Internet Sales Tax Legislation

Alabama

DATE: 12/7/09 The state's Department of Revenue is putting out a recommendation this month encouraging legislators to propose an Internet advertising tax.

California

DATE: 7/6/10 Both houses of the state legislature, the Assembly and the Senate, have adjourned for the summer. They are adjourning before there is an approved budget and it is unclear which groups or committees will be formulating budget proposals. The legislators have been instructed to spend their time in their district offices for the next 30 to 60 days, but are asked to be within 24 hours from Sacramento, so they can return if there is an emergency session. The Budget Conference Committee has not revisited the issue of use tax collection or ad tax proposals since it was first discussed 2 weeks ago. It is unclear if they will pick up that issue, when they will meet again, or if another group will consider it.

The good news is that the legislators who have been involved in budget issues are familiar with the issues and seem to understand the negative impact of the ad tax on affiliate marketers. The bad news is we don't know who will be considering the issue in the future. Please stay tuned.

DATE: 4/19/10 A new bill, AB 2078, has been introduced. This is a Big Brother Sales Tax bill, requiring remote merchants to report back to the state on all purchases made by their California customers. A hearing is scheduled Monday April 19th. This directly impacts merchants who do not currently collect sales tax from California customers. It could indirectly impact everyone if it causes people to stop buying online lest their privacy is violated. More information can be found here.

DATE: 3/12/10 California’s special session ended on Thursday and several tax enforcement measures, including the advertising tax (ABX8 8) failed to make it out of the Assembly. The bill is likely to come back later this year as California seeks avenues to generate additional revenue and decrease its huge budget deficit.

DATE: 2/26/10 There are now two bills in California. The Assembly took all the content from the senate budget bills and duplicated them in assembly bills so they could be amended. The original version of the bill is in ABX8 8 and was referred to Assembly Rules Committee, where it may be referred to Assembly Revenue and Tax Committee. The copy the Assembly made is in the new bill, SBX8 8, which is on the Assembly floor and could be acted on at any time.

Colorado

DATE: 4/22/10 What the Colorado Internet Sales Tax Means to Retailers
As Shop.org's tagline goes, we are the digital division of the National Retail Federation (NRF). This means that we have access to some amazing resources from NRF including Maureen Riehl, a vice president in NRF's government relations department and an expert on Internet sales tax.  The recent law passed in Colorado related to this topic has raised many questions.  Below are some very helpful thoughts from her on what this means to digital retail.  Read More....

- by Scott Silverman, Executive Director, Shop.org 

DATE: 3/11/10 Further Guidance on Requirements on Out-of-State Retailers (Colorado) from Accounting Web.

DATE: 3/10/10 PMA legal POV on Amazon's surprising actions.

DATE: 3/3/10 Amazon has notified Colorado-based members of its affiliate program, that it was ending its business with them "As a result of the new law," Amazon said, "we have decided to stop advertising through associates based in Colorado."

DATE: 2/9/10 All language referring to "affiliates" is being taken out of HB 1193. This "win" is the result of a massive, coordinated effort on the part of the PMA, CO affiliates and many others. Good work PMA!

Connecticut

DATE: 5/26/10 DEAD: In February, 2010, Senate bill SB 5481 was introduced by the Senate finance committee. The bill was passed by the senate committee and passed by the House. But days before the legislative session was to end, the leaders of the Finance, Revenue and Bonding Committee had a change of heart; they recognized the bill would not protect retailers, would not help the state, but would only harm affiliate businesses. The legislative session ended May 5th without passing the ad tax.

DATE: 5/6/10 The Connecticut legislation ended at midnight without passing the ad tax. This was an extremely difficult fight, and frankly, we thought we were going to lose. Thanks to a small but mighty group of affiliate marketers, and an extremely talented lobbyist, the ad tax was finally defeated.

