As a member of the joint task force that met over the past week to address the US Supreme Court overturning the 50-year-old Quill decision that required a business to have a physical presence in a foreign state for that state to be able to collect sales tax if it sold goods in the foreign state. The Governor's office had its attorney draft proposed language based on their interpretation of the SCOTUS ruling on Mayfair. The task force (all Reps and Senators) took the proposal and went through it line by line. The final product of the task force is draft legislation that will be voted on by the House and Senate convened in special session on July 25th. The legislation is not perfect; there's no way to draft a perfect document when no one involved in crafting the legislation has any experience with interstate sales tax law. I openly reminded all members of the task force of this fact when resistance started to grow to changes drafted by a nationally eminent attorney considered top notch in dealing with interstate sales tax avoidance and litigation. The suggested changes were ultimately all adopted, with some of the recommended language amended with the approval of the tax law specialists. If passed, this law will set up a temporary blockade against enforcement by foreign (meaning out-of-state) taxing jurisdictions, at a time when our businesses have NONE. It will allow the AG to engage foreign tax entities on constitutional grounds immediately upon determining that a violation of either the US or NH Constitutions has occurred. It requires any taxing authority to register and to provide a copy of any initial tax levy notice to the AG as a condition of being allowed to assess sales taxes against NH businesses. A commission will be established (if the bill passes next Wednesday) that will immediately begin to study 3 pivotal SCOTUS decisions,brought forth in testimony by former Speaker Bill O'Brien, one of which protects a state and its persons/businesses from having to impose practices that violate the laws and'or ethos of the state. Please remember - this legislation is the result of a task force of legislators assisted by the Attorney General's office and the Governor's office, and will be voted on by the full House and Senate. though there are many unanswered Constitutional questions, it was imperative that we establish a barrier against aggressive states (MA, CT PA, NY) whose tax collectors are waiting to invade New Hampshire. Remember that this bill can be amended by House or Senate; but at the end of the day, we do need a firewall so our businesses aren't required to fight constitutional issues out of their own pocket. This bill not only provides the legislative nexus for the AG to pick up the fight for individual NH businesses on constitutional grounds, it also very clearly defines terms, conditions, restrictions and measures to protect those businesses. That said, it's equally important to understand that the AG will not be providing legal advice to businesses, and that they must seek it on their own, even if the AG is engaging on constitutional issues. It's important to note that the SCOTUS Wayfair decision did not say that states can collect taxes from businesses within other states. It merely struck down the Quill precedent which required a physical presence in a foreign state for that foreign state to be able to collect sales taxes from businesses in the state of origin of the good or service. The issue is far from settled; but we now have the framework for our businesses and the AG and DRA to cite statutes as a reason to deny foreign taxing authorities the unfettered right to come after NH businesses. We're a long way from the ultimate outcome of this issue. But with 45 states now looking to completely eviscerate the case law that protected us for 50 years, as a practical matter, we have erected a significant legal barrier to the invasion of the money-snatchers. Bob Giuda, State Senator, NH District 2
Calling it a way to restore “equality and fairness to our elections,” Gov. Chris Sununu on Friday signed into law highly controversial legislation requiring anyone voting in New Hampshire to take action to become residents of the state.