We don't need 'The Pledge on steroids'
Why a new amendment could potentially be detrimental to NH residents
In November, New Hampshire voters will be asked to amend the state constitution to permanently ban an income tax. It's an amendment that property-tax payers should reject.
In 1784, our legislature enacted a tax law that included this statement of purpose:"It is necessary there should be an Equitable Rule ... so that every person may be Compelled to pay in proportion to his Income."
The founders of New Hampshire would be shocked to learn that we levy huge property taxes on people with modest incomes. In 1784, houses were not taxed at all because they don't generate any income.
CACR 13 is The Pledge on steroids. It is an attempt to keep taxes in New Hampshire exactly as they are now, forever, by prohibiting an alternative to the property tax. Before we enshrine this into our constitution, let's see if everyone is paying "his share."
The households in New Hampshire with the highest incomes -- the 1 percent with incomes $480,000 and up -- on average pay just over 2 percent of their incomes in state and local tax. The folks in the middle, on average, pay about 6 percent. The lowest-income people have the highest tax burden. They pay, on average, over 8 percent of their income in state and local tax.
New Hampshire relies on the property tax more than any other state. Much of what we expect government to do -- educate our children, plow our roads, prosecute criminals, nursing home care for the elderly, police, fire -- is paid in part, or primarily, with property taxes. Our property taxes are the second highest in the nation and twice the national average.
In the past 12 years, the total property tax bill in New Hampshire has doubled.
The proponents of this amendment will prattle on about the "New Hampshire Advantage," as if we are living in a tax paradise. The facts say otherwise.
If you took a New Hampshire family with an average income and an average house, and moved them to a similar house in Florida -- where they have a sales tax, but no income tax -- the family would pay less tax in Florida than they do here. If you moved that family to Delaware -- where they have an income tax, but no sales tax -- that family would pay less tax in Delaware than they do here.Our taxes on retired homeowners are the highest in the nation. A retired homeowner with a modest income, living in a modest home, pays more state and local tax in New Hampshire than he would pay if you moved him to any other state. There are plenty of other reasons to oppose this constitutional amendment:
• We should not write tax policy into the Constitution
• Each legislature and each generation should be free to make its own decisions about taxes and spending
• Tying the hands of the legislature may harm New Hampshire's credit rating, costing us millions of dollars in increased bond interest
• It is unnecessary. If the voters don't want an income tax, they will vote accordinglyIn the end, this amendment is a vote about whether we will turn our backs on our founding principle that all citizens pay their share of the cost of government.
Voting against this amendment keeps our revenue options open, even if we don't want to use all of them now.
Mark Fernald, a state Senator from 1998 to 2002 and the Democratic nominee for governor in 2002, can be reached at email@example.com.