Proposed Spending Cap Could Lock In Current Spending Cuts for a Decade

Testimony before the Commission to Study Business Taxes

The legislative Commission to Study Business Taxes met Monday, February 6, to receive public input on its draft report recommending changes to New Hampshire’s tax system. Taken together, the recommendations would mean a substantial revenue loss for the state.  Had the recommendations been in place for the current biennium, they would have reduced state revenue by a conservative estimate of $100 million. This kind of revenue loss would likely require major cuts to public services, including infrastructure and education that are critical to attracting new businesses. NHFPI Executive Director Jeff McLynch testified that the proposals may hurt economic growth, not help.

His testimony follows: … Continue Reading

Testimony Regarding Education Tax Credits

The House Committee on Ways and Means met Monday, January 23, to receive public input on legislation that would create a tax credit for businesses that contribute to private scholarship organizations. The money would be used for subsidies to students attending private, religious or home schools.

House Bill 1607 would be costly for state officials to implement and would divert scarce public resources to private interests. In particular, state aid to public schools would likely be cut even though there is no evidence students receiving subsidies to attend non-public schools do any better than their public school peers. … Continue Reading

Tobacco Tax Cut Likely to Lose Millions in Revenue, Leave FY12-13 Budget Out of Balance

Near the close of their conference committee deliberations last week, negotiators from the House of Representatives and the Senate added provisions to the fiscal year 2012-2013 budget that, effective July 1, will both drop New Hampshire’s cigarette tax rate from $1.78 per pack to $1.68 per pack and lower taxes on other tobacco products.  Based on the latest data available from the Department of Revenue Administration, those provisions will likely reduce tax revenue by at least $14 million over the biennium and perhaps by as much as $30 million.  However, it now appears that House and Senate negotiators failed to account for any such revenue loss in completing the conference committee’s version of the FY 12-13 budget, meaning that the budget for the coming biennium will likely end up out of balance.  Consequently, to offset any revenue lost to a cigarette tax cut, the House and the Senate may have to add to the hundreds of millions of dollars in spending cuts that they have already imposed, further undermining critical investments in education and public infrastructure and weakening protections for the state’s most vulnerable citizens. … Continue Reading