Relief On The Horizon For Colorado Affiliates
Last Wednesday, Colorado affiliates heard news that may signal a shift in the fight against so-called â€œAmazon taxes.â€ On May 2, 2011, Colorado lawmakers introduced HB 11-1318, which repeals Coloradoâ€™s version of the â€œAmazon tax,â€ while also requiring online retailers to notify buyers that, depending on their state, they may owe use tax even if a retailer doesnâ€™t collect it at the point of sale.
Introduced by the Republican House Majority Leader, Amy Stephens, and Representative Sue Schafer (D-Wheat Ridge), HB 11-1318 appears on a fast track with bill supporters hoping for passage before Coloradoâ€™s 2011 legislative session ends. Bill proponents, both Republican and Democrat, easily carried the House vote this week. The bill now heads to the Senate.
While supporters are optimistic that it will pass in the Democratic-led Senate, some senators who continue to support the original HB10-1193 have voiced concern that repealing the law could hurt local businesses trying to compete with online retailers. They also challenge claims that the law would be overturned in court, despite the District Court decision earlier this year.
HB11-1318 is Coloradoâ€™s answer to the preliminary injunction handed down by the U.S. District Court in January 2011. Judge Robert Blackburnâ€™s ruling put a halt to the implementation of HB10-1193, which stipulated that online retailers like Amazon must collect use tax. Blackburn stated as part of his ruling that â€œthere was a substantial likelihood the law would be thrown out at trial as an â€˜undue burdenâ€™ on businesses.â€ The suit to stop HB10-1193 was brought by the Direct Marketing Association.
As it has done in other states that have passed similar laws, Amazon pulled its affiliate program from Colorado since that was the basis the law used to require Amazon collect taxes. While Amazon has not committed to bring its affiliate program back to Colorado, it has indicated that itâ€™s willing to comply with the law proposed in HB11-1318. Stephens, Schafer, and other supporters are encouraged and consider it a good sign that Amazon and other online retailers may once again offer affiliate programs in Colorado if the bill becomes law.