On April 14th, the Union Leader ran a story titled, “Diverse coalition urges no cuts in business taxes.” From the article:
“I calculated how much these proposals would save my company when they are fully implemented, and it came to less than $150 per year,” said Tom Strickland, president and co-founder of Sequoya Technologies Group, a small IT company with eight employees. “$150 out of a million dollar budget isn’t going to influence my business decisions. I won’t be hiring new employees or buying new equipment as a result of this tax cut.”
What’s stopping Mr. Strickland from sending the alleged $150.00 he would save in taxes to Concord? Absolutely nothing. If he believes that it’s better for the State’s economy to send the $150.00 to Concord, he can do so.
Notably, the article doesn’t say how Strickland calculated the $150.00 in alleged savings. It talks about his $1 million budget, but New Hampshire doesn’t tax budgets. It does tax profits, so perhaps the business just isn’t that profitable?
The Senate would reduce the business profits tax by .6 percent. A $150.00 savings suggests that Strickland’s profits are $25,000.00 per year. Obviously, more profitable companies would see bigger savings.
The most recent data we have on GDP by State is 2013. It shows that other States are doing far better than New Hampshire at growing their economies:
Strickland claims that New Hampshire’s economy isn’t growing because New Hampshire doesn’t have enough government spending. But look at this chart:
When the Democrats took over State government in New Hampshire, and began increasing spending, taxes and regulation, coincides with population outflow from New Hampshire.
The tax cuts proposed by the State Senate are a small step. They amount to only $80 million out of an $11 billion budget, or less than one percent. But they are a step in the right direction.