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    California Bill AB 178 *Important for Affiliate Marketers*


    California Bill AB 178 was postponed back on April 27th, but it has reapeared as California tries to deal with the budget crisis.

    More info here: http://www.performancemarketingalliance.com/2009/03/24/campaign-to-fight-california-bill-178-is-underway/

    I received this email from Linkshare. It provides an email template and list of important people to contact. If you do any affiliate marketing in California, it would be good to send this in to the list of Senators:

    Dear California Affiliate Marketer,

    You may remember the grass-roots campaign we waged in April, to defeat an anti-affiliate tax bill that would have a detrimental effect on affiliate programs. Even though we defeated that bill, it has been revived, in a desperate hope to help California's budget crisis. The bill was originally defeated thanks to the affiliate community in California, who was responsible for convincing the sponsoring committee that this bill was a bad idea. Now it is time to repeat that stellar effort, because we have a few more people to convince.

    Below is a list of influential people who need to hear from you. There is an email template for your use too, it contains the information we believe will be the most influential. Adding a brief sentence or 2 that describes your business is all you need to write. Please copy and paste that email and send to the names and addresses listed here.

    Time is critical - the legislators may send their recommendation to the governor this week. Please send your emails immediately.

    Many thanks for your continued fight!

    Performance Marketing Alliance
    www.performancemarketingalliance.com

    senator lois wolk - senator.wolk at sen.ca.gov
    senator darrell steinberg - senator.steinberg at sen.ca.gov
    senator elaine alquist - senator.alquist at sen.ca.gov
    senator roderick wright - senator.wright at sen.ca.gov
    senator ronald calderon - senator.calderon at sen.ca.gov
    senator gloria negrete mc leod - senator.mcleod at sen.ca.gov
    senator lou correa - senator.correa at sen.ca.gov
    senator denise ducheny - senator.ducheny at sen.ca.gov
    Jennifer Kent - Jennifer.kent at gov.ca.gov (she is the governor's tax advisor please address to "Ms. Kent")

    COPY INTO EMAIL AND SEND TO THESE SENATORS

    Subject: OPPOSITION to Sales/Use Tax Nexus Bill (AB 178 Skinner)

    Dear Senator [Insert Last Name]

    I am a small business owner with a website, and I am in strong opposition to Sales/Use Tax Nexus Bill (AB 178 Skinner), which would require retailers that receive referrals from advertising on websites, such as mine, to collect sales tax in California.

    I am opposed to this bill because it would substantially harm my small business by reducing a large source of revenue that I depend on to survive. This revenue results from providing advertising on my website on behalf of out-of-state retailers. [Describe briefly how your business model is set-up and what you contribute to the local economy.]

    If retailers believe that doing business with me will result in their having to collect sales tax on all California sales, they likely will sever ties with my business, putting the viability of my business at risk. Such was the case in New York State where Overstock dismantled its affiliates program and hundreds of other business followed Overstock's example. This left thousands of small- and medium-sized affiliate businesses with a 50% loss of income.

    Unfortunately, this bill is futile. If enacted, retailers will drop me as a partner, California won't collect sales tax as a result - and my business will be devastated in the process.

    For these reasons, I respectfully oppose this legislation.

    Sincerely,
    [Your Name]
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    As a retailer you gota love this section:

    ...if the cumulative gross receipts or
    sales price from sales by the retailer to customers in this state who
    are referred pursuant to these agreements is in excess of ten
    thousand dollars ($10,000) during the preceding four calendar
    quarterly periods.
    Very unclear. So for each quarter I have to check the previous 4 and collect tax on referred orders only from CA *if* the total was over $10k but if it was not I don't have to worry.

    Sounds like a nightmare to administer.

    I don't do much affiliate marketing but it would be easier for many companies to just drop their affiliates than to manage such a program. Especially given the checkout would show different totals depending upon where the customer came from.
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    Originally Posted by realityhack
    Very unclear. So for each quarter I have to check the previous 4 and collect tax on referred orders only from CA *if* the total was over $10k but if it was not I don't have to worry.

    Sounds like a nightmare to administer.

    I don't do much affiliate marketing but it would be easier for many companies to just drop their affiliates than to manage such a program. Especially given the checkout would show different totals depending upon where the customer came from.
    Exactly. And that is what they did in New York when this bill passed. If it passes in California, I'll be moving to another state. This bill is incredibly short-sighted and unfortunately a lot of people in senate don't understand the repercussions of the bill and that it won't be a good solution long-term.

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