How Can Websites Work Around This Loss of Income?
The beauty of the Internet is that things change so quickly. While California will be losing both the expected sales taxes and a reduced tax on the income of affiliates of Amazon and other affected parties, the poorly researched and clearly insane decision by California can be quickly circumvented by some imaginative web developers.
While Amazon’s tactic of bringing a lawsuit against the state of New York (another of the proponents of the so-called Amazon tax) will help it to stave off the pressure to pay the taxes and raise their prices – thereby losing one of its major selling points – they have already offered an olive branch elsewhere in the state of Texas.
Instead of accepting the tax here, Amazon is instead offering to spend $300 million on job-creating distribution centers and setting up a separate website for voluntary payment of sales taxes by Texans.
The next step for many smaller online businesses could be to move their base of operations abroad, perhaps to Canada, Mexico, or the EU. With the help of overseas web hosts, a change of domain name and the registration of the business to a post office box this could be made possible.
But would this be enough? Or, is California's stance here just a sign of things to come?