Amazon Ends Relationship with North Carolina Affiliates

By: Chris Crum - June 28, 2009

North Carolina residents who are Amazon Affiliates recently received an email telling them the company would be ending its relationships with them due to the North Carolina state legislature getting ready to, as Amazon puts it, "enact an unconstitutional tax collection scheme."

What the North Carolina government is proposing would apply sales tax to purchases made through online affiliates based in NC. It has not yet passed.

Now NC residents have received an email confirming that they are indeed severing ties. Andy Beal at Marketing Pilgrim received one of the emails and shares it on his blog. It reads:

We are writing from the Amazon Associates Program to notify you that your Associates account has been closed as of June 26, 2009. This is a direct result of the unconstitutional tax collection scheme expected to be passed any day now by the North Carolina state legislature (the General Assembly) and signed by the governor. As a result, we will no longer pay any referral fees for customers referred to or after June 26. We were forced to take this unfortunate action in anticipation of actual enactment because of uncertainties surrounding the legislation’s effective date.

Please be assured that all qualifying referral fees earned prior to June 26, 2009 will be processed and paid in full in accordance with our regular referral fee schedule. Based on your account closure date of June 26, 2009, any final payments will be paid by September 1, 2009.

In the event that North Carolina repeals this tax collection scheme, we would certainly be happy to re-open our Associates program to North Carolina residents.

Given that the tax law has not passed, it isn’t hard to understand why Amazon’s NC affiliates would be a little upset. A News-Record article that was picked up by Slashdot offers the following quote:

"Local affiliates say they were ‘blind-sided’ by the company’s action. ‘I got this e-mail at 4:30 this morning,’ said James Barrett, a technology consultant from Winston-Salem. ‘It wasn’t saying your account will be shut down. It said it is shut down. That just blew me up right there.’ Barrett said that he is frustrated at lawmakers for considering the tax, but equally aggravated with Amazon. ‘They’re trying to tick off all their associates and get them to call down to Raleigh,’ Barrett said. ‘I think that is pretty tacky. That’s not the way to use people who are referring business to your business.’"

So far, there is no mention of the North Carolina situation on the Official Amazon Association Blog.

Chris Crum

About the Author

Chris CrumChris Crum has been a part of the WebProNews team and the iEntry Network of B2B Publications since 2003. Follow Chris on Twitter, on StumbleUpon, on Pinterest and/or on Google: +Chris Crum.

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  • A NC Affliate

    You can’t blame Amazon, the morons in Raleigh are taxing us to death here. We are fast becoming known as the “Massachusetts of the South” for being so heavily taxed. Even taxes on our ELECTRIC BILLS are coming. So, if you want to move to North Carolina folks, I can work something out with you. I want to move away. Hell, considering Cap And Trade just got passed, I’m ready to move out of the country.

  • FaTe

    I remember reading about this last year and anyone with 2 brain cells could have seen that Amazon where not going to stick around to be severely raped by silly taxes. Those in “shock” need to do their research, Any company with sense wouldn’t stay in a state doing such.

    Point the finger at the stupid state.

  • Joe

    First, Amazon jumped the gun. The scheme hasn’t passed yet so why terminate accounts now? Then they may reinstate the accounts later if the scheme gets repealed…. So either the affiliate takes down their site and gets delisted from Google and others or removes all their ads spending hours of work for nothing or they leave all as is and send free traffic to Amazon for no compensation.
    Not well played by Amazon.

    Why not give the affiliate a chance to set up a corporation in a business friendly state such as Nevada?

    As for the State of North Carolina, sounds like they are trying to drive business out of state. Government at the state and Federal levels is out of control. They need to clean up their own spending habits and reorganize instead of squeezing every last penny out of the tax payer.

  • Piece A Cake

    I live in Raleigh and have spent the last 2 years building up my Internet business, mostly through affaliate programs. Just bought a house last month. Add another bankruptcy to the )(*^&()( list! Not really, I will adapt and set up business elsewhere. How can you run a business when the rules keep changing so fast?

    • Guest

      Dont blame Amazon blame your elected leaders, call them on the phone, and let them know they will be voted out of office if they try to do this, because amazon is correct this is un constitutional.

  • Guest

    Blame the Democrats in Raleigh. This is the “change” you people voted for!

  • Ted

    While I choose to live in N.C., I always cringe when I hear / see what these “politicians” are doing to our state gov’t. We now have one of the highest gasoline taxes in the nation…have you seen our roads? Or our budget? We’re broke! Why? I know why…but I’m supposed to behave on the Web. I’ve said my piece…. -Ted

  • Martha Lipson

    I live in North Carolina,and I’m new in the world of internet marketing.I was an affiliate of Amazon and now they have closed my account. I really do not know what to do now; Amazon was a great money maker for me. I really do not know what to do now.

  • Anonymous

    Have we all not learned by now how to overcome the government by using it’s own rules?

    Where there are taxes, there are legal ways around them.

  • buy senuke

    It really is a shame that this is happening. There are plenty of other ways to monetize your site however, you could try clickbank, linkshare, commission junction, ebay and google adsense.