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May 09. 2012 3:45PM

House rejects Senate's reconfigured bill banning Internet tax

CONCORD – The House has rejected Senate-backed legislation that would have prohibited taxing Internet access, with lawmakers accusing the Senate of subverting the bill's original intent, to shift a $16 million budget surplus to the rainy day fund.

The Senate transformed HB 1652, which would have moved most of the surplus from the last biennium to the rainy day fund, into a bill that would prevent the state from collecting pending taxes on Internet access.

House lawmakers criticized the move ahead of the vote on Wednesday. “As a (bill) sponsor, I'm very disappointed in the Senate's actions,” said Rep. Franklin Sterling, R-Jaffrey. “The whole point of this is to shore up the rainy day fund.”

The House not only voted to reject the bill, but also against referring it to a conference committee that would have worked to reconcile the differences in the House and Senate bills.

Senate leaders promptly criticized the House vote.

“The Senate remains committed to being on the side of taxpayers, making sure they never have to pay tax on their Internet access,” said Sen. Chuck Morse, R-Salem, the chairman of the Finance Committee, in a statement.

House Republican leaders, who strongly pushed for transferring the surplus to the rainy day fund as an act of fiscal responsibility, fired back.

“Obviously, we would prefer having a responsible dialogue with the Senate, but they seem more interested in using inflammatory rhetoric more consistent with political campaigns than actual governing,” said House Speaker William O'Brien, R-Mont Vernon, in a statement.

Another apparent casualty of the House vote on the bill is a provision that would have allocated $1.5 million of the surplus to help reduce the Developmental Disabilities wait list.

At the same time, both House and Senate leaders indicated that a late compromise was still possible.

“I am confident that at the end of the session, we will have advanced the best policies possible for the state of New Hampshire. We must keep calm and carry on,” said House Majority Leader D.J. Bettencourt, R-Salem.

The vote was the latest flare-up between Senate and House leaders as they attempt to get their high-priority bills passed in the closing weeks of the legislative session.

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