NH House committee skeptical of real estate transfer tax break
Ways and Means members voice concerns, criticism about bill aimed at first-time homebuyers
The NH House Ways and Means Committee’s first reaction to a bill that would cut the rate of the real estate transfer tax for first-time homebuyers was not a favorable one.
Members from both parties criticized the proposal as ineffective, unworkable and unconstitutional.
Senate Bill 301, passed by the Senate earlier this month, would cut the transfer tax by a third for those buying a home the first time at a price under $300,000. It would be retroactive to Jan. 1 of this year.
The idea is to attract people, particularly those in their 30s and 40s, to live in New Hampshire. The growth of that population has “slowed to a trickle,” said Rep. May Beth Walz, D-Bow.
But a tax cut amounting to less than $300 wouldn’t be enough to actually help someone buy a home, said Rep. Barbara Griffin, R-Goffstown.
“First-time homebuyers don’t even know the tax exists until they get the papers at closing,” she said. “If it was a slow market, I might have made some sense, but given the current market, what’s the benefit?”
“I agree,” said Rep. Patrick Abrami, R-Stratham, who said he did not support the bill.
Rep. Sue Almy, D-Lebanon,, thought that giving a special tax break to one kind of homeowner would be unconstitutional, a sentiment echoed by the committee’s chair, Norm Major, R-Plaistow.
Rep. Bill Ohm, R-Nashua suggested an exemption for all homebuyers of up to $160,000.
But both Major and Almy said that would not be equitable since that could be the full value of a starting home in the North Country but less than half the value of a home in the southern part of the state.
Then there was the fiscal impact.
“When we change the real estate transfer tax we are hitting counties in the pocket,” said Marc Abear, R-Meredith.
But not everybody opposed the measure.
Rep. Timothy Lang, R-Sanbornton, thought that it would encourage people to come back to the state.
“I think it achieves its goal,” he said. “I like the bill, at least in concept.”