Op-Ed: Chuck Morse, Jeb Bradley and Dick Hinch: An income tax is not for New Hampshire
EVERY TWO YEARS during the election cycle, the question arises, should New Hampshire go the route of most states and implement a sales or income tax? Usually candidates on both side of the political aisle promise to oppose both.
Just like so much of 2020, this issue — this year, is different. Why?
Our Democratic friends have actually voted for an income tax. That is right. Not once but twice: House Bill 712 and Senate Bill 1. Even more confounding, our Democratic friends deny it.
The language of these identical mandatory paid family leave bills is crystal clear. Page 2 lines 32-34: “Employers may withhold or divert no greater than 0.5 percent of wages per week per employee.” While some businesses may choose to offer paid leave as a benefit, if they don’t, the “withholding of wages” is mandatory. That’s an income tax if ever there was an income tax.
Gov. Chris Sununu agreed and in his veto message stated, “whether one chooses to characterize it as a premium on wages or a payroll deduction, the reality remains that if it looks like an income tax, functions like an income tax, and takes more money out of the paychecks of hard working taxpayers like an income tax, then it’s an income tax.”
Despite this reality of having voted for an income tax, our Democratic friends claim, incredulously, that they oppose an income tax. Nice try — but there is no merit badge for deception.
The broader question is why having no income tax and sales tax works. Former Gov. Steve Merrill said it best, calling it the New Hampshire Advantage.
Look at the facts. Prior to the pandemic, New Hampshire enjoyed one of the strongest economies in the nation. Our unemployment rate was among the lowest. Our poverty rate was the lowest. People were moving here and enjoying growing paychecks. And New Hampshire consistently ranks at or near the top of states in which people want to live.
We improved our economic climate by lowering business taxes and workers compensation costs and not passing expensive mandates on to employers. But the centerpiece of our strong economy for 50 years has been no income tax and no sales tax. Generations of hardworking small businesses and working women and men have benefited. Also, New Hampshire’s economy is now recovering from the pandemic faster than other states.
But now our economy is at risk. A legislative commission chaired by Rep. David Luneau (D-Hopkinton) is seriously considering an increase in education funding of $1.2 billion in response to a pending court case. If $1.2 billion was funded by an income tax, the rate would likely approach 4%.
If our Democratic friends can vote for an income tax to fund mandatory paid family leave and deny it — how will they vote to raise $1.2 billion? We think the answer is clear — they will support an income tax and shift the debate away from their broken promises by claiming an income tax will lower property taxes.
Again, look at the facts. States throughout the Northeast that have both a sales tax and an income tax also have high property taxes. According to the Tax Foundation’s 2020 Facts and Figures, Connecticut, Massachusetts, New Jersey, New York, Rhode Island and Vermont all have property taxes that exceed New Hampshire’s and they all have both a sales and income tax.
Is that what we want for New Hampshire — to become just another high-tax state where jobs flee, paychecks decline and we drop precipitously in the ranking of most livable states?
It should be noted that when the Legislature unified behind Gov. Sununu’s bipartisan budget a year ago, $140 million of new funding went to education. Full day kindergarten was funded as were stabilization grants that protect towns that have declining student enrollments. This level of new education funding was made possible by one thing: a strong and vibrant economy.
If New Hampshire passes an income tax or a sales tax, our strong economy will be undermined. Paychecks will not grow rather they will shrink. Businesses and jobs will migrate to states with better economic climates.
Bear in mind when you vote that an income tax and a sales tax are on the ballot. Bear in mind the denials and the deception about the income tax that our Democratic friends have already voted for. If they get away with that — ask yourself what they will do next. We doubt most of New Hampshire will like it.
Republican Senators Chuck Morse and Jeb Bradley and House Republican Leader Dick Hinch are joined in their opinion by Republican Senators Regina Birdsell and Sharon Carson, Deputy House Leader Sherm Packard and Republican policy leaders Jason Osborne and Kim Rice.