Press Releases

 

Entries in Tax Cuts (9)

Thursday
Feb122015

NHDP - ICYMI: Telegraph Editorial: "Tax cuts offer no growth guarantees"

Key Point: "... we’re also not under the illusion that it would lead to an economic promised land of jobs and revenue growth. The more prudent assumption to make when lowering tax rates is that revenue will be lost and will have to be made up by cutting state programs and services or finding new revenue sources... Before lawmakers cut business taxes, they should first explain how they would make up the lost revenue – preferably by identifying offsets that don’t involve magical thinking or hurt the state’s most vulnerable."
 
See below for an excerpt or click here for the full Telegraph Editorial:

Nashua Telegraph Editorial: Tax cuts offer no growth guarantees

If you were sitting around the kitchen table discussing how best to improve the family budget picture, you’d have to make some choices.

Some of them would be obvious, like canceling that family vacation everybody was looking forward to, buying cheaper brands of groceries, perhaps, and not going out to eat.

Other choices would be more involved, like whether someone in the family should get a part-time job to bring in extra money.

The last thing you’d probably do is volunteer for a cut in pay.

Yet, that’s the direction some Republicans in the New Hampshire Senate are advocating when they suggest that the state cut its two major business taxes, the Business Profits Tax and the Business Enterprise Tax.

One bill in the Senate, sponsored by Sen. Jeb Bradley, R-Wolfboro, would lower the state’s Business Profits Tax from 8.5 percent to 8 percent over 4 years. “Lowering the state’s Business Profits Tax would continue to encourage businesses to seek growth and would help attract new businesses to New Hampshire,” Bradley said.

It would also mean $10 million less in revenue for the state in fiscal years 2016 and 2017, and $20 million less in fiscal years 2018 and 2019.

Another bill, sponsored by Sen. Andy Sanborn, R-Bedford, would lower the Business Enterprise Tax from .75 percent to .675 percent over three years and would result in $7.6 million less in fiscal year 2017, $15 million less in 2018 and $22 million less in fiscal year 2019.

Gov. Maggie Hassan has said the tax cuts would create a hole in the budget, though Bradley and Sanborn see things differently.

The underlying premise is that cutting the rates would create more revenue by enticing new businesses to relocate to the state, or prompting those that are already here to expand and hire more workers.

That might be true if the state’s business taxes were the only obstacle to economic growth, but they’re not. Other factors include high energy costs, an aging, less-productive workforce and the exodus of the state’s young adults. As a practical matter, a half percent decrease in the BPT over 4 years is little more than symbolic and is unlikely to turn the state into a business magnet.

We understand that the state’s business tax rates are among the highest in the nation, and we’re not inherently opposed to some reduction. But we’re also not under the illusion that it would lead to an economic promised land of jobs and revenue growth.

The more prudent assumption to make when lowering tax rates is that revenue will be lost and will have to be made up by cutting state programs and services or finding new revenue sources.

Honesty dictates that lawmakers identify which areas of government would take the hit if the revenue growth they project fails to materialize, as we think is the case.

The state’s higher education system? That was targeted the last time Republicans controlled both chamber of the Legislature in 2011-12, but New Hampshire college graduates already carry the highest student debt burden in the country and UNH is already out of reach for many of them. Cutting state support for higher education will only accelerate the outward migration of young people from the state.

Health and Human Services is the state’s largest agency, but they’re already facing a $58 million budget shortfall that is partly the result of the state’s settlement of a lawsuit brought by the federal government with regard to mental health services, and another brought by the state’s hospitals over a tax that was ruled unconstitutional. [...]

Before lawmakers cut business taxes, they should first explain how they would make up the lost revenue – preferably by identifying offsets that don’t involve magical thinking or hurt the state’s most vulnerable.

Click here for the full Telegraph Editorial:
Tuesday
Jan272015

NHDP - ICYMI: Monitor Editorial: Cut to business taxes will only hurt business in NH 

Key Point: "Businesses need good roads and bridges and other infrastructure. To attract employees, they need communities with good schools, parks and other amenities. To the extent lower tax revenue leads to a reduction in public services and state investments in infrastructure and education it will harm the business climate. Business taxes are well down the list of a company’s concerns when locating and in New Hampshire, despite the nominally high rate of the BPT, the overall business tax rate isn’t all that bad. The Tax Foundation ranked New Hampshire seventh in attractiveness to business."

Click here for the full Concord Monitor editorial or see excerpt below.

Haven’t we already heard this story about the wondrous Republican perpetual motion machine? In this latest version, it’s the promise that cutting two of the state’s major sources of revenue, the business profits tax and business enterprise tax, will increase revenue. There’s no reason to believe that’s true or, for that matter, any reason to believe that reducing business taxes will attract and retain businesses. There is, however, good reason to believe that making up for the lost revenue will require even deeper cuts to New Hampshire’s already frugal budget. Those cuts will not just hurt the needy, but make the state less, rather than more, attractive to young, well-educated workers and the businesses seeking to hire them. 

That’s why lawmakers should roundly reject Senate Bills 1 and 2.

In October, after four years of research, testimony and deliberation, the legislatively created New Hampshire Commission to Study Business Taxes issued a report that repeatedly stated that the state’s 8.5 percent business profits tax and 0.725 percent business enterprise tax did not materially affect the state’s ability to compete for businesses. The 12-member commission also found “no basis for concluding that any effect of attracting new businesses or business expansion as a result of a rate reduction would generate additional tax revenue sufficient to compensate for the revenue loss. . . .” Curiously, Sen. Jeb Bradley, one of the sponsors of both tax cut bills, was a member of the commission and now argues in favor of the cuts for the very reasons the commission deemed flawed.

