NH State Representative Steven Smith

There has been a lot of hysteria over the recent Supreme Court decision in SOUTH DAKOTA V. WAYFAIR. Let me explain the real facts. This case arose because Wayfair (an internet based company) was pushing ads to South Dakota residents containing the message ““‘[o]ne of the best things about buying through Wayfair is that we do not have to charge sales tax.’”  As you can imagine, South Dakota was not happy. They passed a law requiring that out of state vendors selling to South Dakota residents pay the sales tax. This was challenged and overturned by the State Supreme Court. The United States Supreme Court then overturned that decision and sent it back to South Dakota with very specific guidelines.

You can read the decision for yourself here – https://www.supremecourt.gov/opinions/17pdf/17-494_j4el.pdf The decision begins on page 23 and is an easy read.

Amid rhetoric about “thousands of taxing jurisdictions” knocking on New Hampshire’s door, undue burdens to our businesses, etc. … it is important to understand who this affects and in what manner.

1 – Who is affected.. Establishing a nexus.

Tax liability if you do more than 200 transactions or $100,000 to the destination state.

Examples:

• I sell 3.6 million dollars online. My sales are all around $80,000 per state in 40 states. Under this decision, I am exempt.
• I sell any amount less than $100,000 to each state and have 9,000 customers spread evenly in 50 states. I am exempt.

In other words, no small business are affected by this decision.

2 – Complying with the commerce clause

Only state wide taxes are part of this decision. Arguments about “thousands of taxing jurisdictions” literally have nothing to do with this. The decision specifically makes this point (second paragraph, age 23).

If I am liable for taxes, the taxing state must provide reporting software to me free of charge. Further, if I choose to use their use their software, I am protected from audit.

Summary

There are very limited cases where this ruling will apply. We are talking about Amazon and Walmart in scope. Further, states wishing to pursue this will have to revamp their own state laws first to be in compliance.

Today, we do not celebrate the fourth of July. We celebrate Independence Day. That is a big difference. If you complained, out loud, about the government or a government official today… and you were not killed or imprisoned, celebrate Independence Day. The people who did declare independence and fought to make it reality risked their lives. They risked their property. They risked their families. They risked literally everything so that we can enjoy the freedom we have today.

With apologies to Tennyson, the day before yesterday, I filed for re-election. Serving in the NH House has been an extremely worthwhile experience. I have the honor of being the Governor’s appointee on the Interagency Council on Homelessness (appointed by Gov. Hassan, reappointed by Gov. Sununu). I’ve been the Chair of the House Transportation Committee for 4 years. During that time, I’ve led efforts to modernize the state’s thinking about transportation modalities. I created a test monitoring program for driverless vehicles, because they are here now. We created a new commission to review public transportation projects, focusing on new methods and technologies. Most of all, it has given me satisfaction every time I was able to help a constituent navigate a problem with the state. I have more to give, and hope that the voters of Sullivan County District 11 give me the chance again.