Thanks to Arkansas Act 1001 that forces retailers with online affiliates in Arkansas to collect state sales tax beginning October 24, 2011, Amazon has announced that, as of July 24, there will be no Amazon affiliates in Arkansas.
In an email dated June 10, Amazon informed its Arkansas affiliates of the upcoming cancellation of contract:
For well over a decade, the Amazon Associates Program has worked with a large number of Arkansas residents. Unfortunately, a new state tax law signed by Governor Beebe compels us to terminate this program for Arkansas-based participants. It specifically imposes the collection of taxes from consumers on sales by online retailers – including but not limited to those referred by Arkansas-based affiliates like you – even if those retailers have no physical presence in the state.
We opposed this new tax law because it is unconstitutional and counterproductive. It was supported by big-box retailers that seek to harm the affiliate advertising programs of their competitors. Similar legislation in other states has led to job and income losses, and little, if any, new tax revenue. We deeply regret that its enactment forces this action. The unfortunate consequences of this legislation on Arkansas residents like you were explained to the legislature, including Senate and House leadership, as well as to the Governor’s staff.
As a result of the new law, contracts with all Arkansas residents participating in the Amazon Associates Program will be terminated on July 24, 2011.