* The so-called Amazon Tax also passed the House yesterday…
Now, some large Internet retailers such as Amazon.com and Overstock.com don’t collect Illinois sales taxes because they don’t have a physical Illinois presence.
Shoppers technically still owe the taxes, but the vast majority don’t pay because they’re unaware.
The legislation would force Amazon to collect the taxes because they have certain kinds of contracts with Illinois companies. It was approved by a 88-29 vote.
Illinois tax collectors may want to hold off on expecting a large influx of cash immediately, though. In other states that have tried the same move, the laws have been tied up in the courts.
* From yesterday’s House debate…
Companies like Amazon allow third-party vendors to sell through its Web site. If Amazon stopped dealing with Illinois businesses to avoid the law, the multi-billion-dollar company wouldn’t be legally bound to pay the tax. That prospect concerns Rep. Dave Winters, R-Shirland.
“A company in my district has a relationship with Amazon. If they move three miles north to Wisconsin, they’re not subject to Illinois law anymore. They could then say ‘you know what, this tax is a great tax but we’re not paying it. We moved out of state, and we’re moving all those jobs with us,’” Winters said.
Having online retailers charge the same tax that brick-and-mortar stores doing business in the state is a matter of fairness, according to Osterman. He said business owners in the state support the measure.
“The business community is squarely behind this. They want to make sure that Illinois businesses are treated fairly and that they are not put at a competitive disadvantage,” Osterman said.
* The bill now heads to the governor’s desk, but Amazon responded quickly yesterday, blasting out an e-mail to Illinois members of its “associates program,” which was forwarded to me last night by several readers…
Greetings from the Amazon Associates Program: We regret to inform you that the Illinois state legislature has passed an unconstitutional tax collection scheme that, if signed by Governor Quinn, would leave Amazon.com little choice but to end its relationships with Illinois-based Associates. You are receiving this email because our records indicate that you are a resident of Illinois…
Please note that this not an immediate termination notice and you are still a valued participant in the Amazon Associates Program. But if the governor signs this bill, we will need to terminate the participation of all Illinois residents in the Associates Program. After that point, we will no longer pay any advertising fees for sales referred to amazon.com, endless.com and smallparts.com nor will we accept new applications for the Associates Program from Illinois residents.
The unfortunate consequences of this legislation on Illinois residents like you were explained to the legislature, including Senate and House leadership, as well as to the governor’s staff.
Over a dozen other states have considered essentially identical legislation but have rejected these proposals largely because of the adverse impact on their states’ residents.
Governor Quinn’s office may be reached here.
We thank you for being part of the Amazon Associates Program, and wish you continued success in the future.
Some Illinois-based Web businesses were furious Thursday at a legislative plan that would require online retailers, such as Amazon.com and Overstock.com, to collect a 6.25 percent state tax if they have commissioned affiliates in the state.
That puts at risk huge revenue streams for such Illinois-based Web sites as FatWallet.com, CouponCabin.com and BradsDeals.com, which receive much of their commissions from sending customers to major online retailers. Their commissions are at risk because large retailers have shown in the past that they will sever business relationships with affiliates like those to avoid collecting state sales tax, called a use tax in Illinois, on products they sell. […]
“I feel like I’ve been completely flipped the bird,” said Tim Storm, chief executive of FatWallet, based in Rockton, near Rockford. “Essentially, 30 to 40 percent of our revenue gets shut off instantaneously.”
FatWallet officials were busy Thursday scouting ways to leave Illinois, Storm said.
* And in other business-related legislative news…
One week. That’s the most supporters of a clean coal plant that is supposed to be built in Taylorville are willing to give state lawmakers.
Illinois senators voted late Wednesday against state support for what is being billed as a multi-billion dollar, state-of-the-art clean coal power plant and research site. Tenaska Inc. is not asking Illinois lawmakers to pay for the $3.5 billion plant. Instead, the company wants a state guarantee that the electricity generated there will have a market.
Bill Braudt, general manager of business development for Tenaska Inc., said, right now, the company can only sign a three year contract for power. But he insists that no one is willing to finance a multi-billion dollar project based solely on a three year guarantee.
Tenaska has been asking for state help for more than four years, and Braudt said this is the company’s last go-round in Springfield.
“We’ve spent five years trying to develop this project, and $40 million of our own money,” he said. “And if it doesn’t pass this time there is not much confidence that we have that it will be passed later.”
You’ve no doubt seen the arguments on both sides by reading the ads posted here. There are good arguments both for and against this plant, but if we want to stop using old, dirty coal technology then we’ve got to realize that it’s gonna cost more money. There is no magic solution.
* Casinos might take a pass on expanding: Under the gambling expansion legislation being considered by lawmakers, existing casinos each would be allowed to add 800 new spots to gamble. But with revenues from their current offerings already dropping and the rights to those spots costing big bucks, existing casinos might take a pass on expanding, an industry representative said Thursday.
* Plants that would turn coal to gas could cost consumers - Illinois bills would force state utilities to purchase synthetic gas from two companies proposing to build plants that produce gas from coal, one downstate and the other on the Southeast Side of Chicago.
* Legislature approves watchdog over transit agencies - State ethics officer could check for fraud, waste