New Hampshire Revised Statutes 78-E:1 – Findings and Purpose
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The general court finds that:
I. Over 10,000 state and local jurisdictions within the United States impose sales and use taxes. Many of these jurisdictions have their own laws, regulations, policies, and standards for determining sales and use tax obligations.
II. The state of New Hampshire does not impose a traditional broad-based sales and use tax on customers making purchases of goods and services in New Hampshire, nor on goods and services purchased by its residents out of state for use, storage, or consumption in New Hampshire. New Hampshire law and policy does not require New Hampshire businesses to suffer the cost and burdens of establishing administrative systems to comply with the collection and remission provisions of a traditional broad-based sales and use tax law.
III. The state of New Hampshire is a year-round destination visited by millions of persons from various states that impose sales and use tax on their own residents. Complying with the complexities of these multiple and various foreign sales and use tax laws and regulations will impose very costly burdens on all affected New Hampshire retail businesses. These burdens will be especially difficult for smaller businesses that seek to expand their customer base by using old and new technologies such as traditional mail and communications using the Internet.
IV. On June 21, 2018, the United States Supreme Court issued its decision in South Dakota v. Wayfair, Inc., et al. The Court overturned over 50 years of precedent that had required the physical presence in a state of a retail seller before the state could impose on the seller its sales and use tax collection requirements. This decision exposes remote retail businesses, including those located within New Hampshire, to assertions by thousands of foreign taxing jurisdictions of various collection and remission requirements on remote retail businesses that were previously protected by the longstanding physical presence rule.
V. The Wayfair decision left unresolved many questions relating to the scope of constitutionally allowable sales tax impositions on remote sellers, including the definition of a constitutionally sufficient safe harbor for the protection of relatively small businesses and others with relatively low levels of sales business in the foreign taxing jurisdiction. The Court directly invited further examination of these questions, observing that the Wayfair case involved only “large, national companies that undoubtedly maintain an extensive virtual presence” and stating that the “question remains whether some other principle in the Court’s Commerce Clause doctrine might invalidate the [South Dakota] Act.”
VI. New Hampshire has enacted the business enterprise tax (BET), which is a form of value-added or consumption tax imposed directly on the business, and not on the consumer. The enactment of the BET represents the affirmative adoption by New Hampshire of a fundamentally different consumption tax policy than other states’ adoption of retail sales and use taxes, and further reflects New Hampshire’s direct rejection of complexities and undue administrative burdens that result from traditional retail sales and use taxes and their third-party collection regimes.
VII. Because New Hampshire has never enacted a traditional broad-based sales and use tax law, New Hampshire retailers selling intrastate and remotely to other states had been fully protected pre-Wayfair from the burden of sales tax collection and remittance responsibilities. Post-Wayfair, New Hampshire has a compelling governmental interest in providing for the continuing protection of these retailers, especially relatively small retailers, from any unlawful imposition of this burden. The establishment and expansion of small and “micro-businesses” represent a particularly valuable segment of New Hampshire’s economy and comprise a majority of employers in the state. The high cost and practical difficulty of compliance with sales and use tax requirements in a state that has chosen not to impose sales and use tax obligations would disproportionately and negatively impact these businesses and discourage other aspiring entrepreneurs from starting new businesses in New Hampshire.
VIII. New Hampshire has a compelling governmental interest in protecting the privacy of an individual’s personal information that may be used to facilitate the sale of goods and services within this state.
IX. New Hampshire has a compelling governmental interest in protecting its remote sellers and the private, personal information they possess from consumers from persons who may attempt to steal money or sensitive information from remote sellers by impersonating a foreign taxing jurisdiction or foreign taxing authority.
X. New Hampshire has a compelling governmental interest in protecting New Hampshire remote sellers from tax assessment and collection practices by foreign taxing jurisdictions and authorities that unlawfully discriminate against out-of-state persons in favor of in-state persons.
XI. The purpose of this chapter is to (a) ensure that no foreign taxing jurisdiction or authority imposes or attempts to impose sales and use tax collection obligations on a New Hampshire remote seller in a manner that violates the United States or New Hampshire constitutions or any other applicable provision of law and (b) protect New Hampshire remote sellers and the private, personal information they possess from consumers from persons who may attempt to steal money or sensitive information from remote sellers by impersonating a foreign taxing jurisdiction or foreign taxing authority.
I. Over 10,000 state and local jurisdictions within the United States impose sales and use taxes. Many of these jurisdictions have their own laws, regulations, policies, and standards for determining sales and use tax obligations.
Terms Used In New Hampshire Revised Statutes 78-E:1
- Jurisdiction: (1) The legal authority of a court to hear and decide a case. Concurrent jurisdiction exists when two courts have simultaneous responsibility for the same case. (2) The geographic area over which the court has authority to decide cases.
