There's also a New Hampshire Disadvantage

Last modified: 5/3/2011 12:00:00 AM
A few weeks ago the Monitor published several letters regarding the 'New Hampshire Advantage,' which I have given some thought to.

As a retired owner of a small business for 25 years whose customer base covered all of New England, the advantage for us was being close to the Boston market that made up 80 percent of our business. Our situation isn't rare among New Hampshire businesses, for without Boston's economic engine there would be limited opportunities in New Hampshire.

The proximity to Boston also brings many visitors to our seashore, lakes and mountains, which provides economic growth and tax revenue from the tolls, liquor and meals and room purchases - and let's not forget the retail sales from out-of-state visitors that create local jobs. In addition, many Boston businesses have created jobs by locating facilities here in New Hampshire.

Then there are the 87,000 New Hampshire residents, about 13 percent of New Hampshire's workforce, who work in Massachusetts. This brings an interesting twist to the 'New Hampshire Advantage': These 87,000 New Hampshire residents pay about $235 million in income tax to Massachusetts each year!

In addition, 11,000 New Hampshire residents work in Maine, paying $16 million in income taxes to Maine. And 8,500 New Hampshire residents work in Vermont and pay about $6 million in income taxes to that state. And New Hampshire gets none of this $257 million per year from 19 percent of its own workforce! The reason: New Hampshire has no income tax and therefore no right of reciprocity.

This tax revenue represents about 50 percent of what the Legislature wants to cut out of the budget.

It would seem logical and make economic sense for the Legislature to look into establishing a fair and equitable income tax that would recoup at least some of the tax revenue that residents of New Hampshire are already paying to our border states.

In addition, a properly structured income tax would provide a far more reliable revenue stream to the state and put far less of a burden than the current property tax on those who can least afford it.

It would fund the necessary functions such as social services, infrastructure and education that a modern state needs to provide to stay competitive and be a great place to live.

(Raymond Lanier lives in Concord.)

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