Responding to a new law that would affix a sales tax to Amazon purchases made in California, Amazon announced it will drop its Affiliates program in the state. Affiliates members help sell Amazon products and get a cut of the proceeds. Dropping the program’s California users would presumably spare Amazon from having to collect sales tax on its California transactions.

CNN Money reports Amazon wrote a letter to associates that seethed about the law. An excerpt:

We oppose this bill because it is unconstitutional and counterproductive. Similar legislation in other states has led to job and income losses, and little, if any, new tax revenue.”

Shot back a spokesman for a California legislator:

“It’s odd that a company would voluntarily dilute its business in the most populous state in the country simply because it’s being asked to collect what is lawfully owed.”

Rhode Island, Connecticut, New York, Illinois, North Carolina and Arkansas have all passed similar laws, and Amazon has dropped its Associates program in all the states but New York.

Amazon drops California associates to avoid sales tax [CNN Money]

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