Assuming, as we do, that the tax cuts will shrink state revenue, they could backfire. Businesses need good roads and bridges and other infrastructure. To attract employees, they need communities with good schools, parks and other amenities. To the extent lower tax revenue leads to a reduction in public services and state investments in infrastructure and education it will harm the business climate. 

Business taxes are well down the list of a company’s concerns when locating and in New Hampshire, despite the nominally high rate of the BPT, the overall business tax rate isn’t all that bad. The Tax Foundation ranked New Hampshire seventh in attractiveness to business. What does hurt business is the state’s high property taxes. That’s the single largest tax most businesses pay – equal to 45 cents on the tax dollar, according to one study, and 52 cents on the tax dollar in another. If communities have to offset state spending cuts with property tax increases, businesses lose.

In testimony opposing SB1 and SB2, Jeffrey McLynch, executive director of the New Hampshire Fiscal Policy Institute, pointed out that a loss to the state treasury of $78 million amounts to more than the combined budget of the Department of Resources and Economic Development and Environmental Services and nearly equals the state’s support for its community college system. It’s not a sum that can be offset with a little belt-tightening here and there. [...]

Click here for the full Concord Monitor editorial. 

Saturday
Dec012012

GraniteStateProgress - Santa joins effort to end the Bush Tax Cuts and increase tax fairness

Local activists will be staging event with Santa on Elm St. during Manchester Holiday Parade


Concord – Activists urging an end to Bush-era tax cuts for the nation’s highest income earners is
enlisting an unlikely figure to help lobby for their cause. He’s known by many names to children
around the world - St. Nicholas historically, Father Christmas in England and he’s even to
Basque children as Olentzero – but we usually call him simply Santa Claus. 

This Yuletide, Santa has something more important than cookies and milk on his mind. He’s
taking to the streets of Manchester urging Congress to put the middle class ahead of
millionaires and end tax breaks for the top 2%. 

Santa’s message is clear. “Time to set our priorities straight: Tax cuts for the wealthy means
fewer Pell Grants, fewer Head Starts and more kids shoved into crowded classrooms,” “Mr.
Claus” said today. “Everyone knows that I know who’s been naughty and nice and there is still
time for Republicans in Congress to take action and get into the ‘nice’ category before I have to
start handing out coal.”
 
WHO: Santa and his activist elves
 
WHERE:  In front of A Caribbean Affair on Elm, Manchester 
 
WHEN:  Saturday, December 1st from 2:00 to 4:00 pm in front of A Caribbean Affair on Elm, Manchester

Wednesday
May162012

NH House Continues Focus on Jobs and Economy, Passes Business Tax Cut 

House Speaker William O’Brien

“We need to work with our employers to give them confidence to invest, grow and hire. Lowering their cost of doing business and making New Hampshire more competitive will entail a complete transformation in a state government that also rolls back excessive regulations; refuses to increase taxes; and ensures an environment of growth, responsiveness, stability, and support. We understand our state's future depends on a government committed to advancing economic growth and we will continue to advance these goals to preserve and enhance our New Hampshire Advantage.”

House Majority Leader D.J. Bettencourt

“This bill would increase the ability of our small business community to invest in capital equipment. In a recovering economy, we need to give the green light to our entrepreneurs and small business owners to go out and buy machinery, equipment, vehicles, furniture and other qualifying property knowing that they’ll be able to deduct up to $25,000 from their Business Profits Tax. This will contribute to the overall health of our economy and continue our efforts to make New Hampshire more business friendly.”

Friday
Apr202012

US Rep Bass Statement on Passage of Small Business Tax Cut Act

WASHINGTON – Congressman Charles F. Bass (NH-02) submitted the following statement for the Congressional Record today regarding H.R. 9, the Small Business Tax Cut Act, which passed the House this afternoon by a vote of 235 to 173, with one Member voting present.

Bass’ statement for the Record follows:

“Today, I had the privilege to honor and remember the life and heroism of Greenland Police Chief Michael Maloney.  We will always be grateful for his service to the community and the sacrifice he made protecting each and every one of us.  My heartfelt condolences are with his family and colleagues during this tragic time.

“My attendance, however, precluded me from being present for the vote on H.R. 9.  Had I been present, I would have serious reservations about supporting this bill, not because I am against tax cuts for small businesses, but because I believe it is time for Congress to move away from a tax code that is filled with a patchwork of temporary provisions – for both businesses and individuals – that leads to an overly complicated and unfair tax system. 

“As someone who owned and helped run a small manufacturing business, I understand the pressures every small business faces each day, whether it is trying to ensure you have enough orders to keep people employed, making payroll each month, complying with onerous and unnecessary regulations, or ensuring your small business can compete in the global economy.   I would be the first person to say we must lower taxes for small businesses, which are the primary job creators in New Hampshire, but this is not the way it should be done.

“We need to do it in a manner that is part of a larger tax reform package that will eliminate loopholes and deductions so we can broaden the tax base and lower rates across the board.  This will not only help small businesses pay lower taxes, but also prevent companies from being able to maneuver through the tax code in a manner that allows them to pay zero taxes.  It is time Congress takes responsibility and shows leadership by working in a bipartisan manner to simplify our tax code so that rates are lowered across the board for individuals and all businesses, loopholes are eliminated, and the base of taxpayers is broadened in order to provide real certainty and a globally competitive playing field for all New Hampshire and American job creators.”

http://bass.house.gov