[thematt]

It's not that the purchase is exempt from tax, it's that Amazon isn't responsible for collecting it. The onus falls on the consumer to pay the sales tax directly to the state. Nobody does though, which is why they want Amazon to collect it.

If you're looking for justification, refer to the Supreme Court ruling that established it, which said that requiring these companies to comply with the varied sales tax rules and regulations of 45 states and some 7,500 different local taxing jurisdictions would burden interstate commerce.

[bambax]

Why don't they fight in court then?

Cutting their affiliates lose looks really low; they should stand for them instead.

[dexen]

Perhaps because fighting in court is costly and long, while asking your affiliates to petition their representatives to change law may be cheaper and quicker? And suggesting to the representatives jobs will be lost (still a big no-no in today's post-crisis mentality)?

Never mind the tax paid to the state actually goes into improvement of local infrastructure, services etc.

[yummyfajitas]

They probably will. They already have in other states.

http://techcrunch.com/2009/01/13/new-york-court-dismisses-am...

I'm not a lawyer, but I believe they cannot file a lawsuit until they are actually harmed (i.e., after the law takes effect).

[chopsueyar]

http://en.wikipedia.org/wiki/Locus_standi