There are other options. Overstock has reportedly said that the company will simply break off relationships with companies in New York, thus keeping itself beyond the reach of New York's tax authorities. In the process, this will have a negative impact on those companies that used to work with Overstock, but now can't.
Some of those companies will go out of business as a result, while others will have their sales reduced. This, in turn, will cut the amount of tax that New York receives from companies that once were in this business, but now can't be. I've been trying to see who wins in that scenario, but so far, I don't see any winners except the state Attorney General, who can claim another victory when he runs for governor.
Meanwhile, we'll continue to hear from all sides how the requirement to pay sales tax will somehow doom Amazon's business. I hate to break it to them, but avoiding sales tax doesn't seem to be a major reason people shop online. The primary reasons seem to be convenience and selection. After all, if sales taxes had any impact, how is it that Walmart does so much business? Even in their online sales, they charge sales tax.
But what's most important to remember is that nothing in this current taxation battle is taxation of the Internet. The rules about sales taxes apply—whether customers place their orders by mail, phone, telegraph or online. It's not the Internet that's being taxed; it's the sale of products, regardless of how they're sold.