WebHeader_Grove.jpg
Play Live Radio
Next Up:
0:00
0:00
Available On Air Stations
Join as a $13-a-month sustainer and get the retro NHPR t-shirt!
NH News
One of the hallmarks of New Hampshire government is its insistence on maintaining low personal and business tax burdens. To that end, there’s no broad-based standard income, sales or estate tax. Inventory, capital gains, and professional services are also tax-free.Unlike other New England states, however, New Hampshire maintains two major business taxes. The first to be instituted was the Business Profits Tax (BPT). But since the bulk of the state’s businesses range from the small-to-very-small, larger firms complained they were shouldering the bulk of the tax burden. So 1993, the Legislature instituted the Business Enterprise Tax (BET). As Jennifer Weiner writes in “How Does New Hampshire Do It?,” a report released by the Boston Federal Reserve, the BET taxes “wages and salaries, interests and dividends paid by businesses.” In other words, it is, technically, an income tax, but the burden’s placed on businesses, rather than individuals. At 0.75 percent, the BET is also a lower rate than a standard state income tax.The other major piece of New Hampshire’s revenue pie is property tax. Residents pay both a state and town property tax. In 2010, Kiplinger’s reports the State Education Income Tax was “$2.35…per $1,000 of total equalized valuation.” Town rates, meanwhile, can vary widely across the state. If you don’t combine New Hampshire’s two business taxes, property tax makes up the largest slice of revenue, at 16 percent.Another notable aspect of New Hampshire’s tax system, as Weiner notes in the Boston Fed report, is that it’s highly diversified. No one tax makes up 20 percent of money coming in. Other major state taxes include Meals and Rooms, Tobacco, Liquor Sales and Distribution, Real Estate Transfer, Interest and Dividends, Insurance Premium, Communications, and Utility Property Taxes.Summary provided by StateImpact NH

Tax Amendments Likely Headed to Ballot

It looks like tax policy will be front and center on ballots later this fall.

Lawmakers have agreed on two constitutional amendments that limit New Hampshire’s ability to tax its citizens.

When Republicans swept into the Legislature after the 2010 elections, they promised to focus on jobs and the economy.

Leadership in both chambers believe they’ve helped deliver on that promise by reaching agreement on constitutional amendments to install a tax cap, and another banning an income tax.

A cap would mean raising any taxes or fees would require a 60% vote from legislators.

Senate Majority Leader Jeb Bradley says of the two, he believes the income tax amendment does more to protect the so-called New Hampshire advantage.

“Putting that kind of protection in the constitution will be certainty for investors, for entrepreneurs, people who want to grow businesses here.”

Before either amendment makes it to the ballot, a super majority of lawmakers must support the proposals.

Both amendments require support from 2/3rds of the voters.

Critics say the plans make it more difficult to run the government’s affairs frugally.