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Beyond the loss of those who were attracted to New Hampshire due to its lack of an income tax, those who have lived in New Hampshire for generations are likely to see their cost of living increase rapidly as the income tax as a revenue source spurs significant increases in spending.
Exactly -- where people might feel some hesitation voting to spend their own (and their next door neighbor's) money on frivolous line items in town budget, it's easy to vote to send representatives to Concord who vow to allocate "state revenue" towards frippery.
The hidden evil of "broad based taxes" is how they transfer budget control and power from town hall to the statehouse. We only need look at Vermont and Connecticut to see how this plays out -- ever increasing tax rates, and the highest individual tax burden in the region (both in the top 10 nationwide).
If NH were to implement an income tax it would have many unintended consequences. Currently NH is one of the few New England destinations for retirees. Additionally, NH has also experienced the fastest growth in per capita personal income in New England and is among the fastest in the nation. Much of this growth is due to an inflow of high income residents from other nearby states as well as those attracted from high tax states who prefer a 4-season climate over warmer locations in the south. Implementing an income tax would not only reduce the inflow, it most likely would lead to an outflow of many of these very same people. Many of these high income residents populate the expensive homes in the Lakes Region and similar vacation destinations and pay significant property taxes which are the life blood to many communities.
Beyond the loss of those who were attracted to New Hampshire due to its lack of an income tax, those who have lived in New Hampshire for generations are likely to see their cost of living increase rapidly as the income tax as a revenue source spurs significant increases in spending. As a resident of Connecticut, I have personally witnessed the impact of this over the past two decades. Our state went from being a highly desirable alternative to neighboring New York and Massachusetts for businesses looking for less expensive options in the region to a high cost one saddled with high debt and obligations requiring a constant need for new taxes and fees to keep things afloat.
As a part-time resident of New Hampshire for many years, I am aware of the property tax concerns of many residents. However, as uncomfortable and imperfect as property taxes are, they are the best available way of addressing specific community wants and needs with the exception of state roads and the environmental impact of through traffic and activities. Here in Connecticut we have an income tax AND high property taxes in many communities. The promises of the income tax did not reduce the property tax burden. Even here there are opportunities to reside in communities with significantly lower property taxes. The choices made by the residents play a big part in the tax structure. Hopefully New Hampshire will learn some lessons from their small nearby neighbor and look at opportunities to improve the existing structure as opposed to implementing an income tax which will drastically change the independent character and spirit of the Live Free or Die state.
Our current tax structure may be attractive to high income out-of-staters, but it's already a problem for retirees who may have lived here all their lives. The continual increases in property taxes, due both to rising growth-driven property values and increased spending, are making it difficult for older folks to stay in their homes. I am in no way advocating a state income or sales tax, but our current situation looks good only to well-heeled people from somewhere else.
The cost of living in the northeast is high, but NH has managed to keep the total tax burden low. Neighboring states like CT have similar property taxes with the additional burden of income tax (4.5-7.5% including pensions and SS), sales tax (6.35% on everything including services like home & auto maintenance, phone/internet, cable & satellite TV) and annual property taxes on vehicles (based on the car's value times the town's mill rate every year). The state/towns even tax 1% of the sale price when you sell your house. The way I see it NH is by far the bargain of the northeast and that is why we are here.
FYI, NH taxes both the seller and buyer of a property with each paying .75%.
It would behoove NH to get serious about implementing meaningful property tax deduction for seniors according to income. How to offset the loss of this income from local & state government is the trick. In the past, the NH legislature has looked at taxing second homes, vacation properties, at a slightly higher rate. I'm not specifically advocating this, but it's time that lawmakers need to step outside the box concerning this issue.
It would behoove NH to get serious about implementing meaningful property tax deduction for seniors according to income. How to offset the loss of this income from local & state government is the trick. In the past, the NH legislature has looked at taxing second homes, vacation properties, at a slightly higher rate. I'm not specifically advocating this, but it's time that lawmakers need to step outside the box concerning this issue.
IMO NH needs to given the 55 and over group some serious property tax discounts (if it's their primary residence). Especially if they are childless and don't need their town to educate any grade school children. What all towns don't need more of are couples with school age children.
I would like NH to be attractive more to the middle aged empty nesters and childless couples. Also to anyone who is able to telecommute to work.
NH doesn't need more children, not as long as our school systems only promote STEM education to all students. If you want to attract young adult workers, they need to be in the skilled trades, not STEM career fields.
There is no advantage for NH to be promoting the STEM majors to their grade school students, because they will only go to universities outside NH and acquire high college debt, then not return to NH because we don't have STEM jobs for them or any work that would allow them to pay down their student debt easily.
IMO NH needs to given the 55 and over group some serious property tax discounts (if it's their primary residence). Especially if they are childless and don't need their town to educate any grade school children. What all towns don't need more of are couples with school age children.
I would like NH to be attractive more to the middle aged empty nesters and childless couples. Also to anyone who is able to telecommute to work.
NH doesn't need more children, not as long as our school systems only promote STEM education to all students. If you want to attract young adult workers, they need to be in the skilled trades, not STEM career fields.
There is no advantage for NH to be promoting the STEM majors to their grade school students, because they will only go to universities outside NH and acquire high college debt, then not return to NH because we don't have STEM jobs for them or any work that would allow them to pay down their student debt easily.
