Overstock Ends Affiliate Marketing in Four States to Avoid Sales Tax

Overstock.com is no longer using affiliate advertising in four states to protest upcoming laws that will require online retailers to collect sales tax if they are marketing within state boundaries. The states are Rhode Island, New York, North Carolina and Illinois. Online retailers typically do not collect sales tax from customers in states where they do not have a physical presence, but the interpretation of presence is getting broader as states seek new revenue. Overstock will instead market directly to residents in those states by giving customers a credit worth about $30. In all, Overstock said, the program could cost about $4.5 million.

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I think the NSA has a job to do and we need the NSA. But as (physicist) Robert Oppenheimer said, “When you see something that is technically sweet, you go ahead and do it and argue about what to do about it only after you’ve had your technical success. That is the way it was with the atomic bomb.”

— Phil Zimmerman, PGP inventor and Silent Circle co-founder, in an interview with Om Malik