Today marks one year since Illinois Circuit Court Judge Robert Lopez Cepero ruled that HB 3659, Public Act 96-1544, was unconstitutional. Affiliates within the State of Illinois were cut off by most companies such as Amazon and eBay after the bill was signed into law. As a result, Illinois entered a lose-lose-lose situation by reducing taxable income of its citizens, forcing businesses like FatWallet to leave the state, and gaining no further sales tax revenue. From many conversations that I have had, confusion and denial of the Use Tax (Line 23 currently) on the IL-1040 has also led to many people continuing to pay no sales tax on Internet purchases in their annual income tax filing.
As a perspective on politics, the whole situation is interesting. As someone cut off from an opportunity to make revenue (except for a slight workaround through Skimlinks) it is incredibly frustrating. After political and judicial maneuverings by the State, the law finally had its day in court and was ruled unconstitutional. However, 365 days later, the law is still in place and taking effect. While affiliate revenue may not be the end of the world, it is terrifying to think of a worse law that legislators could pass, be ruled unconstitutional, yet continue to impact citizens for more than a year after the ruling.
While you are still looking around for the checks & balances in state government, you can review the timeline of Public Act 96-1544:
January 6th, 2011 – “Amazon Tax” Passes Illinois Legislature – Amazon Warns IL Associates Accts
March 10th, 2011 – IL Governor Quinn Signs “Amazon Tax” Into Law, Overstock and Amazon Terminate All Illinois Associates
June 17th, 2011 – State of Illinois Sued For Unconstitutional “Amazon Tax” Law
July 28th, 2011 – PMA dismisses federal suit, files suit with Illinois State Circuit Court
August 3rd, 2011 – “Main Street Fairness” Act Heads To The Federal Level and Amazon Supports It
October 26th, 2011 – State Rep. Dave Winters proposes suspending Public Act 96-1544
November 30th, 2011 – Amazon testifies to Congress supporting Federal Sales Tax
December 2nd, 2011 – Overstock pushes for Equity in Sales Tax Collection Act Bill
April 27th, 2012 – Judge rules “Amazon Tax” unconstitutional
May 4, 2012 – Amazon informs me via e-mail that they have no statement on the court ruling at this time.
April 22, 2013 – Internet Sales Tax bill makes progress in the Senate
Present – Public Act 96-1544 still in place, affiliate programs still block Illinois residents
If you are wondering why the law is still in place, the Performance Marketing Association says that an appeal by the state is pending. How much longer must we wait?