A top Democrat is calling on lawmakers to reverse recent business tax cuts in the state, saying future budgets will be “grim” if Concord fails to raise enough in revenue.
Rep. Susan Almy of Lebanon, who chairs the House Ways and Means Committee, testified before that body on Wednesday in favor of House Bill 623, which would set the Business Profits Tax rate at the pre-2015 level of 8.5 percent.
She says recent rounds of cuts, which have reduced the BPT to 7.7 percent, will limit what the state can spend money on, especially if the economy cools down. Another round of tax cuts are scheduled to go into effect in 2021.
“Tax payments purchase public goods that everybody wants: productive and creative citizens, environmental beauty, safety, good transportation, the rule of law, health and the ability to live free in a state we love,” said Almy.
While raising the BPT, Almy’s bill calls for cutting the Business Enterprise Tax by a tenth to .05 percent. Almy says that would create benefits for smaller businesses.
The combination would result in approximately $60 million in additional state revenue through 2023, according to an analysis included in the bill.
The measure faces opposition from Republicans and business advocacy groups.
“I think it sends a very poor message. It is almost the legislature reneging on what many businesses may have considered a promise,” said Dave Juvet with the Business and Industry Association.
“And it is not just a poor message to businesses in this state. It’s a poor message to businesses around this country.”
Juvet said that even with the recent tax cuts, revenue has continued to soar in New Hampshire.
Governor Chris Sununu has made the same argument, citing the tax cuts for the state’s historically low unemployment rate.
Democrats in the New Hampshire Senate are backing a different bill that would reverse this year’s round of business tax rates, as well as block future reductions.