Shaheen, Ayotte Vote Against Internet Sales Tax

U.S. Sens. Jeanne Shaheen (D-NH) and Kelly Ayotte (R-NH) voted against the Internet sales tax bill on May 6, calling it burdensome legislation that would harm New Hampshire small businesses.

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The Senate voted 69 to 27 to pass the legislation. It now goes to the House, where Republicans may scuttle it.

Senator Shaheen's statement after the vote:

"I was disappointed the Senate passed such a misguided piece of legislation this afternoon and did so without giving the bill the comprehensive review that it deserved. This internet sales tax bill would impose countless new burdens on small businesses and could stunt their ability to expand and create jobs. We shouldn’t be imposing new and unnecessary burdens on New Hampshire small businesses, especially when there is no benefit for our state.

This bill creates a bureaucratic nightmare by forcing New Hampshire small businesses to comply with 46 different state laws. This could result in serious economic consequences including audits, lawsuits, and a countless number of hours lost in productivity."

Senator Ayotte's statement on the bill:

"The fight doesn't end here. As this legislation moves to the House, I will continue my efforts to protect New Hampshire's online retailers from being forced to become tax collectors for other states. Ayotte has led the fight to protect New Hampshire Internet businesses from online sales tax legislation. She has taken to the Senate floor several times in opposition to this bill, bringing the concerns of New Hampshire online retailers to the debate on Capitol Hill. Last year, she introduced a bipartisan resolution expressing the sense of the Senate that no federal legislation should give states the authority to impose any new burdensome or unfair tax collecting requirements on Internet businesses and entrepreneurs.

Under current Supreme Court precedent, absent a sufficient connection, a state cannot force out-of-state Internet businesses to collect and remit sales taxes. For example, when a customer in Illinois buys a product from an online vendor based in another state that has no physical presence in Illinois, authorities in Illinois cannot currently compel the out-of-state vendor to send it the Illinois tax on that sale. However, cash-strapped states looking to plug budget holes continue to push for a new law that would force online retailers to collect sales taxes for jurisdictions nationwide."

What do you think this legislation would mean for sales-tax-free New Hampshire?