not quite.

"Amazon aren't paying the tax, they're collecting it. The buyers who live in New York are paying it to Amazon as part of the price, but Amazon probably don't want to pass the taxes collected back on to the state."

... I can see someone failed reading comprehension classes. Amazon has not been collecting sales tax from New York residents because Amazon does not (did not) have a physical presence in New York state. They're fighting to keep from having to both collect and pay sales tax because it drives the prices up, which in turn lowers the appeal of shopping at Amazon for the New Yorkers who are choosing Amazon, in large part, to *avoid* the hefty sales tax they would pay if they went to a local retailer.

New York state, knowing quite well that this is a large part of the reason New Yorkers shop at Amazon, and wanting to bring that revenue back home, is now arguing that affiliates count as physical presence, which would cause Amazon to have to charge sales tax and thus pay sales tax on New York sales. Either that, or not collect sales tax but still pay sales tax -- vanishingly unlikely -- or, drop its affiliates in the state, which is probably what they will now do, as Overstock has already done.