Amazon Update: Victory in CO, Waiting in IL and Threats in Cal

Don't Tax You, Don't Tax Me, Tax the Guy Behind the Tree

The Direct Marketing Association scored a major victory in winning an injunction against Colorado’s application of the “Big Brother” variation of the Amazon that imposes onerous reporting requirements but does not impose an obligation to collect tax on out-of-state retailers. The federal court ruled that the law improperly discriminated against and imposed an undue burden on interstate commerce.

Once again, however, affiliates are in danger in California as Amazon again has threatened to terminate in-state affiliates if California adopts the Amazon tax. Interestingly, California authorities concede that such terminations would offset at least half the gain in revenue anticipated from the “Amazon tax”.

Bills are pending in Alabama, Connecticut, Hawaii, Minnesota, new Mexico, South Dakota, Vermont and Texas as well as in Illinois where an Amazon tax bill is sitting on the governor’s desk.

The Colorado order was issued hours after a Cyber Law and Business Report show devoted to the Amazon tax and featured Matthew Shaffer one of the lead lawyers in the Colorado case who then spoke about the decision the following week. You can listen or download the podcasts here.

States are looking online for another revenue source — online gambling. While New Jersey Governor Christie vetoed the proposal, lawmakers in several states and the District of Columbia are considering online gambling as a revenue option.