Meeting with Lawmakers to Fight Affiliate Tax

There have already been some great write ups about last week’s California Lobby Day from Karen Garcia and Trisha Fawver as well as some recaps of the day’s events on podcasts, including The Spew and Affiliate Thing.

I went in to the experience not really knowing what to expect. I had never met with lawmakers or publicly elected officials before. I didn’t have a good idea of what was going to happen or what I was going to say. I was pretty nervous. Thankfully, a big group of us (10 people) attended the appointments in California, so it didn’t fall on me to do all talking.

I wanted to share some small things that might it easier if you are going to visit your local representative in California or other reps from any number of states that seem to be jumping on the tax bandwagon each week.

Most of these points are basic, but I hope they will help settle your nerves and give you one (or maybe two or three) less things to worry about was you get involved to fight this unfair tax proposal.

Setting up a Meeting with Lawmakers
*Look for representatives that sit on the Revenue and Tax Committee
*Call those representatives’ office to set up face-to-face meetings
*Try and meet with as many members of that committee as possible in a single day
*If possible, bring people from committee member’s districts. There will be more impact if these lawmakers are speaking with their constituents.

Meeting with Lawmakers (when a bill has been proposed)
*Ask them if they are familiar with the bill
*Don’t worry that you are not a professional lobbyist
*You don’t need a prepared presentation
*Don’t feel you are imposing. Legislators meet with constituent’s everyday and in fact, they work for you. Legislators depend on the support of their constituents as much as you depend on them
*Dress professionally – men, wear a jacket and tie; ladies, office professional attire
*Speak about your personal situation and how you and your family will be negatively impacted.
*Be sympathetic, but firm. For example: “we understand states are facing tough economic times and need to generate revenue, but this tax unfairly targets a single group.”

Basic Points to Make
*Focus on the impact of small business
*Avoid using the word affiliates. Instead go with small business or online publishers
*Let lawmakers know that out of state retailers are likely to drop publishers in that state to avoid nexus in favor of publishers in other states without nexus
*Let lawmakers know losing those merchants will severely harm your business and dramatically reduce your income
*Use the NY Amazon Tax as an example: more than 200 merchants dropped publishers in NY when the tax was enacted a year ago. That number is likely a lot higher but it’s hard to find exact figures.
*Point out that any revenue expected to be generated by the state will be offset by merchants pulling out (therefore, no sales tax collected from those out of state merchants; and that income tax generated from publishers will dramatically decline; and if your affiliate business employs others you may be forced to layoff workers - thus further adding to the state’s costs by workers possibly seeking unemployment)
*Do not use industry jargon - CPA, CPC, etc
*Mention that affiliates small independent businesses using a next generation form of advertising, but don’t spend too much time making the specific distinctions between the fact that affiliates are not sales reps, they are doing a form of advertising. While that is a key point in the bill, getting into the nuances seems to make lawmakers eyes glaze over. They don’t get it.
*Try and avoid words like “commission.” That word seems to imply sales to those not versed in online marketing. Instead, perhaps, you can say that because we are using the Internet and can track who clicks on what ad, we are paid on a performance basis. Still, even that level of specificity met with some blank stares at the California Lobby Day.
*Find an example that illustrates your point in a simple way. In California, the affiliates visiting lawmakers said they were like the ValPak coupon direct mailers. They were simply an electronic version of getting the ads to people that sought them out.
*Stress that you are not a sales rep for any company. You are not selling anything. You don’t get customer information about any transaction or handle any money exchange.
*Understand the bill. The more you know the better. Read the bill and any other information about it. Check out the forums – ABestWeb.com and 5 Star Affiliate Programs. There is also a Facebook group. And Melanie Seery’s Affiliate Voice. You can also find detailed information about these proposed tax bills on the Performance Marketing Alliance site.
*Be sure to send follow thank you notes to everyone you met with

If Your State has Yet to Propose this Tax
*Find out who sits on the Revenue and Tax Committee (could also be known as Tax committee, Ways and Means or Finance
*Speak with someone on the committee about whether this type of tax is being talked about or proposed
*Ask to set up an appointment to speak with a representative about the topic

The bottom line is that these taxes unfairly target affiliates and it’s up to everyone in the online marketing community to get educated and involved.