- Precedent: A court decision in an earlier case with facts and law similar to a dispute currently before a court. Precedent will ordinarily govern the decision of a later similar case, unless a party can show that it was wrongly decided or that it differed in some significant way.
- state: when applied to different parts of the United States, may extend to and include the District of Columbia and the several territories, so called; and the words "United States" shall include said district and territories. See New Hampshire Revised Statutes 21:4
- United States: shall include said district and territories. See New Hampshire Revised Statutes 21:4
II. The state of New Hampshire does not impose a traditional broad-based sales and use tax on customers making purchases of goods and services in New Hampshire, nor on goods and services purchased by its residents out of state for use, storage, or consumption in New Hampshire. New Hampshire law and policy does not require New Hampshire businesses to suffer the cost and burdens of establishing administrative systems to comply with the collection and remission provisions of a traditional broad-based sales and use tax law.
III. The state of New Hampshire is a year-round destination visited by millions of persons from various states that impose sales and use tax on their own residents. Complying with the complexities of these multiple and various foreign sales and use tax laws and regulations will impose very costly burdens on all affected New Hampshire retail businesses. These burdens will be especially difficult for smaller businesses that seek to expand their customer base by using old and new technologies such as traditional mail and communications using the Internet.
IV. On June 21, 2018, the United States Supreme Court issued its decision in South Dakota v. Wayfair, Inc., et al. The Court overturned over 50 years of precedent that had required the physical presence in a state of a retail seller before the state could impose on the seller its sales and use tax collection requirements. This decision exposes remote retail businesses, including those located within New Hampshire, to assertions by thousands of foreign taxing jurisdictions of various collection and remission requirements on remote retail businesses that were previously protected by the longstanding physical presence rule.
V. The Wayfair decision left unresolved many questions relating to the scope of constitutionally allowable sales tax impositions on remote sellers, including the definition of a constitutionally sufficient safe harbor for the protection of relatively small businesses and others with relatively low levels of sales business in the foreign taxing jurisdiction. The Court directly invited further examination of these questions, observing that the Wayfair case involved only “large, national companies that undoubtedly maintain an extensive virtual presence” and stating that the “question remains whether some other principle in the Court’s Commerce Clause doctrine might invalidate the [South Dakota] Act.”
VI. New Hampshire has enacted the business enterprise tax (BET), which is a form of value-added or consumption tax imposed directly on the business, and not on the consumer. The enactment of the BET represents the affirmative adoption by New Hampshire of a fundamentally different consumption tax policy than other states’ adoption of retail sales and use taxes, and further reflects New Hampshire’s direct rejection of complexities and undue administrative burdens that result from traditional retail sales and use taxes and their third-party collection regimes.
VII. Because New Hampshire has never enacted a traditional broad-based sales and use tax law, New Hampshire retailers selling intrastate and remotely to other states had been fully protected pre-Wayfair from the burden of sales tax collection and remittance responsibilities. Post-Wayfair, New Hampshire has a compelling governmental interest in providing for the continuing protection of these retailers, especially relatively small retailers, from any unlawful imposition of this burden. The establishment and expansion of small and “micro-businesses” represent a particularly valuable segment of New Hampshire’s economy and comprise a majority of employers in the state. The high cost and practical difficulty of compliance with sales and use tax requirements in a state that has chosen not to impose sales and use tax obligations would disproportionately and negatively impact these businesses and discourage other aspiring entrepreneurs from starting new businesses in New Hampshire.
VIII. New Hampshire has a compelling governmental interest in protecting the privacy of an individual’s personal information that may be used to facilitate the sale of goods and services within this state.
IX. New Hampshire has a compelling governmental interest in protecting its remote sellers and the private, personal information they possess from consumers from persons who may attempt to steal money or sensitive information from remote sellers by impersonating a foreign taxing jurisdiction or foreign taxing authority.
X. New Hampshire has a compelling governmental interest in protecting New Hampshire remote sellers from tax assessment and collection practices by foreign taxing jurisdictions and authorities that unlawfully discriminate against out-of-state persons in favor of in-state persons.
XI. The purpose of this chapter is to (a) ensure that no foreign taxing jurisdiction or authority imposes or attempts to impose sales and use tax collection obligations on a New Hampshire remote seller in a manner that violates the United States or New Hampshire constitutions or any other applicable provision of law and (b) protect New Hampshire remote sellers and the private, personal information they possess from consumers from persons who may attempt to steal money or sensitive information from remote sellers by impersonating a foreign taxing jurisdiction or foreign taxing authority.