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  1. #1
    Kung Fu Master Eathan's Avatar
    Join Date
    January 18th, 2005
    Types of Advertising and Nexus confusion
    Just some rambling thoughts here, so bear with me...

    The sample terms and conditions at prohibit certain affiliate activity to help merchants avoid New York sales tax, and thus keep New York affiliates.

    Affiliate is prohibited from engaging in any solicitation activities in New York State intended to refer potential customers to the (Fill in Merchant Company Name), including, but not limited to: distributing flyers, coupons newsletters and other printed materials, or electronic equivalents of such materials; engaging in verbal solicitation, including in-person referrals or initiating telephone calls; and sending emails intended to refer customers to the (Fill in Merchant Company Name).
    This suggests that it comes down to active verses passive marketing. Affiliates can link to merchants, but not actively recruit customers on the merchant's behalf or they'll be considered paid sales reps. The way I read it coupons would be out (especially exclusive coupons), no email newsletters, print advertising, etc.

    This makes me also wonder about affiliates who pose as merchants themselves. Some establish their own brands and pass the customer on to the merchant through a buy button, sometimes directly to the cart itself, while some just copy the merchant's homepage text invariably starting with "We at [merchant name]..."

    Could states point to this copied text and say "We" implies the affiliate is an official representative, or to the buy button and say the affiliate is a franchisee?

    I know it's a stretch, but some of this legislation has tried to say that advertising in a national magazine published in a sales tax state is a nexus. I wouldn't put anything past them.
    Eathan Mertz

    Black Cat Mining - Gold Prospecting & Rockhounding Equipment

  2. #2
    notary sojac Herb ԿԬ's Avatar
    Join Date
    January 18th, 2005
    Central/Western NY State
    sales tax laws vary widely in what constitutes nexus.

    many merchants don't trust states.

    wonder why . . .

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