The first Affiliate Day will be held on September 14 2009. Missy Ward and Shawn Collins, co-founders of Affiliate Summit, have organized Affiliate Day for two reasons; to acknowledge the importance of affiliate marketing and to increase awareness. To mark the day there will be several promotions and giveaways including passes to Affiliate Summit West in January 2010. Contact Affiliate Summit if you have a prize you’d like to donate. Entry to win prizes will be simple – tweet on Affiliate Day (9/14) using hash tag affday09 (#affday09) to enter and then random drawings from entries will be conducted on September 18 to yield winners. Find out more information by reading Affiliate Day and AffiliateTip.
The concept of Affiliate Day is a good one. We do however need to expand it beyond our industry to really reap the benefits. We should seize this opportunity to educate and inform those outside of our industry about what we do and how we do it. Of course Twitter will help but why not take it one step further.
Part of the problem with recent legislation is a lack of understanding of what we do and how we do it. From Governors, State Senators and Representative to those that serve on the Federal level, education is the key to fair legislation. All one has to do is read any of the recent quotes from our legislative “leaders” to see how woefully uninformed and uneducated they are about affiliate marketing. Perhaps if they understood that we are involved in advertising and not really sales people or affiliates (as in affiliate companies) they could enact fairer legislation. Perhaps, with education on our industry, they would see the need to address Internet sales tax on the Federal level.
If every one in our industry who has a blog or traditional website (isn’t that all of us?) took the day to write about one aspect of our work wouldn’t that help educate the general public and legislators about what we do? Post the article on your blog, tweet about it. More importantly, get your information out to those outside our industry. Letters to the editor, email/write legislators and if you have contacts use other media to help spread the word. Use your Affiliate Voice to educate!
Put Affiliate Day in front of a larger audience to reap even more rewards.
I already have two articles and emails planned, how about you?
The good news is we have a little more time to get ready. The bad news is Maryland affiliates will need to go through another round of possible Internet sales tax or advertising tax. State Senator Madaleno of Maryland has announced that in January 2010 he will introduce legislation that will require out of state merchants to collect Maryland sales tax for online purchases to Maryland residents. It is anticipated that his proposed bill will be similar to the one introduced in the last legislative session. That proposed bill required out of state merchants with Maryland affiliates to collect sales tax on sales to Maryland residents if the threshold was reached. That threshold was $10,000 in total sales in the previous four quarters from Maryland affiliates to Maryland residents. As you know, that bill was introduced too late in the last regular session to be completely passed.
Senator Madaleno feels that his proposal establishes a more level playing field. In fact, he calls it an E-fairness bill. He estimates that his legislation will generate $7.5 million a year in additional revenue.
The original proposal was similar to the legislation that exists in New York, North Carolina and Rhode Island. As we have seen from the three states that currently have this legislation, interpretation can vary. Only time will tell how Maryland will interpret the law if it does pass.
While you may feel it is too early to think about interpretation, it is not too early to prepare. Maryland affiliates need to be proactive and prepare their business. We have seen that merchants will remove affiliates prior to a state passing the legislation. Several merchants have publicly stated they will take those steps. If you are an affiliate living in Maryland I urge you to get involved now. Get in touch with me so I can help you organize and prepare your business. Education, organization and preparation are critical.
To join a group to work on this issue contact me at Affiliate Voice LLC. I have also posted about the developments in Maryland Internet sales tax at Get Ready Again Maryland
Over the past year and a half I have urged every affiliate to be proactive. Earlier today I posted Hey Affiliates, Know Your State’s Nexus Definition at my Affiliate Voice LLC blog. In that post I outline the simple but critical steps every affiliate should take. These steps involve educating yourself as to the nexus definition for your state and preparing. You need to prepare for pending legislation and prepare your business model.
Preparing for pending legislation is important and involves steps you need to take now, long before new legislation is proposed. First steps involve identifying how to monitor legislation, knowing your legislators and of course, preparing your business. Preparing your business is knowing which of your merchant relationships are at risk if new nexus laws are enacted. These steps must be completed before the new legislative sessions begin. As we saw several times in recent months legislation can move slow one moment and swift the next. Please review my post at Affiliate Voice blog for additional information on the steps you should take.
Affiliate Voice is again urging every affiliate to be proactive. Learn the nexus definition for your state. The reason is several states are taking action to enforce current laws. They have determined that there is no need for new legislation, existing laws are enough. If your state’s current nexus law includes terms such as solicitors, independent contractor, other representatives or similar wording you may be at risk.
Some states like Missouri, Texas and Michigan have been said to be contacting merchants questioning in state activities to determine if nexus exists. They are seeking to enforce current legislation or to alter interpretation. Merchants should consult with a sales and use tax attorney to ensure they are in compliance. Nexus may have already been established so removing affiliates will not remove the nexus.
Affiliates need to be proactive and prepare. To assist you, I have been adding State Information and Resources at Affiliate Voice Blog and AffiliateVoice.com – Internet Sales Tax and Advertising Tax. Again, merchants should seek professional advice and guidance on these issues.
Please contact Affiliate Voice if you would like to help on any issues and to sponsor our work.
As predicted, the Governor of North Carolina signed the budget. At about 4:30 on August 7, Governor Beverly Perdue signed the North Carolina budget, a budget that included the modernization of the nexus laws. As a result, out of state retailers who meet the sales threshold will be required to collect sales tax on sales to North Carolina residents just as if they had a brick and mortar store located in North Carolina. The sales threshold is $10,000 in total sales from all North Carolina affiliates or publishers to all North Carolina residents in the combined previous four quarters.
North Carolina has now become the third state to enact this legislation. As we wait to see the interpretation of this law I urge everyone to make educated business decisions. Contact and retain the services of a sales and use tax attorney in North Carolina. Does the law even impact you – do you meet the sales threshold? Contact the North Carolina Department of Revenue and ask for clarification on interpretation. Ask about the procedure for rebutting the presumption of nexus. Will the NY Two Step Solution work? (Remember the NY Two Step Solution includes including restrictions against soliciting for a merchant in terms and a yearly affidavit.) Or will North Carolina have an interpretation similar to Rhode Island which currently says you cannot rebut the presumption of nexus if you have affiliates/publishers in the state and meet the sales threshold.
I also urge everyone to keep professional and courteous. Merchants will need to make the decision that is right for their business and for that they cannot be faulted. The manner in which terminations happen will show if we have learned from the events and mistakes with New York affiliates. In some cases, these mistakes were repeated with Rhode Island affiliates.
Merchants, if you must terminate your relationship with North Carolina affiliates, please treat them with respect; give them as much notice as possible. Please make educated and informed decisions and don’t just react. Keep the lines of communication open.
Affiliates, if you receive termination letters please understand that merchants are making business decisions. You may not be happy with or agree with their decision but they are doing what they feel is best; hopefully it is an educated decision. Your responsibility will be to adapt. Identify replacement merchants and replace links; hopefully you are prepared and have replacements lined up and can just replace links. Remember, recovery is possible, it takes work, but there are thousands of merchants to choose from.
If we all work together and continue to communicate we can adapt and move forward.
The North Carolina Department of Revenue website is located here: http://www.dornc.com/index.html
The budget bill in North Carolina was just approved by the House of Representatives. Senate passed it a few moments earlier. The votes were as follows: House 66-51 Senate 27-18.
The budget bill now moves on to the Governor for signing. If signed the Internet sales tax will take effect immediately. The sales threshold is $10,000 in sales from NC affiliates to NC residents in previous four quarters.
Please see my post from this morning, NC Moments Away from Internet Sales Tax for more information.