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Sales Tax Proposed in Tax-Free New Hampshire

Few people like a new tax or a tax increase, but some dislike them more than others. That’s the case with New Hampshire, but that may change.

Jan 30th 2020
Writer, Blogger, Editor Avalara
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One of just five states with no statewide sales tax, many in the Live Free or Die state are vehemently anti-sales tax.

In fact, after the Supreme Court decided physical presence is not the sole requisite for sales tax collection (South Dakota v. Wayfair, Inc., June 21, 2018), New Hampshire Governor Chris Sununu said any state that tried to force New Hampshire businesses to collect their sales taxes would be in for “the fight of their life.”  Yet, not everyone in New Hampshire agrees that all sales taxes should be avoided.

New Hampshire Representatives Skip Cleaver and Mark King recently introduced a bill that would establish a 4.3 percent tax on the retail sale of electronic devices. Specifically, House Bill 1492 would require every vendor of the following electronics products to collect tax from purchasers:

•            Cell phones and smartphones and related equipment

•            Computers and related equipment (e.g., hardware and software)

•            Smart watches and similar products and related equipment

•            Television sets and related equipment

•            Video games and all related play systems and equipment

Why electronic devices? Cleaver reportedly believes that “‘what makes us stupid as a society’ should help pay for education.” If approved, revenue generated by the tax would fund education. But that’s a big if.

The New Hampshire Retail Association is “ready to fight” the bill and has already asked the House Ways & Means Committee to kill it. The state’s main newspaper, The Union Leader, has also criticized it. Still, it could happen.

Meanwhile, In Oregon, another sales tax-free state, there’s now a tax on sales of bicycles and many motor vehicles. In the event New Hampshire does end up with a retail sales tax on certain electronic devices, would it require remote sellers to collect it? Stay tuned…

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