DATE: 5/3/10 Connecticut may abandon the The chances of survival for a controversial bill to force collection of sales taxes on Internet transactions have become very slim as the regular legislative session nears its May 5 deadline, key lawmakers said Thursday. The problem, according to leaders of the Finance, Revenue and Bonding Committee, is that many legislators fear businesses could be harmed regardless of whether action is taken.  Read the full article, "http://www.ctmirror.org/story/5680/legislators-likely-drop-amazon-law-now by Keith M. Phaneuf, featured on The Connecticut Mirror site.

DATE: 4/19/10 The ad tax, SB 5481 on 3/25/10 is still alive. Next week the bill will be reviewed by the House Finance Committee. A vote or decision will have to be made before May 5th, when the legislative session ends.  The progress of the bill was significantly delayed by the efforts of several affiliate marketers which was highly effective in putting faces behind the issue. But more involvement by Connecticut affiliate marketers is needed. There are still opportunities to reverse the course of this bill, but it takes letters and calls and visits from more affiliate marketers. If you are a Connecticut affiliate marketer, your help is needed. Please register your support here and join a Google group so we can communicate directly.

DATE: 3/25/10 The Finance, Revenue and Bonding committee voted on SB 5481 today and passed the ad tax. However, the progress of the bill was significantly delayed by the efforts of several affiliate marketers who stormed Hartford yesterday to meet with state legislators. This was highly effective in putting faces behind the issue. However, the proponents of the bill also have a large presence, so more involvement by Connecticut affiliate marketers is needed. The session ends in May, so there are still opportunities to reverse the course of this bill, but it takes letters and calls and visits from more affiliate marketers. If you are a Connecticut affiliate marketer, your help is needed. Please register your support here and join a Google group so we can communicate directly.

DATE: 3/16/10 Amazon threatens to fire CT affiliates if RB 5481 is passed. 

DATE: 3/15/10 There was a hearing on March 15, 2010 with the Finance, Revenue and Bonding Committee to debate the ad tax bill (RB 5481).  The committee has not yet voted, but it is expected to pass.

DATE: 3/12/10 A new ad tax bill, Number 5481, was proposed on March 8th in Connecticut. The language in this bill specifies a $2,000 per quarter threshold, which is much lower than the typical $10,000 threshold in other state's ad tax bills. A hearing is scheduled for March 15th. If you are a Connecticut affiliate marketer, your help is needed. Please register your support here and join a Google group so we can communicate directly.  Read the Bill

DATE: 4/4/09 Connecticut's version of the "Affiliate Tax" bill (SB 806) could go before the Senate for discussion very soon! Click here for more information on the bill.

Florida

DATE: 4/19/10 Florida has proposed SB 2552, which is not an ad tax, but a proposal that could lead to some sort of internet sales tax collection scheme. This bill is highly unlikely to go anywhere, it is almost comical in its approach. It proposes that the state allocate money so it can build its own software requiring credit card companies to collect sales tax at the time of product shipment. Credit card processing is a highly regulated industry, encompassing strict guidelines on interaction between merchants and banks, and data protection, consumer protection, and security. The likelihood that a state could interfere with well established, internationally mandated standards is extremely slim.

DATE: 2/18/10 No official bill has been introduced yet, but there is loud "buzz" that one is impending. Stay tuned for more information.

Georgia

DATE: 4/19/10 While an ad tax bill has not been proposed, SB 512 is another bill looking to collect internet sales tax.  This bill might be called the "Bounty Hunter Bill".   It authorizes the state to pay contingency fees to lawyers who help the state successfully sue remote retailers to enforce collection obligations under creative assertions of current law. It is unclear if affiliate nexus is a qualification. The senate passed this bill on Friday March 28th. Other states and cities are using similar bounty hunter arrangements when working with plaintiff's attorneys to sue online travel companies over occupancy taxes on the service fees collected from remote travelers.  There are over 60 such lawsuits underway now.

DATE: 4/5/10 Bill language has been added to the placeholder bill GA SB 1221. The language is for support of the streamlined sales tax and not the ad tax. There is another placeholder bill but it isn't likely they will introduce an ad tax when they're introducing streamlined.

