My Turn: Tax Cuts and Jobs Act is a victory for New Hampshire

  • House Rules Committee members Rep. Rob Woodall, R-Ga. (left), and Rep. Michael C. Burgess, R-Texas, attend to corrections needed for final approval of the Republican tax bill on Capitol Hill in Washington on Wednesday. AP

For the Monitor
Thursday, December 21, 2017

The Tax Cuts and Jobs Act nearing completion will be great news for most New Hampshire taxpayers.

Lower individual rates across the board, doubling the standard deduction, reducing rates for (all but a very few) pass-through businesses, elimination of the Affordable Care Act’s individual tax beginning in 2019, and an increase in the Child Tax Credit combined with the continued ability to deduct up to $10,000 in state and local taxes should result in lower taxes for most New Hampshire taxpayers.

The reduction in business taxes – rates across the board, repatriation taxes on business profits currently overseas and expanded immediate expensing – is also good news. It will be particularly good news if it means New Hampshire’s six suffering counties can fill up some of the empty industrial space we’re sitting on – 2 million square feet in my county (Cheshire) alone.

Much has been made of the expansion of the nation’s debt assumed in this legislation. If, however, enough businesses expand or return either their business or their money to the United States, that $1.46 trillion in debt could very quickly be that much, and more, in additional tax revenues. Any increase in our $20 trillion debt is unfortunate, but among the reasons for our debt are our overseas – and counterproductive – military adventures, unnecessary overseas military presence, unfavorable and unfair trade agreements, a tax code with ostensibly high rates but numerous loopholes, and the subsidy the federal government provides profligate spending through the unlimited deductibility of state and local taxes that New Hampshire and other frugal states have been subsidizing. Importantly, this legislation addresses the loophole issue and ends unlimited deductibility of state and local taxes.

Our bifurcated state and national economies need to become more competitive and, while many Americans don’t recognize the Tax Cut and Jobs Act’s positive changes, the Chinese do and are referring to it as a Gray Rhino, defined as a significant known threat.

The opportunity to revitalize our economy and lower taxes is great news for New Hampshire.

(James W. McConnell of North Swanzey represents Cheshire District 12 in the New Hampshire House of Representatives.)