https://www.wmur.com/article/nh-primary-source-biden-administration-sides-with-massachusetts-over-nh-in-interstate-tax-court-battle/36549508Biden administration sides with Massachusetts over NH in income tax court battle
MANCHESTER, N.H. —
The top litigator for the Biden administration has advised the U.S. Supreme Court not to hear New Hampshire’s challenge to a Massachusetts regulation imposing its state income tax on Bay State-employed Granite Staters working from home amid the COVID-19 pandemic.
The resulting reaction from the Granite State was harsh -- and bipartisan.
The New Hampshire Department of Justice, at the direction of Gov. Chris Sununu, in October asked the Supreme Court to hear its challenge to the Massachusetts rule, calling it unfair and unconstitutional.
Thousands of New Hampshire residents employed by Massachusetts companies continued to be required to pay that state’s income tax despite working remotely from home during the pandemic.
"Massachusetts cannot balance its budget on the backs of our citizens and punish our workers for working from home to keep themselves, their families, and those around them safe,” Sununu said at the time.
In January, the Supreme Court asked the federal government for its opinion on whether the case warranted a hearing under the original jurisdiction of the court -- as is the case for some interstate disputes.
U.S. Acting Solicitor General Elizabeth B. Prelogar filed a response Tuesday night contending that the case did not warrant such consideration by the nation’s highest court, according to a report in a Law360.
Lawyers for New Hampshire had argued that the court was required to accept the case, but Prelogar backed Massachusetts’ argument that the acceptance was discretionary, and not required.
Prelogar argued that the case should have been filed at the lower court level by an individual or group of people who claimed they were harmed by the Massachusetts tax, and then make its way to the Supreme Court through the appeals process.
It will now be up to the Supreme Court to decide whether to refuse to hear the case or to set aside the Biden administration’s argument and take up the matter.
Republican Sununu was joined in his criticism of the solicitor general’s argument by Democratic U.S. Sens. Maggie Hassan and Jeanne Shaheen and U.S. Rep. Chris Pappas.
Sununu tweeted: “Try as they might, overreach by Washington politicians and efforts by the Biden administration will not deter New Hampshire from fighting against Massachusetts’ unconstitutional attempt to tax our citizens. We remain confident that the Supreme Court will hear our case and that we will win.”
“This is the wrong position by the Biden administration,” said Hassan, who may be challenged by Sununu next year as she seeks reelection to the Senate.
“I’ve long said that attempts by other states to unfairly tax New Hampshire residents are unconstitutional,” said Hassan. “The Supreme Court must hear this case and reverse this bad-faith effort. We need strict and clear limitations set upon states that attempt to wrongly tax Granite Staters, and I will continue to push to ensure exactly that.”
Hassan’s office noted that she wrote a letter to Senate leaders on the issue and questioned Deputy Treasury Secretary nominee Wally Adeyemo about it.
Shaheen said she has opposed efforts to impose an internet sales tax on Granite Staters.
She said she was “disappointed by the Biden administration” for taking the position against New Hampshire’s argument. She called the Massachusetts tax unfair and unconstitutional and an “abuse of Granite State workers.”
Pappas said: "This development further underscores the need for a permanent, legislative fix to protect teleworking Granite Staters and workers across the country from being forced to pay an unfair income tax.”
He said he supported bipartisan legislation that would clarify that workers are required to pay income taxes to the state in which they were “physically present” when the income was earned.
Fiscally conservative group: Stop ‘cash grab’
Also weighing in on the side of Granite State workers was the anti-tax, pro-small government issues group Americans for Prosperity-New Hampshire.
“The Biden administration’s affinity for high taxes has led them to mistakenly support this unconstitutional move to force tax hikes on the back of Granite State workers,” said AFP-New Hampshire state director Greg Moore.
“With this regulation, any former Massachusetts commuter, no matter where they currently live, could be charged with the state’s high income taxes.
“We urge the Biden administration to reconsider Massachusetts’ cash grab that is counter to that state’s long-standing tax policy that income is charged where you work, not where you live.”
The state GOP chair also criticized Biden.
“The pro-tax Biden administration knows no bounds to their taxing ways,” Stephen Stepanek said. “With the solicitor general arguing that New Hampshire residents who lived and worked in New Hampshire ought to be taxed by Massachusetts, reality and logic has clearly vacated the federal government since Joe Biden was sworn in.
"The Supreme Court exists to hear cases between two states and of national impact. For the United States Solicitor General to seriously suggest the Supreme Court shouldn’t hear the case is laughable. Once again, the Biden administration embarrasses itself at the expense of New Hampshire.”