DATE: 3/25/10 Bill language has been added to the placeholder bill HB 1221. The language is for support of the streamlined sales tax and not the ad tax. There is another placeholder bill but it isn't likely they will introduce an ad tax when they're introducing streamlined. We will continue to track this activity until the other placeholder bill is assigned, killed or when the session ends.

DATE: 3/12/10 Placeholder bills were introduced, that may or may not include ad tax language.

DATE: 2/25/10 Georgia House Ways and Means and Appropriations chairs just introduced bills, amending the sales and use tax. Currently these are just "place holder" bills, but could include nexus language in the future. Please visit the PMA's Georgia page for information on the bills.

Hawaii

DATE: 7/2/09 The governor vetoed this bill. It is possible it will be sent to a special session on 7/15 but would require a 2/3 majority in both the House and Senate to overturn her veto on the bill.

Illinois

DATE: 4/19/10 No change from last update: The Senate Revenue Committee had a hearing discussing the ad tax bill, SB 3533, Thursday March 4th. Twenty one affiliates attended the hearing and Brian Littleton was chosen to be the only testimony. The bill has been 'held over', meaning the committee did not vote to move it forward. They may consider revising it in some way and return it to the committee. This is somewhat good news, it means the legislators are taking the affiliate point of view seriously.

DATE: 2/11/10 Sen. Jeffrey M. Schoenberg is proposing legislation that targets out-of-state merchants using affiliates to establish nexus. It is called SB 3353, click here to read the full text of the bill. Please take a few minutes to show your support for the fight against this tax by visiting the PMA's web site and registering. The PMA will send you updates regarding the status of this legislation in Illinois and provide guidance on how you can participate in local activities.

Maryland

DATE: 4/14/10 The Maryland 2010 legislation session ended at 11:59:59pm last night, and the ad tax was not included in the final budget package.

DATE: 4/4/10 The ad tax, SB 824, was heard  on April 4th 2010, in front of the Senate Budget and Taxation committee. The committee did not yet vote; they are expected to vote within a week.

DATE: 3/29/10 No change from last update: The ad tax, SB 824, was heard Wednesday in front of the Senate Budget and Taxation committee. The committee did not yet vote; they are expected to vote within a week.

DATE: 3/18/10 The ad tax, SB 824, was heard in front of the Senate Budget and Taxation committee yesterday. The committee did not yet vote; they are expected to vote within a week.

DATE: 3/16/10 The Senate Budget and Taxation Committee will hear the Ad tax bill,  SB 824, on Wednesday March 17, 2010; the hearing is scheduled for 1:15pm.

DATE: 3/12/10 The Senate Budget and Taxation Committee will hear SB 824, the ad tax, on Wednesday March 17th; the hearing is scheduled for 1:15pm.

If you are a Maryland affiliate marketer, please register your support here so we can contact you directly with updates, and provide letter templates and talking points. You can also join a Google Group here.

DATE: 3/5/10 A hearing on the advertising tax bill in Maryland has been scheduled for March 17th. Maryland publishers can help oppose this tax in several ways: 1) If you haven't already registered on the PMA site; click here to join today; 2)You can also join a group formed for all Maryland publishers to get the latest news; and 3) You can learn more here. Show your opposition to this proposed legislature by emailing Senator Madaleno atrichard.madaleno@senate.state.md.us.

Minnesota

DATE: 5/21/09 HF2323 has been vetoed by the Governor.

Mississippi

DATE: 2/5/10 SB 2927 - The state website reports that SB 2927 died in committee on 2/2.

Missouri

DATE: 9/9/09 Missouri may now consider having an affiliate program with participants that reside in the state of Missouri as constituting a physical presence. Please consult with your tax advisors regarding any tax liability questions this might raise. The Missouri Department of Revenue has released this page that contains information used by the state to determine when a vendor has sufficient nexus.

