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I've worked closely with sales and marketing for a decade in the corporate world. There was only one way to really incentivise sales people and that was with cold hard cash or something that didn't show up as taxable such as going to a meeting in the Bahamas.
The affiliate has to report whatever is given as taxable income and has to pay taxes on it. So you've not giving me an iPod but you're giving me a discount on an iPod that I have no choice in purchasing.
The only give away that I know changed anyone's marketing was a $5,000+ PC.
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