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Overstock.com cuts off affiliates in New York over sales tax issue |
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| May 15, 2008 12:01 PM UTC |
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Tracked Blogger
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Via BloggingStocks:
Filed under: Law, Competitive strategy  Last week, Amazon.com (NASDAQ: AMZN) filed a lawsuit in New York over the state's new law, which requires online retailers to collect sales tax from New York customers if the company has affiliates in the state soliciting sales for them. Most state laws only require sales tax to be collected in a state if a company has a nexus, or physical presence there. Most states require purchasers of products who haven't paid sales tax on the items to voluntarily report the purchases to the state and pay use tax on them (the equivalent of sales tax). As you can imagine, in the government's eyes, this leaves plenty of tax money on the table as consumers rarely report these purchases to their home states and therefore avoid sales and use tax altogether. New York's new law is a move to collect taxes on these sales, but it has angered Amazon.com and other companies. Affiliate programs are important to increase sales, as the "affiliates" are basically people and businesses who refer others to Amazon.com to make purchases. Amazon.com fought back, and now perpetual money-loser Overstock.com (NASDAQ: OSTK) is fighting back in its own way. Overstock is canceling its agreements with all of their affiliates in New York. If New York is going to use that affiliate relationship in order to impose sales tax on internet sales going to New York, then darn it, Overstock.com is going to show them! Continue reading Overstock.com cuts off affiliates in New York over sales tax issue Read | Permalink | Email this | Comments<map name="google_ad_map_145-1196256"><area href="http://imageads.googleadservices.com/pagead/imgclick/145-1196256?pos=0" shape="rect" coords="1,2,367,28" /><area href="http://services.google.com/feedback/abg" shape="rect" coords="384,10,453,23" /></map> 
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