Citing concerns about pushing the state into deficit, a state Senate committee rejected a proposal to drop the rate of a key business tax from 0.55 to 0.50 percent.
The policy is a top priority for Republican leaders in the New Hampshire House, but senators from both parties said cutting the Business and Enterprise tax would be too risky, given estimates that show it could reduce state collections by $25 million in 2029, and $50 million a year after that.
“In my opinion, given the revenue structure and revenue concerns that we are in right now, I think that it would be a fiscally imprudent thing to do,” said Sen. Tim Lang, a Republican from Sanbornton who leads the Senate Ways and Means Committee.
Lang instead won committee support for lifting the filing threshold for the Business and Enterprise Tax from $298,000 to $350,000. Lang said that move would cost the state $2 million in revenue but would likely exempt about 2,000 businesses who now pay the tax from doing so in the future.
“The smallest businesses, the ones hit the most by tariffs, inflation — whatever reason you want to give — interest rates, will now not ever have to file,” Lang said.
The committee also adopted a proposal from Democratic Sen. Cindy Rosenwald to raise nursing home rates by $2.5 million. The goal is to make up for money that the state's 33 nursing homes lost when the federal government cut reimbursement rates in January.
“We have to do what we can to ensure the safety and wellness of our oldest and frailest Granite Staters,” Rosenwald said.
Rosenwald’s proposal would pay for the increased rates by spending $3.5 million from a state Medicaid Enhancement Tax (MET) settlement between the state and its acute care hospitals.
Nathan White, the top financial officer with the Department of Health and Human Services, warned that using settlement money to boost rates could carry risks — including scuttling the state’s existing rate agreements reached with the federal government, and spending money the state needs to make good on ongoing Medicaid obligations.
“I am just here to make sure the committee is aware of those risks if we are to move forward,” White said.
Republican leaders in the House meanwhile said they plan to keep pushing to cut the Business and Enterprise Tax this year.
“Every Committee of Conference I am on will have a tax cut amendment ready to go,” Deputy House Majority Leader Joe Sweeney said in a social media post. “I was elected to cut taxes, and my bill, HB 155 as amended by the House, cut taxes. Let's get the job done.”
