Amazon is throwing a minor temper tantrum in response to a new tax bill recently passed by Illinois Governor Pat Quinn, and it could leave affiliate members in the state high and dry if it gets signed into law. A sharply worded e-mail sent out to Illinois based affiliates late last week makes Amazon’s position on the matter quite clear. "We regret to inform you that the Illinois state legislature has passed an unconstitutional tax collection scheme that, if signed by Governor Quinn, would leave Amazon.com little choice but to end its relationships with Illinois-based Associates”.
Illinois law currently only requires a 6.25 percent sales tax be collected by organizations with a presence in the state, but the new law seeks to redefine this “presence” to include affiliates who help Amazon link to product pages. Realistically this move shouldn’t have affected tax revenues in the state because residences are required to pay a “use tax” already, but they have no way to prove you wrong should you choose to bend the truth come tax time. The new law would require Amazon to collect the tax in this case rather than relying on individual honesty, and as you could imagine, this would probably be bad for business.
Hopefully this move will make Illinois lawmakers think twice since Amazon has proven in the past that they are more than willing to follow up on their threats. The online retailer has already closed its affiliate program in Colorado, Rhode Island, and North Carolina for similar reasons.