Tax and 2 related nexus bills: AB 153, AB 155 and SB 234. The law will go into effect immediately upon signing, and he must sign before July 1st, 2011. [source]
Bad news for California-based affiliates, and thousands of California small businesses.
Merchants, don’t make hasty decisions based on what you may see larger e-tailers like Amazon and Overstock doing in relation to this (in my opinion, there’s more politics behind their decisions than pure economics). In the unfortunate event of the law passing look into collecting the tax. There are multiple tools (e.g. Avalara, or ShareASale’s “US State Revenue” report) than can either help you fully streamline the process, or simplify the monitoring on your end.