New York Politicians Think About Repealing Amazon Tax, But Let It Drop

from the so-much-for-that dept

Back in April, we noted that some NY state politicians were trying to put in place a rather sneaky legal change that effectively would force Amazon to collect sales tax in New York, despite not having a physical presence there. The "trick" was to claim that if you had any affiliates in the state, you had a local presence. Affiliates, of course, can be nothing more than an advertiser. So, based on this change of law, effectively anyone who has an advertiser in NY is considered to have a local presence there and must collect sales tax. Both and Overstock have sued over this law, and Overstock has even gone so far as to cut off all NY affiliates in response (showing how the law probably hurts NYers a lot more than it helps them).

Saul Hansell, over at the NY Times, picked up on an odd fact, however. Just weeks after this passed, a separate bill was introduced to repeal it. Yet, that bill appeared to have no sponsor, but the state Senate actually voted and approved it. After some digging, Hansell got an explanation: saying that the original bill was part of a larger bill that was approved, but many felt that they wanted to address just this specific issue. Of course, it appears that the state senators' interest is not matched by the corresponding state assembly (who would also need to pass such a bill). Over there, they'd just as soon leave the matter as is, and let the courts (and taxpayers) sort it out.

Filed Under: affiliates, amazon tax, new york state, tax

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  1. identicon
    Bryan Henderson, 31 Jul 2008 @ 8:13pm

    Re: Anti-Bundling Bill

    This case shows that we don't need an anti-bundling bill, because a legislator can always just introduce another bill to undo a single component of a prior bundled bill.

    The bundling doesn't force legislators to vote in ways they don't want to -- it just reflects compromises they've made, which would be the same compromises if the bills were separate. A legislator wants low taxes for Amazon customers but even more wants a new highway. So he agrees to support taxing Amazon sales in exchange for his colleagues supporting the highway.

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