NH Says No to Mass. Sales and Use Tax
When the State of Massachusetts attempted to collect sales and use tax from a NH retailer for purchases within NH, the Governor and Legislature acted quickly to put a stop to it.
In response to this claim by Mass. against Town Faire Tire, NH enacted SB-5 prohibiting retailers from disclosing private customer information to foreign states in connection with the collection of certain sales and use taxes.
Gov. John Lynch called the Mass. claim “outrageous” and “unacceptable.”
“We should not allow Massachusetts to turn New Hampshire businesses into tax agents for Massachusetts.” – Gov. John Lynch
The Act creates an irrebutable presumption that, in the absence of voluntary information by the customer, the goods or services purchased in NH are intended to be used in NH.
To impose sales or use tax on purchases within NH, the foreign state must have previously provided written proof to the retailer that its tax laws meet with the very stringent requirements of the new Act. That is unlikely.
Gov. Lynch has vowed to appeal the Town Faire Tire case to Federal Court if necessary to protect NH’s favorable tax structure and pro-business environment.
For more information, contact Attorney Chris Ratté.
NOTICE: The information and articles posted on this website are for informational purposes only and are not intended as legal advice. Contact me to discuss your particular situation or consult a licensed attorney in your state.
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Chris,
There is further news relative to this post, ie., that on October 12, 2009 The Massachusetts Supreme Judicial Court refused to allow the Department of Revenue to create and then to enforce retroactively new interpretations of tax rules that significantly harm law-abiding businesses and individuals.
See http://www.taxhistory.org/taxbase/stnmagsample.nsf/ConNavLink/0054STN0138-0001?OpenDocument
We’re all glad about New Hampshire’s response to the original case, but I believe New Hampshire businesses avoided another dart as a result of the Massachusetts court decision to tell the Mass Department of Revenue to back off!
Thanks,
Steve
Thanks for the update, Steve. It’ll be interesting to see what happens next in this story.
Hi Chris,
That is indeed great news for New Hampshire businesses.
In a previous business I owned a few years ago, the State of Maine came after me to collect several years of “Maine sales tax” that I supposedly should have collected and forwarded to them to the tune of almost $8,000 plus penalties and interest. Ouch!
Unfortunately for me, rulings like this didn’t exist and I didn’t have the resources to fight the Sate of Maine.
Oh well, expensive lessons learned I guess.
Maybe we can fight the State of Maine to get my money back retroactively plus interest and penalties.
Yeah right…
Thanks for the good info.
Merrill