Internet company FatWallet.com signed a one-year lease to move its operations from Wagon Wheel Road in Rockton to the former Kerry Ingredients headquarters in downtown Beloit, Wis.
FatWallet owner Tim Storm said he had no choice but to move the company after Illinois Gov. Pat Quinn signed a law requiring all companies doing business in Illinois to collect and remit legally required sales taxes.
The lease needs to be approved by the Beloit City Council, which is holding a special meeting Friday night. FatWallet hopes to be in the new building by mid-April.
FatWallet officials estimated the new Illinois law would cost it about 30 percent of its business. The company had about $13 million in commission revenue by sending shoppers to the websites of retailers such as Amazon.com.
Illinois is the seventh state to pass the measure that is becoming known as the Amazon law, following Rhode Island, North Carolina, North Dakota, Kansas, Kentucky, Colorado and New York. Amazon has cut off relationships with companies in those states, other than New York, to avoid having to collect sales tax. Amazon is fighting the New York law in court.
Several other states are considering the Amazon law, but Wisconsin is not one of them.
FatWallet was started in 1999 and now employs 54 people. In 2007, the company moved into a $5 million, 30,000-square-foot building on land Storm bought. Storm, who lives in Rockton and is a 1986 Harlem High School graduate, said he has not made a decision what to do with the old headquarters. He said in an email that he is moving the company reluctantly.
“We have been a proud supporter of the Rockford community for years. We are disappointed the short-sighted political decision making in Springfield has brought that to a halt.”
FatWallet spokesman Brent Shelton said it may have been possible the company, which was voted as No. 20 on Entrepreneur Magazine’s list of Best Small & Medium Workplaces in 2010, could have moved part of its operations to Beloit and kept some workers in Rockton.
“We’ve developed a pretty unique culture and it just didn’t make sense to break that up,” Shelton said. “We thought it would be best to keep everyone together.”
Let them go! If they don’t want to help us out in Illinois, so it be.
Predictable. This time enxt year revenue analysis will show a net decrease in tax revenues from this law. That is what has happened in other states. That is what will happen here also. More jobs heading out of state.
Great endoresment RRStar
Once again the intellect of ILLINAUSEA politicians shines brightly!
I would like to know How much the state plans to receive from the taxes on e-tailer businesses that have been in the state. And how much they are going to lose by having good businesses like Fat Wallet leave the state.
What happens to his TIF agreement is he walks away for the building?
At least Beloit is much more fiscally responsible to the taxpayers. m They tie TIFs to results that must be met, before a business gets anything for free.
Taxpayers in Rockton will be stuck with the bill, if Storm walks away,
Thanks Quinn. Any more bright ideas, keep them to yourself. idiot….
How many more businesses moving out of state will it take, before the electorate of Illinois gets rid of the anti-business Democrats, like Quinn, Madigan, and Cullerton? Or, does the state have to go into bankruptcy first?
Good Riddance FW! Don’t ever come back!!
This will blow up in Illinois’ face as we are beginning to see with Fatwallet. States’ ‘Amazon Tax’ Seems to Hurt Revenue, Not Boost It
http://www.dailyfinance.com/story/taxes/states-amazon-tax-seems-to-hurt-revenue-not-boost-it/19388013/
Kathy McKay – here is an answer:
“Then again, expecting affiliate sales-tax collection to overcome even a small part of overall budget deficits may be a tall order. Six months after Rhode Island passed its law, the state has not seen appreciable revenue increases. Paul L. Dion, who heads the revenue-analysis office for the state Department of Revenue, told the Rhode Island Business News that officials “do not believe that there has been any sales tax collected as a result of the Amazon legislation.”
See full article from DailyFinance: http://www.dailyfinance.com/story/taxes/states-amazon-tax-seems-to-hurt-revenue-not-boost-it/19388013/?icid=sphere_copyright
Wake up folks! This law was passed because of BIG TIME lobbying by Walmart, Best Buy and other big box retailers who are deadset on destroying online only retailers like Amazon and Overstock.
I fully agree completely…
I don’t disagree with this post!!