New York Affiliate-Based Sales Tax Law - IMPORTANT!

[Larwee]

TigerDirect has stated they will continue to work with affiliates from all states. This would include New York.

I have received an email from TigerDirect in which they tell what they have done that makes them feel as if they are in compliance with the new law.

As you may be aware, the State of New York recently enacted legislation amending New York Tax Law in an attempt to force publishers to collect sales tax on all sales referred by advertisers with business registered in the State of New York.

At this time we are happy to notify you that we will continue to work with all affiliates from all states and that we have taken the appropriate measures to ensure that we are in compliance of the new law.

In accordance with the terms of our Affiliate Agreement ("Agreement"), we may modify any of the terms and conditions contained in the agreement, at any time and at our sole discretion, by posting a change notice or a new agreement on our site and, by continuing to participate hereunder, affiliate agrees to be bound by such revised terms.

TigerDirect now amends Section 2 of the agreement as more particularly set forth below:

Section 2. "Links on Your Site" of the agreement is hereby amended by adding "Neither you, nor any person or entity acting on your behalf, shall engage in any solicitation activity on behalf of TigerDirect other than by the maintenance of one or more links from your site to the TigerDirect site as authorized by this Agreement. Such prohibited additional solicitation activities include, but are not limited to, the distribution of flyers, coupons, and other printed promotional materials; circulation of printed and electronic newsletters; initiation of telephone calls; and sending emails; any of which mention TigerDirect or refer to the presence of a TigerDirect link on your site."

Please note that, effective immediately, all previous versions of the Agreement are terminated, null, of no effect and are replaced by this new version dated June 5, 2008

We appreciate your understanding in this matter and look forward to continue our mutual success with you.

[Linda Buquet]

Thanks SO much for sharing that Larry. It's good affiliates know who's keeping affiliates and what TOS are being amended. Although as we said on the call there's a good chance changing the TOS will not be enough to avoid the tax.

So the moves lots of merchant are making could possibly not even offer them the protection they think it will. We hope it does, but are afraid it won't.

[James Spinosa]

I have a feeling that TD will still end up having to pay the tax (until Amazon eventually wins ), good to see they aren't pulling an Overstock though.

[Linda Buquet]

THe link to the podcast of the New York Tax issue panel discussion we did yesterday is up at
WebmasterRadio.

Merchants REALLY need to listen because we feel the actions many merchants are taking (like changing their TOS to prohibit other types of solicitation) will not protect them from being liable for the tax.

I am nursing a very ill cat that's been in and out of hospital, ER, etc and needs constant care and needs to go back to hosp tonight. SO I don't have time to type out what I'm referring to. You just REALLY need to listen!

[Linda Buquet]

I promised on the New York Tax issue panel discussion/podcast we had today on WebmasterRadio, that I would blog and link to some of the resources and breaking news stories I mentioned on the show. However, I ended up having to make an emergency trip to the animal hospital. Still having some medical issues over here with my cat, so my blogging is delayed.

One of the things I mentioned on today's radio show was that Peter Bordes, CEO of MediaTrust told me about an interview that was just done with Patrick Byrne CEO of Overstock regarding the NY issue. The interview was just published, so I wanted to get this info out to everyone and then will blog about some of news and a recap of the radio show, later when I can.

The inverview with Patrick Byrne from Overstock is over at MeetInnovators.com and the part that addresses the New York Tax issue is about half way down. Here is a portion of the interview.

Interview with Patrick Byrne from Overstock

"Patrick: The Supreme Court wisely said that the burden cannot be put on the out-of-state retailer. Therefore, I think New York's law is directly unconstitutional. We're not suing the state for any money. We're suing to enjoin them from ever acting upon this law, and we're trying to get the Court to throw out the law.

We had to drop the affiliates because of the risk of not collecting the affiliate tax and then someday having New York win. We would get dinged for that. So we had to drop the affiliates immediately.

More...

That's only part of the interview so head over to read the rest including more info on what we all can do to help the cause. It's a bit hard to find where the tax part starts. It's over half of the way down.

If you missed the show today it just got uploaded. Here's the podcast. I have another new story later, as well as a recap of today's show, as soon as I can blog again. Right now my cat that just had surgery needs me...

Update: Ended up in the ER with my cat most of the night, big scare and he's still there but doing a little better. May have to go back to hospital in the morning. So I don't know when I'll get time to finish blogging the rest. Just stay tuned and check back.

[Linda Buquet]

Wade Tonkin just he did a podcast interview with Clarke Walton of Walton Web Law about the tax issue. I've not had a chance to even listen to the podcast yet, but wanted to be sure my readers know about it.

Podcast with Clarke Walton of Walton Web Law on New York Affiliate Tax

I'm listening to it right now.

[Linda Buquet]

NEW YORK MERCHANTS - IMPORTANT. Especially for the merchants that kept your NY affiliates and amended your TOS. Changing your TOS is NOT enough to avoid nexus. YOU need to read this!

New York Merchants - Important NEW NY Affiliate Tax Info 7/1

[Linda Buquet]

I've been wanting to share with everyone some of the news that came out of the July 28th meeting affiliates had regarding the New York Sales Tax problem. One of the organizers of the event promised to send me detailed info about what happened and what some of the possible solutions are.

In the meantime I was looking for any other coverage about the meeting and found some good info at Melanie Seery's NY Affiliate Voice blog. If you are an affiliate or merchant affected by the New York Amazon Tax Law head over the read the full post.

The group of affiliates, merchants and affiliate managers that met in Albany for the day, was able to secure Mark Klein, of Hodgson Russ Attorneys to provide guidance about the law.

Tax Solution from NYS Meeting "Mr. Klein moved on to the current law and most importantly the June 30 memo from the New York State Department of Taxation and Finance, NYS tax memoTSB-M-08(3.1s). Within this memo lies the solution for merchants and affiliates. He explained that NYS affiliates can work with out of state merchants as long as the affiliate agrees to what is being called safe practices. This agreement must be in writing, signed by the affiliate and kept on file by the merchant. In short the affiliate must only engage in advertising their sites or specific products but not advertise the merchant direct. The NYS tax department is working on releasing a template for the agreement and I will be sure to link to it so it is readily available."

I'll have more info to pass on just as soon as I get it. If anyone else has updates from the July 28th meeting or any other New York Tax news, please get it to me. Many people follow 5 Star for the latest news on the issue and I'm trying my best to be a good information conduit.

[Linda Buquet]

Not good news!

NY Amazon Tax Repeal UNLIKELY per New York Times

[Linda Buquet]

I had made a separate post about this because it was really important. Just realized I should have also added to this thread in case anyone was following it and missed the other post.

The New York Tax Solution, Complete w/ Documentation