While I was away at Affiliate Summit, the State of Indiana was making a pretty big deal that could have an impact on my business. Governor Mitch Daniels announced last week that Amazon and Indiana have reached an agreement whereby Amazon will begin collecting sales tax for purchases in Indiana starting in 2014. Although the issue does not directly impact affiliate marketers in the state, I see it as fairly good news. Unfortunately, a new affiliate tax bill has also now been written.
Why was the Amazon agreement good for affiliates? First of all, much of the argument in favor of taxing all online purchases in Indiana was based on Amazon having fulfillment centers here. The issue of whether true out-of-state merchants whose only contact with Indiana are its affiliates became muddied into the discussion. The average voter/consumer did not understand where the physical location argument stopped and the alleged “nexus” argument began. (See my full post Internet Tax Looming in Indiana?) [Read more…]