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Massachusetts has ordered a tire chain to charge Bay State residents a 5 percent sales tax on their purchases in New Hampshire in an unprecedented move that could have huge implications for consumers and other merchants.
Town Fair Tire Centers, which is based in Connecticut but has six shops in New Hampshire and 25 in Massachusetts, is fighting back with a lawsuit now before the Massachusetts Supreme Judicial Court that accuses the state of violating the US commerce clause. If Massachusetts prevails in the case, which is likely to be heard next month, it could drive up costs for consumers and retailers such as Best Buy and Sears that sell expensive home appliances and other goods in New Hampshire, which doesn't have a state sales tax. It also could mean millions of dollars in new tax revenue for the Commonwealth as it faces a $1.1 billion budget deficit, according to tax analysts.
"This is a first-of-its-kind case," said Fred Nicely, general counsel of the Council on State Taxation, a nonprofit trade association of multistate corporations engaged in interstate and international business. "There's huge ramifications to the entire retail community."
To others, it's a case of "Taxachusetts" striking back at the "Live Free or Die" pride of New Hampshire. The Granite State has long lured Massachusetts residents over the border to enjoy tax-free shopping. New Hampshire Governor John Lynch has even gotten involved, kicking off a campaign one year to persuade Bay Staters to head north so they don't have to cram all of their shopping in when the Commonwealth decides to hold a three-day "sales tax holiday."
The idea that Massachusetts consumers can't enjoy a tax break isn't sitting well with the locals in this troubled economy. Just last week Governor Deval Patrick proposed taxing alcohol, candy, and soda, and raising taxes on hotels and meals.
"People are free to buy their tires wherever they want at the best price," said Erin Willet of Lunenburg, who routinely drives 20 miles to Nashua, N.H., to avoid tax on household items and big ticket purchases like appliances. "If Massachusetts doesn't like it, then they should have predictable tax-free holidays so that people can plan their shopping to take advantage of it."
The Town Fair Tire legal battle dates back to 2003, when the Massachusetts Department of Revenue audited the three New Hampshire stores Town Fair Tire operated at the time, after receiving evidence that Bay State residents were driving up to buy tires and having them installed at the chain's shops. The auditors identified 313 sales made to Massachusetts consumers, based on invoices that included Commonwealth addresses and in some cases telephone numbers. The state's tax authorities say the records demonstrate that Town Fair Tire knew the customer intended to use the goods in the Commonwealth, and therefore should have charged a 5 percent "use tax" - essentially a sales tax for items purchased for use or storage in the Bay State. Those taxes then would be given to Massachusetts. Following the audit, Massachusetts authorities assessed the company about $108,947 in tax, penalties, and interest related to the sales.Continued...
Yes I absolutely have a problem with this. If this gets implemented by an activist judge then I guarantee many other states around the country will follow suit. It will no longer be on cars and now tires but probably everything. Will you have to show a driver's license to buy a pack of gum to ensure that you pay the "proper" amount of sales tax?
Following this logic, shouldn't NH residents be able to shop tax free in whatever state they shop?
It is a real shame that again-because people hate George Bush so much-they voted in similar tax and spenders to the NH state house who if given the chance will make us into another Massachusetts. One only look at Massachusetts to see how well liberal tax and spend policies along with nanny state policies work. Hopefully people in this state will wake up in 2010 before this state is too far gone.
Yes I absolutely have a problem with this. If this gets implemented by an activist judge then I guarantee many other states around the country will follow suit. It will no longer be on cars and now tires but probably everything. Will you have to show a driver's license to buy a pack of gum to ensure that you pay the "proper" amount of sales tax?
Following this logic, shouldn't NH residents be able to shop tax free in whatever state they shop?
It is a real shame that again-because people hate George Bush so much-they voted in similar tax and spenders to the NH state house who if given the chance will make us into another Massachusetts. One only look at Massachusetts to see how well liberal tax and spend policies along with nanny state policies work. Hopefully people in this state will wake up in 2010 before this state is too far gone.
What really is worrying me is the loss of Gregg for both you in NH and which RINO get's appointed by the governor to replace him.
That said, we put an offer in on a house in Plymouth and we'll see what happens.
Maybe, just maybe, 2 more freedom lovers will relocate to NH.
What really is worrying me is the loss of Gregg for both you in NH and which RINO get's appointed by the governor to replace him.
That said, we put an offer in on a house in Plymouth and we'll see what happens.
Maybe, just maybe, 2 more freedom lovers will relocate to NH.
I was worried about that too. This was from CNN.
Quote:
Gregg's term is up in 2010. If he left the Senate, New Hampshire Gov. John Lynch could have named a Democrat to replace him, giving the Democrats the 60-seat majority needed to overcome Republican attempts to use filibusters to block legislation.
But state political sources from both parties said Monday that Lynch will name Gregg's former chief of staff, Bonnie Newman, to replace him.
I am not the biggest Judd Gregg fan to begin with and quite frankly was hoping Sununu would challenge him in the 2010 primary. Judd Gregg is not fiscally conservative enough for me and I have many other issues with him. That being said-this Bonnie Newman scares me even more. With the exception of some time in politics, the majority of her work experience has been for non-profits and in the educational system. Those are keywords for liberalism. She was also down at the Harvard Kennedy School of Politics before Jeannie was and they are supposedly "close" whatever that means. She is also very close to Lynch from their UNH days together.
I would really like to see Sen Sununu run in 2010-hopefully the people in this state would have woken up by then.
Socialism is expensive. So is capitalism. The difference is in who gains and who loses. I prefer the former because I do not have enough wealth to be one of the latter.
Well Judd Gregg was just on the news praising the so-called stimulus plan. No wonder Obama loves him-he supports his pork filled bill of crap that won't do anything but bankrupt this country. I wonder if they will discover that he has not payed his taxes too -like practically everyone else that Obama has appointed.
Another person that Obama appointed-it has been discovered that she did not pay her taxes either. I guess she "forgot" to or Turbo Tax steered her in the wrong direction. She has withdrawn from the job.
Pretty amazing how all these Obama appointees want you and I to pay more in taxes-yet they cannot even pay their own taxes. I guess we need to pay more for them not paying theirs.
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She has withdrawn from the job.
