Amazon Tax, Short-lived?

by Mark Cavers The Amazon tax, which became law in January, is bad for businesses, workers, and families. Last week, Performance Marketing Associates brought a lawsuit against the Illinois Department of Revenuechallenging the constitutionality of the law. As far back as last year, executive vice president, Kristina Rasmussen warned that if the bill passed companies would flee Illinois. The day...

by Mark Cavers

The Amazon tax, which became law in January, is bad for businesses, workers, and families. Last week, Performance Marketing Associates brought a lawsuit against the Illinois Department of Revenuechallenging the constitutionality of the law.

As far back as last year, executive vice president, Kristina Rasmussen warned that if the bill passed companies would flee Illinois. The day the bill passed, small businesses like Fatwallet.com immediately began to look for facilities in Wisconsin to relocate to. For a state that is 48th in job creation, scaring away jobs and employers does not seem like a sustainable strategy for the future. But there is some good news, Performance Marketing Associates seems determined to get this harmful law overturned. From their press release:

“House Bill 3659, signed by Governor Pat Quinn last March, victimizes Illinois entrepreneurs, small businesses, and even non-profit organizations who publish online advertisements for out-of-state retailers in an unlawful attempt to expand the state’s taxing authority.”

This law, like the 67% tax hike just passed, is just another attempt by our Governor to ensure that government spending continues its skyward climb. The sad part is the bill won’t even accomplish its central goal: raise money for the state:

“The fact is, this is a lose-lose situation for the state, which will collect no new use tax revenue from those online retailers that terminate their relationships with local Illinois affiliates, and the affiliates themselves will lose millions of dollars in advertising revenue each year.  That means less income tax revenue for the state and fewer jobs for the people of Illinois.”

Marketing Performance Associates estimates this law will result in $22 million fewer dollars collected through income taxes. Fewer jobs and less tax revenue, a proud day for Illinois government.