New Hampshire State revenues came in stronger than expected in April, driven by a one-time Tax Amnesty Program, rebounding business tax revenues, stronger Real Estate Transfer Tax receipts, and growth in lottery and Insurance Premium Tax revenues. But while the gains may ease short-term budget pressures as the legislative session enters its final month, revenues remain below where they were two years ago, underscoring ongoing fiscal uncertainty tied in part to recent tax policy changes.
NHFPI Research Director Phil Sletten examined the fiscal and economic effects of the proposed Business Enterprise Tax reduction from 0.55% to 0.50%. His analysis found that this proposal would reduce New Hampshire's state revenue by $26 million per year, while providing tax savings too small for most businesses to expand hiring.
State Fiscal Year 2025 revenues dropped 9.4 percent in the General Fund and Education Trust Fund compared to last year after adjusting for inflation. Revenues that surged after the pandemic, fueled by corporate profits and real estate sales, have since declined, underscoring New Hampshire’s reliance on a few volatile sources and the impact of tax policy changes like business tax reductions and the repeal of the Interest and Dividends Tax.
A new federal reconciliation law signed on July 4 will bring sweeping changes to tax and social support programs, with major implications for Granite Staters. According to NHFPI's analysis, the law makes permanent many tax cuts from 2017, and pays for some of the forgone revenue by reducing access to Medicaid, supports for food assistance, and clean energy investments, shifting costs and risks onto low- and moderate-income households.
A new NHFPI analysis finds that business tax rate reductions have cost New Hampshire approximately $1 billion in forgone revenue since 2015.
The State of New Hampshire relies on corporate taxes for a greater percentage of tax revenue than any other state. In fiscal year 2021, New Hampshire raised about 31 percent of total tax revenue through corporate income taxes, while the next highest state was New Jersey, with about 14 percent of tax revenue coming from ...
