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Sununu wants lawmakers back in session to fight internet sales tax

By Dave Solomon
New Hampshire Union Leader

June 28. 2018 9:23PM
Gov. Chris Sununu, surrounded by legislative leaders, explains how the state will address the Supreme Court decision on internet sales taxes. (Dave Solomon / ?Union Leader)

CONCORD - Gov. Chris Sununu on Thursday announced plans to call the state legislature back for a special session within weeks to pass legislation in response to the recent Supreme Court ruling over the collection of sales taxes for internet transactions.

The announcement came one week to the day after the court announced its ruling in South Dakota v. Wayfair.

In a 5-4 vote, the justices ruled that states like South Dakota, which has a sales tax, could collect that sales tax from online retailers in other states, including the five states like New Hampshire that do not even have a sales tax of their own.

“New Hampshire does not and will not ever impose a sales tax,” said Sununu, in outlining a plan designed to make collection of sales taxes from New Hampshire online retailers so cumbersome that other states simply won't bother.

With legislative leaders at his side, Sununu predicted that the special session would pass key legislation now being developed by the Attorney General to achieve several goals.

Any state or other taxing authority seeking to collect sales taxes from a New Hampshire business would be required to notify the N.H. Department of Justice in writing.

Before collecting any money, the out-of-state taxing authority will be required to receive a written determination, from the N.H. Department of Justice that the authority's statutes provide certain protections and meet strict requirements.

Those will include an exemption for a certain dollar volume of sales, a prohibition against retroactive enforcement, and an exemption for small businesses, according to Sununu.

In addition, he said, an out-of-state taxing authority will have to show that its laws will not impose an unconstitutional burden on New Hampshire businesses.

Finally, the DOJ would be empowered by legislation from the special session to file a lawsuit to block any attempt to collect sales taxes in violation of the anticipated new law.

“With this proposal, we will send a message to every out-of-state taxing jurisdiction and authority. If you try to come into our state and force our businesses to collect a sales tax in a manner that violates our laws or the United States Constitution, you will be in for the fight of your life,” Sununu said.

“Working together, we will do everything in our power to prevent other states from imposing arcane sales and use tax obligations on New Hampshire businesses.”

Speaker of the House Gene Chandler announced at the same event that the state would be withdrawing from the National Council of State Legislatures, which had advocated in favor of the Wayfair decision, since it would benefit 45 member states that are losing sales tax revenue to internet transactions.

Chandler said the organization celebrated the ruling with no expression of concern for the five states that would be adversely affected.

“It's unconscionable that New Hampshire business will have to participate in fueling the growth of government in other states,” he said.

Annual dues from New Hampshire to the NCSL total just over $135,000 a year.

Courts Business Shopping Politics

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