Overstock.com today reinstated its relationship with Hawaii-based affiliate advertisers following Gov. Linda Lingle’s decision to veto legislation that would have forced the online retailer to collect taxes on its Hawaii sales.

Lingle’s veto closely followed Governor Arnold Schwarzenegger’s Tuesday night veto of similar legislation in California.
“Today we cheerfully comply with Governor Lingle’s request that we promptly restore our relationships with her state. We are more than happy to do so and thank the Governor for seeing clearly on this bill,” said Patrick Byrne, chairman and chief executive officer of Overstock.com.
Earlier this week, Overstock.com, Amazon.com and online jeweler Blue Nile canceled affiliate advertising contracts in Hawaii and other states where legislatures had passed bills allowing Internet sales to be taxed.
Amazon spokesman Patty Smith said the online retailer was “grateful” for Lingle’s veto.
“We will reinstate Hawaii-based Associates as soon as we receive confirmation that the legislature will not override her veto,” Smith said in an e-mail.
A Blue Nile spokesman said the company supports Lingle’s veto.
“It is the right move for Hawaii’s many entrepreneurial and hard-working citizens who depend on affiliate commissions for all or part of their income. Blue Nile is pleased to announce that we are taking the necessary steps to resume our relationship with Hawaii affiliates,” the spokesman said in an e-mail.