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Gov. Sununu: NH Will Challenge Massachusetts 'Unconstitutional' Income Tax Decision

CONCORD, N.H. (CBS/AP) — New Hampshire Gov. Chris Sununu promised a legal challenge on Friday to a decision by Massachusetts to continue taxing New Hampshire residents who normally work in Massachusetts but have worked remotely during the coronavirus pandemic.

Sununu said the state would file suit in the U.S. Supreme Court on Monday to fight a final ruling of an emergency regulation issued Friday by the Massachusetts Department of Revenue.

The Massachusetts regulation will require income earned by non-resident employees who work remotely to be taxed. It also says if an employee worked in Massachusetts prior to the COVID-19 state of emergency, their income will "continue to be treated as Massachusetts source income."

In a series of tweets on Friday, Sununu said Massachusetts "launched a direct attack on the New Hampshire Advantage, attempting to pick the pockets of our citizens."

Sununu also wrote on Friday, "We are going to fight this unconstitutional attempt to tax our citizens every step of the way, and we are going to win."

About 100,000 New Hampshire residents regularly commute to Massachusetts for work.

Sununu was joined by New Hampshire politicians on both sides of the aisle who criticized the ruling.

"The actions taken by the State of Massachusetts to dip their hand into Granite State pockets because they cannot balance their own budget is disgraceful," Senate Republican Leader Chuck Morse said in a statement. "I applaud Governor Sununu for quickly announcing a plan to file lawsuit against this new rule and make it clear that New Hampshire will never accept an income tax in this state."

Democratic U.S. Rep. Chris Pappas also attacked the ruling as unfair.

"This rule change by Massachusetts extends an outrageous cash grab targeting Granite Staters who are doing their part to stay home and stay safe during a pandemic," Pappas said in a statement.

In August, the New Hampshire Attorney General Gordon MacDonald, in a letter to the Massachusetts Department of Revenue, called the temporary tax measure unclear, overbroad and said it raised constitutional concerns.

The Massachusetts regulation will remain in effect until Dec. 31 or 90 days after the coronavirus state of emergency in Massachusetts is lifted. Massachusetts has a 5.05% income tax. New Hampshire has no income tax.

"The Commonwealth has implemented temporary regulations that are similar to those adopted by other New England states," Massachusetts Department of Revenue spokeswoman Naysa Woomer said in an email statement. "The Administration does not comment on pending lawsuits."

The department said it put the regulations in place to ensure clarity with tax collections for Massachusetts and other states and minimize sudden disruption for employers and employees during the COVID-19 pandemic.

(© Copyright 2020 CBS Broadcasting Inc. All Rights Reserved. The Associated Press contributed to this report.)

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