Sunday, March 18, 2012

The end of GPS Tracklog?

End-of-GPS-Tracklog A labor of love for four years, GPS Tracklog may be going away. What began as a spare time hobby morphed into something much larger. It takes a huge amount of time and, up till now, it’s been worthwhile thanks to sales from Amazon and other advertisers. We’re not exactly living large, but at least we’ve been surviving.

The State of North Carolina may force us to close

We dutifully pay income tax on all revenue associated with the site, but that’s not enough for the state of NC, which wants to tax Internet sales. Normally you don’t pay sales tax on Internet purchases unless a company has a physical presence in your state, right? Well, the NC legislature is going to define website owners running ads as a physical presence for Amazon and others, just like they would if they had a warehouse or storefront here. Creative, huh?

This would allow the state to tax all Amazon purchases made by NC consumers, regardless of how they got to Amazon. You might imagine that these e-commerce companies are none too happy about this. As a matter of fact, many (including Amazon) have already ended their relationship with all NC websites to avoid it.

Which leaves us with few and unpalatable options — to move again, sell the site, completely revise our model or shut it down completely. Our GPS Deals site may be shuttered as well.

Changing the very nature of the Web

My wife made an interesting comment. If you’ve ever researched a product online, you’ve likely come across websites like ours. As the sites grow, most people turn to advertising to justify the time spent. Imagine them all going away.

How to help

One thing you can do is sign this petition. If you are a North Carolina resident, please consider calling your legislators and tell them you are opposed to the Internet tax provisions in S202. And if you think this is just an NC issue, rest assured, this is an early salvo in an attempt to tax all Internet purchases nationwide.

Thanks to everyone for four years of fun. It’s been a blast being able to test the latest gear and bring you all the news from the world of GPS. Here’s hoping we can stick around.

About Rich Owings

Rich is the owner, editor and chief bottle-washer for GPS Tracklog. Connect with him on Twitter, Facebook or Google Plus.

Comments

  1. Good luck with the petition, the sales tax does sound crazy, hope the web site can stick around. It’s a good resource for many.

    • Rich Owings says:

      Thanks Dean. The choices look bleak. My wife really doesn’t want to move again. But all signs are that the Legislature will pass this, even though NC website owners have shown the it will actually mean less revenue for the state. Amazing and depressing.

  2. Rich,

    Like you, I really hope this legislation doesn’t pass because I’m worried about the precedent it will set. While I don’t have the same dependency on my sites for my livelihood (or nearly the same following!) I was certainly hoping to grow my sites over time using a similar advertising strategy.

    It would be a real loss to have this site go away so we’ve signed the petition. You’ve been very helpful over the last year – let me know if there is anything else I can do to help.

  3. sorry to hear this.

  4. Rich Owings says:

    Thanks everyone. Looks like we picked up several hundred petition signatures yesterday.

  5. Jeff Jones says:

    This is a shame! I just signed the petition too. Good luck!

  6. This is terrible news Rich, and I hope you’re able to somehow work around it. I think a case can be made that Internet and mail order sales ought to be subject to sales tax to some degree, they’ve been getting a free ride compared to local bricks-and-mortar, but it needs to be a coordinated, equitable method across all 50 states, not these absurd, piecemeal attempts to grab a piece of the pie by individual states. NC deserves to lose tax revenue as a result, but it’s wrong that people like you are the victims.

  7. Rich Owings says:

    Yes, the national alternative is the Streamlined Sales Tax Project (supported by Amazon, BTW), but the states are in a budget squeeze and they got tired of waiting for the enabling federal legislation.

  8. Why not form an LLC within another state (or even do the popular thing now a days and form it in a different country). Some states it takes almost nothing to become a resident of that state (look at the ones retired people register their RV’s in) and form the company there.

  9. Rich Owings says:

    Oh if it were only that easy. The legislation refers to where you domicile, live or reside. Amazon and others will have a certification process to ensure that you have really moved. We are working with attorneys, sorting out the details.

  10. Bummer, Rich. I’d hate to see GPSTracklog go. Forwarding to some NC friends…

  11. Rich Owings says:

    Thanks Scott. I appreciate it. I expect it will be decided in the next week or two.

  12. I’m #1453, I think that was my number. I was planning to move to NC, this could change my plans…

  13. Rich Owings says:

    Sorry to hear that Craig. Would have been cool having you in the neighborhood (assuming I get to stay).

    The NC House and Senate passed the first reading of the budget last night, including this provision. I’m calling a sales & use tax attorney this morning to set up an appointment and discuss my options.

  14. Rich, what’s the latest on this? A comment updating the provision’s progress would be great. thanks, matthew

  15. Rich Owings says:

    The legislation passed and, after some very large legal expenses, we moved our business out of state. This has meant spending a great deal of time away from my family. I’m working on a plan to bring it back, but that would mean removing all Amazon links, so I don’t know if we can afford that or not. The end result for the state BTW, is that Amazon still doesn’t collect sales tax here. All NC did was drive businesses out of state and lose the income tax paid on that revenue by 6,000 web site owners!

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