Advertising Tax: What Happened and What’s Next

Advertising Tax,[object Object],What Happened and What’s Next,[object Object],Bennet Kelley Wright Andrews ,[object Object]

Prologue : Deficits and New York,[object Object],Part 1: Amazon Wars,[object Object],Part 2: What’s Next,[object Object]

Wright Andrews,[object Object],[object Object]

Chief Legislative Asst. Sen. Sam Nunn

President of Amer. League of Lobbyists

Top 50 LobbyistsWashingtonian Magazine,[object Object]

AGC, Director of Gov’t Affairs – ValueClick

Nat’l Co-Chair -- DNC’s Saxophone Club

Co-Chair -- Cal. Bar Cyberspace Comm.

Regular contributor to Huffington Post, Politics Magazine and Santa Monica Daily PressBegan career with one of Washington’s top lobbyist,[object Object]

NET PUBLIC POLICY 3 HURDLES FORAFFILIATES,[object Object]

Advertising Tax: What Happened and What’s Next

HURDLE #3,[object Object],Internet Industry Assn Warning,[object Object],The inability of the industry to engage in policy issues with anything more than loose coalitions and ad hoc committees has left the industry vulnerable to stronger and well-organized competitors who are better able to work together to achieve policy goals.,[object Object]

K Street Gap,[object Object],AT&T, Comcast Rout Google,[object Object], In “Net Neutrality Battle” (7/20/06),[object Object],AT&T ,[object Object],LOBBYING,[object Object],DOLLARS ,[object Object],PER $1 ,[object Object],SPENT BY GOOGLE,[object Object]

Meet the 800 Pound Gorilla At the Center of the Tax Debate,[object Object]

RED SKY AT MORNINGFY ‘10 Deficits as Pct of FY ‘09 Budget,[object Object],50% ,[object Object],LARGER,[object Object],THAN 2009,[object Object],38 States over 10 pct,[object Object]

FYE 2011 IS PROJECTED TO BE EVEN WORSE,[object Object]

RED SKY AT MORNINGFYE 2011 DEFICITS - EARLY PROJECTIONS,[object Object],FY ‘11 – ALREADY 13 STATES PROJECT DEFICITS GREATER THAN 10%,[object Object],4 STATES GREATER THAN 20%,[object Object]

The New York Law,[object Object]

U.S. Constitutional Limitations,[object Object],Quill Corp. v. North Dakota(1) – Due Process and Commerce Clauses limit state taxing authority to entities with a physical presence in state.,[object Object],Borders Online, LLC v. State Bd. of Equalization(2)- Borders Online subject to sales tax since it was merely agent for Borders brick and mortar operations.,[object Object],504 U.S. 298 (1992),[object Object],29 Cal. Rptr. 3d 176 (Cal. Ct. App. 2005),[object Object]

NY’s Amazon TaxNew York Tax Code Section 1101(b)(8),[object Object],New York Affiliate Sales Tax “Amazon Tax”,[object Object],Seller of tangible or personal property subject to sales tax if:,[object Object],the seller enters into an agreement with a resident of this state under which the resident, for a commission or other consideration . . . refers potential customers, whether by a link on an internet website or otherwise, to the seller, if the cumulative gross receipts from sales by the seller to customers in the state who are referred to the seller by all residents with this type of an agreement with the seller is in excess of [$10,000] during the preceding [four quarters].,[object Object],Remember to call my accountant,[object Object]

A Pot of Gold?,[object Object],$68MM,[object Object],$68MM,[object Object],NY: FY 2010,[object Object],$61.3MM,[object Object],NY: FY 2009,[object Object],NY: INITIAL PROJECTION,[object Object],$50MM,[object Object]

Or Fool’s Gold?,[object Object],Publishers Terminating NY Affiliates,[object Object]

Amazon Complaint DismissedAmazon.com v. New York State Dept. of Taxation & Finance, No. 60124/08 (Jan. 12, 2009),[object Object],The New York law:,[object Object], requires a substantial nexus between an out-of-state seller and New York through a contract to pay commissions for referrals with a New York resident along with realization of more than $10,000 of revenue from New York sales earned through the arrangement. The neutral statute simply obligates out-of-state sellers to shoulder their fair share of the tax collection burden when using New Yorkers to earn profit from other New Yorkers. ,[object Object]

What Happened?,[object Object]

New York Fever,[object Object],[object Object]

“I introduced Assembly Bill 178 for two reasons: to create a level playing field for our brick and mortar businesses and to collect sales tax that is rightfully owed, thereby helping our budget shortfall.”,[object Object]

Status,[object Object],Passed orPassage Likely.,[object Object],?,[object Object],VETO!,[object Object],VETO!,[object Object],California,[object Object],Hawaii,[object Object],North Carolina,[object Object],Rhode Island,[object Object]

Here Comes the Rain,[object Object]

2010:More States plusCongress,[object Object]

Lessons Learned,[object Object]

Key Factors Influencing Legislative Decisions,[object Object],Policy,[object Object],[object Object]

Level of Congressional Understanding of Issues

Costs, Jobs & CompetitivenessPlayers,[object Object],[object Object]

Nature & Strength of Opposition

Advertising Tax: What Happened and What’s Next

Advertising Tax: What Happened and What’s Next

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Advertising Tax: What Happened and What’s Next

Editor's Notes