State revenue got a helpful one-time shot in the arm. Now what?

Analysts fear that once it’s gone for the remainder of the fiscal year, overall revenue will lag unless other accounts, which have been underperforming to date, pick up the pace

Overall revenue for the state of New Hampshire has been in the black for the first half of the fiscal year because of an amnesty program that allows businesses with overdue tax payments to make themselves whole without the usual penalties.

But the amnesty program is a one-time revenue shot in the arm.

Analysts fear that once it’s gone for the remainder of the fiscal year, overall revenue will lag unless other accounts, which have been underperforming to date, pick up the pace. The state Department of Administrative Services said as much in its January revenue analysis.

“It is important to note that, without that unusual windfall, regular revenues remain $14 million behind budget for the year and the state’s largest revenue source, business taxes, are below plan by $40.1 million,” said the analysis, signed off by Charles Arlinghaus, administrative services commissioner, and state comptroller Dana Call.

The state is a little more than halfway through fiscal year 2026, the first year of a two-year budget cycle. FY26 started July 1, 2025, and ends June 30, 2026. The second fiscal year of the budget (FY27) starts July 1, 2026, and ends June 30, 2027.

The budget was built in part on the expectation that the state would raise $3.38 billion in revenue in the first fiscal year.

After seven months, the state has collected $1.4 billion, which is $44.2 million (3.3%) ahead of projections and $37 million (2.7%) ahead of the same period in FY25.

The tax amnesty program was created as part of the state budget. Running from Dec. 1, 2025 through Feb. 15, 2026, it covers various taxes, including business, meals and rentals, and interest and dividends that were due at the end of the last fiscal year.

The inducement to scofflaws is that it waives penalties and half of accrued interest.

Amnesty payments totaled about $46 million in December 2025 and another $16.5 million in January, giving the state a revenue inoculation of some $62.5 million. It stands to collect a little more, with two weeks in February yet to be accounted for.

A New Hampshire Fiscal Policy Institute (NHFPI) analysis of the program paints a picture of caution as the amnesty revenue runs out.

“Without the tax amnesty program, combined revenues to the General and Education Trust Funds would have been $14 million (1.0%) below amounts anticipated by the State Revenue Plan and behind last year’s collections by $25.3 million (1.9%),” said the new NHFPI report, written by Phil Sletten, the organization’s research director.

“These figures suggest that other revenue sources would not have generated enough revenue to help ensure a balanced state budget without the boost from tax amnesty receipts, and that revenues are not growing relative to last year,” he added.

The largest chunk of revenue — 34% of the total — comes from business taxes: the Business Profits Tax (BPT) and the Business Enterprise Tax (BET).

Total business tax revenues as of January are $40.1 million (7.7%) behind plan and $11.2 million (2.3%) short of the same period last year, according to NHFPI.

A bill in the current legislative session, HB 155, seeks to reduce the BET from 0.55% to 0.50%, starting originally in 2027 but amended to start in 2028. Its proponents say a reduced business tax will encourage greater business activity, including relocation to New Hampshire, expansion and hiring.

A bill to kill the BET altogether was killed by the House.

A key revenue contributor in the past — the Interest and Dividends Tax — was repealed as of Jan. 1.

So far this fiscal year, here are the winners and losers in terms of revenue production for the state, fiscal year to data against projections, according to the January report:

• Business Taxes -7.7%
• Meals & Rentals Tax -1.7%
• Tobacco Tax +0.6%
• Transfer from Liquor Commission -11.8%
• Interest & Dividends Tax -81.9%
• Insurance Tax +13.5%
• Communications Tax -4.1%
• Real Estate Transfer Tax +4.8%
• Court Fines & Fees -20.4%
• Securities Revenue +0.9%
• Beer Tax -8.8%
• Other (which includes interest income) +32.8%
• Transfer from Lottery Commission +30.6%
• Utility Property Tax +5.1%

Whether revenue from business taxes rebounds depends on a number of economic factors, influenced both locally and nationally.

Gov. Kelly Ayotte has been cheering the business climate in the Granite State.

In a recent media release, she underscored the state’s sixth-place ranking among all states in the Tax Foundation’s State Business Tax Climate Index. In another pique on Massachusetts (a favorite target during her gubernatorial campaign), she invited Bay State companies to move to the Granite State.

“Any business seeking freedom from higher taxes in Massachusetts or anywhere else in the nation is welcome in the Granite State,” said Ayotte in a prepared statement.

“We’re proud to have one of the best business tax climates in America, and we’re going to keep showcasing all New Hampshire has to offer to companies in Massachusetts and beyond,” she added, in noting the Tax Foundation report.

Ayotte touted the arrival from across the border of two companies SynQor and Analogic and their 500 jobs.

In her mid-term State of the State address earlier this month, she aligned the need to increase housing supply and the need to create more, affordable daycare with business interests and their ability to grow in the state.

The head of the state’s chamber of commerce appreciated the comments.

“Governor Ayotte prioritizing efforts to expand access to affordable child care is an essential ingredient to growing our state’s workforce and strengthening our economic competitiveness,” said Mike Skelton, president of the NH Business and Industry Association in remarks supplied by the governor’s office.

“The business community appreciates the Governor’s leadership on this issue and her support for fully funding child care scholarships and backing a tax credit plan that incentivizes employers to invest in child care centers,” he added.

But a former governor and current U.S. senator, Maggie Hassan, said the Trump-influenced economy isn’t doing any favors to manufacturers.

“While President Trump promised us a manufacturing boom, the reality of his first year has been a bust,” said Hassan, a Democrat and ranking member of the congressional Joint Economic Committee.

“It is critical for both our national security and our economic future that we grow our manufacturing sector. The President has instead spent his first year burdening manufacturers with reckless tariffs, and this loss of jobs is the result,” she added.

An analysis from the JEC’s minority/Democratic members shows the nation’s manufacturing industry lost 108,000 jobs during the first year of President Trump’s second term. Because of tariffs and the uncertainty they mix into the economy, the statement claims that the manufacturing sector has lost even more than the 68,000 jobs that the Bureau of Labor Statistics previously estimated.