Because New York State just doesn’t get it.. they can’t solve their budget problems by raising taxes.

Amazon.com, the online book retailer, and electronics Newegg.com has filed suit against New York in response to a new law requiring online retailers to collect sales tax from buyers in the state.

Rival Overstock.com took a less complex measure: it has canceled relationships with its 3,400 New York-based affiliates, according to the The New York Times.

“We can’t afford to have our New York affiliates up online if it subjects us to New York sales taxes,” said Jonathan Johnson, SVP of corporate affairs for Overstock.

The company seeks to “[show] the New York governor and legislature that this is bad for New York businesses.”

And guess who also isn’t happy about this? Me. I frequently make online purchases at Amazon.com and other places. This evening I noticed the new tax when buying a few books. As a former resident of Massachusetts, my default address on my Amazon.com account is my former Massachusetts address. So, I switched the shipping address to my current New York address, and lo and behold, I was then charged taxes. Amazon and other online retailers had to start collecting sales taxes from buyers from New York state on June 1. This comes just as the cigarette tax in New York claims the honor of being the highest in the nation.

UPDATE: Overstock.com follows suit…

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It looks like Massachusetts is also looking to fix its budget problems on the backs of smokers…

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First Governor Paterson said he wanted to avoid raising taxes as he tried to balance the state budget.

Well apparently the legislature isn’t so interested in avoiding tax hikes — they’re already looking at raising the cigarette tax…

Legislative leaders were talking about doubling the cigarette tax to $3 per pack to help the state make ends meet, but hadn’t finalized the amount by Monday afternoon.

A per-pack increase of $1.25 or $1.50 would push the average price of cigarettes over $7 in New York.

Listening to the radio, the most popular defense of raising the cigarette taxes is the resulting deterrent on smoking. But let’s face it, the goal of the tax increase isn’t to discourage smoking as much as it is to help legislators make ends meet in the state budget. But why are smokers expected to bare the brunt of the state’s budget crisis when just over a month ago the legislature was looking into increasing their own pay?

According to the New York Times article the average pay for a state legislator is just over $90,000, which is a huge salary when you consider the fact the legislature is only in regular session 63 days a year. The average salary in New York State is $47,330… Perhaps legislators should take a pay cut by making a typical salary before they start raising the taxes on people who can’t vote to increase their own pay.

UPDATE: At least Republicans legislators opposed the pay raise…

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