New HampshireDepartment of JusticeOffice of the Attorney General

News Release

For Immediate Release
January 23, 2023

Contact:
Michael S. Garrity, Director of Communications
michael.s.garrity@doj.nh.gov | (603) 931-9375

Samuel Garland, Senior Assistant Attorney General
Samuel.Garland@doj.nh.gov | (603) 271-1211

New Hampshire Prevails on Appeal in Fight Against ARPA Tax Mandate

Concord, NH – Attorney General John M. Formella announces that a unanimous panel of the U.S. Court of Appeals for the Eleventh Circuit has upheld a permanent injunction of the "tax mandate" in the American Rescue Plan Act ("ARPA"). The tax mandate prohibited States from using ARPA funds to "either directly or indirectly" offset tax decreases or delays in tax increases enacted by States. States were required to certify compliance with the tax mandate and certain other requirements in order to receive ARPA funds. If a State violated the tax mandate, the Secretary of the Treasury was authorized to seek recoupment of ARPA funds.

"The ARPA tax mandate was an improper and unconstitutional intrusion on the rights of New Hampshire's elected policymakers to make decisions regarding State tax policy," said Attorney General Formella. "We are grateful that the Eleventh Circuit upheld the District Court's decision to issue a permanent injunction against the mandate, and that the State of New Hampshire's sovereignty will remain protected."

New Hampshire joined twelve other states in challenging the tax mandate as an excessive and unconstitutional exercise of congressional power. A federal district judge agreed and permanently enjoined the tax mandate. On Friday, the Eleventh Circuit upheld that decision, concluding that the States had standing to challenge the tax mandate, that interim rule-making by the Secretary of the Treasury did not render the States' challenge moot, and that the tax mandate violated the Spending Clause of the U.S. Constitution because States cannot ascertain the conditions it places on ARPA funds. The tax mandate therefore remains permanently enjoined. 

The federal government will therefore continue to be barred from enforcing the ARPA tax mandate against the State of New Hampshire and the other twelve plaintiff states.

The opinion is available here: https://media.ca11.uscourts.gov/opinions/pub/files/202210168.pdf Portable Document Format Symbol.

Portable Document Format Symbol Portable Document Format (.pdf). Visit nh.gov for a list of free .pdf readers for a variety of operating systems.

New Hampshire Department of Justice
33 Capitol Street | Concord, NH | 03301
Telephone: 603-271-3658