Disgraced former New York state governor, Eliot Spitzer, was moving aggressively on a plan to tax any Internet transactions from merchants who had affiliates in the state back in November 2007.

After an uproar, Spitzer backed down on the plan. But then he started working on it again just before the hooker scandal that bounced him from office.

I had hoped his departure from state government would take the plan to scapegoat affiliates with it.

But word was that his predecessor, David Paterson, was interested in the plan, too.

Bad news. Looks like the wheels are in motion, according to Stephen Dubner in the New York Times earlier this week.

In the past, online retailers were held to the same standard that the U.S. Supreme Court set for mail-order vendors: The seller only needs to collect the tax on purchases in states where the vendor has a physical presence, such as a storefront or salesman.

Nicknamed the “Amazon Tax,” the premise is that companies with no physical presence in New York, which means their sales to New York residents don’t get taxed, will now be taxed, because Amazon has affiliates in New York.

If it passes legal challenges, I would imagine many other states would follow with similar plans, which could be bad for online merchants and affiliates.

Anyhow, if the whole tax is based on affiliates living in New York, I would imagine (note - I am not a lawyer, and I am simplifying things as a layman) that if Amazon were to cease working with affiliates in New York, such a tax would be invalidated.

I’ve got to wonder if Amazon is considering such a move to keep their business as attractive to New York customers as it is now.

You’ve got some sweet legacy, Eliot.