Sales Tax Attack

Benjamin Franklin Tax Prophecy
"In this world nothing can be said to be certain, except death and taxes." Benjamin Franklin first penned those words in a 1789 letter. Funny how those two words, death and taxes go together. In this context, Mr. Franklin is telling us that we will certainly die and most assuredly we will be taxed. Now, in a more recent sales tax attack, a new collection process is certainly leading to the death of online business transactions.

I started my blog early in 2009 with the intention of making my living completely online. My wife Maggie said, "That's nice honey... but how will you make money?" Great question, one that a lot of people have pondered over the last couple of years as they see their own 'real world' careers crack and crumble with the economy.

There are literally a hundred and one ways to earn a living online. We'll focus on just one today, affiliate marketing since it has recently come under a new sales tax attack, our main topic keyword for the day.

Hold the Sales Tax Please

Here's the over-simplified version of the inside scoop on how this 'make money online' thing works, folks.

Create a blog around something you love - for example, mine happens to be personal development, 'Love That Feeling'.
Choose some categories where you can zoom in on more specific topics - I've designated Monday as 'Wealth' day.
Next, select a keyword from current events to fit your overall blog theme and category - today I've chosen 'sales tax attack'.
Write your article, then select and insert related books and services you recommend using affiliate programs such as Amazon, Clickbank and other vendors.Of course, there are various other strategies. Right now, let's stay on track with today's focus, death and taxes.

Affiliate marketing is one of the easiest ways to get started making money online. Among the advantages are:

You don't have to create or own a product.
You don't have to bother collecting money or delivering that product.
You don't have to deal with customer service headaches.
You simply recommend and when your readers buy, you get a commission.Depending on the size and popularity of your blog, commissions can be extremely lucrative. One gentleman I read about while researching this article brought in $50,000 just in Amazon commissions in 2008. Now, due to the recent sales tax attack, that income is about to be cut off. He and his wife are seriously considering moving to a different state. However, it's only a matter of time before most, if not all states, catch on to this added source of revenue and adopt their own 'money-grab' plan.

As a registered affiliate of Amazon.com, I use a lot of related book recommendations throughout my articles. Up until recently, Amazon has not had to collect sales tax for online purchases as long as they didn't have a store or other physical presence in the state where the sale was made.

In 2008, Amazon started shutting down some of its affiliate programs in states where the new sales tax collection scheme was taking place. Another company, Overstock based in Salt Lake City which also uses an affiliate model, calculated that it would be far more costly to start collecting taxes than to keep the affiliate programs.

How Ridiculous is this Sales Tax Attack

Back in the late 70's and early 80's just before I moved to Toronto, Massachusetts had a state slogan, "Make it in Massachusetts". Just to the north, New Hampshire countered with a bumper sticker which read, "Make it in Massachusetts... Spend it in New Hampshire". Indeed, this is what has been going on for decades in towns all along the Mass/NH border and I'm sure in other places across the country where buyers have the choice of paying tax on purchases or NO tax, as they do in New Hampshire.

My old accountant Joe back in Massachusetts used to joke about this all the time by asking, "Do you see all the people stopping at the Mass/NH border to pay their sales taxes?"

Well, government officials aren't dumb - highly debatable, I know, but when it comes to siphoning the salary out of your shorts, you have to admit, they are right on the money! (pardon the pun)

In some states, there is now an extra line on your annual income tax return that asks you to claim your online spending so you can remit your sales taxes... right along side the line for out-of-state shopping claims. I'm sure they have Joe and his clients' full voluntary cooperation!:)

In our cash starved economy, governments have now awakened to the fact that there are literally millions of dollars slipping through their fingers in state sales tax revenue. New York estimated a whopping $34 million for the current fiscal year, with other states realizing proportionate amounts. It's easy to see why they are most interested in increasing their sales tax collection efforts.

You and the Sales Tax Attack

So with major affiliate operators like Amazon and Overstock shutting down their programs, what's left for the online marketer to do. Fear not; remember there are at least 101 ways to make money online.

You could create your own product in the form of an ebook or digital download software. Instead of getting only a percent in the form of commissions, you get to keep the entire amount all to yourself.

However, if you want to make the really big money, you'll want to recruit affiliates of your own to act as ambassadors for your creation. Think of all the benefits you'll have with others doing all the advertising for you... that is, of course as long as you agree to keep your state, federal and some day, even international government partners informed and involved by giving them their share in the form of taxes.

Is it any wonder why Benjamin Franklin observed that death and taxes make such a lovely, inseparable pair?