It's just simple arithmetic people.
This will never happen because other younger taxpayers will have to make up the shortfall. The school funding problem needs to be addressed outside of property taxes.
If you want lower taxes - look at properties in current use that get a huge tax break that are not paying their fair share. You can have a 1.5 acre parcel of undeveloped land valued at 50k paying $1,400/yr in taxes, while a property in current use of 20 acres valued at 150k, pays $80.00/yr in taxes. All taxpayers in that town make up the balance that the current use property does not pay -- each and every year. Some towns have as much as 70% of their property in current use. These taxpayers need to pay more - much, much more of their fair share of taxes.
This will never happen because other younger taxpayers will have to make up the shortfall. The school funding problem needs to be addressed outside of property taxes.
If you want lower taxes - look at properties in current use that get a huge tax break that are not paying their fair share. You can have a 1.5 acre parcel of undeveloped land valued at 50k paying $1,400/yr in taxes, while a property in current use of 20 acres valued at 150k, pays $80.00/yr in taxes. All taxpayers in that town make up the balance that the current use property does not pay -- each and every year. Some towns have as much as 70% of their property in current use. These taxpayers need to pay more - much, much more of their fair share of taxes.
That is not quite accurate as the properties in current use are often high valuation/high value properties in many towns that just so happen to have enough acreage for current use. Also, the tax base of the town and tax rate are key factors in addition to population age demographics/growth rates. Current use certainly is a valuable tool in most cases at keep rural wooded areas intact, preventing subdivision, more development, the need more services, and increasing the tax rate.
That is not quite accurate as the properties in current use are often high valuation/high value properties in many towns that just so happen to have enough acreage for current use. Also, the tax base of the town and tax rate are key factors in addition to population age demographics/growth rates. Current use certainly is a valuable tool in most cases at keep rural wooded areas intact, preventing subdivision, more development, the need more services, and increasing the tax rate.
Not sure what you are trying to say -- as some properties in Current Use have homes on them with enough acreage to enroll for the deduction, while others are simply vacant parcels that may be over or under 10 acres but are contiguous to reach the 10 acre threshold. The argument against preventing subdivision, more development, etc. is always the promotion, but there many developed properties with owners that have no children that pay for these services that they don't use. Development of properties can be a net gain not a net drain. And some property owners opt not to put their property in current use even though their property meets the criteria. Why should they pay higher taxes and others not? If you want to get serious about fixing the tax system - a big component is addressing current use taxation inequality. If your argument is focused on preventing subdivision and development as the main benefit of current use, then slap a conservation easement on those lands and get rid of development rights forever - that is a different animal worthy of a major tax deduction. As it stands the current use system is a tax avoidance scheme others have to pay for as property values rise through the devaluation of the dollar.
Maybe instead of figuring out how to take more money from residents, we should work towards reducing wasted taxpayer $$$
Quote:
Originally Posted by illtaketwoplease
If you want lower taxes - look at properties in current use that get a huge tax break that are not paying their fair share. You can have a 1.5 acre parcel of undeveloped land valued at 50k paying $1,400/yr in taxes, while a property in current use of 20 acres valued at 150k, pays $80.00/yr in taxes. All taxpayers in that town make up the balance that the current use property does not pay -- each and every year. Some towns have as much as 70% of their property in current use. These taxpayers need to pay more - much, much more of their fair share of taxes.
Depends on what you feel is a "fair share" of taxes. If somebody has 20 acres in current use, those 20 acres are empty, wooded, or farmed and are being taxed based on how they are currently being used -- inherently those uses are such that those acres are consuming immensely fewer town services than if those 20 acres were at their "highest and best use", converted into 80 town homes.
If 1 acre of empty land were taxed at the same rate as 4 prime building lots of ÂĽ acre each, that's what we're going to get -- all buildable land sold off and built up.
Quote:
Originally Posted by illtaketwoplease
Not sure what you are trying to say -- as some properties in Current Use have homes on them with enough acreage to enroll for the deduction, while others are simply vacant parcels that may be over or under 10 acres but are contiguous to reach the 10 acre threshold.
In the case of "some properties in Current Use have homes on them with enough acreage to enroll for the deduction", the owner is paying the full tax rate for the home, and for the land the home/lawn/driveway/etc sits on. The deduction reduces the tax bill only for 10+ "extra" acres not actually developed (or for any number of acres used for farming).
Quote:
Originally Posted by illtaketwoplease
As it stands the current use system is a tax avoidance scheme others have to pay for as property values rise through the devaluation of the dollar.
That's assuming the sole goal of a tax system is revenue extraction, getting as much money out of the landowner as the town can hit them up for.
By definition, "current use" means that instead of taxing the owner based on the possible value they could get out of their land (the "highest and best use" being if they sold it to a developer to build a subdivision), instead the owner is taxed on how they currently use the land, and disincentivizes them from selling out (at least in the short term) through the "land use change tax".
The school funding problem needs to be addressed outside of property taxes.
Correct.
The state should take over all public schools. Do away with all of the local school boards. All public schools owned by the state.
One state school board.
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Maybe instead of figuring out how to take more money from residents, we should work towards reducing wasted taxpayer $$$
