The new year means New Hampshire businesses will pay lower taxes.
Two key state business taxes were first reduced in 2016, the result of a compromise between then Governor Hassan and Republican lawmakers. The deal allowed for further tax cuts as long as revenues didn’t decline.
But the state’s relatively strong economy has pushed receipts up, triggering a new round of business tax cuts for 2018.
“This is all part of a process of trying to make the state more competitive,” says Greg Moore with Americans For Prosperity-New Hampshire.
The Business Profits Tax will go from 8.2% down to 7.9%, which puts the state’s rate below neighboring Massachusetts, which levies an 8% tax. Business advocates say that is an important selling point.
“That’s a great pitch to try to invite companies from Massachusetts to come here, and to invite companies that are thinking about expanding in the area to do so in New Hampshire, as opposed to Massachusetts,” says Moore.
The Business Enterprise Tax rate will also fall from .72% to .675%. The budget signed by Governor Sununu this year calls for future cuts to both business taxes in 2020 and 2022.