Nevada

DATE: 3/2/10 Great news! The special session that was convened has adjourned and no tax legislation was introduced.

New Mexico

DATE: 2/5/10 Bill HB 50 is still officially classified as being in pre-file status, and is not expected to move forward.

New York

DATE: 4/9/08 New York Tax Law 1101(b)(8)(vi) requires affected businesses to register and start collecting taxes by June 1st. The state estimates the law would generate $50 million in the current fiscal year. The law applies to companies that do more than $10,000 worth of business in the state. 

North Carolina

DATE: 7/6/10 The ACLU has filed suit against the state of North Carolina, intervening in the lawsuit previously filed by Amazon. In an attempt to force nexus, North Carolina has approached several out-of-state merchants, including Amazon, who terminated affiliates when the ad tax passed. The state is requiring detailed purchase information back to 2003, in an attempt to collect back sales tax, claiming these merchants already had nexus established if they had affiliates even prior to the ad tax being passed. As part of the audit, the state is requiring personally identifiable information on each purchase.

"The Constitution does not permit government agencies to conduct such sweeping collections of our personal and private information," said Aden Fine, staff attorney with the ACLU Speech, Privacy and Technology Project. "Disclosing the purchase records of thousands of Amazon customers would violate their constitutional rights to read and purchase the lawful materials of their choice, free from government intrusion."

DATE: 8/10/09 The Governor of North Carolina signed that state's budget on Friday. This new budget includes nexus language making North Carolina the third State to include language (joining New York and Rhode Island) specific to online marketing and creating a nexus due to the referrer's home State.

Rhode Island

DATE: 4/19/10 No change from last update:A hearing was tentatively scheduled 3/18/10, to hear H 7071, the repeal bill to reverse the ad tax. It was postponed until further notice.

DATE: 3/25/10 No change from last update: A hearing was tentatively scheduled 3/18/10, to hear H 7071, the repeal bill to reverse the ad tax. It was postponed until further notice.

DATE: 3/18/10 Hearing for  H 7071, the repeal bill to reverse the ad tax, was postponed until further notice.

DATE: 3/12/10 A bill, HB 7071, has been introduced to repeal the ad tax. Awaiting word from political advisers on progress of this bill.

DATE: 6/29/09 Nexus law has passed. Both houses of the legislature passed the budget bill by veto-proof margins.

Tennessee

DATE: 4/19/10 Tennessee has submitted bill SB 1741/HB 1947, a Big Brother Sales Tax bill that copies the Colorado sales tax reporting bill. This bill would require out-of-state merchants to report back on all sales made to Tennessee consumers. It will have a direct impact on remote retailers who do not collect sales tax, and since it violates consumer privacy, it may have a chilling effect on internet sales overall.

DATE: 4/6/10 Tennessee submitted bill SB 1741/HB 1947 which copies the Colorado sales tax reporting bill. This bill would require out-of-state merchants to report back on all sales made to Tennessee consumers. This isn't like the typical ad tax that directly targets affiliate marketing, but it can have a serious impact on online merchants. A Finance, Ways and Means committee meeting is scheduled tomorrow, but it doesn't appear they will take public testimony.

Vermont

DATE: 2/17/10

Your immediate response is needed to let the Vermont House Ways and Means Committee know that you are opposed to the internet advertising tax being proposed in your state.

DATE: 2/5/10 Bill H 661 has been introduced but has not moved into the House or Senate yet. The PMA is reporting that they do not expect it to move forward.

Virginia

DATE: 3/13/10 We just received hopeful news: the Virginia budget conferees did not include the ad tax language in the budget bill they submitted today. There is one more step to go! The governor needs to sign the bill into law. We do not expect him to ask for the ad tax to get put back, but this isn't over until the budget is signed.

DATE: 3/12/10 The ad tax bill, SB 660, was tabled by the House Finance committee. It will officially die when the legislative session ends on March 13th.

DATE: 3/4/10 Good news! The bill was set aside for later consideration as of 3/1/10.