Regular readers will notice a minor design change: All Amazon-related links and ads have been deleted. I'm a longtime Amazon Associate. I never made big bucks at it; in some years, I didn't make enough to even get a 1099 form. It did pay my TypePad fees though.
Unfortunately, in a moronic attempt to raise tax revenues that has predictably backfired, Governor Jerry Brown and the Democrats in Sacramento have forced Amazon to put me out of business:
Gov. Jerry Brown has signed into law California's tax on Internet sales through affiliate advertising which will immediately cut small-business website revenue 20% to 30%, experts say.
The bill, AB 28X, takes effect immediately. The state Board of Equalization says the tax will raise $200 million a year, but critics claim it will raise nothing because online retailers will end their affiliate programs rather than collect the tax.
Amazon has already emailed its termination of its affiliate advertising program with 25,000 websites. ...
Board of Equalization Member George Runner blasted Brown for signing the law. "Even as Governor Jerry Brown lifted his pen to sign this legislation, thousands of affiliates across California were losing their jobs. The so-called 'Amazon tax' is truly a lose-lose proposition for California. Not only won’t we see the promised revenues, we’ll actually lose income tax revenue as affiliates move to other states."
I won't be moving to another state, but any chance the state had of getting income taxes from my Amazon sales just went out the window, so that's one tax loss they'll suffer, Meanwhile, while Brown and the bill's proponents say the bill will help small local retailers, this is one consumer who's going to go right along doing the vast majority of my shopping at Amazon.
This will be a huge blow to bloggers and freelance website owner/managers, who often depend on affiliate programs or click-through advertising as a primary source of the revenue that pays for website hosting and up-keep.
And when websites start closing down, or when their owners dissolve their California companies and file for business incorporation in other states, the Mainstream media will once again be stumped by the UNEXPECTED failure of this bill to raise even a fraction of the revenue that was originally projected.
It has been said that insanity is repeating the same failures over and over again, hoping to achieve a different result. I think we can now safely say (as if we hadn't suspected all along) that the government of California is truly insane.
And from Walter Jacobson:
This is why Obama will not see the trillion dollars in new taxes he wants, even if such legislation were passed. People change their business and personal practices once taxes reach a tipping point.
This why we can’t tax our way to reducing the deficit. We can control spending, but we cannot control revenue because we cannot control people.