And the exodus begins…
Unfortunately, with the threat of the California budget hanging over their heads like Damocles sword, the first merchant has pulled their affiliate program from California.
According to David Lewis of Cashbaq.com, Overstock.com sent a boiler plate rejection letter out to their affiliates via CJ’s internal email this afternoon.
I’m sorry to see the impasse come to this, but Democratic legislators flat out refused to see the light here and as other large and small companies follow suit, we will simply see more money leaving the state.
I would urge affiliates that receive these sorts of removal letters to send them directly to your representatives and ask them point blank why they stood idly by and did nothing to protect your business, your income, and your families from financial devastation.
Click here to find your Assemblyperson and Senator.
**UPDATE**
Here is the full text of the “official” letter from Overstock that affiliates received tonight:
June 30, 2009
Dear Affiliate:
We regret to inform you that the North Carolina, Rhode Island, California and Hawaii state legislatures have or are about to pass unconstitutional tax nexus and collection laws in an attempt to force Internet retailers to collect and remit sales tax on all sales to residents of these states.
These legislative measures purport to establish a state tax nexus on the basis of contracts with local advertising affiliates, even when none exists under U.S. Supreme Court precedent. Overstock.com, Inc. (“Overstock”) has no tax nexus in any state other than Utah.
Due to the passage or eminent passage of these unconstitutional laws, Overstock regretfully must discontinue its relationships with all of its advertising affiliates in these states.
Accordingly, it is with reluctance that Overstock hereby gives notice of termination of your participation in Overstock’s Affiliate Program.
Any money owed to you, based on your advertising services prior to termination, will be paid in the normal course of business.
Overstock regrets that it has been put in this position. In the future should these laws be vetoed, declared unconstitutional, or repealed, we will cheerfully resume our former business relationship.
Respectfully,
Jonathan E. Johnson III
President
Overstock.com, Inc.
AB178 Nexus language added to CA budget bill
And it’s time for round three apparently…
On Monday, June 22nd a group of us will be headed to the California State Capitol yet again to fight what is now known as the “Amazon Tax” or “Internet Advertising Tax”. We’d love to have you in attendance if you can make it. Please contact me for more details if you are available.
If you are unable to make it on such short notice (believe me, they sprung this on us last minute), please give us your support by contacting your Legislator via email, phone and twitter using the contact list I created below.
They prefer to hear from their own constituents of course and honestly, it’s people that live in their own district that seem to make the biggest impact. They don’t like upsetting their own voters. You can locate your representative via zip code here.
Also, please feel free to contact the Governor’s office and twitter him your concerns at @Schwarzenegger.
AB 178 Hearing Update
It was announced this morning that the hearing for AB 178 in California has been postoned until Monday, April 27th at 1:30 pm. It is still in room 126 at the State Capitol.
We urge you to become the proverbial squeaky wheel!! Call your Assemblymember, write them, email them, visit them at their district office or at the Capitol, pester their staff. Explain to them that taxing advertising is a terrible precedent to set!
AB 178 Lobby Day
Today, I had the honor and privilege of representing our advertising industry at the California State Capitol in opposition of Assembly Bill 178 (AB 178) along with nine other amazing people: Alan Gray from NewsBlaze.com, Brook Schaff from Schaaf Consulting, Charlie Graham from ShopItToMe.com, David Lewis from CashBaq.com, Mark Cook from GlobalMountain.com, Ryan Owen from Savings.com, Trisha Lyn Fawver from New Edge Media, Robert Smahl from eBates.com and Lisa Picarille, former editor of Revenue Magazine and current independent consultant. We had eighteen different meetings all over the capitol with various Assemblypersons, Senators, Madam Speaker, staffers and even one surprise meeting with a lobbyist.
Overall, I think the consensus is that the day went well. We spent a majority of each meeting educating the capitol folks on what our industry is, what it is not, how it works and how much this bill will negatively impact our livelihoods and those of their constituents.
I was definitely impressed with the technical savvy of some of the staffers we had meetings with, as well as that of Assemblyman DeVore who excitedly gave us his twitter, @chuckdevore. I was, however, deeply concerned by the complete lack of understanding of even the most basic processes of the industry, especially by some of the folks from Assemblyman Calderon’s office who is Chair of the Assembly Revenue and Tax Committee and is co-sponsoring this bill. If you are part of the industry and you are in Mr. Calderon’s district, I urge and implore you to write, call, email and make appointments with him this next week. It is imperative that he be brought up to speed on how much this bill will affect so very many small businesses across the state.
The ten of us split into two groups to better deal with the space constraints of some of the offices and to avoid feeling rushed between meetings. As it was, we were exceedingly busy! We had appointments nearly every half hour from 9:30 AM until 5 PM with several that were double booked. All in all, we managed to meet with the following people:
- Amy Costa (Senator Dean Florez)
- Phil Horner (Assemblyman Anthony J. Portantino)
- Catalina Hayes-Bautista (Assemblywoman Fiona Ma)
- Gayle Miller (Senator Lois Wolk – Chair of the Senate Revenue and Tax Committee)
- Mike Welch (Assemblyman Joe Coto)
- David Lynch (Senator George Runner)
- Ania Garbien (Senator Patricia Wiggins)
- Dave Weiher (Assemblyman Jim Nielsen)
- George Andrews (Assemblywoman Diane L. Harkey)
- Kevin Eastman (Assemblyman Chuck DeVore – Vice Chair of the Assembly Revenue and Tax Committee)
- Chris Alvarez (Assemblywoman Lori Saldaña)
- Senator Elanie Alquist
- Ken DeVore (Senator Roy Ashburn)
- Assemblyman Jim Beall Jr.
- Frank Russo (Assemblywoman Nancy Skinner – AB 178 Author)
- Oksana Jaffe and David Ruff (Assemblyman Charles M. Calderon – Chair of the Assembly Revenue and Tax Committee)
- Madam Speaker Bass
- Lenny Goldberg (the lobbyist who initially brought this bill to Skinner’s office)
Now the million dollar question everyone wants an answer to…how is everyone voting? At this point unfortunately, it’s still up in the air for many of the Assemblymembers, however in the meetings my group attended, Assemblyman Nielsen and Assemblyman DeVore were both opposed to the bill. Senators Runner and Ashburn were also opposed, but the bill is still in the Assembly, so their votes don’t count as of yet. Assemblywoman Ma and Assemblyman Coto’s staff didn’t come straight out and say that they would vote to support the bill, but both mentioned that since it is sponsored by Calderon’s office and he is the chair of their committee and is also a fellow Democrat, they would be hard pressed to oppose it. Hence the need for a full court press from their constituents.
This fight is far from over folks. If you are a California resident affected by this bill that creates nexus for out of state merchants based upon their advertising on your site, you -need- to step up. On April 13th, the Committee for Revenue and Taxation will vote on this bill at 1:30 pm in Room 126. Between now and then, we need to flood their offices with our opposition. This is your income at stake!
