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Overstock.com Looks To Bypass State Tax Efforts With New Program

Salt Lake City-based Overstock.com said this morning that it has launched a new program to reward its customers in states where it has cut its affiliate program due to those states tax efforts. Overstock.com said that it will redirect its ad dollars that it normally spends in Rhode Island, New York, North Carolina, and Illinois on affiliate payments, and instead pay credits in its Club O program directly to consumers in those states. Overstock said that any of its customers in those states who have spent more than $300 in the past year, will receive a free Club O membership and an additional $10 balance; existing Club O members will receive $20 to their accounts, which allow users to purchase products using those points.

The move comes as those states--and others--have looked to force Overstock.com and other online retailers like Amazon.com to collect sales taxes, by making their affiliates a "nexus" for state tax purposes. Instead, Overstock.com cut all of its affiliate ties in those states. Overstock.com said the new move will provide over $30 in value to over 150,000 customers.