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Another Update on North Carolina

Seems like more people are finally talking about the proposed Internet tax law in North Carolina which I reported back in March. The proposed legislation has been added to the NC State budget. Here is the excerpt on the new nexus definition:

The retailer has representatives in this State who solicit business or transact
2 business on behalf of the retailer, solicits or transacts business in this State
3 by employees, independent contractors, agents, or other representatives
4 whether the mail order remote sales thus subject to taxation by this State
5 result from or are related in any other way to such the solicitation or
6 transaction of business. A retailer is presumed to be soliciting or transacting
7 business by an independent contractor, agent, or other representative if the
8 retailer enters into an agreement with a resident of this State under which the
9 resident, for a commission or other consideration, directly or indirectly refers
10 potential customers, whether by a link on an Internet Web site or otherwise,
11 to the retailer, if the cumulative gross receipts from sales by the retailer to
12 purchasers in this State who are referred to the retailer by all residents with
13 this type of agreement with the retailer is in excess of ten thousand dollars
14 ($10,000) during the preceding four quarterly periods. This presumption
15 may be rebutted by proof that the resident with whom the retailer has an
16 agreement did not engage in any solicitation in the State on behalf of the
17 seller that would satisfy the nexus requirement of the United States

Merchants are already indicating that they will terminate North Carolina Affiliates.

We lucked out in Minnesota with the Governor exerting a power swipe against the Legislators. He nixed the bulk of their budget and switched to his own version, choosing to cut and cut the budget with devastating results for the average citizen.

So if you are in North Carolina, get a hold of your legislators and express your opinions. If you are an affiliate and you have not already done so,  it is crucial that you  get your sites ready and your merchant lists organized. Hopefully, you began that process back in March when I first blogged about this, leaving you more time for speaking with legislators.

{ 1 comment… add one }

  • Ben Yarbrough June 24, 2009, 9:35 pm

    Please see our blog for our perspectice and more details. http://blog.calyptix.com/

    The NC House version of the Amazon provision does not apply to sellers if their gross receipts from sales into NC via referrals by NC residents during the prior four quarters are $10,000 or less. FYI, the digital tax part of the budget bill (S 202) is section 27C.2. For an update you can access the details from our blog at http://blog.calyptix.com/

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