California Governor Schwarzenegger Vetoes “”Amazon”” Nexus Provisions

Governor Schwarzenegger vetoed a majority vote tax increase passed by the California legislature after announced that it would pull its affiliate advertising from the State. California lawmakers had proposed a tax on affiliate advertising similar to New York’s “Amazon” laws. The new laws would have changed the definition of “retailer engaging in business in this state” to include any retailer entering into an agreement with a resident of California under which the resident, for a commission or other consideration, directly or indirectly refers potential customers of tangible personal property via a link on its website or otherwise to the retailer. Governor Schwarzenegger stressed his commitment to not raising taxes and his fight to keep and create jobs in California. will continue to do business with affiliates in California (Press Release, Governor Schwarzenegger Remains Committed to No New Taxes, Announces Will Continue to do Business in California (July 1, 2009).

Posted on July 22, 2009