Republicans reject business tax breaks in NH Senate panel vote
Lawmakers recommend sending to study bills to aid startups, workforce programs
Senate Ways and Means Committee Chair Sen. Andy Sanborn, R-Bedford, says it would be 'financially prudent' to 'press the pause button' on the tax breaks.
NH Senate Ways and Means Committee Chair Andy Sanborn, R-Bedford, said Wednesday he wanted to “press the pause button” on several targeted tax breaks designed to ease worker shortages and help startup businesses.
In a political role reversal, Sanborn and two fellow Republicans sent the tax breaks, held over from last year, to interim study, arguing it was “financially prudent” to do so. Democrats, however, wanted to go ahead with the breaks, arguing that the bills wouldn’t cost much and would help the economy.
In the recent past, Republicans have been the ones to push tax breaks to help business – decreasing the tax rate, expanding the research and development tax credit and increasing expense deductions – with some of the same arguments Democrats were making.
But Sanborn, who is running for the Republican 1st District congressional nomination, later told NH Business Review that the bigger issue was that Republicans favored “cutting taxes for everyone, while Democrats wanted to just cut them for their political friends.”
The party-line Ways and Means vote is a recommendation. Lawmakers will vote on it these and dozens of other retained bills in the first session of next year.
Here are the bills under study:
• Senate Bill 75 would give a tax credit against the business profits taxes for donations to career and technical education centers, limited to $500,000.
“This is an investment in our workforce that is so needed right now,” said Sen. Dan Feltes, D-Concord. But there are 13 programs dealing with training, said Sanborn, which is when he talked about pressing the pause button. Sen. Gary Daniels, R-Milford, plans to introduce a bill to evaluate the workforce training programs.
• SB 76 would allow a business to take three-quarters of the R&D credit as a rebate up-front, instead of a credit later, enabling startups that may not make a profit to get the money when needed.
Sanborn called the measure a “creative way to give some companies seed money,” but he said he was concerned that “we are picking winners and losers.”
“We are not picking winners and losers,” replied Feltes. “We are giving an option on how to take a credit. It provides flexibility so more businesses will have this kind of option to take it.”
• SB 183 would provide a 75 percent tax credit to a business that recruits high-tech workers to the state. The credit, which would be administered by the Community Development Finance Authority, would be available for businesses chosen by the NH High Tech Council, with the aggregate capped at $1 million.
• House Bill 574, which would increase the limit on CDFA investment tax credits from $5 million to $6 million.
Sen. Lou D’Alessandro, D-Manchester, noted that the bills had the backing of the Taylor Caswell, who heads the state Department of Business and Economic Affairs, when he was director of the Business Finance Authority. Feltes also pointed out that bill passed the House on a bipartisan vote with the backing of the business community.
Daniels said that he would expect the business community to support it, but lawmakers must be more “fiscally responsibility about bills that are going to cost us money.”